Fieldstone Mortgage Investment Corp – ‘424B5’ on 11/18/05 re: Fieldstone Mortgage Investment Trust, Series 2005-3

On:  Friday, 11/18/05, at 9:46am ET   ·   As of:  11/17/05   ·   Accession #:  950117-5-4405   ·   File #s:  333-125910, -02

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Document/Exhibit                   Description                      Pages   Size 

 1: 424B5       Fieldstone Mtge Investment Trust, Series 2005-3      328   1.67M 

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Prospectus supplement to prospectus dated July 1, 2005
$1,156,009,000

[FIELDSTONE INVESTMENT CORPORATION LOGO]

FIELDSTONE INVESTMENT CORPORATION 
Seller

FIELDSTONE MORTGAGE INVESTMENT CORPORATION
Depositor 

WELLS FARGO BANK, N.A.
Master Servicer 

FIELDSTONE MORTGAGE INVESTMENT TRUST, SERIES 2005-3 
Issuer

MORTGAGE-BACKED NOTES 

THE TRUST                                                                       

The trust will consist primarily of two groups of conventional, adjustable rate 
and fixed rate mortgage loans secured by first and second liens on residential  
properties that were originated by a subsidiary of Fieldstone Investment        
Corporation.                                                                    

OFFERED NOTES                                                                   

The following classes of notes are offered pursuant to this prospectus          
supplement:                                                                     

o  4 classes of Class A Notes and                                       

o  13 classes of Class M Notes.                                         

CREDIT ENHANCEMENT                                                              

Credit enhancement for the notes will include excess interest (including net    
swap receipts under an interest rate swap agreement), overcollateralization,    
subordination and limited cross-collateralization.                              

--------------------------------------------------------------------------------
INVESTMENT IN THESE NOTES INVOLVES RISKS. YOU SHOULD CONSIDER CAREFULLY THE RISK
FACTORS BEGINNING ON PAGE S-20 IN THIS PROSPECTUS SUPPLEMENT AND PAGE 8 OF THE  
ATTACHED PROSPECTUS. THIS PROSPECTUS SUPPLEMENT MAY BE USED TO OFFER AND SELL   
THE NOTES OFFERED HEREBY ONLY IF ACCOMPANIED BY THE PROSPECTUS.                 

These notes will be issued by the Trust, and will be backed only by the assets  
of the Trust. Neither these notes nor the assets of the Trust will be           
obligations of Credit Suisse First Boston LLC, Bear, Stearns & Co. Inc., Lehman 
Brothers Inc., Merrill Lynch, Pierce, Fenner & Smith Incorporated, Fieldstone   
Investment Corporation, Fieldstone Servicing Corp., Wells Fargo Bank, N.A.,     
JPMorgan Chase Bank, National Association or any of their respective affiliates.
These notes will not be insured or guaranteed by any governmental agency or any 
other entity.                                                                   
--------------------------------------------------------------------------------

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

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

Credit Suisse First Boston LLC, Bear, Stearns & Co. Inc., Lehman Brothers Inc.  
and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as underwriters, will   
each offer the Class A and Class M Notes purchased from Fieldstone Mortgage     
Investment Corporation, as depositor, at a price equal to approximately 99.76%  
of the aggregate note principal balance of the notes plus accrued interest, if  
applicable, before deducting expenses estimated to be approximately $850,000.   
Each underwriter will sell the notes it purchases from time to time in          
negotiated transactions at varying prices to be determined at the time of sale. 

Delivery of the notes will be made in book-entry form through the facilities of 
The Depository Trust Company, Clearstream Luxembourg and the Euroclear System on
or about November 23, 2005.                                                     

CREDIT SUISSE FIRST BOSTON                                                      
BEAR, STEARNS & CO. INC.        
                         LEHMAN BROTHERS
                                                             MERRILL LYNCH & CO.

November 15, 2005 

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Important Notice about Information in this Prospectus Supplement
 and the Attached Prospectus

     You should rely only on the information contained in this document. We have
not authorized anyone to provide you with different information. You should not 
assume that the information in the prospectus supplement or the prospectus is   
accurate as of any date other than the date on the front of this document.      

  Information about the notes is contained in (a) the attached prospectus,
which provides general information, some of which may not apply to the notes;   
and (b) this prospectus supplement, which describes the specific terms of the   
notes.                                                                          

This prospectus supplement and the attached prospectus include        
cross-references to sections in these materials where you can find further      
related discussions. The tables of contents in this prospectus supplement and   
the attached prospectus identify the pages where those sections are located.    

    In this prospectus supplement, the terms "Depositor," "we," "us" and "our"
refer to Fieldstone Mortgage Investment Corporation.                            

    We have filed preliminary information regarding the trust's assets and the
notes with the Securities and Exchange Commission. The information contained in 
this document supersedes all of that preliminary information, which was prepared
for prospective investors.                                                      

--------------------------------------------------------------------------------
To understand the structure of these notes, you must read carefully both
 the attached prospectus and this prospectus supplement in their entirety.
--------------------------------------------------------------------------------

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 Summary of Terms - The Series 2005-3 Notes*

                                                        [Enlarge/Download Table]

                           Class 1-A     Class 2-A1     Class 2-A2    Class 2-A3     Class M1  
                          ------------  ------------   ------------  ------------  ------------
                                                                                               
Initial Principal                                                                              
   Amount(1):             $316,989,000  $294,358,000   $262,801,000   $15,000,000   $44,283,000
Interest Rate:             LIBOR plus    LIBOR plus     LIBOR plus    LIBOR plus    LIBOR plus 
                          0.245%(2)(3)  0.120%(2)(3)   0.260%(2)(3)  0.340%(2)(3)  0.430%(2)(4)
ERISA Eligible:               Yes           Yes            Yes            Yes           Yes    
First Principal Payment                                                                        
   Date(5):                  12/2005       12/2005        8/2007        5/2014        1/2010   
Weighted Avg. Life At                                                                          
   Issuance:                                                                                   
   to 20% call                                                                                 
      (yrs.)(5)(6):           1.89          1.00            2.67          4.34          4.32   
   to 10% call                                                                                 
      (yrs.)(5)(7):           2.07          1.00            2.93          6.17          4.90   
   to maturity                                                                                 
      (yrs.)(5):              2.26          1.00            3.01          10.65         5.36   
Principal Window:                                                                              
   to 20% call                                                                                 
      (months)(5)(6):        1 - 52       1 - 21         21 - 52        52 - 52       50 - 52  
   to 10% call                                                                                 
      (months)(5)(7):        1 - 74       1 - 21         21 - 74        74 - 74       50 - 74  
   to maturity                                                                                 
      (months)(5):          1 - 176       1 - 21         21 - 102      102 - 168     50 - 148  
Expected Maturity:                                                                             
   to 20% call(5)(6):      March 2010    August 2007     March 2010   March 2010    March 2010 
   to 10% call(5)(7):     January 2012  August 2007    January 2012  January 2012  January 2012
   to maturity(5):          July 2020    August 2007      May 2014     November     March 2018 
                                                                         2019                  
Maturity Date(8):           February      February        February     February      February  
                              2036          2036            2036         2036          2036    

Interest Accrual                                                                               
   Method(9):              Actual/360    Actual/360      Actual/360   Actual/360    Actual/360 
Payment Delay:               0 days        0 days          0 days       0 days        0 days   

Anticipated Ratings                                                                            
(Moody's/S&P/Fitch)(10):   Aaa/AAA/AAA  Aaa/AAA/AAA   Aaa/AAA/AAA    Aaa/AAA/AAA   Aa1/AA+/AA+ 

CUSIP Number:               31659TEE1     31659TEF8      31659TEG6     31659TEH4     31659TEJ0 


                             Class M2     Class M3       Class M4      Class M5                
                          ------------  ------------   ------------  ------------              
                                                                                               
Initial Principal                                                                              
   Amount(1):              $41,369,000   $27,968,000    $19,811,000  $19,228,000               
Interest Rate:              LIBOR plus   LIBOR plus     LIBOR plus    LIBOR plus               
                          0.450%(2)(4)  0.480%(2)(4)   0.600%(2)(4)  0.630%(2)(4)              
ERISA Eligible:                Yes           Yes            Yes          Yes                   
First Principal Payment                                                                        
   Date(5):                  9/2009       7/2009          5/2009        4/2009                 
Weighted Avg. Life At                                                                          
   Issuance:                                                                                   
   to 20% call                                                                                 
      (yrs.)(5)(6):            4.13        3.99            3.92          3.88                  
   to 10% call                                                                                 
      (yrs.)(5)(7):            4.64        4.51            4.44          4.39                  
   to maturity                                                                                 
      (yrs.)(5):               5.09        4.94            4.86          4.80                  
Principal Window:                                                                              
   to 20% call                                                                                 
      (months)(5)(6):        46 - 52      44 - 52         42 - 52      41 - 52                 
   to 10% call                                                                                 
      (months)(5)(7):        46 - 74      44 - 74         42 - 74      41 - 74                 
   to maturity                                                                                 
      (months)(5):          46 - 142     44 - 135        42 - 130      41 - 125                
Expected Maturity:                                                                             
   to 20% call(5)(6):      March 2010    March 2010     March 2010    March 2010               
   to 10% call(5)(7):     January 2012  January 2012   January 2012  January 2012              
   to maturity(5):          September    February       September     April 2016               
                              2017         2017           2016                                 
Maturity Date(8):           February     February       February      February                 
                              2036         2036           2036          2036                   

Interest Accrual                                                                               
   Method(9):              Actual/360    Actual/360     Actual/360    Actual/360               
Payment Delay:               0 days        0 days         0 days        0 days                 

Anticipated Ratings                                                                            
(Moody's/S&P/Fitch)(10):   Aa2/AA+/AA    Aa3/AA+/AA-     A1/AA+/A+     A2/AA/A                 

CUSIP Number:               31659TEK7     31659TEL5      31659TEM3    31659TEN1                

                                                                [Download Table]

------------------------------------------------------------------------------------
                             Class M6        Class M7      Class M8       Class M9  
                           ------------   ------------   ------------   ------------
                                                                                    
Initial Principal                                                                   
   Amount(1):               $18,645,000    $18,645,000    $15,149,000    $12,819,000
Interest Rate:              LIBOR plus      LIBOR plus    LIBOR plus     LIBOR plus 
                           0.690%(2)(4)   1.200%(2)(4)   1.450%(2)(4)   2.000%(2)(4)
ERISA Eligible:                Yes            Yes            Yes            Yes     
First Principal Payment                                                             
   Date(5):                   3/2009         2/2009         2/2009         1/2009   
Weighted Avg. Life At                                                               
   Issuance:                                                                        
   to 20% call                                                                      
      (yrs.)(5)(6):            3.85           3.82           3.78           3.77    
   to 10% call                                                                      
      (yrs.)(5)(7):            4.36           4.33           4.30           4.29    
   to maturity                                                                      
      (yrs.)(5):               4.74           4.68           4.62           4.56    
Principal Window:                                                                   
   to 20% call                                                                      
      (months)(5)(6):         40 - 52        39 - 52        39 - 52        38 - 52  
   to 10% call                                                                      
      (months)(5)(7):         40 - 74        39 - 74        39 - 74        38 - 74  
   to maturity                                                                      
      (months)(5):           40 - 120       39 - 114       39 - 108       38 - 102  
Expected Maturity:                                                                  
   to 20% call(5)(6):       March 2010     March 2010     March 2010     March 2010 
   to 10% call(5)(7):      January 2012   January 2012   January 2012   January 2012
   to maturity(5):           November       May 2015      November       May 2014   
                               2015                         2014                    
Maturity Date(8):            February       February       February       February  
                               2036           2036           2036           2036    

Interest Accrual                                                                    
   Method(9):               Actual/360     Actual/360     Actual/360     Actual/360 
Payment Delay:                0 days         0 days         0 days         0 days   

Anticipated Ratings                                                                 
(Moody's/S&P/Fitch)(10):     A3/AA/A-     Baa1/A+/BBB+   Baa2/A+/BBB    Baa3/A/BBB- 

CUSIP Number:                31659TEP6      31659TEQ4      31659TER2      31659TES0 


                             Class M10      Class M11      Class M12      Class M13 
                           ------------   ------------   ------------   ------------
                                                                                    
Initial Principal                                                                   
   Amount(1):               $20,976,000    $11,653,000    $8,740,000     $7,575,000 
Interest Rate:             5.000%(2)(4)   5.000%(2)(4)   5.000%(2)(4)   5.000%(2)(4)

ERISA Eligible:                Yes            Yes            Yes            Yes     
First Principal Payment                                                             
   Date(5):                   1/2009         12/2008        12/2008        12/2008  
Weighted Avg. Life At                                                               
   Issuance:                                                                        
   to 20% call                                                                      
      (yrs.)(5)(6):            3.75           3.73           3.72           3.54    
   to 10% call                                                                      
      (yrs.)(5)(7):            4.27           4.23           4.01           3.55    
   to maturity                                                                      
      (yrs.)(5):               4.45           4.26           4.01           3.55    
Principal Window:                                                                   
   to 20% call                                                                      
      (months)(5)(6):         38 - 52        37 - 52        37 - 52        37 - 52  
   to 10% call                                                                      
      (months)(5)(7):         38 - 74        37 - 74        37 - 69        37 - 56  
   to maturity                                                                      
      (months)(5):            38 - 95        37 - 81        37 - 69        37 - 56  
Expected Maturity:                                                                  
   to 20% call(5)(6):        March 2010    March 2010     March 2010     March 2010 
   to 10% call(5)(7):      January 2012   January 2012    August 2011     July 2010 
   to maturity(5):         October 2013    August 2012    August 2011     July 2010 

Maturity Date(8):            February       February       February       February  
                               2036           2036           2036           2036    

Interest Accrual                                                                    
   Method(9):                 30/360         30/360         30/360         30/360   
Payment Delay:                24 days        24 days        24 days        24 days  

Anticipated Ratings                                                                 
(Moody's/S&P/Fitch)(10):     NR/A-/NR     NR/BBB+/NR      NR/BBB/NR     NR/BBB-/NR  

CUSIP Number:                31659TET8      31659TEU5      31659TEV3      31659TEW1 

----------                                                                      
*NOTE: Footnotes and additional summary information on facing page.             

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Footnotes:                                                                      

(1)  The initial note principal amounts are approximate amounts and are subject 
to a permitted variance of plus or minus 5%.                          

(2)  The interest rate for each class of notes (excluding the class M10, class  
 M11, class M12 and class M13 notes) is the least of (i) one-month LIBOR
 plus the applicable margin, (ii) the available funds rate and (iii) the
  fixed rate cap of 12.250% annually. The interest rate for the class M10,
class M11, class M12 and class M13 notes is equal to the lesser of (i)
   5.000% per annum and (ii) the available funds rate. The interest rate for
the notes (excluding the class M10, class M11, class M12 and class M13
  notes) is subject to adjustment and your interest rate may be lower than
the initial interest rate. See "Description of the                    
Notes--Payments--Payments of Interest."                               

(3)  If the servicer has not exercised its cleanup call on the first payment    
date on which the aggregate loan balance of the mortgage loans and the
  amount on deposit in the pre-funding account at the beginning of the due
period related to that payment date is less than 10% of the sum of the
     aggregate loan balance of the mortgage loans as of the initial cut-off date
   and the amount on deposit in the pre-funding account on the closing date,
    the margin on each of the class 1-A, class 2-A1, class 2-A2 and class 2-A3
notes will increase on the following payment date to two times its    
respective margin shown above.                                        

(4)  If the servicer has not exercised its cleanup call on the first payment    
date on which the aggregate loan balance of the mortgage loans and any
   amounts on deposit in the pre-funding account at the beginning of the due
period related to that payment date is less than 10% of the sum of the
     aggregate loan balance of the mortgage loans as of the initial cut-off date
   and the amount on deposit in the pre-funding account on the closing date,
     the margin on each of the class M1, class M2, class M3, class M4, class M5,
class M6, class M7, class M8 and class M9 notes will increase on the  
   following payment date to 1.5 times its respective margin shown above and
   the class M10, class M11, class M12 and class M13 notes will increase its
coupon shown above by 0.500%.                                         

(5)  The information regarding first principal payment date, weighted average   
   life at issuance, principal payment window and expected maturity is based
     on the modeling assumptions defined beginning on page S-101 and 100% of the
 prepayment assumption, which assumes (i) with respect to the adjustable
     rate mortgage loans a constant prepayment rate, or CPR, for the first month
    of 8% and an additional 2% each month thereafter until reaching 30% CPR in
     month 12 and remaining constant through month 22, remaining constant at 55%
 CPR for months 23 through 27 and then remaining constant at 35% CPR for
  months 28 and thereafter, in each period subject to a maximum CPR of 95%
and (ii) with respect to the fixed rate mortgage loans 20% of HEP.    

(6)  Assumes the servicer exercises its cleanup call on the first payment date  
     on which the aggregate loan balance of the mortgage loans and the amount on
deposit in the pre-funding account at the beginning of the due period 
    related to that payment date is reduced to less than 20% of the sum of the
aggregate loan balance of the initial mortgage loans as of the initial
  cut-off date and the amount on deposit in the pre-funding account on the
   closing date. See "The Trust Agreement and the Indenture--Certain Matters
Under the Agreements--Redemption."                                    

(7)  Assumes the servicer exercises its cleanup call on the first payment date  
     on which the aggregate loan balance of the mortgage loans and the amount on
deposit in the pre-funding account at the beginning of the due period 
   related to that payment date is less than 10% of the sum of the aggregate
   loan balance of the initial mortgage loans as of the initial cut-off date
   and the amount on deposit in the pre-funding account on the closing date.
See "The Trust Agreement and the Indenture--Certain Matters Under the 
Agreements--Redemption."                                              

(8)  Assumes the payment date following the latest possible maturity date for a 
subsequent mortgage loan having a maturity date of January 2036.      

(9)  The interest rate index reset date for the notes (other than the class M10,
     class M11, class M12 and class M13 notes) is two business days prior to the
start of each interest accrual period.                                

(10) The designation "NR" means that the applicable rating agency will not rate 
the notes of that class.                                              

Additional Summary Information:                                                 

                                                                [Download Table]
                                                                                
Credit Enhancement:              Excess interest (including net swap receipts   
                                 under an interest rate swap agreement),        
                                 overcollateralization, subordination and       
                                 limited cross-collateralization                

Overcollateralization                                                           
Requirements:                    Initial Overcollateralization Amount =         
                                 approximately 0.80% of original principal      
                                 balance of the initial mortgage loans as of the
                                 initial cut-off date and the amount on deposit 
                                 in the pre-funding account on the closing date.

                                 Targeted Overcollateralization Amount = 0.80%  
                                 of original principal balance of the initial   
                                 mortgage loans as of the initial cut-off date  
                                 and the amount on deposit in the pre-funding   
                                 account on the closing date.                   

                                 Stepdown Overcollateralization Amount = 1.60%  
                                 of current principal balance of the mortgage   
                                 loans and the amount on deposit in the         
                                 pre-funding account at the end of the related  
                                 due period for the related payment date.       

                                 Minimum Required Overcollateralization Amount =
                                 0.50% of original principal balance of the     
                                 initial mortgage loans as of the initial       
                                 cut-off date and the amount on deposit in the  
                                 pre-funding account on the closing date.       

                                 Earliest Possible Stepdown Date = the earlier  
                                 of (a) the first payment date on which the     
                                 aggregate class principal amount of the class A
                                 notes (after giving effect to payments of the  
                                 principal funds amount for such payment date)  
                                 has been reduced to zero and (b) the later to  
                                 occur of (i) the payment date in December 2008 
                                 or (ii) the first payment date on which the    
                                 aggregate class principal amount of the class A
                                 notes (after giving effect to payments of the  
                                 principal funds amount for such payment date)  
                                 is less than or equal to 52.60% of the         
                                 aggregate loan balance of the mortgage loans   
                                 and the amount on deposit in the pre-funding   
                                 account as of the end of the immediately       
                                 preceding due period.                          

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 TABLE OF CONTENTS

                                                                [Download Table]
                                                                                
Summary Information.....................................................     S-7
   Transaction Parties..................................................     S-7
   Cut-off Date.........................................................     S-7
   Closing Date.........................................................     S-7
   Payment Date.........................................................     S-7
   The Trust............................................................     S-7
   The Mortgage Loans...................................................     S-8
   The Pre-Funding Account..............................................     S-8
   The Series 2005-3 Notes..............................................     S-9
   Relationship Between Loan Groups and the Notes.......................     S-9
   Interest Payments....................................................     S-9
   Principal Payments...................................................    S-10
   Servicing Compensation and Payment of Expenses.......................    S-11
   Denominations........................................................    S-11
   Book-Entry Registration..............................................    S-11
   Credit Enhancement...................................................    S-11
   Realized Losses......................................................    S-12
   The Swap Agreement...................................................    S-13
   Optional Redemption..................................................    S-13
   Legal Investment.....................................................    S-13
   Federal Income Tax Consequences......................................    S-13
   ERISA Considerations.................................................    S-14
   Ratings..............................................................    S-14
Risk Factors............................................................    S-20
Forward-Looking Statements..............................................    S-30
Glossary................................................................    S-30
The Mortgage Pool.......................................................    S-31
   General..............................................................    S-31
   The Indices..........................................................    S-34
   Pre-Funding and Conveyance of Subsequent                                     
      Mortgage Loans ...................................................    S-34
Underwriting Guidelines.................................................    S-36
   General..............................................................    S-36
   The Fieldstone Underwriting Guidelines...............................    S-36
Servicing of the Mortgage Loans.........................................    S-40
   General..............................................................    S-40
   Servicing Compensation and Payment of Expenses.......................    S-40
   Adjustment to Servicing Fees in Connection with                              
      Certain Prepaid Mortgage Loans ...................................    S-41
   Advances.............................................................    S-41
   Collection of Taxes, Assessments and Similar Items...................    S-42
   Insurance Coverage...................................................    S-42
   Evidence as to Compliance............................................    S-42
   Master Servicer Default; Servicer Default;                                   
      Subservicer Default ..............................................    S-42
   Pledge of Servicing Rights...........................................    S-42
Parties to the Transaction..............................................    S-43
   The Seller and Sponsor...............................................    S-43
   The Depositor........................................................    S-43
   The Master Servicer..................................................    S-44
   The Servicer.........................................................    S-44
   The Trust............................................................    S-44
   The Owner Trustee....................................................    S-44
   The Indenture Trustee................................................    S-45
   The Subservicer......................................................    S-45
Description of the Notes................................................    S-47
   General..............................................................    S-47
   Book-Entry Notes.....................................................    S-47
   Payments on Mortgage Loans; Custodial Accounts;                              
      Collection Account ...............................................    S-51
   Payments.............................................................    S-51
   Credit Enhancement...................................................    S-58
   Calculation of One-Month LIBOR.......................................    S-62
   The Swap Agreement...................................................    S-63
   Reports to Noteholders...............................................    S-65
   The Ownership Certificate............................................    S-67
The Mortgage Loan Purchase Agreement and the Transfer                           
   and Servicing Agreement .............................................    S-67
   General..............................................................    S-67
   Assignment of Mortgage Loans.........................................    S-67
   Pre-Funding Account..................................................    S-68
   Administration.......................................................    S-69
   Amendment............................................................    S-69
   Voting Rights........................................................    S-69
The Trust Agreement and the Indenture...................................    S-69
   General..............................................................    S-69
   Certain Matters under the Agreements.................................    S-70
   Amendment............................................................    S-71
Yield, Prepayment and Maturity Considerations...........................    S-72
   General..............................................................    S-72
   Prepayments and Yields for Notes.....................................    S-73
   Additional Information...............................................    S-76
Federal Income Tax Consequences.........................................    S-76
   Tax Classification of the Trust and of the Notes.....................    S-76
   Tax Consequences to Holders of the Notes.............................    S-77
State and Local Income Tax Considerations...............................    S-80
ERISA Considerations....................................................    S-81
   General..............................................................    S-81
   Purchases of the Notes...............................................    S-81
Legal Investment........................................................    S-82
Use of Proceeds.........................................................    S-82
Method of Distribution..................................................    S-82
Summary of Fees and Expenses related to the Issuance of                         
   the Notes ...........................................................    S-84
Legal Matters...........................................................    S-84
Ratings.................................................................    S-85
Glossary of Defined Terms...............................................    S-86
Annex I.................................................................     I-1
Annex II................................................................    II-1
Annex III...............................................................   III-1
Annex IV................................................................    IV-1

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

 Summary Information

  This section briefly summarizes significant characteristics of the notes
and the mortgage loans. It does not contain all of the information that you need
to consider in making your investment decision. To understand fully the terms of
the notes, you should read both this prospectus supplement and the attached     
prospectus in their entirety.                                                   

 Transaction Parties

Seller and Sponsor: Fieldstone Investment Corporation, a Maryland corporation   
that has elected to be treated as a real estate investment trust, whose address 
is 11000 Broken Land Parkway, Columbia, Maryland 21044 and whose telephone      
number is (410) 772-7200.                                                       

Depositor: Fieldstone Mortgage Investment Corporation, 11000 Broken Land        
Parkway, Columbia, Maryland 21044 and whose telephone number is (866) 365-FMIC  
(3642). See "The Depositor" in the prospectus.                                  

Issuing Entity: Fieldstone Mortgage Investment Trust, Series 2005-3, a Delaware 
statutory trust.                                                                

Master Servicer: Wells Fargo Bank, N.A., a national banking association, whose  
address is 9062 Old Annapolis Road, Columbia, Maryland 21045 and whose telephone
number is (410) 884-2000. See "Parties to the Transaction--The Master Servicer."

Servicer: Fieldstone Servicing Corp., a Maryland corporation, whose address is  
11000 Broken Land Parkway, Suite 600, Columbia, Maryland 21044 and whose        
telephone number is (410) 772-7200. See "Parties to the Transaction--The        
Servicer."                                                                      

Subservicer: JPMorgan Chase Bank, National Association, a national banking      
association, whose address is 1111 Polaris Portway, Columbus, Ohio 43240 and    
whose telephone number is (614) 213-1900. See "Parties to the Transaction--The  
Subservicer."                                                                   

Indenture Trustee: HSBC Bank USA, National Association, a national banking      
association, whose address is 452 Fifth Avenue, New York, New York 10018,       
Attention: Corporate Trust and whose telephone number is (212) 525-1501. See    
"Parties to the Transaction--The Indenture Trustee."                            

Owner Trustee: U.S. Bank Trust National Association, a national banking         
association, whose address is 300 Delaware Avenue, Suite 813, Wilmington,       
Delaware 19801, Attention: Corporate Trust. See "Parties to the Transaction--The
Owner Trustee."                                                                 

Trust Administrator: Wells Fargo Bank, N.A., a national banking association,    
whose "corporate trust office" for purposes of transfers and exchanges and for  
presentment and surrender of the notes for final payment is 6th Street and      
Marquette Avenue, Minneapolis, Minnesota 55479 and whose address for all other  
purposes is 9062 Old Annapolis Road, Columbia, Maryland 21045 and whose         
telephone number is (410) 884-2000. See "The Mortgage Loan Purchase Agreement   
and the Transfer and Servicing Agreement."                                      

Swap Counterparty: Bank of America, N.A., a national banking association, whose 
address is Bank of America Plaza, 233 South Wacker Drive, Suite 2800, Chicago,  
Illinois 60606 and whose telephone number is (312) 234-2732. See "Description of
the Notes--The Swap Agreement."                                                 

Cut-off Date

For any mortgage loan delivered on the closing date, the cut-off date will be   
November 1, 2005, which is also referred to in this prospectus supplement as the
initial cut-off date. For any subsequent mortgage loan, the cut-off date will be
the date that such mortgage loan is transferred to the trust, which is also     
referred to in this prospectus supplement as the subsequent cut-off date.       

Closing Date

The closing date will be on or about November 23, 2005.                         

Payment Date

The 25th day of each month, beginning in December, 2005. If the 25th day is not 
a business day, then the payment date will be the next business day.            

 The Trust

The name of the trust is Fieldstone Mortgage Investment Trust, Series 2005-3.   

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The Mortgage Loans

The notes represent obligations of the trust and will be secured by, among other
things, (a) collateral consisting on the closing date of a mortgage pool with an
aggregate principal balance of approximately $875,331,945.33, referred to in    
this prospectus supplement as the initial mortgage loans and (b) the aggregate  
amount of funds on deposit in the pre-funding account. The mortgage loans will  
consist of two groups designated as group 1 and group 2.                        

Group 1 will consist of first lien and second lien, adjustable rate and fixed   
rate mortgage loans that had a principal balance at origination of no more than 
$359,650 if a single-unit property (or $539,475 if the property is located in   
Hawaii or Alaska), $460,400 if a two-unit property (or $690,600 if the property 
is located in Hawaii or Alaska), $556,500 if a three-unit property (or $834,750 
if the property is located in Hawaii or Alaska), or $691,600 if a four-unit     
property (or $1,037,400 if the property is located in Hawaii or Alaska) and with
respect to second lien fixed rate mortgage loans, mortgage loans that had a     
principal balance at origination of no more than $179,825 (or $269,773.50 if the
property is located in Hawaii or Alaska). Group 2 will consist of first lien and
second lien, adjustable rate and fixed rate mortgage loans that had a principal 
balance at origination that may or may not conform to the criteria specified    
above for mortgage loans included in group 1.                                   

Pursuant to the transfer and servicing agreement, the seller has made to the    
trust certain representations and warranties concerning the Mortgage Loans. See 
"Origination and Sale of Mortgage Loans--Representations and Warranties" in the 
prospectus. In the event the seller breaches a representation or warranty made  
with respect to a mortgage loan or if any principal document executed by the    
borrower concerning a mortgage loan is found to be defective in any material    
respect and the breaching party cannot cure the breach or defect within the     
required time, the indenture trustee may require the seller to purchase the     
mortgage loan from the trust upon deposit with the trust administrator of funds 
equal to the then unpaid principal balance of the mortgage loan plus accrued    
interest at the mortgage rate through the end of the month in which the purchase
occurs plus any additional amounts, as provided in the mortgage loan purchase   
agreement or transfer and servicing agreement, as applicable, net of certain    
amounts (including servicing fees) that may be reimbursable to any of the       
servicer, master servicer or subservicer. In the event of a breach by the seller
of a representation or warranty with respect to any mortgage loan or the        
delivery by the seller to the indenture trustee of a materially defective       
document with respect to a mortgage loan, the seller may, under certain         
circumstances, rather than repurchasing the affected mortgage loan, substitute a
mortgage loan having characteristics substantially similar to those of the      
defective one. See "The Mortgage Loan Purchase Agreement and the Transfer and   
Servicing Agreement" in this prospectus supplement and "The Trusts--Substitution
of Trust Assets" in the prospectus.                                             

The statistical mortgage loan information presented in this prospectus          
supplement includes both the initial mortgage loans and certain of the mortgage 
loans that are expected to be included among the subsequent mortgage loans to be
delivered by the seller to the trust during the pre-funding period described    
below. For additional information on the statistical mortgage loans, see "The   
Statistical Mortgage Loans." Prior to the issuance of the notes, some of the    
initial mortgage loans may be removed from the mortgage pool as a result of     
incomplete documentation or otherwise and any initial mortgage loans that prepay
or default will be removed. Other mortgage loans may be included in the mortgage
pool prior to the issuance of the notes. However, the removal and inclusion of  
such mortgage loans will not materially alter the characteristics of the        
mortgage loans as described in this prospectus supplement, although the range of
mortgage rates and maturities and certain other characteristics of the mortgage 
loans may vary.                                                                 

 The Pre-Funding Account

On the closing date, the seller will deposit approximately $290,000,000, which  
represents approximately 25.09% of the aggregate Class Principal Amount of the  
Notes, into a segregated account maintained with the trust administrator,       
referred to in this prospectus supplement as the pre-funding account. This      
amount will be allocated between the mortgage groups so that the sum of the     
amount deposited in the pre-funding account for a mortgage group plus the       
aggregate loan balance of the initial mortgage loans in that group on the       
closing date equals approximately $415,450,679 and $749,881,267 for group 1 and 
group 2, respectively. The maximum aggregate loan balance of subsequent mortgage
loans to be transferred to the trust for group 1 and group 2 is approximately   
$103,387,448 and $186,612,551, respectively.                                    

The trust will use the amounts deposited in the pre-funding account to buy      
subsequent mortgage loans                                                       

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for each group from the seller after the closing date and prior to February 22, 
2006. The seller must satisfy certain conditions specified in the transfer and  
servicing agreement before it can sell subsequent mortgage loans to the trust.  
In addition, the obligation of the trust to purchase subsequent mortgage loans  
during the pre-funding period is subject to the following requirements:         

o    such subsequent mortgage loan may not be more than one calendar month      
contractually delinquent as of the related subsequent cut-off date;   

o    such subsequent mortgage loan may not have a final maturity date later than
January 1, 2036;                                                      

o    the remaining term to stated maturity of such subsequent mortgage loan will
not exceed 30 years;                                                  

o    such subsequent mortgage loan will have a mortgage rate not less than      
6.000% per annum;                                                     

o    such subsequent mortgage loan will not have an original loan-to-value ratio
of greater than 100%;                                                 

o    such subsequent mortgage loan will have a principal balance not greater    
than $1,200,000;                                                      

o    such subsequent mortgage loan will be secured by a first lien or second    
lien on a mortgaged property; and                                     

o    such subsequent mortgage loan will be otherwise acceptable to the rating   
agencies.                                                             

If any amounts are left in the pre-funding account for purchase of subsequent   
mortgage loans for a mortgage group on February 22, 2006, the holders of the    
class A notes related to that group will receive those amounts as a principal   
payment on the February 2006 payment date. See "The Mortgage Pool--Prefunding   
and Conveyance of Subsequent Mortgage Loans."                                   

 The Series 2005-3 Notes

The notes will have the original note principal amount, interest rate and other 
features set forth in the table on page S-4. The trust will issue the notes     
under an indenture dated as of November 1, 2005, between the issuer, the trust  
administrator and the indenture trustee. Any collections on the mortgage loans  
will be used to pay applicable fees and expenses to the master servicer, the    
servicer, the subservicer, the trust administrator, the indenture trustee and   
the owner trustee, to make certain payments to the swap counterparty and to make
interest or principal payments on the notes. All principal collections will be  
paid to one or more classes of the notes, in each case in the manner and to the 
extent described under "Description of the Notes--Payments." Any interest       
collections in excess of the amount paid to holders of the notes (either as     
interest or principal), the master servicer, the servicer, the subservicer, the 
trust administrator, the owner trustee, the indenture trustee and the swap      
counterparty will be paid to the holder of the ownership certificate, which we  
are not offering by this prospectus supplement. See "Description of the         
Notes--Payments."                                                               

Relationship Between Loan Groups and the Notes                                  

The class 1-A notes generally relate to the mortgage loans in group 1 and the   
class 2-A1, class 2-A2 and class 2-A3 notes generally relate to the mortgage    
loans in group 2. The class M1, class M2, class M3, class M4, class M5, class   
M6, class M7, class M8, class M9, class M10, class M11, class M12 and class M13 
notes, also referred to as the subordinate notes, generally relate to the       
mortgage loans in group 1 and group 2. The notes generally receive payments     
based on interest, principal and other amounts collected from the mortgage loans
in the related mortgage group or groups. The class 1-A, class 2-A1, class 2-A2  
and class 2-A3 notes are referred to herein as the class A notes or the senior  
notes.                                                                          

 Interest Payments

Interest will accrue on each class of notes at the interest rate for that class.
Interest will accrue on each class of notes, other than the class M10, class    
M11, class M12 and class M13 notes, from the prior payment date (or the closing 
date, in the case of the first payment date) to the day prior to the current    
payment date. Interest will accrue on the class M10, class M11, class M12 and   
class M13 notes during the calendar month prior to the month of the current     
payment date.                                                                   

The interest rate on the notes other than the class M10, class M11, class M12   
and class M13 notes will be the least of (i) one-month LIBOR plus the applicable
margin, (ii) the available funds rate and (iii) the fixed rate cap of 12.250%   
per annum.                                                                      

The interest rate on the class M10, class M11, class M12 and class M13 notes    
will be the lesser of (i) 5.000% per annum and (ii) the available funds rate;   
provided that, following the payment date on which the aggregate principal      
balance of the mortgage loans                                                   

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and the amount on deposit in the pre-funding account at the beginning of the due
period related to that payment date is less than 10% of the sum of the aggregate
unpaid principal balance of the initial mortgage loans as of the initial cut-off
date and the amount on deposit in the pre-funding account on the closing date,  
the interest rate for the class M10, class M11, class M12 and class M13 notes   
will increase to the lesser of (i) 5.500% per annum and (ii) the available funds
rate.                                                                           

To the extent that interest payable on a note is limited on any payment date by 
application of the available funds rate, the amount of interest that would have 
been payable in absence of such limitation will be payable, to the extent of    
funds available, on future payment dates as described in this prospectus        
supplement.                                                                     

Any interest shortfall due to the application of the fixed rate cap will not be 
reimbursed.                                                                     

See "Risk Factors--The interest rate indices for the mortgage loans and on the  
notes differ and the interest rates on the mortgage loans and the notes adjust  
at different intervals."                                                        

On each payment date, the trust administrator will make payments from interest  
funds for each mortgage group after the payment of certain expenses of the trust
and net swap payments or net swap receipts in respect of the swap agreement, in 
the following order of priority:                                                

o    to the related senior notes, current interest for such payment date;       

o    to the senior notes of the unrelated mortgage group, current interest for  
     such payment date (after giving effect to the payment of the interest funds
for the unrelated mortgage group);                                    

o    to the subordinate notes, in the order of priority described in this       
prospectus supplement, current interest for such payment date;        

o    to the indenture trustee, the owner trustee, the master servicer, the trust
  administrator, the servicer and the subservicer, previously unreimbursed
     extraordinary costs, liabilities and expenses to the extent provided in the
transfer and servicing agreement; and                                 

o    to be applied as part of excess interest for such payment date.            

For a complete description of the interest payments to the noteholders, see     
"Description of the Notes--Payments--Payments of Interest."                     

Principal Payments

Principal payments on the notes will generally reflect principal collections on 
the mortgage loans in the trust. Principal payments on the notes will also      
include a portion of interest collections on the mortgage loans to the extent   
necessary to re-establish or restore overcollateralization to the required      
level, as described below.                                                      

See "Description of the Notes--Payments--Payments of Principal."                

On each payment date, the trust administrator will pay principal on the notes as
described under "Description of the Notes--Payments--Payments of Principal."    

The allocation and priority of payments may differ depending on whether the     
payment date is prior to or after the stepdown date or if the payment occurs    
when a trigger event is in effect.                                              

The stepdown date means the earlier of (a) the first payment date on which the  
aggregate class principal amount of the class A notes (after giving effect to   
payments of the principal funds amount for such payment date) has been reduced  
to zero and (b) the later to occur of (i) the payment date in December 2008 or  
(ii) the first payment date on which the aggregate class principal amount of the
class A notes (after giving effect to payments of the principal funds amount for
such payment date) is less than or equal to 52.60% of the aggregate loan balance
of the mortgage loans and the amount on deposit in the pre-funding account as of
the end of the immediately preceding due period.                                

A trigger event exists for any payment date after the stepdown date, in respect 
to which (a) the quotient of (1) the aggregate stated principal balance of all  
mortgage loans 60 or more days delinquent, measured on a rolling three-month    
basis (including mortgage loans in foreclosure, REO properties and mortgage     
loans with respect to which the applicable borrower is in bankruptcy) divided by
(2) the aggregate loan balance of the mortgage loans and the amount on deposit  
in the pre-funding account as of the end of the due period related to the       
preceding servicer remittance date, equals or exceeds the product of (i) 33.750%
and (ii) the required class A subordination percentage, (b) the quotient of (1) 
the                                                                             

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aggregate realized losses incurred from the initial cut-off date through the    
last day of the calendar month preceding such payment date divided by (2) the   
aggregate loan balance of the mortgage loans as of the initial cut-off date and 
the amount on deposit in the pre-funding account as of the closing date exceeds 
the required loss percentage described in this prospectus supplement or (c) a   
principal deficiency amount exists for such payment date.                       

Servicing Compensation and Payment of Expenses                                  

As compensation for master servicing, custodial duties and administration of the
trust, the master servicer will be entitled to receive, on a monthly basis, an  
amount equal to the product of 0.0030% per annum on the stated principal balance
of each mortgage loan as of the beginning of the related due period.            

The servicer and the subservicer collectively will be paid, on a monthly basis, 
an amount equal to the product of 0.50% per annum on the stated principal       
balance of each mortgage loan as of the beginning of the related due period,    
which is referred to as the servicing fee. As additional servicing compensation,
the servicer and subservicer are generally entitled to retain (a) all prepayment
penalties collected in respect of the mortgage loans and all servicing related  
fees, including fees collected in connection with assumptions, modification,    
late payment charges and other similar amounts to the extent collected from the 
borrower, (b) any prepayment interest excess and (c) any investment earnings on 
funds held in their respective custodial accounts and escrow accounts. See      
"Servicing of the Mortgage Loans--Servicing Compensation and Payment of         
Expenses."                                                                      

The servicing fees and master servicing fees may be subject to adjustment in    
connection with certain borrower prepayments. When a borrower prepays all or a  
portion of a mortgage loan between due dates, the borrower is required to pay   
interest on the amount prepaid only to the date of prepayment rather than a full
month's interest, which could result in a prepayment interest shortfall in      
respect of interest available for payment to noteholders. In order to mitigate  
the effect of prepayment interest shortfalls, each of the servicer and the      
subservicer (or the master servicer, to the extent that the servicer fails to do
so) will be required to pay compensating interest (but only up to the amount of 
the servicing fee for the related payment date, in the case of the servicer or  
the subservicer, or the master servicing fee for the related payment date, in   
the case of the master servicer) into the collection account to the extent of   
any prepayment interest shortfall in respect of borrower prepayments.           

Each of the servicing fee and the master servicing fee shall be payable from    
borrower payments and other receipts in respect of the mortgage loans prior to  
the payment of any amounts to the noteholders.                                  

 Denominations

The trust will issue each class of notes in minimum denominations of $100,000 in
original principal amount and integral multiples of $1 in excess of $100,000.   

 Book-Entry Registration

The trust initially will issue the notes in book-entry form. You may elect to   
hold your interest in the notes through The Depository Trust Company in the     
United States, or Clearstream Luxembourg or the Euroclear Bank, S.A./N.V. in    
Europe, or indirectly through participants in these systems. You will not be    
entitled to receive a definitive note representing your interest except under   
limited circumstances.                                                          

See "Description of the Notes--Book-Entry Notes" in this prospectus supplement  
and "Description of the Securities--Book-Entry Procedures and Definitive        
Certificates" in the prospectus.                                                

Credit Enhancement

Credit enhancement is intended to reduce the harm caused to holders of the notes
as a result of shortfalls in payments received and losses realized on the       
mortgage loans. The credit enhancement for the notes will consist of excess     
interest (including net swap receipts payable by the swap counterparty in       
respect of an interest rate swap agreement as further described below under "The
Swap Agreement"), overcollateralization, subordination and limited              
cross-collateralization features described in this prospectus supplement.       

Excess Interest and Overcollateralization. The overcollateralization amount is  
the excess of the aggregate outstanding principal balance of the mortgage loans 
and the current amount on deposit in the pre-funding account over the aggregate 
principal amount of the notes. On the closing date, the overcollateralization   
amount will equal approximately $9,322,945, or approximately 0.80% of the sum of
(a) the aggregate balance of the mortgage loans as of the initial cut-off date  
and                                                                             

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(b) the amount on deposit in the pre-funding account on the closing date.       
Generally, because more interest is required to be paid by the borrowers than is
necessary to pay the interest accrued on the notes and the expenses of the      
trust, there is expected to be excess interest. If the overcollateralization    
amount is reduced below the overcollateralization target amount as a result of  
losses on the mortgage loans, the trust will apply some or all of this excess   
interest as principal payments on the most senior classes of notes then         
outstanding until the overcollateralization target is restored, resulting in an 
acceleration of amortization of the notes relative to the mortgage loans. This  
acceleration feature is intended to maintain and restore overcollateralization. 
Once the required level of overcollateralization is re-established, the         
acceleration feature will cease, unless it becomes necessary again to restore   
the required level of overcollateralization. The actual level of                
overcollateralization may increase or decrease over time. This could result in a
temporarily faster or slower amortization of the notes. See "Description of the 
Notes--Credit Enhancement--Overcollateralization."                              

Subordination. The rights of the holders of the more junior classes of notes to 
receive payments will be subordinated to the rights of the holders of the more  
senior classes of notes to receive payments. The Class M Notes are subordinated 
to the senior notes in their right to receive payments of principal and         
interest. Class M Notes with a higher numerical designation are subordinated to 
the Class M Notes with a lower numerical designation in their right to receive  
principal and interest. See "Description of the Notes--Payments."               

In general, the protection afforded the holders of more senior classes of notes 
by means of this subordination will be effected by the preferential right of the
holders of the more senior classes to receive, prior to any payment being made  
on any payment date to the holders of the more junior classes of notes, the     
amount of interest and principal due on the more senior classes of notes and, if
necessary, by the right of the more senior holders to receive future payments on
the mortgage loans that would otherwise have been allocated to the holders of   
the more junior classes of notes.                                               

The chart below summarizes the relative seniority of the various classes of     
notes and indicates the initial level of credit support provided to the various 
classes of notes. Credit support primarily consists of excess interest,         
overcollateralization and subordination offered to the various classes.         

                                                                [Download Table]

                           Initial Credit
        Class(es)              Support   
------------------------   --------------
                                         
1-A, 2-A1, 2-A2 and 2-A3       23.70%    
M1                             19.90%    
M2                             16.35%    
M3                             13.95%    
M4                             12.25%    
M5                             10.60%    
M6                              9.00%    
M7                              7.40%    
M8                              6.10%    
M9                              5.00%    
M10                             3.20%    
M11                             2.20%    
M12                             1.45%    
M13                             0.80%    

Limited Cross-Collateralization. Under certain limited circumstances, principal 
payments on the mortgage loans in one group may be paid as principal to holders 
of the class A notes corresponding to the other group. If the class A notes     
relating to one group have been retired, then principal payments on the mortgage
loans relating to the retired class A notes will be paid to the remaining class 
A notes of the other group, if any, before being paid to the class M1, class M2,
class M3, class M4, class M5, class M6, class M7, class M8, class M9, class M10 
class M11, class M12 and class M13 notes. See "Description of the               
Notes--Payments."                                                               

 Realized Losses

Realized losses on the mortgage loans will have the effect of reducing amounts  
available to make payments in respect of, first, the ownership certificate      
(through the application of excess cashflow generated by the mortgage loans and 
net swap receipts received in respect of the swap agreement to fund such        
deficiency and through a reduction in the overcollateralization amount for the  
related payment date); second, the class M13 notes; third, the class M12 notes; 
fourth, the class M11 notes; fifth, the class M10 notes; sixth, the class M9    
notes; seventh, the class M8 notes; eighth, the class M7 notes; ninth, the class
M6 notes; tenth, the class M5 notes; eleventh, the class M4 notes; twelfth, the 
class M3 notes; thirteenth, the class M2 notes and fourteenth, the class M1     
notes, before reducing amounts available to make payments in respect of the     
class A notes. Realized losses will not reduce the outstanding class principal  
amount of any note, however, under certain loss scenarios, principal and        
interest received from the mortgage loans may be                                

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insufficient to pay the notes all principal and interest to which they are      
entitled.                                                                       

To the extent that realized losses are incurred, those realized losses will     
reduce the aggregate principal balances of the mortgage loans, and thus may     
reduce the overcollateralization amount. As described herein, the               
overcollateralization amount is increased and maintained by application of      
excess interest generated by the mortgage loans and net payments received by the
trust in respect of the swap agreement to make payments of principal on the     
notes.                                                                          

The Swap Agreement

The trust will have the benefit of a swap agreement, which will be entered into 
on or before the closing date. The swap counterparty will be Bank of America,   
N.A. Under the swap agreement, on each payment date, beginning on the payment   
date in December 2005, and ending on the payment date in January 2009, the trust
will be obligated to make fixed payments at the per annum rate of 4.358%, and   
the swap counterparty will be obligated to make floating payments at LIBOR (as  
determined under the swap agreement), in each case calculated on a swap notional
balance and adjusted on a monthly basis. The swap agreement is intended         
primarily to (i) protect against interest rate risk from upward movements in    
one-month LIBOR and (ii) diminish the basis risk associated with the hybrid     
adjustable-rate mortgage loans in the mortgage pool. Net swap receipts received 
by the trust under the swap agreement will be applied to pay on any payment date
current interest, to maintain required overcollateralization levels and to pay  
any available funds shortfalls and deferred interest. Any amounts received under
the swap agreement in excess of the amount needed to satisfy payments described 
in the immediately preceding sentence shall be paid to the holder of the        
ownership interest in the trust and shall not be available to make payments in  
respect of the notes.                                                           

In certain circumstances, the trust will also be required to make payments to   
the swap counterparty. See "Description of the Notes--The Swap Agreement."      

 Optional Redemption

Subject to restrictions described in this prospectus supplement, on any payment 
date after the payment date on which the aggregate unpaid principal balance of  
the mortgage loans and the amount on deposit in the pre-funding account at the  
beginning of the due period for the related payment date is reduced to less than
20% of the sum of the aggregate loan balance of the initial mortgage loans as of
the initial cut-off date and the amount on deposit in the pre-funding account on
the closing date, the servicer will have the option, pursuant to the indenture, 
to purchase the mortgage loans and the other assets of the trust. If the        
servicer has not purchased the mortgage loans after the first payment date on   
which the aggregate unpaid principal balance of the mortgage loans and the      
amount on deposit in the pre-funding account at the beginning of the due period 
for the related payment date is reduced to less than 10% of the sum of the      
aggregate loan balance of the initial mortgage loans as of the initial cut-off  
date and the amount on deposit in the pre-funding account on the closing date,  
(i) the margins on the notes (other than the class M10, class M11, class M12 and
class M13 notes) will be increased as set forth on page S-5 beginning on the    
next payment date and (ii) in the case of the class M10, class M11, class M12   
and class M13 notes, the interest rate will increase to the lesser of (a) 5.500%
per annum and (b) the available funds rate beginning on the next payment date.  
See "The Trust Agreement and the Indenture--Certain Matters Under the           
Agreements--Redemption."                                                        

Legal Investment

None of the notes will constitute "mortgage related securities" under the       
Secondary Mortgage Market Enhancement Act of 1984, as amended. We make no other 
representation as to the appropriate characterization of the notes under any    
laws relating to investment restrictions. You should consult your own counsel as
to whether you have the legal authority to invest in these notes. See "Risk     
Factors--The notes lack SMMEA eligibility and may lack liquidity, which may     
limit your ability to sell" and "Legal Investment" in this prospectus supplement
and "Legal Investment Considerations" in the prospectus.                        

 Federal Income Tax Consequences

For federal income tax purposes the notes will be characterized as debt to the  
extent they are issued to parties unrelated to the owner of the ownership       
certificate. Each noteholder that is unrelated to the owner of the ownership    
certificate, by its acceptance of a note, will agree to treat the notes as debt.

The trust will be classified as a taxable mortgage pool. The trust will not,    
however, be subject to federal income tax as a corporation as long as the       
ownership certificate is owned exclusively by a "real                           

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estate investment trust," a "qualified REIT subsidiary" or an entity that is    
disregarded for United States federal income tax purposes that is wholly-owned  
by a "real estate investment trust" or a "qualified REIT subsidiary." The seller
represents that it qualifies as a "real estate investment trust" and that it    
will own the ownership certificate directly or indirectly through a "qualified  
REIT subsidiary" or an entity that is disregarded for United States federal     
income tax purposes that is wholly-owned by a "real estate investment trust" or 
a "qualified REIT subsidiary." Moreover, the trust agreement sets forth         
restrictions on the transferability of the ownership certificate to ensure that 
it will only be (i) held by a "real estate investment trust," a "qualified REIT 
subsidiary" or an entity that is disregarded for United States federal income   
tax purposes that is wholly-owned by a "real estate investment trust" or a      
"qualified REIT subsidiary" or (ii) pledged to secure indebtedness or be the    
subject of a repurchase agreement treated by the trust as secured indebtedness  
for federal income tax purposes. See "Risk Factors--Trust Could Become a Taxable
Entity" and "Federal Income Tax Consequences" in this prospectus supplement and 
in the prospectus for additional information concerning the application of      
federal income tax laws to the notes.                                           

ERISA Considerations

Under current law, in general, the notes will be eligible for purchase by an    
employee benefit plan or other retirement arrangement subject to the Employee   
Retirement Income Security Act of 1974, as amended and/or the Internal Revenue  
Code of 1986, as amended. You should consult with your counsel with respect to  
the legal consequences of such plan's or arrangement's acquisition and ownership
of the notes. See "ERISA Considerations" in this prospectus supplement and in   
the prospectus.                                                                 

 Ratings

The notes are required to receive the ratings indicated under the heading       
"Ratings" in the chart shown on page S-85 of this prospectus supplement.        

A note rating is not a recommendation to buy, sell or hold notes and may be     
subject to revision or withdrawal at any time by any rating agency. The ratings 
on the notes address the likelihood of the receipt by holders of the notes of   
all payments on the underlying mortgage loans to which they are entitled. They  
do not represent any assessment of the likelihood or rate of principal          
prepayments or the likelihood that any available funds shortfall (as described  
in this prospectus supplement) will be paid. See "Ratings."                     

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 The Statistical Mortgage Pool
 Approximate Statistical Mortgage Loan Characteristics

   The following tables summarize approximate characteristics of the pool of
statistical mortgage loans. When we refer to percentages of mortgage loans in   
the following tables, we are describing the percentage of the aggregate         
principal balance of the statistical mortgage loans as of November 1, 2005,     
which we refer to as the cut-off date. The sum of the percentages may not equal 
100.00% due to rounding.                                                        

                                                                [Download Table]
                                                                                
Number of statistical mortgage loans............................          4,402 
Aggregate outstanding principal balance of                                      
   statistical mortgage loans.......... ........................   $875,331,945 
Percentage of first lien statistical mortgage loans.............          96.12%
Percentage of second lien statistical mortgage loans............           3.88%
Percentage of adjustable rate statistical mortgage loans........          89.21%
Percentage of fixed rate statistical mortgage loans.............          10.79%

                                                        [Enlarge/Download Table]

                                                           Average or                       
                                                            Weighted                        
                                                             Average           Range        
                                                           ----------  ---------------------
                                                                                            
Outstanding principal balance(1)..........................  $198,849   $19,789 to $1,196,730
Original principal balance(1).............................  $198,943   $20,000 to $1,200,000
Current mortgage rates(2).................................    7.278%     6.150% to 10.990%  
Gross Margin(2)(3)........................................    5.729%     3.000% to 6.750%   
Maximum mortgage rates(2)(3)..............................   13.154%    12.150% to 16.600%  
Minimum mortgage rates(2)(3)..............................    7.154%     6.150% to 10.600%  
Initial Rate Cap(2)(3)....................................    2.985%      2.000% to 3.000%  
Periodic Rate Cap(2)(3)...................................    1.000%      1.000% to 1.000%  
Original loan-to-value ratio(2)(4)........................    82.40%     14.41% to 100.00%  
Credit Score(2)...........................................       650         502 to 815     
Original term to maturity (in months)(2)..................       353         180 to 360     
Stated remaining term to maturity (in months)(2)..........       351         176 to 360     
Seasoning (in months)(2)..................................         2           0 to 5       
Months to Roll(2).........................................        24          20 to 60      

----------                                                                      
(1)  Indicates average                                                          

(2)  Indicates weighted average                                                 

(3)  Applies to adjustable rate mortgage loans only                             

(4)  With respect to first lien mortgage loans, this refers to original         
loan-to-value ratios. With respect to second lien mortgage loans, this
refers to combined loan-to-value ratios.                              

                                                                [Download Table]
                                                                                
Number of statistical mortgage loans with prepayment                            
   penalties at origination.....................................          3,401 
Aggregate outstanding principal balance of statistical                          
   mortgage loans with prepayment penalties at origination......   $717,066,993 
Percentage of statistical mortgage loans with prepayment                        
   penalties at origination.....................................          81.92%
Weighted average prepayment term at origination for                             
   statistical loans with prepayment penalties (in months)......             25 

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Product Types for the Statistical Mortgage Loans

 [THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]

                                                        [Enlarge/Download Table]

   2/28         2/28      30/15      3/27         3/27          5/1             5/1                      
LIBOR ARM  LIBOR IO ARM  BALLOON  LIBOR ARM  LIBOR IO ARM  TREASURY ARM  TREASURY IO ARM  Fixed  Fixed IO
---------  ------------  -------  ---------  ------------  ------------  ---------------  -----  --------
                                                                                                         
  24.70%       52.29%     3.87%      4.07%       6.79%         0.28%          1.08%       5.85%    1.07% 

 Mortgage Rates for the Statistical Mortgage Loans

 [THE FOLLOWING TABLE WAS REPRESENTED BY A BAR GRAPH IN THE PRINTED MATERIAL.]

                                                        [Enlarge/Download Table]

6.001% to  6.501% to  7.001% to  7.501% to  8.001% to  8.501% to  9.001% to  9.501% to  10.001% to  10.501% to
  6.500%     7.000%     7.500%     8.000%     8.500%     9.000%     9.500%    10.000%     10.500%     11.000% 
---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  ----------  ----------
                                                                                                              
  19.68%     33.22%     18.57%     14.44%     4.81%      3.38%      1.80%      2.36%       1.21%       0.53%  

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 Outstanding Principal Balances for the Statistical Mortgage Loans

 [THE FOLLOWING TABLE WAS REPRESENTED BY A BAR GRAPH IN THE PRINTED MATERIAL.]

                                                        [Enlarge/Download Table]

$50,000   $50,001  $100,001  $150,001  $200,001  $250,001  $300,001  $350,001  $400,001  $450,001  $500,001
  or         to       to        to        to        to        to        to        to        to        or   
  less   $100,000  $150,000  $200,000  $250,000  $300,000  $350,000  $400,000  $450,000  $500,000   greater
-------  --------  --------  --------  --------  --------  --------  --------  --------  --------  --------
                                                                                                           
 1.27%     7.43%    12.39%    13.15%    10.58%    10.45%    10.77%     9.87%     6.89%     5.84%    11.35% 

 Credit Grade Summary for the Statistical Mortgage Loans

 [THE FOLLOWING TABLE WAS REPRESENTED BY A PIE CHART IN THE PRINTED MATERIAL.]

                                                                [Download Table]

  A      A-      B      C      D  
-----   ----   ----   ----   ---- 
                                  
93.50%  3.68%  1.98%  0.62%  0.22%

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 Original Loan-to-Value Ratios for the Statistical Mortgage Pool

 [THE FOLLOWING TABLE WAS REPRESENTED BY A BAR GRAPH IN THE PRINTED MATERIAL.]

                                                        [Enlarge/Download Table]

50.00%  50.01%  55.01%  60.01%  65.01%  70.01%  75.01%  80.01%  85.01%  90.01%   95.01%
  or      to      to      to      to      to      to      to      to      to       to  
less    55.00%  60.00%  65.00%  70.00%  75.00%  80.00%  85.00%  90.00%  95.00%  100.00%
------  ------  ------  ------  ------  ------  ------  ------  ------  ------  -------
                                                                                       
 0.79%   0.47%   0.85%   1.05%   2.74%   3.51%  47.96%  18.64%  16.53%   3.75%   3.71% 

 Credit Score Summary for the Statistical Mortgage Loans

 [THE FOLLOWING TABLE WAS REPRESENTED BY A BAR GRAPH IN THE PRINTED MATERIAL.]

                                                        [Enlarge/Download Table]

501 to  526 to  551 to  576 to  601 to  626 to  651 to  676 to  701 to  726 to  751 to  776 to  801 to
  525     550     575     600     625     650     675     700     725     750     757     800     825 
------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------  ------
                                                                                                      
 0.63%   2.52%   6.97%  10.27%  14.22%  14.33%  17.60%  15.20%   9.08%   5.21%   2.64%   1.13%   0.21%

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 Original Prepayment Penalty Term for the Statistical Mortgage Loans

 [THE FOLLOWING TABLE WAS REPRESENTED BY A BAR GRAPH IN THE PRINTED MATERIAL.]

                                                                [Download Table]

6 Months   12 Months   24 Months   30 Months   36 Months    None 
--------   ---------   ---------   ---------   ---------   ----- 
                                                                 
  1.13%      2.33%       67.05%      0.02%       11.40%    18.08%

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Risk Factors

 References herein to percentages of statistical mortgage loans refer in
each case to the percentage of the aggregate principal balance of all of the    
statistical mortgage loans in the mortgage pool (or in a particular group) as of
the cut-off date, based on the stated principal balances of such mortgage loans 
as of the cut-off date, after giving effect to scheduled payments due on or     
prior to the cut-off date, whether or not received.                             

Prepayments of the mortgage loans will affect the yield to maturity of the notes

The yield to maturity and weighted average life of the notes will be  
affected primarily by the rate and timing of principal payments (including      
prepayments, liquidations, repurchases and defaults) of, and losses on, the     
mortgage loans. Prepayment experience may be affected by many factors, including
general economic conditions, interest rates and the availability of alternative 
financing, homeowner mobility and the solicitation of borrowers to refinance    
their mortgage loans. In addition, substantially all of the mortgage loans      
contain due-on-sale provisions. The servicer or subservicer intends to enforce  
these provisions unless enforcement is not permitted by applicable law or the   
servicer or subservicer, as applicable, permits the purchaser of the related    
mortgaged property to assume the mortgage loan in a manner consistent with      
accepted servicing practices. To the extent permitted by applicable law, any    
assumption will not release the original borrower from its obligation under the 
mortgage loan. See "Yield, Prepayment and Maturity Considerations" in this      
prospectus supplement and "Certain Legal Aspects of the Mortgage                
Loans--'Due-on-Sale' Clauses" in the prospectus for a description of the        
provisions of the mortgage loans that may affect their prepayment experience.   

     The seller and its affiliates maintain customer retention programs that may
involve the solicitation of mortgage loan borrowers for possible loan           
refinancing. For example, a customer retention program may include the          
solicitation of all borrowers of the seller or its affiliates with adjustable   
rate mortgage loans that are approaching a scheduled rate reset date or         
borrowers of mortgage loans with a prepayment penalty period scheduled to       
expire. In addition, the seller and its affiliates may, from time to time,      
engage in general public solicitations for participation in various mortgage    
loan refinancing programs. Although solicitations related to customer retention 
programs or general refinancing solicitations will not be targeted specifically 
to the borrowers of the mortgage loans included in your trust, such borrowers   
may be included among those receiving such solicitations. Any refinancing of a  
mortgage loan may result in a prepayment of that mortgage loan and,             
consequently, may affect the weighted average life of the notes.                

 The yield on the notes will also be sensitive to the level of one-month
LIBOR and the level of the related mortgage index. In addition, the yield to    
maturity of any notes that you purchase at a discount or premium will be more   
sensitive to the rate and timing of payments thereon. You should consider, in   
the case of any notes that you purchase at a discount, the risk that a slower   
than anticipated rate of principal payments could result in an actual yield that
is lower than the anticipated yield and, in the case of any notes that you      
purchase at a premium, the risk that a faster than anticipated rate of principal
payments could result in an actual yield that is lower than the anticipated     
yield. Because approximately 81.92% of the statistical mortgage loans contain   
prepayment penalties, the rate of principal prepayments during the term of such 
prepayment penalties may be less than the rate of principal prepayments for     
mortgage loans that do not contain prepayment penalties; however, principal     
prepayments of the mortgage loans could be expected to increase, perhaps        
materially, at or near the time of the expiration of such prepayment penalties. 
We cannot make any representation as to the anticipated rate of prepayments on  
the mortgage loans, the amount and timing of losses on the mortgage loans, the  
likelihood of borrower refinancing (whether related to customer retention       
programs, refinancing solicitations or otherwise), the level of one-month LIBOR 
or the related mortgage index or the resulting yield to maturity of any notes.  
Any reinvestment risks resulting from a faster or slower incidence of           
prepayments on the mortgage loans will be borne entirely by the noteholders as  
described in this prospectus supplement. See "Yield, Prepayment and Maturity    
Considerations" in this prospectus supplement and "Description of the           
Securities--Maturity and Prepayment Considerations" and "Yield Considerations"  
in the prospectus.                                                              

The overcollateralization provisions of the trust will affect the yield to      
maturity of the notes                                                           

    The overcollateralization provisions of the trust will affect the weighted
average life of the notes and consequently the yield to maturity of the notes.  
In order to maintain the required level of overcollateralization,               

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monthly excess cashflow may be applied as payments of principal to the most     
senior class of notes then outstanding. This application of monthly excess      
cashflow will occur if the overcollateralization level is reduced below the     
required level due to losses on the mortgage loans, and it would have the effect
of reducing the weighted average lives of the notes. The actual required amount 
of overcollateralization may change from payment date to payment date, producing
uneven levels of accelerated payments in respect of principal under these       
circumstances. We cannot predict whether, or to what degree, it will be         
necessary to apply monthly excess cashflow as payments of principal in order to 
maintain the required amount of overcollateralization.                          

  Monthly excess cashflow generally is the excess of interest collected or
advanced on the mortgage loans and net swap receipts received in respect of the 
swap agreement over the interest required to pay interest on the notes and the  
trust expenses. Mortgage loans with higher interest rates will contribute more  
interest to the monthly excess cashflow. Mortgage loans with higher interest    
rates may prepay faster than mortgage loans with relatively lower interest rates
in response to a given change in market interest rates. Any disproportionate    
prepayments of mortgage loans that have higher interest rates may adversely     
affect the amount of monthly excess cashflow.                                   

As a result of the interaction of these factors, the effect of the    
overcollateralization provisions on the weighted average life of the notes may  
vary significantly over time. See "Yield, Prepayment and Maturity               
Considerations" in this prospectus supplement and "Description of the           
Securities--Maturity and Prepayment Considerations" and "Yield Considerations"  
in the prospectus.                                                              

Mortgage loans originated under the underwriting guidelines described in this   
prospectus supplement carry a risk of higher delinquencies                      

    The underwriting guidelines used in connection with the origination of the
mortgage loans in the trust consider the credit quality of a borrower and the   
value of the mortgaged property. The borrowers generally do not qualify for     
loans conforming to Fannie Mae or Freddie Mac guidelines.                       

As a result of the underwriting guidelines used in connection with the
origination of the mortgage loans in the trust, these mortgage loans are likely 
to experience rates of delinquency, foreclosure and bankruptcy that are higher, 
and that may be substantially higher, than those experienced by mortgage loans  
underwritten to Fannie Mae and Freddie Mac conforming guidelines. Similarly, an 
overall general decline in residential real estate values could cause a         
particularly severe decline in the value of the mortgaged properties relating to
mortgage loans in the Trust. We cannot provide any assurance that the mortgaged 
properties will not experience an overall decline in value.                     

Mortgage loans originated pursuant to stated income documentation programs may  
have a greater risk of default                                                  

Approximately 51.52% of the statistical mortgage loans in the mortgage
pool, and approximately 38.80% and 58.57% of the group 1 and group 2 statistical
mortgage loans, respectively (in each case, based on the aggregate scheduled    
principal balance of the related loan group as of the cut-off date), were       
originated pursuant to stated income documentation programs. Unlike full        
documentation programs, borrowers' income is not subject to verification under  
stated income programs. Therefore, stated income documentation mortgage loans   
may involve a greater risk of default than full documentation mortgage loans    
with income verification.                                                       

Hybrid adjustable-rate mortgage loans may experience faster prepayments than    
fixed rate mortgage loans                                                       

     The majority of the mortgage loans are adjustable rate mortgage loans, each
of which has a fixed interest rate for the first two, three or five years after 
origination, which then converts to an adjustable interest rate. This type of   
adjustable-rate mortgage loan is commonly referred to as a hybrid mortgage loan.
The prepayment experience on hybrid mortgage loans may differ from the          
prepayment experience on fixed-rate mortgage loans due to the effects of        
adjustable mortgage interest rates, periodic rate caps and maximum mortgage     
rates. In particular, hybrid mortgage loans may be subject to higher prepayment 
rates as they approach conversion to adjustable rates. As a hybrid mortgage loan
approaches its initial adjustment date, the borrower may become more likely to  
refinance that loan to avoid an increase in the loan rate, even if prevailing   
fixed-rate mortgage loans are only available at rates that are slightly lower or
higher than the mortgage interest rate before adjustment.                       

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The interest rate indices for the mortgage loans and on the notes differ and the
interest rates on the mortgage loans and the notes adjust at different intervals

    The interest rates on the notes other than the class M10, class M11, class
M12 and class M13 notes are calculated based upon the value of an index         
(one-month LIBOR) which is different from the value of the index applicable to  
substantially all of the mortgage loans (six-month LIBOR) in the mortgage pool  
as described under "The Mortgage Pool--General." As a result, the interest rates
on the notes, other than the class M10, class M11, class M12 and class M13      
notes, are subject to the available funds rate and a fixed rate cap. The class  
M10, class M11, class M12 and class M13 notes are subject to the available funds
rate.                                                                           

  The available funds rate limits the interest rate payable on the related
notes with respect to a related payment date. Any shortfalls arising from the   
application of the available funds rate will be carried over as described herein
with accrued interest at the then-applicable interest rate (computed without    
regard to the available funds rate) and, if available, paid from excess cash    
flow, which includes net swap receipts received by the trust in respect of the  
swap agreement, on a later payment date. Various factors may cause the available
funds rate described above to limit the interest rate on the related notes.     
First, this can result if one-month LIBOR increases more rapidly than six-month 
LIBOR or the treasury mortgage index, as applicable. In addition, the interest  
rates on the notes other than the class M10, class M11, class M12 and class M13 
notes adjust monthly, while the interest rates on the mortgage loans adjust less
frequently, with the result that the operation of the available funds rate      
described above may cause the interest rates on these notes to be reduced for   
extended periods in a rising interest rate environment. Certain of the mortgage 
loans are subject to periodic (i.e., semi-annual or annual) adjustment caps and 
maximum rate caps, and the weighted average margin is subject to change based   
upon prepayment experience, which also may result in the available funds rate   
described above limiting increases in the interest rates for these notes.       
Consequently, the interest paid on the mortgage loans (net of the sum of the    
servicing fee, the master servicing fee, the owner trustee fee and certain other
expenses) with respect to any payment date may not equal the amount of interest 
that would accrue at one-month LIBOR plus the applicable margin on the notes    
other than the class M10, class M11, class M12 and class M13 notes plus the     
amount of interest that would accrue on the class M10, class M11, class M12 and 
class M13 notes during the related period. Furthermore, if the available funds  
rate described above determines the interest rate for a class of notes for a    
payment date, the market value of those notes may be temporarily or permanently 
reduced.                                                                        

  The interest rates on the class 1-A, class 2-A1, class 2-A2, class 2-A3,
class M1, class M2, class M3, class M4, class M5, class M6, class M7, class M8  
and class M9 notes are also subject to a fixed rate cap, which limits the       
interest rate on such notes to a per annum rate of 12.250%. If the interest rate
for a class of notes for a payment date is limited by the maximum fixed rate,   
the market value of those notes may be temporarily or permanently reduced.      

The risks associated with the swap agreement                                    

    Any net swap receipts received under the swap agreement will be applied to
pay principal, interest and available funds shortfalls as described in this     
prospectus supplement. However, no net swap receipts will be payable by the swap
counterparty unless the swap floating rate amount owed by the swap counterparty 
on a payment date exceeds the swap fixed rate amount owed to the swap           
counterparty. This will not occur except in periods when one-month LIBOR exceeds
4.358% per annum. We cannot assure you that any amounts will be received under  
the swap agreement, or that any such amounts that are received will be          
sufficient to cover payments to be made in respect of the notes.                

  In addition, any net swap payment payable to the swap counterparty under
the terms of the swap agreement will reduce amounts available for payment to the
noteholders, and may reduce payments of interest and principal on the notes. If 
the rate of prepayments on the mortgage loans is faster than anticipated, the   
swap notional balance on which payments due under the swap agreement are        
calculated may exceed the total principal balance of the mortgage loans, thereby
increasing the relative proportion of interest and principal collections on the 
mortgage loans that must be applied to make swap payments to the swap           
counterparty. Therefore, the combination of a rapid rate of prepayment and low  
prevailing interest rates could adversely affect the yields on the notes.       

In the event that the trust, after application of all interest and    
principal received on the mortgage loans available to pay the swap counterparty,
cannot make the required net swap payments to the swap counterparty, a          

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swap termination amount will be owed to the swap counterparty. Any swap         
termination amount payable to the swap counterparty in the event of early       
termination of the swap agreement will reduce amounts available for payment to  
noteholders. See "Description of the Notes--Payments" and "--The Swap           
Agreement."                                                                     

The swap agreement is subject to swap counterparty risk                         

As of the date of this prospectus supplement, Moody's rates the swap  
counterparty's long-term certificates of deposit as "Aa1" and short-term        
certificates of deposit as "P-1;" S&P rates the swap counterparty's long-term   
certificates of deposit as "AA-" and its short-term certificates of deposit as  
"A-1+;" Fitch rates long-term certificates of deposit of the swap counterparty  
as "AA" and short-term certificates of deposit as "F1+." The ratings on the     
notes are dependent in part upon the credit ratings of the swap counterparty. If
a credit rating of the swap counterparty is qualified, reduced or withdrawn and 
the swap counterparty fails to post required collateral, a substitute swap      
counterparty or credit support provider is not obtained or any other arrangement
sufficient to restore the credit ratings of the notes is not established, in    
each case in accordance with the terms of the swap agreement, the ratings of the
notes may be qualified, reduced or withdrawn. In such event, the value and      
marketability of the notes will be adversely affected.                          

Inadequate amount of subsequent mortgage loans will affect the timing and rate  
of return on your investment                                                    

   If the amount of subsequent mortgage loans purchased for a mortgage group
by the trust is less than the amount deposited in the pre-funding account for   
that group on the closing date, holders of the class or classes of class A notes
related to that group will receive a payment of principal of the amount         
remaining in the pre-funding account allocated to that group on the payment date
occurring in February 2006. To the extent that there are significant amounts on 
deposit in the pre-funding account following the expiration of the pre-funding  
period, the holders of the Class A Notes entitled to payments of principal will 
receive significant prepayments which may adversely affect their yield.         

Prepayment interest shortfalls may reduce your yield                            

  When a mortgage loan is prepaid, the borrower is charged interest on the
amount prepaid only up to the date on which the prepayment is made, rather than 
for an entire month. This may result in a shortfall in interest collections     
available for payment on the next payment date. The servicer is required to     
cover a portion of the shortfall in interest collections that are attributable  
to prepayments on the mortgage loans, but only up to the amount of the          
servicer's servicing fee for the related calendar month.                        

   On any payment date, any prepayment interest shortfalls to the extent not
covered by compensating interest paid by the servicer will result in a lower    
available funds rate, which could adversely affect the yield on the related     
notes.                                                                          

Recent developments may increase risk of loss on the mortgage loans             

   The Servicemembers Civil Relief Act was signed into law in December 2003,
revising the Soldiers' and Sailors' Civil Relief Act of 1940. The Servicemembers
Civil Relief Act and comparable state legislation provide relief to borrowers   
who enter active military service and to borrowers in reserve status who are    
called to active duty after the origination of their mortgage loans. Certain    
state laws provide relief similar to that of the Servicemembers Civil Relief Act
and may permit the borrower to delay or forego certain interest and principal   
payments. The response of the United States to the terrorist attacks on         
September 11, 2001 and to the current situation in Iraq has involved military   
operations that have placed a substantial number of citizens on active duty     
status, including persons in reserve status or in the National Guard who have   
been called or will be called to active duty. It is possible that the number of 
reservists and members of the National Guard placed on active duty status in the
near future may increase. The Servicemembers Civil Relief Act provides generally
that a borrower who is covered by the Servicemembers Civil Relief Act may not be
charged interest on a mortgage loan in excess of 6% per annum during the period 
of the borrower's active duty. These shortfalls are not required to be paid by  
the borrower at any future time. The master servicer, the servicer and the      
subservicer will not advance these shortfalls as delinquent payments and such   
shortfalls are not covered by any form of credit enhancement on the notes.      
Shortfalls on the mortgage                                                      

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loans due to the application of the Servicemembers Civil Relief Act or similar  
state legislation or regulations will reduce the amount of collections available
for payment on the notes.                                                       

   The Servicemembers Civil Relief Act also limits the ability of a servicer
to foreclose on a mortgage loan during the borrower's period of active duty and,
in some cases, during an additional three-month period thereafter. As a result, 
there may be delays in payment and increased losses on the mortgage loans. Those
delays and increased losses will be borne primarily by the outstanding class of 
notes with the lowest payment priority.                                         

    We do not know how many mortgage loans have been or may be affected by the
application of the Servicemembers Civil Relief Act or any similar state         
legislation. See "Certain Legal Aspects of the Mortgage Loans--Servicemembers   
Civil Relief Act and Similar State-Enacted Legislation" in the prospectus.      

The protection accorded to your notes by subordination is limited               

  The rights of the class M1 notes to receive payments with respect to the
mortgage loans will be subordinate to the rights of the class A notes to receive
those payments; the rights of the class M2 notes to receive payments with       
respect to the mortgage loans will be subordinate to the rights of the class A  
and the class M1 notes to receive those payments; the rights of the class M3    
notes to receive payments with respect to the mortgage loans will be subordinate
to the rights of the class A, class M1 and class M2 notes to receive those      
payments; the rights of the class M4 notes to receive payments with respect to  
the mortgage loans will be subordinate to the rights of the class A, class M1,  
class M2 and class M3 notes to receive those payments; the rights of the class  
M5 notes to receive payments with respect to the mortgage loans will be         
subordinate to the rights of the class A, class M1, class M2, class M3 and class
M4 notes to receive those payments; the rights of the class M6 notes to receive 
payments with respect to the mortgage loans will be subordinate to the rights of
the class A, class M1, class M2, class M3, class M4 and class M5 notes to       
receive those payments; the rights of the class M7 notes to receive payments    
with respect to the mortgage loans will be subordinate to the rights of the     
class A, class M1, class M2, class M3, class M4, class M5 and class M6 notes to 
receive those payments; the rights of the class M8 notes to receive payments    
with respect to the mortgage loans will be subordinated to the rights of the    
class A, class M1, class M2, class M3, class M4, class M5, class M6 and class M7
notes to receive those payments; the rights of the class M9 notes to receive    
payments with respect to the mortgage loans will be subordinated to the rights  
of the class A, class M1, class M2, class M3, class M4, class M5, class M6,     
class M7 and class M8 notes to receive those payments; the rights of the class  
M10 notes to receive payments with respect to the mortgage loans will be        
subordinated to the rights of the class A, class M1, class M2, class M3, class  
M4, class M5, class M6, class M7, class M8 and class M9 notes to receive those  
payments; the rights of the class M11 notes to receive payments with respect to 
the mortgage loans will be subordinated to the rights of the class A, class M1, 
class M2, class M3, class M4, class M5, class M6, class M7, class M8, class M9  
and class M10 notes to receive those payments; the rights of the class M12 notes
to receive payments with respect to the mortgage loans will be subordinated to  
the rights of the class A, class M1, class M2, class M3, class M4, class M5,    
class M6, class M7, class M8, class M9, class M10 and class M11 notes to receive
those payments; and the rights of the class M13 notes to receive payments with  
respect to the mortgage loans will be subordinated to the rights of the class A,
class M1, class M2, class M3, class M4, class M5, class M6, class M7, class M8, 
class M9, class M10, class M11 and class M12 notes to receive those payments.   
This subordination is intended to enhance the likelihood of regular receipt by  
higher-ranking classes of notes of the full amount of the monthly payments      
allocable to them, and to afford protection against losses.                     

   If realized losses are incurred with respect to the mortgage loans to the
extent that the aggregate principal amount of the notes exceeds the stated      
principal balances of the mortgage loans, the class M notes, in reverse order of
seniority (first to the class M13 notes, second to the class M12 notes, third to
the class M11 notes, fourth to the class M10 notes, fifth to the class M9 notes,
sixth to the class M8 notes, seventh to the class M7 notes, eighth to the class 
M6 notes, ninth to the class M5 notes, tenth to the class M4 notes, eleventh to 
the class M3 notes, twelfth to the class M2 notes and thirteenth to the class M1
notes) may never receive that principal and interest. If realized losses on the 
mortgage loans exceed certain levels, a portion of the interest due on each     
class of class M notes will be deferred and paid after certain other payments   
are made to restore overcollateralization and to pay available funds shortfalls 
to the notes. Investors should fully consider the risks associated with an      
investment in the class M notes, including the possibility that investors may   
not fully recover their initial investment as a result of realized losses.      

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Potential inadequacy of credit enhancement                                      

   The notes are not insured by any financial guaranty insurance policy. The
excess interest (including any net swap receipts under the interest rate swap   
agreement), overcollateralization, subordination and limited                    
cross-collateralization features are intended to enhance the likelihood that    
holders of more senior classes will receive regular payments of interest and    
principal, but are limited in nature and may be insufficient to cover all       
shortfalls and losses on the mortgage loans.                                    

The seller may not be able to repurchase defective mortgage loans               

   The seller has made various representations and warranties related to the
mortgage loans sold by it to the trust. Those representations are summarized in 
"The Mortgage Loan Purchase Agreement and the Transfer and Servicing            
Agreement--Assignment of Mortgage Loans."                                       

  If the seller fails to cure a material breach of its representations and
warranties with respect to any mortgage loan in a timely manner, then the seller
would be required to repurchase or substitute for the defective mortgage loan.  
It is possible that the seller may not be capable of repurchasing or            
substituting any defective mortgage loans, for financial or other reasons. The  
inability of the seller to repurchase or substitute for defective mortgage loans
would likely cause the mortgage loans to experience higher rates of             
delinquencies, defaults and losses. As a result, shortfalls in the payments due 
on the notes could occur.                                                       

Mortgage loans with interest-only payments                                      

Approximately 61.22% of all of the statistical mortgage loans and     
approximately 61.29% and 61.19% of the statistical mortgage loans to be included
in group 1 and group 2, respectively, provide for payment of interest at the    
related mortgage interest rate, but no payment of principal for approximately   
the first five years following the origination of the mortgage loan. Following  
such interest-only period, the monthly payment with respect to each of these    
mortgage loans will be increased to, and include a portion allocable to         
principal in, an amount sufficient to amortize the principal balance of the     
mortgage loan over the remaining term and to pay interest at the mortgage       
interest rate. The presence of these mortgage loans in group 1 and group 2 will,
absent other considerations, result in longer weighted average lives of the     
related notes than would have been the case had these loans not been included in
the mortgage pool. If you purchase such notes at a discount, you should consider
that the extension of weighted average lives could result in a lower yield than 
would be the case if these mortgage loans provided for the payment of principal 
and interest on every payment date. In addition, a borrower may view the absence
of any obligation to make payment of principal during such period as a          
disincentive to prepayment. If a recalculated monthly payment as described above
is substantially higher than a borrower's previous interest-only monthly        
payment, that loan may be subject to an increased risk of delinquency, loss     
and/or prepayment.                                                              

Second lien mortgage loans may have a greater risk of default                   

Approximately 3.88% of all of the statistical mortgage loans and      
approximately 2.94% and 4.40% of the statistical mortgage loans to be included  
in group 1 and group 2 are secured by second liens on the related mortgage      
properties. The proceeds from any liquidation, insurance or condemnation        
proceedings will be available to satisfy the outstanding principal balance of   
such mortgage loans only to the extent that the claims of the related senior    
mortgages have been satisfied in full, including any related foreclosure costs. 
In circumstances when it has been determined to be uneconomical to foreclose on 
the mortgaged property, the master servicer may not be able to recover the      
entire outstanding balance of the mortgage loan, and may write off the          
outstanding balance as bad debt. The foregoing considerations will be           
particularly applicable to mortgage loans secured by second liens that have high
combined loan-to-value ratios because it is comparatively more likely that the  
master servicer would deem foreclosure to be uneconomical in the case of such   
mortgage loans. In addition, the rate of default of second lien mortgage loans  
may be greater than that of mortgage loans secured by first liens on comparable 
properties.                                                                     

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Mortgage loans with balloon payments                                            

Approximately 3.87% of all of the statistical mortgage loans and      
approximately 2.93% and 4.39% of the aggregate principal balance of the         
statistical mortgage loans to be included in group 1 and group 2, respectively, 
are mortgage loans that provide for the payment of any remaining unamortized    
principal balance in a single payment, or balloon loans. If the borrower is     
unable to repay the mortgage loan at maturity or refinance the amount owed, you 
may suffer a loss if the collateral for the mortgage loan is insufficient and   
the other forms of credit enhancement are insufficient or unavailable to cover  
the loss.                                                                       

Mortgage loans with high original loan-to-value ratios may present a greater    
risk of loss                                                                    

     Approximately 35.17% of the statistical mortgage loans in the mortgage pool
had original loan-to-value ratios (or with respect to the second lien mortgage  
loans, combined loan-to-value ratios) of greater than 80% but less than or equal
to 90%, and approximately 7.46% of the statistical mortgage loans had original  
loan-to-value ratios (or with respect to the second lien mortgage loans,        
combined loan-to-value ratios) of greater than 90%, but less than or equal to   
100%. Mortgage loans with high loan-to-value ratios may be more likely to       
experience borrower default and foreclosure than mortgage loans with low        
original loan-to-value ratios or combined loan-to-value ratios. Moreover, a high
rate of foreclosure on mortgage loans with high original loan-to-value ratios or
combined loan-to-value ratios is likely to result in significant losses on such 
mortgage loans and is more likely to be subject to a judicial reduction of the  
loan amount in bankruptcy or other proceedings than mortgage loans with lower   
original loan-to-value ratios or combined loan-to-value ratios. If a court      
relieves a borrower's obligation to repay amounts otherwise due on a mortgage   
loan, neither the servicer, the subservicer nor the master servicer will be     
required to advance funds in respect of such relieved amounts, and any loss in  
respect thereof may reduce the amount available to be paid to noteholders. In   
such event, holders of subordinate classes of notes may suffer losses.          

Mortgage loans with simultaneous second liens and mortgage loans with higher    
combined loan-to-value ratios may be subject to higher levels of default        

   At the time of origination, the related borrowers of approximately 56.06%
of the statistical mortgage loans, and approximately 46.33% and 61.45% of the   
statistical mortgage loans to be included in group 1 and group 2, respectively, 
obtained second lien mortgage loans secured by the same mortgaged properties as 
secure the borrowers' mortgage loans included in the trust. Approximately 55.29%
of the statistical mortgage loans in the statistical mortgage pool, and         
approximately 45.56% and 60.67% of the statistical mortgage loans to be included
in group 1 and group 2, respectively, have combined loan-to-value ratios that   
exceed 95%. Mortgage loans with higher combined loan-to-value ratios may        
experience higher rates of default than loans with lower combined loan-to-value 
ratios due to the limited equity of the related borrowers in the related        
mortgaged properties. Investors also should be aware that borrowers may obtain  
secondary mortgage financing secured by their mortgaged properties following the
date of origination of the mortgage loans included in the trust.                

The geographic concentration of mortgage loans means your investment may be     
especially sensitive to economic conditions and other factors particular to the 
areas of concentration                                                          

  As of the cut-off date, approximately 40.32% of the statistical mortgage
loans, and approximately 23.29% and 49.76% of the statistical mortgage loans to 
be included in group 1 and group 2, respectively, of the mortgaged properties   
were located in California. An overall decline in the California residential    
real estate market could adversely affect the values of the mortgaged properties
securing the related mortgage loans. As the residential real estate market is   
influenced by many factors, including the general condition of the economy and  
interest rates, we cannot assure you that the California residential real estate
market will not weaken. If the California residential real estate market should 
experience an overall decline in property values, the rates of losses on the    
related mortgage loans would be expected to increase, and could increase        
substantially. In addition, properties in California may be more susceptible    
than homes located in other parts of the country to certain types of uninsurable
hazards, such as wildfires, as well as floods, earthquakes, mudslides and other 
natural disasters.                                                              

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Recent hurricanes and tropical storms may have caused damage to certain         
mortgaged properties or may affect the ability of borrowers to make payments on 
their mortgage loans                                                            

Properties located in certain parts of the United States, particularly
certain states located in the Gulf Coast region of the United States, were      
affected by recent hurricanes and tropical storms during the 2005 hurricane     
season. Any damage to mortgaged properties as a result of the recent hurricanes 
or tropical storms may or may not be covered by the related hazard insurance    
policies The seller has conducted a preliminary review of mortgaged properties  
located in Louisiana parishes and Mississippi, Alabama and Florida counties     
designated as disaster areas by the Federal Emergency Management Agency. Based  
on that review, the seller has determined that mortgaged properties located in  
those designated areas have not experienced significant damage. No assurance can
be given as to the effect of these storms or future storms on the rate of       
delinquencies and losses on the mortgage loans secured by mortgaged properties  
that were or may be affected by recent hurricanes or tropical storms. The seller
will be obligated to repurchase any mortgage loan if the related property       
incurred material damage prior to the closing date, with respect to the initial 
mortgage loans, or prior to the related subsequent cut-off date, with respect to
the subsequent mortgage loans, and this damage has a material adverse affect on 
the interest of noteholders in the mortgage loan. The full economic impact of   
damage sustained during the 2005 hurricane season is uncertain but may affect   
the ability of borrowers to make payments on their mortgage loans. We have no   
way to determine the particular nature of such economic effects, how long any of
these effects may last, or how these effects may affect the performance of the  
mortgage loans. Any adverse impact as a result of these events may be borne by  
the holders of the notes, particularly if the seller fails to repurchase any    
affected mortgage loan.                                                         

Delays and expenses connected with the liquidation of mortgaged properties may  
result in losses to you                                                         

   Even assuming that the mortgaged properties provide adequate security for
the mortgage loans, there could be substantial delays in connection with the    
liquidation of mortgage loans that are delinquent and resulting shortfalls in   
payments to you could occur. Further, liquidation expenses, such as legal fees, 
real estate taxes and maintenance and preservation expenses, will reduce the    
security for the mortgage loans and thereby reduce the proceeds payable to you. 
If any of the mortgaged properties fail to provide adequate security for the    
related mortgage loans, you could experience a loss, particularly if you are a  
holder of one of the most subordinate classes.                                  

Ratings on the notes do not address all of the factors you should consider when 
purchasing notes                                                                

     The rating of each class of notes will depend primarily on an assessment by
the rating agencies of the mortgage loans as well as the structure of the       
transaction. The rating by the rating agencies of any class of notes is not a   
recommendation to purchase, hold or sell any rated notes, inasmuch as the rating
does not comment as to the market price or suitability for a particular         
investor. There is no assurance that the ratings will remain in place for any   
given period of time or that the ratings will not be qualified, lowered or      
withdrawn by the rating agencies. In general, the ratings address credit risk   
and do not address the likelihood of prepayments or the likelihood that any     
shortfalls will be paid. See "Ratings" in this prospectus supplement.           

Collections on the mortgage loans may be delayed or reduced if the seller or the
servicer becomes insolvent                                                      

   The transfer of the mortgage loans from Fieldstone Investment Corporation
to Fieldstone Mortgage Investment Corporation, will be treated as a sale of the 
mortgage loans. However, in the event of an insolvency of Fieldstone Investment 
Corporation, the conservator, receiver or trustee in bankruptcy of such entity  
may attempt to recharacterize the mortgage loan sales as a borrowing, secured by
a pledge of the applicable mortgage loans. If these transfers were to be        
challenged, delays in payments of the notes and reductions in the amounts of    
these payments could occur.                                                     

   In the event of a bankruptcy or insolvency of Fieldstone Servicing Corp.,
as servicer, the bankruptcy trustee or receiver may have the power to prevent   
Wells Fargo Bank, N.A., as master servicer, from appointing a successor         
servicer. Regardless of whether a successor servicer is appointed, any          
termination of Fieldstone Servicing Corp., as servicer (whether due to          
bankruptcy or insolvency or otherwise), could adversely affect the servicing of 
the mortgage loans, including the delinquency experience of the mortgage loans. 

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The lack of physical notes may cause delays in payments and cause difficulty in 
pledging or selling the notes                                                   

    The notes will not be issued in physical form. Noteholders will be able to
transfer notes only through The Depository Trust Company, participating         
organizations, indirect participants and certain banks. The ability to pledge a 
note to a person that does not participate in The Depository Trust Company may  
be limited because of the lack of a physical note. In addition, noteholders may 
experience some delay in receiving payments on these notes because the trust    
administrator will not send payments directly to them. Instead, the trust       
administrator will send all payments to The Depository Trust Company, which will
then credit those payments to the participating organizations. Those            
organizations will in turn credit accounts noteholders have either directly or  
indirectly through indirect participants.                                       

The notes may be inappropriate for individual investors                         

   The notes may not be an appropriate investment for you if you do not have
sufficient resources or expertise to evaluate the particular characteristics of 
the applicable class of notes. This may be the case because, among other things:

 o    The yield to maturity of notes purchased at a price other than par
   will be sensitive to the uncertain rate and timing of principal
prepayments on the mortgage loans;                          

   o    The rate of principal payments on, and the weighted average life of,
   the notes will be sensitive to the uncertain rate and timing of
   principal prepayments on the mortgage loans and the priority of
       principal payments among the classes of notes, and for that reason,
       the notes may be inappropriate investments for you if you require a
        payment of a particular amount of principal on a specific date or an
otherwise predictable stream of payments;                   

   o    You may not be able to reinvest amounts paid in respect of principal
   on a note (which, in general, are expected to be greater during
        periods of relatively low interest rates) at a rate at least as high
as the interest rate on your notes; or                      

    o    It is possible that a secondary market for the notes will not develop
      or that your investment may not be liquid. Lack of liquidity could
       result in a substantial decrease in the market value of your notes.

You should also carefully consider the further risks and other special
considerations discussed above and under the heading "Yield, Prepayment and     
Maturity Considerations" in this prospectus supplement, and in the prospectus   
under the heading "Risk Factors."                                               

The notes lack SMMEA eligibility and may lack liquidity, which may limit your   
ability to sell your notes                                                      

   The underwriters intend to make a secondary market in the notes, but will
have no obligation to do so. We cannot assure you that a secondary market for   
any class of notes will develop, or if one does develop, that it will continue  
or provide sufficient liquidity of investment or that it will remain for the    
term of the related class of notes. None of the notes will constitute "mortgage 
related securities" for purposes of the Secondary Mortgage Market Enhancement   
Act of 1984, as amended. Accordingly, many institutions with legal authority to 
invest in SMMEA securities will not be able to invest in the notes, thereby     
limiting the market for the notes. In light of these risks, you should consult  
your own counsel as to whether you have the legal authority to invest in        
non-SMMEA notes such as the notes. See "Legal Investment" in this prospectus    
supplement and "Legal Investment Considerations" in the prospectus.             

Violations of federal, state and local laws may result in shortfalls on the     
mortgage loans                                                                  

Federal, state and local laws regulate the underwriting, origination, 
servicing and collection of the mortgage loans. These laws have changed over    
time and have become more restrictive or stringent with respect to specific     
activities of the servicers and the originators. Actual or alleged violations of
these federal, state and local laws may, among other things:                    

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     o    limit the ability of the servicers to collect principal or interest on
the mortgage loans,                                         

o    provide the borrowers with a right to rescind the mortgage loans,

o    entitle the borrowers to refunds of amounts previously paid or to
set-off those amounts against their loan obligations,       

    o    result in a litigation proceeding (including class action litigation)
being brought against the trust, and                        

 o    subject the trust to liability for expenses, penalties and damages
resulting from the violations.                              

As a result, these violations or alleged violations could result in   
shortfalls in the payments due on your notes. See "Certain Legal Aspects of the 
Mortgage Loans" in the prospectus.                                              

A violation of anti-predatory lending laws may result in losses on the mortgage 
loans                                                                           

    None of the mortgage loans are "High Cost Loans" within the meaning of the
Home Ownership and Equity Protection Act of 1994. In addition to the Home       
Ownership and Equity Protection Act of 1994, however, a number of legislative   
proposals have been introduced at the federal, state and local levels that are  
designed to discourage predatory lending practices. Some states and localities  
have enacted, or may enact, laws or regulations that prohibit inclusion of some 
provisions in mortgage loans that have mortgage rates or origination costs in   
excess of prescribed levels, and require that borrowers be given certain        
disclosures prior to the consummation of such mortgage loans. In some cases,    
state or local law may impose requirements and restrictions greater than those  
in the Home Ownership and Equity Protection Act of 1994. Approximately 1.31% of 
the statistical mortgage loans, and approximately 1.81% and 1.03% of the        
statistical mortgage loans included in group 1 and group 2, respectively, are   
subject to anti-predatory lending laws in Massachusetts related to the          
origination of mortgage loans in connection with refinancings. Massachusetts law
provides that a lender may not originate a mortgage loan for the purpose of     
refinancing all or part of an existing mortgage loan that was originated within 
a specified period of time prior to the refinancing unless the refinancing is in
the borrower's interest. The Massachusetts statute identifies a number of       
factors to be considered in determining whether the refinancing is in the       
borrower's interest. The determination is highly subjective and the burden is on
the lender to determine and demonstrate that the refinancing is in the related  
borrower's interest.                                                            

  Any failure to comply with any anti-predatory lending laws could subject
the trust, and other assignees of the mortgage loans, to monetary penalties and 
could result in a rescission of the related mortgage loans. Lawsuits have been  
brought in various states making claims against assignees of High Cost Loans for
violations of state law. Named defendants in these cases include numerous       
participants within the secondary mortgage market, including some securitization
trusts. The seller has represented to the trust that the mortgage loans do not  
violate the Home Ownership and Equity Protection Act of 1994 or any similar     
federal, state or local laws, including the Massachusetts anti-predatory lending
statute. The Seller will be obligated to repurchase any mortgage loan that is   
determined to be in violation of any such anti-predatory lending law. If,       
however, the Seller is unable or unwilling to repurchase any such mortgage loan,
the trust may experience losses resulting from certain remedies for such        
violation, including possible rescission of the related mortgage loan.          

Trust could become a taxable entity, resulting in reduced cash flow available to
make payment on your notes                                                      

    For U.S. federal income tax purposes, the trust will be a taxable mortgage
pool. As long as the sole class of equity interest in a taxable mortgage pool is
owned exclusively by an entity that qualifies as a "real estate investment      
trust" or a "qualified REIT subsidiary" under the rules set out in the Internal 
Revenue Code of 1986, as amended, or as an entity that is disregarded for       
federal income purposes that is wholly-owned by a real estate investment trust  
or a qualified REIT subsidiary, such entity referred to herein as a "qualifying 
REIT entity," the taxable mortgage pool will not be subject to federal income   
tax. The seller will hold through Fieldstone Mortgage Ownership Corp., its      
direct, wholly-owned qualified REIT subsidiary, a 100% ownership interest in the
ownership certificate. The seller represents that it qualifies as a real estate 
investment trust and that it will not undertake any action that would cause the 
trust to be subject to federal income tax. Under the terms of the trust         
agreement, the ownership certificate only                                       

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may be (i) transferred to an entity that qualifies as a qualifying REIT entity  
or (ii) pledged to secure indebtedness or be the subject of a repurchase        
agreement treated by the trust as secured indebtedness for federal income tax   
purposes. The provisions of the Internal Revenue Code of 1986, as amended,      
pertaining to real estate investment trusts are, however, highly technical and  
complex. If the seller were to fail to qualify as a real estate investment      
trust, or if the seller were to transfer the ownership certificate (or any      
retained notes that were not characterized as indebtedness for federal income   
tax purposes) to an entity that did not qualify as a qualifying REIT entity,    
including because of a default and foreclosure under a secured lending or       
repurchase agreement, the trust could become subject to federal income tax as   
though it were a corporation. Any tax imposed on the trust would reduce cash    
flow that would otherwise be available to make payments on the notes and could  
cause losses which could adversely affect the notes, in particular the          
subordinate notes. The failure of the holder of the ownership certificate to    
qualify as a qualifying REIT entity would constitute an event of default under  
the indenture. See "Federal Income Tax Consequences" and "The Trust Agreement   
and the Indenture--Certain Matters under the Agreements--Redemption" in this    
prospectus supplement.                                                          

Forward-Looking Statements

In this prospectus supplement and the attached prospectus, we use     
forward-looking statements. These forward-looking statements are found in the   
material, including each of the tables, set forth under "Risk Factors" and      
"Yield, Prepayment and Maturity Considerations." Forward-looking statements are 
also found elsewhere in this prospectus supplement and the prospectus and       
include words like "expects," "intends," "anticipates," "estimates" and other   
similar words. These statements are inherently subject to a variety of risks and
uncertainties. Actual results may differ materially from those we anticipate due
to changes in, among other things:                                              

o    economic conditions and industry competition;                    

o    political, social and economic conditions;                       

o    the law and government regulatory initiatives; and               

o    interest rate fluctuations.                                      

We will not update or revise any forward-looking statements to reflect
changes in our expectations or changes in the conditions or circumstances on    
which these statements were originally based.                                   

Glossary

  A glossary of defined terms used in this prospectus supplement begins on
page S-86.                                                                      

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 The Mortgage Pool

General                                                                         

  The statistical mortgage pool with respect to the notes consisted, as of
the Cut-off Date, of approximately 4,402 conventional mortgage loans evidenced  
by promissory notes having an aggregate principal balance of approximately      
$875,331,945. The statistical mortgage pool consists of the Initial Mortgage    
Loans and certain of the Mortgage Loans that are expected to be included among  
the Subsequent Mortgage Loans to be delivered by the Seller during the          
Pre-Funding Period. The statistical mortgage pool will be divided into two      
groups, referred to as Group 1 and Group 2. Group 1, representing approximately 
35.65% of the statistical mortgage pool as of the Cut-off Date, will consist of 
first lien and second lien, conventional, adjustable rate and fixed rate        
mortgage loans that had a principal balance at origination of no more than      
$359,650 if a single-unit property (or $539,475 if the property is located in   
Hawaii or Alaska), $460,400 if a two-unit property (or $690,600 if the property 
is located in Hawaii or Alaska), $556,500 if a three-unit property (or $834,750 
if the property is located in Hawaii or Alaska), or $691,600 if a four-unit     
property (or $1,037,400 if the property is located in Hawaii or Alaska) and with
respect to second lien fixed rate mortgage loans, mortgage loans that had a     
principal balance at origination of no more than $179,825 (or $269,773.50 if the
property is located in Hawaii or Alaska). Group 2, representing approximately   
64.35% of the statistical mortgage pool as of the Cut-off Date, will consist of 
first lien and second lien, conventional, adjustable rate and fixed rate        
mortgage loans that had a principal balance at origination that may or may not  
conform to the criteria specified above for mortgage loans included in Group 1. 

The Class 1-A Notes will generally be payable out of cash flows       
attributable to the Group 1 Mortgage Loans. The Class 2-A1, Class 2-A2 and Class
2-A3 Notes will generally be payable out of cash flows attributable to Group 2  
Mortgage Loans. The Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, 
Class M7, Class M8, Class M9, Class M10, Class M11, Class M12 and Class M13     
Notes will generally be payable out of cash flows attributable to the Group 1   
and Group 2 Mortgage Loans.                                                     

 References herein to percentages of Statistical Mortgage Loans refer in
each case to the percentage of the aggregate principal balance of all of the    
Statistical Mortgage Loans in the statistical mortgage pool (or in a particular 
group) as of the Cut-off Date, based on the Stated Principal Balances of such   
Statistical Mortgage Loans as of the Cut-off Date, after giving effect to       
Scheduled Payments due on or prior to the Cut-off Date, whether or not received.
References to percentages of mortgaged properties refer, in each case, to the   
percentages of aggregate Stated Principal Balances of the related Statistical   
Mortgage Loans (determined as described in the preceding sentence). The         
information with respect to the Statistical Mortgage Loans set forth in this    
prospectus supplement is approximate statistical information as of the Cut-off  
Date. Prior to or on the Closing Date, additional Mortgage Loans may be         
delivered to the Trust. In addition, prior to the Closing Date, Initial Mortgage
Loans may be removed and other initial Mortgage Loans may be substituted for the
removed loans. Although the Seller expects to deliver the Statistical Mortgage  
Loans that are not Initial Mortgage Loans to the Trust during the Pre-Funding   
Period, no assurance can be given that these mortgage loans will be actually    
delivered. The Depositor believes that the information set forth in this        
prospectus supplement with respect to the Statistical Mortgage Loans is         
representative of the characteristics of the Initial Mortgage Loans and an      
identified portion of the Subsequent Mortgage Loans at the Closing Date,        
although some characteristics of these Initial Mortgage Loans on the Closing    
Date may vary from those represented here and not all of the Statistical        
Mortgage Loans will be delivered to the Trust on the Closing Date and may not be
delivered during the Pre-Funding Period. The sum of certain percentages in this 
prospectus supplement may not equal 100% due to rounding. Certain               
characteristics of the Statistical Mortgage Loans are set forth in Annex II to  
this prospectus supplement.                                                     

The mortgage notes are secured by mortgages or deeds of trust or other
similar security instruments creating first and second liens on real properties 
including single-family residences, two- to four-family dwelling units,         
condominiums, planned unit developments, townhouses and rowhouses. The Trust    
includes, in addition to the mortgage pool, the following:                      

   o    certain amounts held from time to time in Accounts maintained in the
    name of the Trust Administrator under the Transfer and Servicing
Agreement;                                                  

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     o    any property that initially secured a Mortgage Loan and is acquired by
foreclosure or deed-in-lieu of foreclosure;                 

 o    all insurance policies described below, along with the proceeds of
those policies;                                             

     o    rights to require repurchase of the Mortgage Loans by the Depositor or
        the Seller, as applicable, for breach of representation or warranty;
and                                                         

o    the rights of the Trust under the Swap Agreement.                

    All of the Statistical Mortgage Loans were originated by FIC in accordance
with underwriting guidelines established and maintained by FMC, a subsidiary of 
FIC. The underwriting guidelines generally applied by FMC in originating the    
Mortgage Loans are described under "Underwriting Guidelines." Because, in       
general, such underwriting guidelines do not conform to Fannie Mae or Freddie   
Mac guidelines, the Mortgage Loans are likely to experience higher rates of     
delinquency, foreclosure and bankruptcy than if they had been underwritten to a 
higher standard.                                                                

All of the Mortgage Loans were originated on or after May 25, 2005.   
Scheduled Payments made either earlier or later than the scheduled due dates on 
the Mortgage Loans will not affect the amortization schedule or the relative    
application of these payments to principal and interest.                        

    Approximately 81.92% of the Statistical Mortgage Loans provide for payment
by the Borrower of a Prepayment Penalty. Generally, each such Mortgage Loan     
provides for payment of a Prepayment Penalty in connection with certain         
voluntary, full or partial prepayments made within the period of time specified 
in the related Mortgage Note, ranging from six months to three years from the   
date of origination of such Mortgage Loan (with a weighted average at           
origination of 25 months for the Statistical Mortgage Loans in the mortgage     
pool), as described herein. The amount of the applicable Prepayment Penalty, to 
the extent permitted under applicable state law, is as provided in the related  
Mortgage Note; generally, this amount is equal to six month's interest on any   
amounts prepaid in excess of 20% of the original principal balance or, in some  
cases, 80% of the current principal balance of the related Mortgage Loan during 
any 12-month period during the applicable penalty period. All Prepayment        
Penalties collected in respect of the Mortgage Loans shall be payable to the    
Servicer and the Subservicer as additional servicing compensation. Prepayment   
Penalties will not be available to make payments to holders of the Notes.       

Approximately 89.21% of the Statistical Mortgage Loans in the mortgage
pool, and approximately 88.66% and 89.51% of the Statistical Mortgage Loans in  
Group 1 and Group 2, based on aggregate scheduled principal balances of the     
Cut-off Date are adjustable rate mortgage loans.                                

Approximately 10.79% of the Statistical Mortgage Loans in the mortgage
pool, and approximately 11.34% and 10.49% of the Statistical Mortgage Loans in  
Group 1 and Group 2, based on aggregate scheduled principal balances of the     
Cut-off Date are fixed rate mortgage loans.                                     

     Approximately 3.88% of the Statistical Mortgage Loans in the mortgage pool,
and approximately 2.94% and 4.40% of the Statistical Mortgage Loans in Group 1  
and Group 2, respectively, based on aggregate scheduled principal balance as of 
the Cut-off Date are secured by second liens.                                   

Approximately 38.92% of the Statistical Mortgage Loans in the mortgage
pool, and approximately 35.67% and 40.72% of the Statistical Mortgage Loans in  
Group 1 and Group 2, respectively, have Original Loan-to-Value Ratios between   
80.01% and 95.00%. As of the Cut-off Date, approximately 3.71% of the           
Statistical Mortgage Loans in the statistical mortgage pool have Original       
Loan-to-Value Ratios in excess of 95.00%. Approximately 82.02% of the           
Statistical Mortgage Loans in the mortgage pool, and approximately 74.85% and   
85.99% of the Statistical Mortgage Loans in Group 1 and Group 2, respectively,  
have Combined Loan-to-Value Ratios between 80.01% and 100.00%. None of the      
Statistical Mortgage Loans in the mortgage pool have Combined Loan-to-Value     
Ratios in excess of 100.00%.                                                    

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As of the Cut-off Date, the remaining term to stated maturity of the  
Statistical Mortgage Loans ranged from 176 months to 360 months and the weighted
average remaining term to stated maturity of the Statistical Mortgage Loans was 
approximately 351 months.                                                       

   Each adjustable rate Mortgage Loan will accrue interest at the adjustable
rate calculated as specified under the terms of the related mortgage note and   
each fixed rate Mortgage Loan will have a Mortgage Rate that is fixed for the   
life of such Mortgage.                                                          

 Substantially all of the adjustable rate Mortgage Loans in the mortgage
pool provide for semi-annual adjustment of the related Mortgage Rate based on   
the Six-Month LIBOR Index, as described at "--The Indices" below. There will be 
corresponding adjustments to the monthly payment amount, in each case on each   
Adjustment Date applicable thereto; provided that the first such adjustment will
be (i) in the case of approximately 76.99% of the Statistical Mortgage Loans,   
approximately two years following origination, (ii) in the case of approximately
10.86% of the Statistical Mortgage Loans, approximately three years following   
origination, and (iii) in the case of approximately 1.36% of the Statistical    
Mortgage Loans, approximately five years following origination. On each         
Adjustment Date, the Mortgage Rate will be adjusted to equal the sum, rounded   
generally to the nearest multiple of 1/8%, of the related index and the         
applicable gross margin, provided that the Mortgage Rate on each such adjustable
rate Mortgage Loan will not increase or decrease by more than the Periodic Rate 
Cap on any related Adjustment Date and will not exceed a specified Maximum      
Mortgage Rate over the life of such Mortgage Loan or be less than a specified   
Minimum Mortgage Rate over the life of such Mortgage Loan. The Mortgage Rate for
the adjustable rate Mortgage Loan generally will not increase or decrease on the
first Adjustment Date by more than the Initial Rate Cap; the Initial Rate Caps  
for the 2/28 LIBOR ARM Loans, the 2/28 LIBOR IO ARM Loans, the 3/27 LIBOR ARM   
Loans and the 3/27 LIBOR IO ARM Loans (representing in the aggregate            
approximately 87.85% of the Statistical Mortgage Loans) are 3.000%, the Initial 
Rate Caps for the 5/1 Treasury ARM Loans and the 5/1 Treasury IO ARM Loans      
(representing in the aggregate approximately 1.36% of the Statistical Mortgage  
Loans) are 2.000%. The Minimum Mortgage Rate for each adjustable rate Mortgage  
Loan is equal to such Mortgage Loan's initial Mortgage Rate.                    

Effective with the first monthly payment due on each adjustable rate  
Mortgage Loan (other than the IO ARM Loans) after each related Adjustment Date, 
the monthly payment amount will be adjusted to an amount that will amortize     
fully the outstanding principal balance of the related Mortgage Loan over its   
remaining term (other than with respect to the IO ARM Loans, where the first    
scheduled principal payment will not be due until five years after the          
origination of the IO ARM Loans), and pay interest at the Mortgage Rate as so   
adjusted. The 2/28 LIBOR ARM Loans, the 2/28 LIBOR IO ARM Loans, the 3/27 LIBOR 
ARM Loans and the 3/27 LIBOR IO ARM Loans (representing in the aggregate        
approximately 87.85% of the Statistical Mortgage Loans) are subject to a        
Periodic Rate Cap of approximately 1.000% with respect to each Adjustment Date  
after the first Adjustment Date. The 5/1 Treasury ARM Loans and the 5/1 Treasury
IO ARM Loans (representing in the aggregate approximately 1.36% of the          
Statistical Mortgage Loans) are subject to a Periodic Rate Cap of approximately 
2.000% with respect to each Adjustment Date after the first Adjustment Date.    

 Due to the application of the Initial Rate Caps, Periodic Rate Caps and
Maximum Mortgage Rates, the Mortgage Rate on each adjustable rate Mortgage Loan,
as adjusted on any related Adjustment Date, may be less than the sum of the     
related index and the applicable gross margin, rounded as described herein. See 
"--The Indices" below.                                                          

The adjustable rate Mortgage Loans generally do not permit the related
Borrower to convert the adjustable Mortgage Rate to a fixed Mortgage Rate.      

    Each of FIC and FMC utilizes the Office of Thrift Supervision's convention
(the "OTS Convention") for determining delinquency statistics. The OTS          
Convention assumes that each month has exactly 30 days, so a Borrower who has   
not paid on the last day of the month is only 29 days late. A Mortgage Loan will
only be considered between 30 and 59 days delinquent if a scheduled payment has 
not been received by the end of the month following the month in which such     
scheduled payment was to be made. For example, assume a Mortgage Loan has a     
scheduled payment due on August 1, 2006 and the Borrower failed to make such    
payment. This Mortgage Loan will not be considered 30 to 59 days delinquent     
until September 30, 2006.                                                       

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 As of the Cut-off Date, the aggregate original principal balance of the
Statistical Mortgage Loans was approximately $875,745,037. As of the Cut-off    
Date, the aggregate Stated Principal Balance of the Statistical Mortgage Loans  
was approximately $875,331,945, the minimum Stated Principal Balance was        
approximately $19,789, the maximum Stated Principal Balance was approximately   
$1,196,730, the lowest current Mortgage Rate and the highest current Mortgage   
Rate were approximately 6.150% and approximately 10.990% per annum,             
respectively, and the weighted average Mortgage Rate was approximately 7.278%   
per annum. The weighted average Original Loan-to-Value Ratio of the Statistical 
Mortgage Loans as of the Cut-off Date was approximately 82.40%, and the weighted
average Combined Loan-to-Value Ratio of the Statistical Mortgage Loans as of the
Cut-off Date was approximately 92.35%.                                          

   The weighted average Credit Score of the Statistical Mortgage Loans as of
the date of origination of the respective Statistical Mortgage Loan was         
approximately 650. The Credit Scores are generated by models developed by a     
third party and are made available to lenders through three national credit     
bureaus. The models were derived by analyzing data on consumers in order to     
establish patterns which are believed to be indicative of the Borrower's        
probability of default. The Credit Score is based on a Borrower's historical    
credit data, including, among other things, payment history, delinquencies on   
accounts, levels of outstanding indebtedness, length of credit history, types of
credit, and bankruptcy experience. Credit Scores generally range from           
approximately 350 to approximately 900, with higher scores indicating an        
individual with a more favorable credit history compared to an individual with a
lower score. However, a Credit Score purports only to be a measurement of the   
relative degree of risk a Borrower represents to a lender, i.e., that a Borrower
with a higher score is statistically expected to be less likely to default in   
payment than a Borrower with a lower score. In addition, it should be noted that
Credit Scores were developed to indicate a level of default probability over a  
two-year period which does not correspond to the life of a mortgage loan.       
Furthermore, Credit Scores were not developed specifically for use in connection
with mortgage loans, but for consumer loans in general. Therefore, a Credit     
Score does not take into consideration the effect of mortgage loan              
characteristics on the probability of prepayment by the Borrower. None of the   
Depositor, the Seller or the Servicer makes any representations or warranties as
to the actual performance of any Mortgage Loan or that a particular Credit Score
should be relied upon as a basis for an expectation that the Borrower will repay
the Mortgage Loan according to its terms.                                       

   As used herein, the Credit Score of a mortgage loan is generally equal to
the lower of two credit scores or the middle of three credit scores for two-file
and three-file credit reports, respectively. For all Mortgage Loans purchased by
the Seller, the credit report and the related Credit Score are generated during 
the underwriting of the mortgage loan by the originator and generally within 45 
days of the origination date.                                                   

The Indices                                                                     

   As indicated above, the Mortgage Index applicable to the determination of
the Mortgage Rates for approximately 98.48% and 1.52% of the adjustable rate    
Statistical Mortgage Loans will be the Six-Month LIBOR Index and the Treasury   
Mortgage Index, respectively, and as most recently available as of the first    
Business Day of the month prior to the related Adjustment Date. In the event    
that either the Six-Month LIBOR Index or the Treasury Mortgage Index becomes    
unavailable or otherwise unpublished, the Trust Administrator will select a     
comparable alternative index over which it has no direct control and which is   
readily verifiable.                                                             

Pre-Funding and Conveyance of Subsequent Mortgage Loans                         

     On the Closing Date, the excess of the sum of the aggregate Class Principal
Amount of the Notes and the initial Overcollateralization Amount over the       
aggregate Stated Principal Balance of the Initial Mortgage Loans as of the      
Initial Cut-off Date, which amount is expected to be approximately $290,000,000,
will be deposited in the Pre-Funding Account established and maintained by the  
Trust Administrator on behalf of the Noteholders. Any investment income earned  
from amounts in the Pre-Funding Account shall be paid to the Seller, and will   
not be available for payments on the Notes. During the Pre-Funding Period, the  
Depositor is expected to purchase Subsequent Mortgage Loans indirectly through  
an affiliate from the Seller and sell such Subsequent Mortgage Loans to the     
Trust. The maximum aggregate loan balance of Subsequent Mortgage Loans to be    
transferred to the Trust for Group 1 and Group 2 is approximately $103,387,448  
and $186,612,551, respectively. The Subsequent Mortgage Loans purchased by the  
Trust from each such amount will be allocated to the related Mortgage Group. The
purchase price for each Subsequent Mortgage Loan will equal the principal       
balance of such Subsequent Mortgage                                             

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Loan and will be paid from the amounts in the Pre-Funding Account allocated to  
that Mortgage Group. Accordingly, the purchase of Subsequent Mortgage Loans for 
a Mortgage Group will decrease the amount on deposit in the Pre-Funding Account 
for that Mortgage Group and increase the aggregate Stated Principal Balance of  
the Mortgage Loans in that Mortgage Group. The characteristics of the Mortgage  
Loans in the Trust will vary upon the acquisition of Subsequent Mortgage Loans. 
The obligation of the Trust to purchase Subsequent Mortgage Loans during the    
Pre-Funding Period is subject to the following requirements:                    

    o    such Subsequent Mortgage Loan may not be more than one calendar month
       contractually delinquent as of the related Subsequent Cut-off Date;

     o    such Subsequent Mortgage Loan may not have a final maturity date later
than January 1, 2036;                                       

     o    the remaining term to stated maturity of such Subsequent Mortgage Loan
will not exceed 30 years;                                   

    o    such Subsequent Mortgage Loan will have a Mortgage Rate not less than
6.000% per annum;                                           

    o    such Subsequent Mortgage Loan will not have an Original Loan-to-Value
Ratio or Combined Loan-to-Value Ratio greater than 100%;    

o    such Subsequent Mortgage Loan will have a principal balance not  
greater than $1,200,000;                                    

o    such Subsequent Mortgage Loan will be secured by a first lien or 
second lien on a mortgaged property; and                    

o    such Subsequent Mortgage Loan will be otherwise acceptable to the
Rating Agencies.                                            

    Following the purchase of such Subsequent Mortgage Loans by the Trust, the
mortgage pool and each Mortgage Group will have the following characteristics   
(based upon the characteristics of the (a) Initial Mortgage Loans as of the     
Initial Cut-off Date and (b) Subsequent Mortgage Loans as of the related        
Subsequent Cut-off Date):                                                       

Mortgage Pool                                                         

    o    a weighted average current Mortgage Rate of at least 7.25% per annum;

    o    a weighted average remaining term to stated maturity of less than 360
months;                                                     

o    a weighted average Original Loan-to-Value Ratio of not more than 
82.50%;                                                     

o    a weighted average Credit Score of at least 649; and             

     o    no more than 10.00% of the Mortgage Loans by Aggregate Loan Balance at
the end of the Pre-Funding Period will be used for cash-out 
refinances.                                                 

Group 1                                                               

    o    a weighted average current Mortgage Rate of at least 7.35% per annum;

    o    a weighted average remaining term to stated maturity of less than 360
months;                                                     

o    a weighted average Original Loan-to-Value Ratio of not more than 
81.50%; and                                                 

  o    no more than 15.00% of the Group 1 Mortgage Loans by Aggregate Loan
          Balance at the end of the Pre-Funding Period will be used for cash-out
refinances.                                                 

Group 2                                                               

    o    a weighted average current Mortgage Rate of at least 7.20% per annum;

    o    a weighted average remaining term to stated maturity of less than 360
months;                                                     

o    a weighted average Original Loan-to-Value Ratio of not more than 
83.10%; and                                                 

 o    no more than 8.00% of the Group 2 Mortgage Loans by Aggregate Loan
          Balance at the end of the Pre-Funding Period will be used for cash-out
refinances.                                                 

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 Underwriting Guidelines

    The Mortgage Loans were originated by Fieldstone Mortgage Company ("FMC"),
a nationwide mortgage banking company and wholly-owned subsidiary of Fieldstone 
Investment Corporation, or by other mortgage lenders generally in accordance    
with underwriting guidelines established and maintained by FMC (the "Fieldstone 
Underwriting Guidelines"). See "Origination and Sale of Mortgage Loans -        
Fieldstone Underwriting Guidelines" in the prospectus.                          

General                                                                         

     FMC originates, finances, sells, securitizes and services both "conforming"
loans (i.e., loans that are insured by the FHA or partially guaranteed by VA, or
which qualify for sale to Fannie Mae or Freddie Mac) and "non-conforming" loans 
(i.e., loans that are not insured or guaranteed by FHA or VA and do not qualify 
for sale to Fannie Mae or Freddie Mac) secured by single-family, two- to        
four-family, condominium units, units of planned unit developments, townhomes   
and modular homes. FMC originates mortgage loans directly and acquires loans    
from mortgage lenders and brokers. FMC originates loans primarily in the        
wholesale market, through mortgage brokers, but also originates loans directly  
with customers through its retail branch network. In addition, FMC acquires     
mortgage loans from correspondent lenders. The mortgage loans have been         
underwritten and originated using procedures intended to comply with all        
applicable federal and state laws and regulations. FMC focuses on providing the 
best loan available for a given borrower's needs and credit history. FMC's      
non-conforming borrowers generally have good credit backgrounds, but tend to    
have higher loan-to-value ratios, or LTVs, less income documentation, and/or    
higher debt-to-income ratios than conforming borrowers. The following table     
summarizes certain information regarding FMC's total loan originations:         

                                                                [Download Table]

                         As of September 30,        Year Ended December 31,        
                         -------------------  ------------------------------------ 
                                 2005            2004         2003         2002    
                              ----------      ----------   ----------   ---------- 
                                                  (in thousands)                   
                                                                                   
Non-Conforming Loans ...      $4,558,085      $6,185,045   $5,148,182   $2,479,323 
   As a percentage of                                                              
   total originations ..              80%             83%          70%          62%
Conforming Loans .......       1,167,569       1,290,202   $2,223,868   $1,537,084 
   As a percentage of                                                              
   total originations ..              20%             17%          30%          38%
Total Originations .....      $5,725,654      $7,475,247   $7,372,050   $4,016,407 
                              ==========      ==========   ==========   ========== 

The Mortgage Loans included in the Trust are non-conforming loans. A  
non-conforming loan generally does not meet the eligibility requirements of     
Fannie Mae or Freddie Mac because the borrower's cash flow, credit history      
and/or collateral value do not meet the specific standards of the conforming    
loan market.                                                                    

The Fieldstone Underwriting Guidelines                                          

 FMC generally underwrites its non-conforming loans to meet the specific
guidelines of one of FMC's loan programs. The Fieldstone Underwriting Guidelines
generally are designed to evaluate a prospective borrower's credit history and  
ability to repay the loan, as well as the value and adequacy of the related     
mortgaged property as collateral. The Fieldstone Underwriting Guidelines are    
established and maintained by FMC's credit committee, which is composed of FMC's
President, Executive Vice President-Secondary, Chief Credit Officer, Chief      
Financial Officer and Senior Vice President - Investment Portfolio and other    
appropriate officers. The Fieldstone Underwriting Guidelines are modified and   
revised continually based on changes in residential mortgage underwriting and   
lending practices and requirements of secondary mortgage markets. In addition,  
the Fieldstone Underwriting Guidelines allow for certain flexibility, and       
exceptions to the underwriting guidelines are permitted in certain              
circumstances.                                                                  

FMC generally originates its second-lien loans in conjunction with a  
first-lien loan secured by the same mortgaged property. Although FMC's          
first-lien and second-lien programs offer unique features, FMC's underwriting   
and compliance guidelines are generally consistent across all programs.         

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All of FMC's non-conforming loans are underwritten by FMC's on-staff  
underwriting personnel, and FMC does not delegate underwriting authority to any 
broker or third party. FMC's underwriting process considers a combination of    
factors in deciding whether to approve a loan, including the borrower's income  
documentation, LTV, mortgage and consumer credit payment history, property type 
and credit score. The mortgage loan underwriting process relies upon an         
underwriter's analysis of the prospective borrower's ability to repay the loan  
according to its terms, the risk that the prospective borrower will not repay,  
the fees and rates charged, the value of the related mortgaged property as      
collateral, the benefit the loan is providing to the prospective borrower and   
the loan amounts relative to the risk. FMC's policy is to analyze the overall   
situation of the prospective borrower and to take into account compensating     
factors that may be used to offset certain areas of weakness. These compensating
factors include credit scores, proposed reductions in the borrower's debt       
service expense, borrower assets, employment stability, number of years in      
residence and net disposable income. FMC's underwriting process and the         
Fieldstone Underwriting Guidelines require a thorough application review and    
documentation designed to maximize the value of the mortgage loans.             

  The Fieldstone Underwriting Guidelines include a review of the income of
each applicant. FMC personnel review the loan applicant's source of income,     
calculate the amount of income from sources indicated on the loan application or
similar documentation and calculate debt-to-income ratios to determine the      
applicant's ability to repay the loan. Also, FMC generally classifies its       
non-conforming loans into credit grade categories, based on an assessment of    
borrower repayment credit risk. FMC's credit grade classification considers     
several factors, including the applicant's mortgage payment history, consumer   
credit history, credit score, bankruptcy history and debt-to-income ratio.      
Certain loan characteristics, including LTV and documentation type, also factor 
into FMC's credit grading.                                                      

    FMC requires a full appraisal of each property to be pledged as collateral
in connection with the origination of each loan. Appraisals generally conform to
the Uniform Standards of Professional Appraisal Practice and must be on forms   
acceptable to Freddie Mac and Fannie Mae. Appraisals are performed by licensed, 
third-party, fee-based appraisers and include inspection of the exterior and    
interior of the subject property and review and evaluation of neighborhood      
conditions, site and zoning status and the condition and value of improvements. 
FMC's appraisal review process requires that each appraisal be validated (except
in limited circumstances) by either a non-affiliated appraisal review firm or by
one of FMC's qualified underwriters using additional data to evaluate the       
appraisal. In most cases, FMC utilizes automated value measures to validate     
appraisals. FMC generally requires that an appraisal be no more than 180 days   
old on the day the loan is funded.                                              

The Mortgage Loans generally have been underwritten under one of the  
following documentation programs:                                               

  o    Full Documentation - income verification based on current pay stubs
         and W-2s for wage earners or two years' tax returns for self-employed
borrowers                                                   

  o    24 Months of Bank Statements - allowed for all types of employment,
          this program uses an average of deposits for the most recent 24 months

 o    12 Months of Bank Statements - allowed for self-employed borrowers
      only, this program requires 12 months of bank statements to verify
income                                                      

    o    Limited Documentation - generally available for borrowers with higher
      credit scores, this program requires a year-to-date pay stub, most
         recent 1099 or six months of bank statements depending on whether the
          borrower is a wage earner, a contractor or self-employed, respectively

  o    Stated Documentation - this program requires wage earners to verify
  two years' employment in the same profession and self-employed
      borrowers to provide evidence that the business has been owned and
operated for at least two years                             

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Each of these documentation programs includes a thorough credit       
underwriting. Exceptions to documentation requirements and other modifications  
may be granted on a case-by-case basis for certain prospective borrowers and for
certain loan programs.                                                          

    FMC emphasizes quality control prior to origination. FMC's quality control
department also reviews and re-underwrites, on a post-funding basis,            
approximately 10% of all mortgage loans that FMC originates. FMC generally      
selects loans for post-funding re-underwriting on a random basis, (though FMC   
may make select targeted samples of loans from time to time) and reports its    
findings to management and underwriting department managers on a regular basis. 
Underwriting changes and corrective actions may be implemented from time to time
as a result of analysis of the quality control data, performance trends and     
servicing issues.                                                               

     The Mortgage Loans generally have been originated in accordance with one of
the following FMC loan programs, which generally apply the following            
underwriting criteria:                                                          

  o    Wall Street: The Wall Street program utilizes both credit score and
          mortgage history and offers loans to borrowers with Alt-A credit. This
program offers both first and second liens.                 

  o    High Street: The High Street program utilizes both credit score and
        mortgage history and offers loans to borrowers with subprime credit.
This program offers both first and second liens.            

o    Main Street: The Main Street program utilizes traditional credit 
          underwriting, rating borrowers' credit from "A" through "D" and offers
       loans for borrowers with subprime credit. This program offers first
liens only.                                                 

================================================================================
KEY: BK = bankruptcy; FC = foreclosure; FICO = Fair Isaac & Company; NOD =      
notice of default; Mortgage History = number of 30-day, 60-day and 90-day       
delinquencies in last 12 months; Consumer Credit = history of delinquencies on  
consumer debt                                                                   
================================================================================

Wall Street (First Lien)

                                                        [Enlarge/Download Table]

                                                                            Maximum LTV (%)                    
                                                       --------------------------------------------------------
                                         Months Since  Full Doc    Stated     Full Doc     Stated      Maximum 
Credit   FICO  Mortgage     Consumer     ------------    Owner      Owner    Non-Owner   Non-Owner      Debt   
 Grade  Score   History      Credit         BK   FC    Occupied   Occupied    Occupied    Occupied   Ratio(%)* 
------  -----  --------  --------------     --   --    --------   --------   ---------   ---------   ----------
                                                                                                               
  A      620      0x30   Not Considered     24   36       95         90          90          80          50    
  A      620      1x30   Not Considered     24   36       90         90          80          80          50    
  A-     600      0x30   Not Considered     24   36       95         90          85          70          50    
         580             Not Considered     24   36       95         85          80          70          50    
  A-     620      1x30   Not Considered     24   36       90         90          80         N/A          50    
         600             Not Considered     24   36       90         90         N/A         N/A          50    
  A-     620      2x30   Not Considered     24   36       85         90          80         N/A          50    
  B      540      0x30   Not Considered     24   36       90         60          60          60          50    
  B      620     0x120   Not Considered     12   24       95         90          90          70          50    
  B      600     0x120   Not Considered     12   24       95         90          85          70          50    
  B      580     0x120   Not Considered     12   24       90         85          80          70          50    
  C      540     0x120   Not Considered     12   24       60         60          60          60          50    


* Debt Ratio exceptions of up to 55% are allowed for LTV less than 85% or under 
the following circumstances: minimum FICO score 640, owner occupied, full doc   
and bank statement, gross monthly disposable income of $3,000 or net monthly    
disposable income of $600 for first family member and $250 for each member      
thereafter, 3 year BK and FC seasoning. Not available on 6 month LIBOR ARM.     

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Wall Street (Second Lien) 

                                                        [Enlarge/Download Table]

                                                                           Maximum CLTV (%)                   
                                                       -------------------------------------------------------
                                         Months Since  Full Doc    Stated     Full Doc    Stated      Maximum 
Credit   FICO  Mortgage     Consumer     ------------    Owner      Owner    Non-Owner   Non-Owner     Debt   
Grade   Score   History      Credit         BK   FC    Occupied   Occupied    Occupied    Occupied   Ratio(%)*
------  -----  --------  --------------     --   --    --------   --------   ---------   ---------   ---------
                                                                                                              
  A      660     0x30    Not Considered     24   36       100        100         95          90          50   
  A      620     0x30    Not Considered     24   36       100        100         90          90          50   
  A      620     1x30    Not Considered     24   36       100        N/A         85         N/A          50   
  A-     620     2x30    Not Considered     24   36        90        N/A         85         N/A          50   

* Debt Ratio exceptions of up to 55% are allowed for LTV less than 85% or under 
the following circumstances: minimum FICO score 640, owner occupied, full       
documentation and bank statement, gross monthly disposable income of $3,000 or  
net monthly disposable income of $600 for first family member and $250 for each 
family member thereafter, 3 year BK and FC seasoning. Not available on 6 month  
LIBOR ARM.                                                                      

High Street (First Lien)

                                                        [Enlarge/Download Table]

                                                                            Maximum LTV (%)                    
                                                        -------------------------------------------------------
                                          Months Since  Full Doc    Stated     Full Doc     Stated     Maximum 
Credit   FICO  Mortgage      Consumer     ------------    Owner      Owner    Non-Owner   Non-Owner     Debt   
Grade   Score   History       Credit         BK   FC    Occupied   Occupied    Occupied    Occupied   Ratio(%)*
------  -----  -------- ----------------     --   --    --------   --------   ---------   ---------   ---------
                                                                                                               
  A      640     0x30     Not Considered     24   36       100        100         85         N/A          50   
         620              Not Considered     24   36       100         90         85         N/A          50   
  A      660     1x30     Not Considered     24   36       100        100         85         N/A          50   
         620              Not Considered     24   36       100         90         85         N/A          50   
  A-     600     1x30     Not Considered     24   36       100         85         85         N/A          50   
         580              Not Considered     24   36        95         85         85         N/A          50   
         540              Not Considered     24   36        90         80         80         N/A          50   
  A-     580     2x30     Not Considered     24   24        90         85         80         N/A          50   
         520              Not Considered     24   24        85         65         75         N/A          50   
  B      600     3x30     Not Considered     24   24        90         85         80         N/A          50   
  B      580     3x30     Not Considered     24   24        85         70         75         N/A          50   
  B      540     3x30     Not Considered     24   24        85         65         75         N/A          50   
  B      520     3x30     Not Considered     24   24        80         60         70         N/A          50   
  B      640     1x60     Not Considered     18   18        85         75         75         N/A          50   
  B      600     1x60     Not Considered     18   18        85         70         75         N/A          50   
  B      520     1x60     Not Considered     18   18        80         60         70         N/A          50   
  C      640     2x60     Not Considered     12   12        80         65         70         N/A          50   
  C      520     2x60     Not Considered     12   12        80         60         70         N/A          50   

* Debt Ratio exceptions of up to 55% are allowed under the following            
circumstances: full documentation and bank statement and gross disposable income
of $3,000 or net disposable income of $600 for first family member and $250 for 
each family member thereafter.                                                  

 High Street (Second Lien)

                                                        [Enlarge/Download Table]

                                                               Maximum CLTV (%)       
                                                       -------------------------------
                                         Months Since  Full Doc    Stated     Maximum 
Credit   FICO  Mortgage     Consumer     ------------    Owner      Owner       Debt  
Grade   Score   History      Credit         BK   FC    Occupied   Occupied   Ratio(%)*
------  -----  --------  --------------     --   --    --------   --------   ---------
                                                                                      
  A      640     0x30    Not Considered     24   36       100        100         50   
         620     0x30    Not Considered     24   36       100        N/A         50   
  A      660     1x30    Not Considered     24   36       100        100         50   
         620     1x30    Not Considered     24   36       100        N/A         50   
  A-     600     1x30    Not Considered     24   36       100        N/A         50   
         580     1x30    Not Considered     24   36        90        N/A         50   
  A-     580     2x30    Not Considered     24   24        90        N/A         50   
  B      600     3x30    Not Considered     24   24        90        N/A         50   

* Debt Ratio exceptions of up to 55% are allowed under the following            
circumstances: full documentation and bank statement and gross monthly          
disposable income of $3,000 or net monthly disposable income of $600 for first  
family member and $250 for each family member thereafter.                       

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Main Street (First Lien)

                                                        [Enlarge/Download Table]

                                                                       Maximum LTV (%)                    
                                                   -------------------------------------------------------
                                     Months Since  Full Doc    Stated     Full Doc    Stated      Maximum 
Credit  Mortgage                     ------------    Owner      Owner    Non-Owner   Non-Owner      Debt  
Grade    History   Consumer Credit      BK   FC    Occupied   Occupied    Occupied    Occupied   Ratio(%)*
------  --------  -----------------     --   --    --------   --------   ---------   ---------   ---------
                                                                                                          
  A        1x30    30's, No 60's        24   24       90         80          85          **         50    
  A-       3x30    30's, Isolated       24   24       90         80          80          **         50    
                        60's                                                                              
  B        1x60    60's, Isolated       18   18       85         75          75          **         50    
                        90's                                                                              
  C        1x90    90's, Isolated       12   12       80         70          70          **         50    
                       120's                                                                              
  D       No NOD     500 Score         >12  >12       70         **          **          **         50    

* Debt Ratio exceptions of up to 55% for full documentation loans with CLTVs    
less than or equal to 85%. Program allows for up to 55% maximum Debt Ratio for  
full documentation loans with CLTVs greater than 85% but less than or equal to  
90% under the following circumstances: owner occupied, full documentation only  
(bank statements not allowed), minimum 640 score for primary wage earner, no 2-4
unit purchases, bankruptcies or foreclosures must have occurred a minimum of 36 
months prior to loan closing, and disposable income must meet the following     
limits: $600 for first family member and $250 for each family member thereafter.

** No programs available                                                        

 Servicing of the Mortgage Loans

General                                                                         

Notwithstanding anything to the contrary in the prospectus, the Master
Servicer will not be ultimately responsible for the performance of the servicing
activities by the Servicer or the Subservicer, except as described under        
"--Servicing Compensation and Payment of Expenses", "--Adjustment to Servicing  
Fees in Connection with Certain Prepaid Mortgage Loans" and "--Advances" below. 
If the Servicer fails to fulfill its obligations under the Transfer and         
Servicing Agreement, the Master Servicer is obligated to terminate the Servicer,
and appoint a successor servicer as provided in the Transfer and Servicing      
Agreement. See "Description of the Agreements--Servicer Events of Default and   
Master Servicer Events of Default" and "--Rights Upon Servicer and Master       
Servicer Events of Default" in the prospectus.                                  

     In managing the liquidation of defaulted Mortgage Loans, the Servicer shall
have the option at any time to purchase any delinquent Mortgage Loan or         
substitute an eligible substitute mortgage loan for any delinquent Mortgage     
Loan. See "Servicing of the Trust Assets--Realization Upon Defaulted Mortgage   
Loans" in the prospectus.                                                       

In addition, in connection with its management of the liquidation of  
defaulted Mortgage Loans, the Servicer may sell delinquent Mortgage Loans;      
provided, however, that the Servicer shall not take any action that is          
inconsistent with or prejudices the interests of the Noteholders in any Mortgage
Loan or the rights and interests of the Depositor, the Indenture Trustee, the   
Master Servicer, the Trust Administrator, the Custodian and the Noteholders.    

    All of the Mortgage Loans will be sub-serviced by the Subservicer pursuant
to the terms and conditions of the Transfer and Servicing Agreement. The        
Subservicer will be required to perform all duties of the Servicer under the    
Transfer and Servicing Agreement, but the Servicer will have ultimate           
responsibility for the servicing of the Mortgage Loans.                         

Servicing Compensation and Payment of Expenses                                  

   As compensation for master servicing, custodial duties and administration
of the trust, the Master Servicer will be entitled to the Master Servicing Fee. 
In addition, the Master Servicer will be entitled to investment earnings on     
amounts on deposit in the Collection Account established by the Trust           
Administrator.                                                                  

The Servicer and the Subservicer will be paid in the aggregate, the   
Servicing Fee. If the Servicer or Subservicer is terminated and replaced by a   
successor servicer or subservicer, as applicable, the aggregate                 

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compensation payable to such successor servicer and subservicer will in all     
cases not exceed the Servicing Fee calculated at the Servicing Fee Rate. As     
additional servicing compensation, the Servicer and Subservicer are entitled to 
retain (i) all Prepayment Penalties collected in respect of the mortgage loans  
and all servicing related fees, including assumption fees, modification fees,   
ancillary servicing fees, extension fees, non-sufficient fund fees and late     
payment charges to the extent collected from the Borrower, (ii) any Prepayment  
Interest Excess and (iii) any interest or other income earned on funds held in  
their respective Custodial Accounts and escrow accounts and other similar items 
described under the Transfer and Servicing Agreement.                           

The Servicing Fee is subject to reduction as described below under    
"Adjustment to Servicing Fees in Connection with Certain Prepaid Mortgage       
Loans."                                                                         

   The Master Servicer, the Servicer and the Subservicer will be entitled to
reimbursement for certain expenses prior to payment of any amounts to           
Noteholders.                                                                    

Adjustment to Servicing Fees in Connection with Certain Prepaid Mortgage Loans  

Prepayments received during a Prepayment Period will be included in   
determining payments to Noteholders on the related Payment Date. When a Borrower
prepays all or a portion of a Mortgage Loan between Due Dates, the Borrower is  
required to pay interest on the amount prepaid only to the date of prepayment   
rather than a full month's interest, which could result in a Prepayment Interest
Shortfall in respect of interest available for payment to Noteholders on the    
related Payment Date. In order to mitigate the effect of any such Prepayment    
Interest Shortfall, the Subservicer (or if it fails to do so, the Servicer) will
be required to pay Compensating Interest into the Collection Account to the     
extent of any Prepayment Interest Shortfall in respect of prepayments received  
during the portion of the Prepayment Period from the sixteenth day of the       
calendar month preceding a Payment Date through the last day of the calendar    
month preceding the related Payment Date; provided, however, that the amount of 
Compensating Interest in respect of any Payment Date shall be limited to the    
Servicing Fee otherwise payable for such Payment Date. To the extent that the   
Servicer and the Subservicer fail to pay required Compensating Interest in      
respect of any Payment Date, the Master Servicer will be required to pay such   
Compensating Interest, but only to the extent of the Master Servicing Fee for   
the applicable Payment Date. Conversely, any interest received in respect of    
prepayments received during the portion of the Prepayment Period from the first 
day of the calendar month in which the Payment Date occurs through the fifteenth
day of the calendar month in which the Payment Date occurs will constitute      
Prepayment Interest Excess, which will be retained by the Servicer or the       
Subservicer as additional servicing compensation and will not be available to   
make any payments to the Noteholders on the related Payment Date.               

Advances                                                                        

 Subject to the limitations described below, on each Servicer Remittance
Date, the Subservicer (or if it fails to do so, the Servicer), will be required 
to make Advances from its funds or funds in the applicable Custodial Account    
that are not included in the available funds for such Payment Date. Advances are
intended to maintain a regular flow of scheduled interest and principal payments
on the Notes rather than to guarantee or insure against losses. The Subservicer 
(or, if it fails to do so, the Servicer) is obligated to make Advances with     
respect to delinquent payments of principal of or interest on each Mortgage Loan
(with such payments of interest adjusted to the related Net Mortgage Rate) to   
the extent that such Advances are, in its judgment, reasonably recoverable from 
future payments and collections or insurance payments or proceeds of liquidation
of the related Mortgage Loan. The Master Servicer will be obligated to make any 
required Advance if the Subservicer and Servicer fail in their obligations to do
so, to the extent provided in the Transfer and Servicing Agreement. In the event
the Subservicer, Servicer or Master Servicer previously made Advances which     
later are determined to be nonrecoverable, the Subservicer, Servicer or Master  
Servicer, as applicable, will be entitled to reimbursement of such Advances     
prior to payments to Noteholders. If the Subservicer, Servicer or Master        
Servicer, as applicable, determines on any Determination Date to make an        
Advance, such Advance will be included with the payment to holders of the Notes 
on the related Payment Date. In addition, the Subservicer, Servicer or Master   
Servicer, as applicable, may withdraw from the applicable Custodial Account or  
the Collection Account, as applicable, funds that were not included in the      
available funds for the preceding Payment Date to reimburse itself for Advances 
previously made. Any failure by the Subservicer or Servicer to make an Advance  
as required by the Transfer and Servicing Agreement will constitute an event of 
default thereunder, in which case the Master Servicer or such other entity as   
may be appointed as                                                             

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successor servicer, will be obligated to make any such Advance in accordance    
with the terms of the Transfer and Servicing Agreement. See "Servicing of the   
Trust Assets--Advances" in the prospectus.                                      

Collection of Taxes, Assessments and Similar Items                              

The Servicer and the Subservicer will, to the extent required by the  
related loan documents, maintain escrow accounts for the collection of hazard   
insurance premiums and real estate taxes with respect to the Mortgage Loans, and
will make servicing advances with respect to delinquencies in required escrow   
payments by the related Borrowers to the extent necessary to avoid the loss of a
Mortgaged Property due to a tax sale or the foreclosure thereof as a result of a
tax lien.                                                                       

Insurance Coverage                                                              

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

Evidence as to Compliance                                                       

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

Master Servicer Default; Servicer Default; Subservicer Default                  

    If the Master Servicer is in default in its obligations under the Transfer
and Servicing Agreement, the Indenture Trustee may, and must if directed to do  
so by the Noteholders having more than 50% of the Voting Rights applicable to   
each class of Notes affected thereby, terminate the Master Servicer. However, if
the Master Servicer is in default of its obligation to make an Advance as       
described in the Transfer and Servicing Agreement, the Indenture Trustee shall  
promptly terminate the Master Servicer. In such event, the Indenture Trustee    
will either assume the duties of Master Servicer or appoint a successor Master  
Servicer.                                                                       

   If the Subservicer is in default in its obligation under the Transfer and
Servicing Agreement, the Servicer will terminate the Subservicer and either     
appoint a successor Subservicer, in accordance with the Transfer and Servicing  
Agreement, or succeed to the responsibilities of the terminated Subservicer. If 
the Servicer succeeds to the responsibilities of the Subservicer, it will be    
entitled to receive the applicable portion of the Servicing Fee.                

 If the Servicer is in default in its obligations under the Transfer and
Servicing Agreement (including its obligations with respect to a defaulting     
Subservicer), the Master Servicer may, at its option, terminate the defaulting  
Servicer and either appoint a successor servicer, in accordance with the        
Transfer and Servicing Agreement, or succeed to the responsibilities of the     
terminated Servicer. If the Master Servicer succeeds to the responsibilities of 
the Servicer, it will be entitled to receive the applicable portion of the      
Servicing Fee.                                                                  

Pledge of Servicing Rights                                                      

 The Transfer and Servicing Agreement permits either the Servicer or the
Subservicer to obtain financing by means of a pledge and assignment of its      
rights to reimbursement for outstanding Advances and other rights under the     
Transfer and Servicing Agreement to one or more lenders. To the extent provided 
under any such financing arrangement, upon default by the Servicer or the       
Subservicer, the lender may appoint a successor servicer or successor           
subservicer, as applicable, provided that such successor servicer or successor  
subservicer, as applicable,                                                     

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meets the requirements for appointment of a successor servicer or successor     
subservicer, as applicable, under the Transfer and Servicing Agreement. See     
"--General" above.                                                              

Parties to the Transaction

 The following is a summary of the roles and responsibilities of various
parties to the transaction, including a general description of the relevant     
transaction party's experience in participating in securitizations of mortgage  
loans and mortgage-related assets. A more complete description of the duties and
obligations with respect to each transaction party is included in the terms and 
provisions of the Mortgage Loan Purchase Agreement, the Transfer and Servicing  
Agreement, the Indenture and the Trust Agreement.                               

The Seller and Sponsor                                                          

Fieldstone Investment Corporation, a Maryland corporation, is the sole
seller of the mortgage loans, and also acts as the sponsor of the offering of   
the notes. FIC owns all of the outstanding capital stock of each of the         
depositor, FMIC, and of the servicer, Fieldstone Servicing Corp.                

FIC is a self-managed, fully-integrated mortgage banking company that 
originates, securitizes, sells and services non-conforming and conforming       
single-family residential mortgage loans secured primarily by first liens. FIC's
goal is to be an efficient, low-cost originator of high quality residential     
mortgages and to provide exemplary service to its customers. FIC retains a      
significant portion of its non-conforming loans in an investment portfolio, and 
FIC's current strategy is to own a portfolio of loans with a principal balance  
approximately equal to 12 times FIC's shareholders' equity. FIC will finance    
this portfolio with a combination of long-term securitization debt, short-term  
warehouse debt and its equity. FIC retains the servicing rights with respect to 
non-conforming loans in its portfolio in order to monitor and improve their     
performance. FIC continues to sell a portion of the non-conforming loans and all
of the conforming loans that it originates on a whole loan, servicing-released  
basis.                                                                          

     FIC has elected to be taxed as a real estate investment trust, or REIT, for
federal income tax purposes, effective November 12, 2003. FIC intends to        
distribute to its stockholders all or substantially all of its REIT taxable     
income each year in order to comply with the distribution requirements of the   
Internal Revenue Code and to avoid federal income tax. FIC intends to retain its
net gains on sales of loans to build its capital base. In order to meet some of 
the requirements to qualify as a REIT, FIC conducts all of its loan origination,
processing, underwriting, sales and servicing functions through its primary     
operations subsidiary, Fieldstone Mortgage Company, which FIC has elected to    
treat as a taxable REIT subsidiary. FIC funds the conforming and non-conforming 
loans FIC sells.                                                                

     FIC's principal offices are located at 11000 Broken Land Parkway, Columbia,
Maryland 21044 and its telephone number is (410) 772-7200.                      

The Depositor                                                                   

    Fieldstone Mortgage Investment Corporation was incorporated in Maryland in
2005, as a wholly-owned, limited-purpose financing subsidiary of FIC. FMIC's    
principal office is located at 11000 Broken Land Parkway, Columbia, Maryland    
21044, telephone (866) 365-FMIC (3642).                                         

  FMIC was formed solely for the purpose of facilitating the financing and
sale of mortgage loans and mortgage-related assets. It may not engage in any    
business or investment activities other than issuing and selling securities     
secured primarily by, or evidencing interests in, mortgage loans and            
mortgage-related assets and taking certain similar actions. FMIC's certificate  
of incorporation prohibits FMIC from incurring, assuming or guaranteeing any    
indebtedness except for (A) any indebtedness that (i) constitutes Eligible      
Securities, (ii) provides for recourse solely to the assets pledged to secure   
such indebtedness or to entities other than FMIC and (iii) provides that the    
holder of such indebtedness may not cause of the filing of a petition in        
bankruptcy or take any similar action against FMIC until at least 91 days after 
every indebtedness of FMIC                                                      

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evidenced by the securities is indefeasibly paid in full and (B) any            
indebtedness that by its terms (i) is subordinated to indebtedness of FMIC      
evidenced by Eligible Securities issued by FMIC and (ii) provides that the      
holder thereof may not cause the filing of a petition in bankruptcy or take any 
similar action against FMIC until at least 91 days after every indebtedness of  
FMIC evidenced by the Eligible Securities is indefeasibly paid in full. FMIC's  
articles of incorporation limit FMIC's business to the foregoing and place      
certain other restrictions on FMIC's activities. In particular, FMIC cannot     
amend the purposes for which FMIC has been formed without the consent of an     
independent director.                                                           

FMIC does not have, nor is it expected in the future to have, any     
significant assets. As a newly-formed entity, FMIC does not have any prior      
experience or involvement in securitizing assets of any kind.                   

The Master Servicer                                                             

   The information set forth in the following paragraph has been provided by
the Master Servicer. None of the Depositor, the Indenture Trustee, the          
Underwriters or any of their respective affiliates has made or will make any    
representation as to the accuracy or completeness of this information.          

   Wells Fargo Bank, N.A. is a national banking association, with its master
servicing offices located at 9062 Old Annapolis Road, Columbia, Maryland 21045. 
Wells Fargo is engaged in the business of master servicing single family        
residential mortgage loans secured by properties located in all 50 states and   
the District of Columbia. Wells Fargo is a banking subsidiary of Wells Fargo &  
Company.                                                                        

The Servicer                                                                    

    Fieldstone Servicing Corp. will be named as Servicer of the Mortgage Loans
under the Transfer and Servicing Agreement. Fieldstone Servicing Corp. is a     
wholly-owned subsidiary of FIC. All of the Mortgage Loans, however, will be     
subserviced by JPMorgan Chase Bank, National Association, a national banking    
association, as Subservicer, which will have primary responsibility for         
servicing the Mortgage Loans including, but not limited to, all collection,     
advancing and loan level reporting obligations, maintenance of custodial and    
escrow accounts, maintenance of insurance and enforcement of foreclosure        
proceedings with respect to the Mortgage Loans and the Mortgaged Properties in  
accordance with the provisions of the Transfer and Servicing Agreement.         
Notwithstanding the obligations of the Subservicer to service the Mortgage      
Loans, the Servicer will remain responsible, pursuant to the terms of the       
Transfer and Servicing Agreement, for the acts and omissions of the Subservicer 
in respect of its obligation to service the Mortgage Loans. Under the Transfer  
and Servicing Agreement, the Master Servicer has the authority to terminate the 
Servicer for certain events of default which indicate that either the Servicer  
or the Subservicer is not performing, or is unable to perform, its duties and   
obligations under the Transfer and Servicing Agreement. See "Servicing of the   
Mortgage Loans" above.                                                          

The Trust                                                                       

 Fieldstone Mortgage Investment Trust, Series 2005-3 will be a statutory
trust formed under the laws of the State of Delaware pursuant to the Trust      
Agreement, as amended and restated, among the Depositor, the Owner Trustee and  
the Trust Administrator. The Trust will not engage in any activity other than   
acquiring, holding and managing the Mortgage Loans and the other assets of the  
Trust and proceeds therefrom, entering into the Swap Agreement, issuing the     
Notes, making payments on the Notes, and related activities.                    

    On the Closing Date, the Trust will pledge the Initial Mortgage Loans, the
Swap Agreement and other trust assets to the Indenture Trustee as security for  
the issuance of the Notes. The Depositor will sell the Notes to the Underwriters
and apply the net proceeds of such sale to the purchase of the Mortgage Loans.  
Other than the Mortgage Loans and the other trust assets pledged as collateral  
for the Notes, the Trust will not have any significant assets available for     
payment of the Notes.                                                           

    The Trust's principal offices are located in Wilmington, Delaware, in care
of U.S. Bank Trust National Association, as Owner Trustee, at the address set   
forth below under "--The Owner Trustee."                                        

The Owner Trustee                                                               

U.S. Bank Trust National Association will act not in its individual   
capacity but solely as the Owner Trustee under the Trust Agreement. U.S. Bank   
Trust National Association is a national banking association and its principal  

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offices are located at 300 Delaware Avenue, Suite 813, Wilmington, Delaware     
19801, Attention: Corporate Trust Services. The initial and annual fee payable  
to the Owner Trustee will be paid out of Interest Funds and will be an          
obligation of the Trust.                                                        

 The Trust Administrator and the Depositor will perform on behalf of the
Owner Trustee and the Trust certain administrative functions required under the 
Indenture and Transfer and Servicing Agreement pursuant to the terms of the     
Transfer and Servicing Agreement.                                               

The Indenture Trustee                                                           

     HSBC Bank USA, National Association will be the Indenture Trustee under the
Indenture. The Indenture Trustee will be entitled to receive as compensation for
its services a fee agreed to with and payable by the Master Servicer. The       
Indenture Trustee will also be entitled to customary indemnification for certain
costs and expenses prior to payment of any amounts to Noteholders. The Indenture
Trustee's Corporate Trust Office is located at 452 Fifth Avenue, New York, New  
York 10018, Attention: Corporate Trust, or any other address that the Indenture 
Trustee may designate from time to time by notice to the Noteholders, the Owner 
Trustee, the Trust Administrator, the Depositor and the Master Servicer.        

The Subservicer                                                                 

    The information set forth in the following paragraphs has been provided by
the Subservicer. None of the Seller, the Depositor, the Indenture Trustee, the  
Master Servicer, the Servicer, the Trust Administrator, the Underwriters nor any
of their respective affiliates has made or will make any representation as to   
the accuracy or completeness of this information.                               

  JPMorgan Chase Bank, National Association. JPMorgan Chase Bank, National
Association is a wholly-owned bank subsidiary of JPMorgan Chase & Co., a        
Delaware corporation whose principal office is located in New York, New York.   
JPMorgan is a commercial bank offering a wide range of banking services to its  
customers both domestically and internationally. It is chartered, and its       
business is subject to examination and regulation, by the Office of the         
Comptroller of the Currency. JPMorgan's main office is located in Columbus,     
Ohio. It is a member of the Federal Reserve System and its deposits are insured 
by the Federal Deposit Insurance Corporation.                                   

Prior to January 1, 2005, JPMorgan formed Chase Home Finance LLC, a   
wholly-owned, limited liability corporation. Prior to January 1, 2005, Chase    
Manhattan Mortgage Corporation ("CMMC") was engaged in the mortgage origination 
and servicing businesses. On January 1, 2005, CMMC merged with and into CHF with
CHF as the surviving entity. JPMorgan will be the servicer of all originations  
and servicing rights purchases occurring on or after January 1, 2005 and will   
engage CHF as its subservicer. CHF is engaged in the business of servicing      
mortgage loans and will continue to directly service its servicing portfolio    
existing prior to January 1, 2005.                                              

    In its capacity as Subservicer, JPMorgan will be responsible for servicing
the Mortgage Loans in accordance with the terms set forth in the Transfer and   
Servicing Agreement. JPMorgan may perform any or all of its obligations under   
the Transfer and Servicing Agreement through one or more subservicers. JPMorgan 
has engaged CHF as its subservicer to perform loan servicing activities for the 
Mortgage Loans on its behalf. JPMorgan will remain liable for its servicing     
duties and obligations under the Transfer and Servicing Agreement as if JPMorgan
alone were subservicing the Mortgage Loans.                                     

 Chase Home Finance LLC. Due to the recent restructuring of its mortgage
operations JPMorgan does not have meaningful historical servicing data. As a    
result and due to JPMorgan's engagement of CHF as its subservicer, CHF is       
providing below historical delinquency, foreclosure and loan loss data for its  
portfolio of fixed rate and adjustable rate subprime mortgage loans that were   
originated or purchased by CHF and subsequently securitized in asset-backed     
transactions (the "CHF Subprime Securitized Servicing Portfolio"). The CHF      
Subprime Securitized Servicing Portfolio represents only a portion of the total 
servicing portfolio of CHF, and many of the mortgage loans in the CHF Subprime  
Securitized Servicing Portfolio have not been outstanding long enough to        
experience the level of delinquencies, foreclosures and loan losses which might 
be expected to occur on a larger, more seasoned portfolio of mortgage loans     
which were underwritten, originated and serviced in a manner similar to the     
mortgage loans in the                                                           

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CHF Subprime Securitized Servicing Portfolio. Because of the relatively small   
size and relative lack of seasoning of the CHF Subprime Securitized Servicing   
Portfolio, there can be no assurance that the delinquency, foreclosure and loan 
loss experience on the Mortgage Loans will correspond to the delinquency,       
foreclosure and loan loss experience shown in the tables below, and the actual  
delinquency, foreclosure and loan loss experience on the Mortgage Loans could be
significantly worse. Moreover, the Mortgage Loans were originated by a          
subsidiary of the Seller and were not originated by CHF and as a result, the    
actual delinquency, loss and foreclosure experience on the Mortgage Loans could 
be significantly worse than the delinquency, foreclosure and loan loss          
experience shown in the tables below.                                           

    CHF Subprime Securitized Servicing Portfolio. The following tables contain
information relating to the delinquency, loan loss and foreclosure experience   
with respect to the CHF Subprime Securitized Servicing Portfolio.               

 Delinquency and Foreclosure Experience of the
CHF Subprime Securitized Servicing Portfolio
(Dollars in Thousands)

                                                        [Enlarge/Download Table]

                                                                           As of December 31,                            
                           As of June 30,      ------------------------------------------------------------------------- 
                                2005                     2004                     2003                     2002          
                      ----------------------   ----------------------   -----------------------   ---------------------- 
                      Number of     Dollar     Number of     Dollar     Number of      Dollar     Number of     Dollar   
                        Loans       Amount       Loans       Amount       Loans        Amount       Loans       Amount   
                      ---------   ----------   ---------   ----------   ---------   -----------   ---------   ---------- 
                                                                                                                         
Portfolio............  60,264     $7,268,961    75,898     $9,388,238    90,370     $11,146,244    73,597     $8,326,818 
Delinquency                                                                                                              
   30-59 days........    2.43%          1.98%     2.41%          1.83%     2.40%           1.83%     2.69%          2.28%
   60-89 days........    0.67%          0.48%     0.70%          0.54%     0.84%           0.66%     0.86%          0.72%
   90 days or more...    1.80%          1.26%     1.75%          1.31%     1.43%           1.15%     1.41%          1.21%
                       ------     ----------    ------     ----------    ------     -----------    ------     ---------- 
Total................    4.90%          3.72%     4.86%          3.68%     4.67%           3.64%     4.96%          4.21%
                       ======     ==========    ======     ==========    ======     ===========    ======     ========== 
Foreclosure rate.....    2.64%          2.21%     2.72%          2.20%     2.47%           2.06%     2.65%          2.48%
REO properties.......     441            N/A       504            N/A       532             N/A       480            N/A 

The period of delinquency is based on the number of days payments are 
contractually past due. The delinquency statistics set forth above exclude loans
in foreclosure. The portfolio statistics set forth above exclude REO properties.

   The foreclosure rate reflects the number of mortgage loans in foreclosure
as a percentage of the total number of mortgage loans or the dollar amount of   
mortgage loans in foreclosure as a percentage of the total dollar amount of     
mortgage loans, as the case may be, as of the date indicated. REO properties are
real estate owned properties which relate to foreclosed mortgages or properties 
for which deeds in lieu of foreclosure have been accepted, and held by CHF      
pending disposition.                                                            

Loan Loss Experience
 of the CHF Subprime Securitized Servicing Portfolio
(Dollars in Thousands)

                                                        [Enlarge/Download Table]

                                                                        Year Ending December 31,       
                                                 As of June 30,  ------------------------------------- 
                                                      2005           2004         2003         2002    
                                                 --------------  -----------   ----------   ---------- 
                                                                                                       
Average amount outstanding......................   $8,178,647    $10,443,888   $9,642,035   $7,902,732 
Net losses......................................   $   31,834    $    73,858   $   73,504   $   43,458 
Net losses as a percentage of average amount                                                           
   outstanding..................................         0.39%          0.71%        0.76%        0.55%

    The average amount outstanding during the period is the arithmetic average
of the principal balances of the mortgage loans outstanding on the last business
day of each month during the period. Net losses are amounts relating to mortgage
loans that have been determined by CHF to be uncollectible, less amounts        
received by CHF as recoveries from liquidation proceeds and deficiency          
judgments.                                                                      

   There can be no assurance that the delinquency, foreclosure and loan loss
experience on the Mortgage Loans will correspond to the delinquency, foreclosure
and loan loss experience set forth in the tables above. Therefore, CHF cannot   
predict to what degree the actual delinquency, foreclosure and loan loss        
experience on the Mortgage Loans will correspond to the statistical information 
set forth above.                                                                

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Consequently, the delinquency, foreclosure and loan loss experience set forth in
the tables above may not necessarily be material to your decision to invest.    

   In general, during periods in which the residential real estate market is
experiencing an overall decline in property values such that the principal      
balances of the mortgage loans and any secondary financing on the related       
mortgaged properties become equal to or greater than the value of the related   
mortgaged properties, rates of delinquencies, foreclosures and losses could be  
significantly higher than might otherwise be the case. In addition, adverse     
economic conditions (which may affect real property values) may affect the      
timely payment by mortgagors of scheduled payments and, accordingly, the actual 
rates of delinquencies, foreclosures and losses with respect to the mortgage    
pool.                                                                           

Collection Procedures. CHF employs a variety of collection techniques 
during the various stages of delinquency. The primary purpose of all collection 
efforts performed by CHF is to bring a delinquent mortgage loan current in as   
short a time as possible. Telephone calls are used as the principal form of     
contacting a mortgagor. CHF utilizes a combination of predictive and preview    
dealer strategies to maximize the results of collection calling activity. Prior 
to initiating foreclosure proceedings, CHF makes every reasonable effort to     
determine the reason for the default, whether the delinquency is a temporary or 
permanent condition, and the mortgagor's attitude toward the obligation. CHF    
will take action to foreclose a mortgage only once every reasonable effort to   
cure the default has been made and a projection of the ultimate gain or loss on 
REO sale is determined. In accordance with accepted servicing practices,        
foreclosures are processed within individual state guidelines and in accordance 
with the provisions of the mortgage and applicable state law.                   

Description of the Notes

General                                                                         

     The Mortgage Loans and the other trust assets pledged as collateral for the
Notes will represent all the assets of the Trust for payment of the Notes.      
Copies of the Indenture and the Transfer and Servicing Agreement will be        
attached as an exhibit to the Current Report on Form 8-K of the Trust that will 
be available to purchasers of the Notes at, and will be filed with, the         
Securities and Exchange Commission within 15 days of the initial delivery of the
Notes.                                                                          

   The following summaries do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, the provisions of the      
Indenture and the Transfer and Servicing Agreement. When particular provisions  
or terms used in the Indenture or the Transfer and Servicing Agreement are      
referred to, the actual provisions (including definitions of terms) are         
incorporated by reference.                                                      

     The Notes will consist of the Class 1-A Notes, Class 2-A1 Notes, Class 2-A2
Notes, Class 2-A3 Notes, Class M1 Notes, Class M2 Notes, Class M3 Notes, Class  
M4 Notes, Class M5 Notes, Class M6 Notes, Class M7 Notes, Class M8 Notes, Class 
M9 Notes, Class M10, Class M11, Class M12 and Class M13 Notes.                  

The equity ownership in the Trust will be evidenced by the Ownership  
Certificate. The Ownership Certificate Holder will be entitled to receive on    
each Payment Date any remaining cash flow from Mortgage Loan collections after  
all principal and interest on the Notes and other expenses of the Trust for such
Payment Date have been made.                                                    

The Notes will be issued in book-entry form as described below. The   
Definitive Notes will be transferable and exchangeable through the Trust        
Administrator. The Class A Notes and the Class M Notes will be issued in minimum
dollar denominations of $100,000 and integral multiples of $1 in excess of      
$100,000.                                                                       

Book-Entry Notes                                                                

 The Notes will be Book-Entry Notes. Noteholders may elect to hold their
Book-Entry Notes through DTC in the United States, or Clearstream Luxembourg or 
Euroclear in Europe, if they are participants in such systems, or indirectly    
through organizations which are participants in such systems. The Book-Entry    
Notes will be issued in one                                                     

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or more notes which equal the aggregate principal amount of the Notes and will  
initially be registered in the name of Cede & Co., the nominee of DTC.          
Clearstream Luxembourg and Euroclear will hold omnibus positions on behalf of   
their participants through customers' securities accounts in Clearstream        
Luxembourg's and Euroclear's names on the books of their respective             
depositaries, which in turn will hold such positions in customers' securities   
accounts in the depositaries' names on the books of DTC. Citibank, N.A. will act
as depositary for Clearstream Luxembourg and JPMorgan Chase Bank will act as    
depositary for Euroclear. Investors may hold such beneficial interests in the   
Class A Notes and the Class M Notes in minimum Class Principal Amounts of       
$100,000 and integral multiples of $1 in excess of $100,000. Except as described
below, no person acquiring a Book-Entry Note will be entitled to receive a      
Definitive Note. Unless and until Definitive Notes are issued, it is anticipated
that the only noteholder of the Book-Entry Notes will be Cede & Co., as nominee 
of DTC. Noteholders will not be noteholders as that term is used in the         
Indenture. Noteholders are only permitted to exercise their rights indirectly   
through Participants and DTC.                                                   

   The beneficial owner's ownership of a Book-Entry Note will be recorded on
the records of the Financial Intermediary that maintains the beneficial owner's 
account for such purpose. In turn, the Financial Intermediary's ownership of    
such Book-Entry Note will be recorded on the records of DTC (or of a            
participating firm that acts as agent for the Financial Intermediary, whose     
interest will in turn be recorded on the records of DTC, if the beneficial      
owner's Financial Intermediary is not a DTC Participant, and on the records of  
Clearstream Luxembourg or Euroclear, as appropriate).                           

     Noteholders will receive all payments of principal of, and interest on, the
Book-Entry Notes from the Trust Administrator through DTC and DTC Participants. 
While the Book-Entry Notes are outstanding (except under the circumstances      
described below), under the Rules, DTC is required to make book-entry transfers 
among Participants on whose behalf it acts with respect to the Book-Entry Notes 
and is required to receive and transmit payments of principal of, and interest  
on, the Book-Entry Notes. Indirect Participants, with whom Noteholders have     
accounts with respect to Book-Entry Notes, are similarly required to make       
book-entry transfers and receive and transmit such payments on behalf of their  
respective Noteholders. Accordingly, although Noteholders will not possess      
notes, the Rules provide a mechanism by which Noteholders will receive payments 
and will be able to transfer their interests.                                   

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

Because of time zone differences, credits of securities received in   
Clearstream Luxembourg or Euroclear as a result of a transaction with a         
Participant will be made during subsequent securities settlement processing and 
dated the Business Day following the DTC settlement date. Such credits or any   
transactions in such securities settled during such processing will be reported 
to the relevant Euroclear or Clearstream Luxembourg Participants on such        
Business Day. Cash received in Clearstream Luxembourg or Euroclear, as a result 
of sales of securities by or through a Clearstream Luxembourg Participant or    
Euroclear Participant to a DTC Participant, will be received with value on the  
DTC settlement date but will be available in the relevant Clearstream Luxembourg
or Euroclear cash account only as of the Business Day following settlement in   
DTC. For information with respect to tax documentation procedures relating to   
the Book-Entry Notes, see "Federal Income Tax Consequences--Grantor             
Trusts--Taxation of Certain Foreign Holders of Grantor Trust Securities" in the 
prospectus and "Global Clearance, Settlement and Tax Documentation              
Procedures--Certain U.S. Federal Income Tax Documentation Requirements" in Annex
I hereto.                                                                       

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

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

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

  Clearstream Luxembourg is incorporated under the laws of Luxembourg as a
professional depository. Clearstream Luxembourg holds securities for Clearstream
Luxembourg Participants and facilitates the clearance and settlement of         
securities transactions between Clearstream Luxembourg Participants through     
electronic book-entry changes in accounts of Clearstream Luxembourg             
Participants, thereby eliminating the need for physical movement of notes.      
Transactions may be settled in Clearstream Luxembourg in multiple currencies,   
including United States dollars. Clearstream Luxembourg provides to its         
Clearstream Luxembourg Participants, among other things, services for           
safekeeping, administration, clearance and settlement of internationally traded 
securities and securities lending and borrowing. Clearstream Luxembourg         
interfaces with domestic markets in several countries. As a professional        
depository, Clearstream Luxembourg is subject to regulation by the Luxembourg   
Monetary Institute. Clearstream Luxembourg Participants are recognized financial
institutions around the world, including underwriters, securities brokers and   
dealers, banks, trust companies, clearing corporations and certain other        
organizations. Indirect access to Clearstream Luxembourg is also available to   
others, such as banks, brokers, dealers and trust companies that clear through  
or maintain a custodial relationship with a Clearstream Luxembourg Participant, 
either directly or indirectly.                                                  

   Euroclear was created in 1968 to hold securities for its participants and
to clear and settle transactions between its participants through simultaneous  
electronic book-entry delivery against payment, thereby eliminating the need for
physical movement of Notes and any risk from lack of simultaneous transfers of  
securities and cash. Euroclear is owned by Euroclear plc and operated through a 
license agreement by Euroclear Bank S.A./N.V., a bank incorporated under the    
laws of the Kingdom of Belgium.                                                 

The Euroclear Operator holds securities and book-entry interests in   
securities for participating organizations and facilitates the clearance and    
settlement of securities transactions between Euroclear Participants, and       
between Euroclear Participants and Participants of certain other securities     
intermediaries through electronic book-entry changes in accounts of such        
Participants or other securities intermediaries.                                

  The Euroclear Operator provides Euroclear Participants with, among other
things, safekeeping, administration, clearance and settlement, securities       
lending and borrowing and other related services.                               

     Non-Participants of Euroclear may hold and transfer book-entry interests in
the Notes through accounts with a direct Participant of Euroclear or any other  
securities intermediary that holds a book-entry interest in the Notes through   
one or more securities intermediaries standing between such other securities    
intermediary and the Euroclear Operator.                                        

     Securities clearance accounts and cash accounts with the Euroclear Operator
are governed by the Terms and Conditions. The Terms and Conditions govern       
transfers of securities and cash within Euroclear, withdrawals of securities and
cash from Euroclear and receipts of payments with respect to securities in      
Euroclear. All securities in Euroclear are held on a fungible basis without     
attribution of specific notes to specific securities clearance accounts.        

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The Euroclear Operator acts under the Terms and Conditions only on behalf of    
Euroclear Participants and has no record of or relationship with persons holding
through Euroclear Participants.                                                 

   Payments on the Book-Entry Notes will be made on each Payment Date by the
Trust Administrator to DTC. DTC will be responsible for crediting the amount of 
such payments to the accounts of the applicable DTC Participants in accordance  
with DTC's normal procedures. Each DTC Participant will be responsible for      
disbursing such payments to the beneficial owners of the Book-Entry Notes that  
it represents and to each Financial Intermediary for which it acts as agent.    
Each such Financial Intermediary will be responsible for disbursing funds to the
beneficial owners of the Book-Entry Notes that it represents.                   

  Under a book-entry format, beneficial owners of the Book-Entry Notes may
experience some delay in their receipt of payments, since such payments will be 
forwarded by the Trust Administrator to Cede & Co. Payments with respect to     
Book-Entry Notes held through Clearstream Luxembourg or Euroclear will be       
credited to the cash accounts of Clearstream Luxembourg Participants or         
Euroclear Participants in accordance with the relevant system's rules and       
procedures, to the extent received by the Relevant Depositary. Such payments    
will be subject to tax reporting and may be subject to tax withholding in       
accordance with relevant United States tax laws and regulations. See "Federal   
Income Tax Consequences--Grantor Trusts--Taxation of Certain Foreign Holders of 
Grantor Trust Securities" in the prospectus and "Global Clearance, Settlement   
and Tax Documentation Procedures--Certain U.S. Federal Income Tax Documentation 
Requirements" in Annex I to this prospectus supplement. Because DTC can only act
on behalf of Financial Intermediaries, the ability of a beneficial owner to     
pledge Book-Entry Notes to persons or entities that do not participate in the   
depository system, or otherwise take actions in respect of such Book-Entry      
Notes, may be limited due to the lack of physical notes for such Book-Entry     
Notes. In addition, issuance of the Book-Entry Notes in book-entry form may     
reduce the liquidity of those Notes in the secondary market since some potential
investors may be unwilling to purchase Notes for which they cannot obtain       
physical notes.                                                                 

     Monthly and annual reports on the Trust provided by the Trust Administrator
to Cede & Co., as nominee of DTC, may be made available to beneficial owners    
upon request, in accordance with the rules, regulations and procedures creating 
and affecting DTC or the Relevant Depositary, and to the Financial              
Intermediaries to whose DTC accounts the Book-Entry Notes of such beneficial    
owners are credited.                                                            

    DTC has advised the Depositor and the Trust Administrator that, unless and
until Definitive Notes are issued, DTC will take any action permitted to be     
taken by the holders of the Book-Entry Notes under the Indenture only at the    
direction of one or more Financial Intermediaries to whose DTC accounts the     
Book-Entry Notes are credited, to the extent that such actions are taken on     
behalf of Financial Intermediaries whose holdings include such Book-Entry Notes.
Clearstream Luxembourg or the Euroclear Operator, as the case may be, will take 
any other action permitted to be taken by a holder of a Book-Entry Note under   
the Indenture on behalf of a Clearstream Luxembourg Participant or Euroclear    
Participant only in accordance with its relevant rules and procedures and       
subject to the ability of the Relevant Depositary to effect such actions on its 
behalf through DTC. DTC may take actions, at the direction of the related       
Participants, with respect to some Book-Entry Notes which conflict with actions 
taken with respect to other Book-Entry Notes.                                   

Definitive Notes will be issued to beneficial owners of the Book-Entry
Notes, or their nominees, rather than to DTC, only if:                          

   o    DTC or the Depositor advises the Trust Administrator in writing that
         DTC is no longer willing, qualified or able to discharge properly its
  responsibilities as nominee and depository with respect to the
      Book-Entry Notes and the Depositor is unable to locate a qualified
successor; or                                               

o    after the occurrence and continuation of an event of default,    
   beneficial owners having not less than 51% of the Voting Rights
evidenced by any class of Book-Entry Notes advise the Trust 
          Administrator and DTC through the Financial Intermediaries and the DTC
        Participants in writing that the continuation of a book-entry system
          through DTC (or a successor to DTC) is no longer in the best interests
          of beneficial owners of such class and the applicable DTC Participants
consent to the termination.                                 

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Upon the occurrence of any of the events described in the immediately 
preceding paragraph, the Trust Administrator will be required to notify all     
beneficial owners of the occurrence of such event and the availability through  
DTC of Definitive Notes. Upon surrender by DTC of the global note or notes      
representing the Book-Entry Notes and instructions for re-registration, the     
Trust Administrator and the Indenture Trustee will issue Definitive Notes, and  
thereafter the Trust Administrator will recognize the holders of such Definitive
Notes as holders of the Notes under the Indenture.                              

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

Payments on Mortgage Loans; Custodial Accounts; Collection Account              

 The Transfer and Servicing Agreement provides that the Servicer and the
Subservicer, for the benefit of the Noteholders, shall establish and maintain   
one or more accounts, each known as a "Custodial Account," into which the       
Servicer and the Subservicer, as applicable, is generally required to deposit or
cause to be deposited, promptly upon receipt and in any event within two        
Business Days of receipt, generally all amounts received with respect to the    
Mortgage Loans, except that the Servicer and Subservicer may deduct their       
respective portion of the Servicing Fee and any expenses of liquidating         
defaulted Mortgage Loans or property acquired in respect thereof. The Transfer  
and Servicing Agreement permits the Servicer and the Subservicer to direct any  
depository institution maintaining the related Custodial Account to invest the  
funds in the related Custodial Account in one or more investments acceptable to 
Fitch, Moody's and S&P as provided in the Transfer and Servicing Agreement, that
mature, unless payable on demand, no later than the Servicer Remittance Date.   
The Servicer and the Subservicer will be entitled to all income and gain        
realized from the related Custodial Account investments, and the income and gain
will be subject to withdrawal by the Servicer or the Subservicer, as applicable,
from time to time. The Servicer or the Subservicer will be required to deposit  
the amount of any losses incurred in respect to the related Custodial Account   
investments out of its own funds as the losses are realized.                    

     The Transfer and Servicing Agreement provides that the Trust Administrator,
for the benefit of the Noteholders, shall establish and maintain one or more    
accounts, known as a "Collection Account," into which the Servicer and the      
Subservicer, as applicable, is generally required to deposit or cause to be     
deposited from the Custodial Accounts on the Servicer Remittance Date. The      
Transfer and Servicing Agreement permits the Trust Administrator to direct any  
depository institution maintaining the related Collection Account to invest the 
funds in the Collection Account in one or more investments acceptable to Fitch, 
Moody's and S&P as provided in the Transfer and Servicing Agreement, that       
mature, unless payable on demand, generally no later than one Business Day prior
to the related Payment Date. The Master Servicer will be entitled to all income 
and gain realized from the Collection Account investments, and the income and   
gain will be subject to withdrawal by the Master Servicer from time to time. The
Master Servicer will be required to deposit the amount of any losses incurred in
respect to the Collection Account investments out of its own funds as the losses
are realized.                                                                   

Payments                                                                        

    General. Payments on the Notes will be made by the Trust Administrator, on
each Payment Date, commencing in December 2005, to the persons in whose names   
the Notes are registered at the close of business on the Record Date.           

   Payments on each Payment Date will be made by check mailed to the address
of the person entitled to payments as it appears on the note register, or, in   
the case of any Noteholder that has so notified the Trust Administrator in      
writing in accordance with the Transfer and Servicing Agreement, by wire        
transfer in immediately available funds to the account of such Noteholder at a  
bank or other depository institution having appropriate wire transfer           
facilities; provided, however, that the final payment in retirement of the Notes
will be made only upon presentation and surrender of such Notes at the office of
the Trust Administrator or such other address designated in writing by the Trust
Administrator. On each Payment Date, a holder of a Note will receive such       
holder's Percentage Interest of the amounts required to be paid with respect to 
the applicable class of Notes.                                                  

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   Payments of Interest. On each Payment Date, interest payable on the Notes
will equal interest accrued at the then applicable Interest Rate for the related
Accrual Period. All calculations of interest on the Notes (other than the Class 
M10, Class M11, Class M12 and Class M13 Notes) will be made on the basis of a   
360-day year and the actual number of days elapsed in the related Accrual       
Period. Calculations of interest on the Class M10, Class M11, Class M12 and     
Class M13 Notes will be made on the basis of a 360 day year consisting of twelve
30 day months.                                                                  

     (A) On each Payment Date, the Interest Funds for Group 1 for such date will
be paid in the following order of priority:                                     

         (i)  to the Swap Counterparty, to the extent not previously paid from
            the Collection Account, the Group 1 Percentage of any Net Swap
        Payment for such Payment Date and swap termination amounts
               payable to the Swap Counterparty in the event that the Trust is a
               defaulting party or an affected party under the terms of the Swap
Agreement;                                        

          (ii) to the Class 1-A Notes, Current Interest thereon for such Payment
Date;                                             

       (iii) pro rata, to the Class 2-A1 Notes, Class 2-A2 Notes and Class
              2-A3 Notes, Current Interest thereon (after giving effect to the
               payment of the Interest Funds for Group 2) for such Payment Date;
and                                               

         (iv) for application pursuant to clause (C) below, any Interest Funds
        for Group 1 remaining undistributed for such Payment Date.

    On any Payment Date for which the Trust has Net Swap Receipts, the Group 1
Percentage of such Net Swap Receipts shall be included in the Interest Funds in 
order to make payments as set forth above.                                      

     (B) On each Payment Date, the Interest Funds for Group 2 for such date will
be paid in the following order of priority:                                     

         (i)  to the Swap Counterparty, to the extent not previously paid from
            the Collection Account, the Group 2 Percentage of any Net Swap
        Payment for such Payment Date and swap termination amounts
               payable to the Swap Counterparty in the event that the Trust is a
               defaulting party or an affected party under the terms of the Swap
Agreement;                                        

        (ii) pro rata, to the Class 2-A1 Notes, the Class 2-A2 Notes and the
               Class 2-A3 Notes, Current Interest thereon for such Payment Date;

        (iii) to the Class 1-A Notes, Current Interest thereon (after giving
               effect to the payment of the Interest Funds for Group 1) for such
Payment Date; and                                 

         (iv) for application pursuant to clause (C) below, any Interest Funds
        for Group 2 remaining undistributed for such Payment Date.

    On any Payment Date for which the Trust has Net Swap Receipts, the Group 2
Percentage of such Net Swap Receipts shall be included in the Interest Funds in 
order to make payments as set forth above.                                      

     (C) On each Payment Date, the aggregate of any remaining Interest Funds for
Group 1 and Group 2 from clauses (A)(iv) and (B)(iv) above, respectively, will  
be paid in the following order of priority:                                     

        (i)  to the Class M1 Notes, Current Interest for such class for such
Payment Date;                                     

        (ii) to the Class M2 Notes, Current Interest for such class for such
Payment Date;                                     

         (iii) to the Class M3 Notes, Current Interest for such class for such
Payment Date;                                     

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        (iv) to the Class M4 Notes, Current Interest for such class for such
Payment Date;                                     

        (v)  to the Class M5 Notes, Current Interest for such class for such
Payment Date;                                     

        (vi) to the Class M6 Notes, Current Interest for such class for such
Payment Date;                                     

         (vii) to the Class M7 Notes, Current Interest for such class for such
Payment Date;                                     

          (viii) to the Class M8 Notes, Current Interest for such class for such
Payment Date;                                     

        (ix) to the Class M9 Notes, Current Interest for such class for such
Payment Date;                                     

         (x)  to the Class M10 Notes, Current Interest for such class for such
Payment Date;                                     

         (xi) to the Class M11 Notes, Current Interest for such class for such
Payment Date;                                     

          (xii) to the Class M12 Notes, Current Interest for such class for such
Payment Date;                                     

      (xiii) to the Class M13 Notes, Current Interest for such class for
such Payment Date;                                

 (xiv) to the Indenture Trustee, the Owner Trustee, the Master
     Servicer, the Trust Administrator, the Servicer and the
       Subservicer, previously unreimbursed extraordinary costs,
             liabilities and expenses to the extent provided in the Transfer
and Servicing Agreement; and                      

    (xv) for application as part of Monthly Excess Cashflow for such
              Payment Date, as described at "--Credit Enhancement--Application
              of Monthly Excess Cashflow" below any Interest Funds for Group 1
and Group 2 remaining for such Payment Date.      

     Notwithstanding the foregoing, on each Payment Date, payments in respect of
interest will be made to each class of Class A Notes from the Interest Funds for
the related Mortgage Group before any such payments are made to such Class A    
Notes from the Interest Funds for any other Mortgage Group.                     

   Payments of Principal. On each Payment Date, the Principal Payment Amount
for each Mortgage Group and for each Payment Date is required to be paid as     
follows until the Principal Payment Amount has been fully paid:                 

    I. On each Payment Date (a) prior to the Stepdown Date or (b) with respect
to which a Trigger Event is in effect, the Trust Administrator will make the    
following payments, concurrently, to the extent of funds in the Collection      
Account available therefor:                                                     

   (A) For Group 1: the Principal Payment Amount for Group 1 will be paid in
the following order of priority:                                                

         (i)  to the Swap Counterparty, to the extent not previously paid from
    the Collection Account, the Group 1 Percentage of swap
               termination amounts payable to the Swap Counterparty in the event
             that the Trust is a defaulting party or an affected party under
the terms of the Swap Agreement;                  

         (ii) to the Class 1-A Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

    (iii) sequentially, to the Class 2-A1, Class 2-A2 and Class 2-A3
               Notes, in that order, after giving effect to payments pursuant to
               clause (I)(B)(ii) below, until the Class Principal Amount of each
          such class has been reduced to zero; provided that if on any
            Payment Date the Total Principal Deficiency Amount exceeds the
         aggregate Class Principal Amounts of the Class M Notes, all
payments pursuant to this clause will be made     

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             concurrently, on a pro rata basis, to the Class 2-A1 Notes, the
Class 2-A2 Notes and the Class 2-A3 Notes;        

        (iv) to the Class M1 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (v)  to the Class M2 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (vi) to the Class M3 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

         (vii) to the Class M4 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

          (viii) to the Class M5 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (ix) to the Class M6 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (x)  to the Class M7 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (xi) to the Class M8 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

         (xii) to the Class M9 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

      (xiii) to the Class M10 Notes, until the Class Principal Amount of
such class has been reduced to zero;              

          (xiv) to the Class M11 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

         (xv) to the Class M12 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

          (xvi) to the Class M13 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

       (xvii) to the Swap Counterparty, to the extent not previously paid,
               the Group 1 Percentage of swap termination amounts payable to the
            Swap Counterparty in the event that the Swap Counterparty is a
        defaulting party or the sole affected party under the Swap
Agreement; and                                    

       (xviii) for application as part of Monthly Excess Cashflow for such
              Payment Date, as described at "--Credit Enhancement--Application
           of Monthly Excess Cashflow" below, any such Principal Payment
        Amount for Group 1 remaining after application pursuant to
clauses (i) through (xvii) above.                 

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   (B) For Group 2: the Principal Payment Amount for Group 2 will be paid in
the following order of priority:                                                

         (i)  to the Swap Counterparty, to the extent not previously paid from
    the Collection Account, the Group 2 Percentage of swap
               termination amounts payable to the Swap Counterparty in the event
             that the Trust is a defaulting party or an affected party under
the terms of the Swap Agreement;                  

        (ii) sequentially, to the Class 2-A1 Notes, the Class 2-A2 Notes and
            the Class 2-A3 Notes, in that order, until the Class Principal
               Amount of each such class has been reduced to zero; provided that
          if on any Payment Date the Total Principal Deficiency Amount
          exceeds the aggregate Class Principal Amounts of the Class M
      Notes, all payments pursuant to this clause will be made
             concurrently, on a pro rata basis, to the Class 2-A1 Notes, the
Class 2-A2 Notes and the Class 2-A3 Notes;        

         (iii) to the Class 1-A Notes after giving effect to payments pursuant
             to clause (I)(A)(ii) above, until the Class Principal Amount of
such class has been reduced to zero;              

        (iv) to the Class M1 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (v)  to the Class M2 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (vi) to the Class M3 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

         (vii) to the Class M4 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

          (viii) to the Class M5 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (ix) to the Class M6 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (x)  to the Class M7 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

        (xi) to the Class M8 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

         (xii) to the Class M9 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

      (xiii) to the Class M10 Notes, until the Class Principal Amount of
such class has been reduced to zero;              

          (xiv) to the Class M11 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

         (xv) to the Class M12 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

          (xvi) to the Class M13 Notes, until the Class Principal Amount of such
class has been reduced to zero;                   

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       (xvii) to the Swap Counterparty, to the extent not previously paid,
               the Group 2 Percentage of swap termination amounts payable to the
            Swap Counterparty in the event that the Swap Counterparty is a
        defaulting party or the sole affected party under the Swap
Agreement; and                                    

       (xviii) for application as part of Monthly Excess Cashflow for such
              Payment Date, as described at "--Credit Enhancement--Application
           of Monthly Excess Cashflow" below, any such Principal Payment
        Amount for Group 2 remaining after application pursuant to
clauses (i) through (xvii) above.                 

 II. On each Payment Date (a) on or after the Stepdown Date and (b) with
respect to which a Trigger Event is not in effect, the Principal Payment Amount 
for each Mortgage Group for such date will be paid in the following order of    
priority:                                                                       

         (i)  to the Swap Counterparty, to the extent not previously paid from
             the Collection Account, the swap termination amounts payable to
               the Swap Counterparty in the event that the Trust is a defaulting
               party or an affected party under the terms of the Swap Agreement;

  (ii) to the Class 1-A Notes (from amounts in Group 1 except as
               provided below) and to the Class 2-A1 Notes, Class 2-A2 Notes and
          Class 2-A3 Notes (from amounts in Group 2 except as provided
          below), sequentially, in that order, in each case, an amount
             equal to the lesser of (x) the Principal Payment Amount for the
              related Mortgage Group for such Payment Date and (y) the Related
              Senior Principal Payment Amount for such Mortgage Group for such
            Payment Date, in each case until the Class Principal Amount of
            each such class or classes has been reduced to zero; provided,
            however, to the extent that the Principal Payment Amount for a
         Mortgage Group exceeds the Related Senior Principal Payment
             Amount for such Mortgage Group, such excess shall be applied to
               the class or classes of Class A Notes of the other Mortgage Group
              (in the case of the Class 2-A1, Class 2-A2 and Class 2-A3 Notes,
              sequentially, in that order), but in an amount not to exceed the
               Senior Principal Payment Amount for such Payment Date (as reduced
               by any payments pursuant to subclauses (x) and (y) of this clause
             (a) on such Payment Date); provided that if on any Payment Date
               the Total Principal Deficiency Amount exceeds the aggregate Class
            Principal Amounts of the Class M Notes, to the Class 1-A Notes
             (from the amounts in Group 1) and to the Class 2-A1, Class 2-A2
           and Class 2-A3 Notes (from amounts in Group 2), pro rata, the
              Principal Payment Amount for the related Mortgage Group for such
Payment Date;                                     

         (iii) to the Class M1 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
              paid to the Senior Notes on such Payment Date pursuant to clause
          (ii) above, and (y) the M1 Principal Payment Amount for such
              Payment Date, until the Class Principal Amount of such class has
been reduced to zero;                             

        (iv) to the Class M2 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
             paid to the Senior Notes and the Class M1 Notes on such Payment
              Date pursuant to clauses (ii) and (iii) above, respectively, and
              (y) the M2 Principal Payment Amount for such Payment Date, until
          the Class Principal Amount of such class has been reduced to
zero;                                             

        (v)  to the Class M3 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
           paid to the Senior Notes, Class M1 and Class M2 Notes on such
          Payment Date pursuant to clauses (ii), (iii) and (iv) above,
            respectively, and (y) the M3 Principal Payment Amount for such
              Payment Date, until the Class Principal Amount of such class has
been reduced to zero;                             

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        (vi) to the Class M4 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
             paid to the Senior Notes, Class M1, Class M2 and Class M3 Notes
            on such Payment Date pursuant to clauses (ii), (iii), (iv) and
              (v) above, respectively, and (y) the M4 Principal Payment Amount
             for such Payment Date, until the Class Principal Amount of each
such class has been reduced to zero;              

         (vii) to the Class M5 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
              paid to the Senior Notes, Class M1, Class M2, Class M3 and Class
            M4 Notes on such Payment Date pursuant to clauses (ii), (iii),
              (iv), (v) and (vi) above, respectively, and (y) the M5 Principal
             Payment Amount for such Payment Date, until the Class Principal
 Amount of each such class has been reduced to zero;

          (viii) to the Class M6 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
              paid to the Senior Notes, Class M1, Class M2, Class M3, Class M4
               and Class M5 Notes on such Payment Date pursuant to clauses (ii),
               (iii), (iv), (v), (vi) and (vii) above, respectively, and (y) the
          M6 Principal Payment Amount for such Payment Date, until the
           Class Principal Amount of each such class has been reduced to
zero;                                             

        (ix) to the Class M7 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
               paid to the Senior Notes, Class M1, Class M2, Class M3, Class M4,
          Class M5 and Class M6 Notes on such Payment Date pursuant to
           clauses (ii), (iii), (iv), (v), (vi), (vii) and (viii) above,
            respectively, and (y) the M7 Principal Payment Amount for such
               Payment Date, until the Class Principal Amount of each such class
has been reduced to zero;                         

        (x)  to the Class M8 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
            paid to the Senior Notes and the Class M1, Class M2, Class M3,
             Class M4, Class M5, Class M6 and Class M7 Notes on such Payment
           Date pursuant to clauses (ii), (iii), (iv), (v), (vi), (vii),
           (viii) and (ix) above, respectively, and (y) the M8 Principal
             Payment Amount for such Payment Date, until the Class Principal
 Amount of each such class has been reduced to zero;

        (xi) to the Class M9 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
            paid to the Senior Notes and the Class M1, Class M2, Class M3,
               Class M4, Class M5, Class M6, Class M7 and Class M8 Notes on such
            Payment Date pursuant to clauses (ii), (iii), (iv), (v), (vi),
             (vii), (viii), (ix) and (x) above, respectively, and (y) the M9
             Principal Payment Amount for such Payment Date, until the Class
           Principal Amount of each such class has been reduced to zero;

          (xii) to the Class M10 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
            paid to the Senior Notes and the Class M1, Class M2, Class M3,
           Class M4, Class M5, Class M6, Class M7, Class M8 and Class M9
               Notes on such Payment Date pursuant to clauses (ii), (iii), (iv),
               (v), (vi), (vii), (viii), (ix), (x) and (xi) above, respectively,
             and (y) the M10 Principal Payment Amount for such Payment Date,
          until the Class Principal Amount of each such class has been
reduced to zero;                                  

       (xiii) to the Class M11 Notes, an amount equal to the lesser of (x)
           the excess of (a) the aggregate Principal Payment Amounts for
            each of Group 1 and Group 2 for such Payment Date over (b) the
         amount paid to the Senior Notes and the Class M1, Class M2,

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               Class M3, Class M4, Class M5, Class M6, Class M7, Class M8, Class
             M9 and Class M10 Notes on such Payment Date pursuant to clauses
              (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix), (x), (xi) and
          (xii) above, respectively, and (y) the M11 Principal Payment
               Amount for such Payment Date, until the Class Principal Amount of
each such class has been reduced to zero;         

          (xiv) to the Class M12 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
            paid to the Senior Notes and the Class M1, Class M2, Class M3,
               Class M4, Class M5, Class M6, Class M7, Class M8, Class M9, Class
              M10 and Class M11 Notes on such Payment Date pursuant to clauses
           (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix), (x), (xi),
             (xii) and (xiii) above, respectively, and (y) the M12 Principal
             Payment Amount for such Payment Date, until the Class Principal
 Amount of each such class has been reduced to zero;

         (xv) to the Class M13 Notes, an amount equal to the lesser of (x) the
               excess of (a) the aggregate Principal Payment Amounts for each of
           Group 1 and Group 2 for such Payment Date over (b) the amount
            paid to the Senior Notes and the Class M1, Class M2, Class M3,
               Class M4, Class M5, Class M6, Class M7, Class M8, Class M9, Class
              M10, Class M11 and Class M12 Notes on such Payment Date pursuant
           to clauses (ii), (iii), (iv), (v), (vi), (vii), (viii), (ix),
             (x), (xi), (xii), (xiii) and (xiv) above, respectively, and (y)
               the M13 Principal Payment Amount for such Payment Date, until the
           Class Principal Amount of each such class has been reduced to
zero;                                             

      (xvi) to the Swap Counterparty, to the extent not previously paid,
              swap termination amounts payable to the Swap Counterparty in the
           event that the Swap Counterparty is a defaulting party or the
            sole affected party under the terms of the Swap Agreement; and

      (xvii) for application as part of Monthly Excess Cashflow for such
Payment Date, as described under "--Credit        
             Enhancement--Application of Monthly Excess Cashflow" below, any
       such Principal Payment Amount remaining after application
pursuant to clauses (i) through (xvi) above.      

Credit Enhancement                                                              

Credit enhancement for the Notes consists of, in addition to the      
subordination of the Class M Notes, excess interest including Net Swap Receipts 
payable by the Swap Counterparty in respect of the Swap Agreement, as further   
described in "--The Swap Agreement" below, overcollateralization and limited    
cross-collateralization, in each case as described herein.                      

Subordination. The rights of holders of the Class M Notes to receive  
payments with respect to the Mortgage Loans will be subordinated, to the extent 
described herein, to such rights of holders of each class of Notes having a     
higher priority of payment, as described under "--Payments--Payments of         
Interest" and "--Payments--Payments of Principal" above. This subordination is  
intended to enhance the likelihood of regular receipt by holders of Notes having
a higher priority of payment of the full amount of interest and principal       
payable thereto, and to afford such Noteholders limited protection against      
Realized Losses incurred with respect to the Mortgage Loans.                    

The limited protection afforded to holders of Notes by means of the   
subordination of the Class M Notes having a lower priority of payment will be   
accomplished by the preferential right of holders of such Notes to receive,     
prior to any payment in respect of any Interest Funds or Principal Funds,       
respectively, being made on any Payment Date in respect of Notes having a lower 
priority of payment, the amounts of interest due them and principal available   
for payment, respectively, on such Payment Date.                                

    Realized Losses. Realized Losses on Mortgage Loans will have the effect of
reducing amounts payable in respect of or amounts available to make payments in 
respect of first, the Ownership Certificate (through the                        

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application of Monthly Excess Cashflow to fund such deficiency and through a    
reduction in the Overcollateralization Amount for the related Payment Date);    
second, the Class M13 Notes; third, the Class M12 Notes; fourth, the Class M11  
Notes; fifth, the Class M10 Notes; sixth, the Class M9 Notes; seventh, the Class
M8 Notes; eighth, the Class M7 Notes; ninth, the Class M6 Notes; tenth, the     
Class M5 Notes; eleventh, the Class M4 Notes; twelfth, the Class M3 Notes;      
thirteenth, the Class M2 Notes; fourteenth, the Class M1 Notes, before reducing 
amounts available to make payments in respect of the Class A Notes. Realized    
Losses will not reduce the Class Principal Amount of any Note, however, under   
certain loss scenarios, there may not be enough principal and interest from the 
Mortgage Loans to pay the Notes all principal and interest to which they are    
entitled.                                                                       

     To the extent that Realized Losses are incurred, those Realized Losses will
reduce the Aggregate Loan Balance, and thus may reduce the Overcollateralization
Amount. As described herein, the Overcollateralization Amount is increased and  
maintained by application of Monthly Excess Cashflow to make payments of        
principal on the Notes.                                                         

  Excess Interest. The Mortgage Loans included in each Mortgage Group bear
interest each month that in the aggregate is expected to exceed the amount      
needed to pay monthly interest on the related Notes, the fees, if any, and      
expenses of the Servicer, the Subservicer, the Master Servicer, the Trust       
Administrator, the Indenture Trustee and the Owner Trustee. Such excess interest
from the Mortgage Loans each month will be available to absorb Realized Losses  
on the Mortgage Loans and to achieve and maintain overcollateralization at the  
required levels.                                                                

    In addition, allocable portions of Net Swap Receipts received by the Trust
in respect of the Swap Agreement shall be included in Interest Funds with       
respect to each Mortgage Group.                                                 

   Overcollateralization. The Aggregate Collateral Balance as of the Closing
Date will exceed the initial aggregate Class Principal Amount of the Notes by   
approximately $9,322,945, which represents approximately 0.80% of the Aggregate 
Collateral Balance as of the Closing Date. The weighted average of the Net      
Mortgage Rates of the Mortgage Loans is currently, and generally in the future  
is expected to be, higher than the weighted average Interest Rate on the Notes. 
As described below, interest collections will be applied to payments of         
principal to the extent needed to maintain overcollateralization (i.e., the     
excess of the Aggregate Collateral Balance as of the related Due Period over the
aggregate Class Principal Amount of the Notes) at the required Targeted         
Overcollateralization Amount. However, Realized Losses with respect to Mortgage 
Loans in any Mortgage Group will reduce overcollateralization, and could result 
in an overcollateralization deficiency.                                         

  As described herein, to the extent that the Overcollateralization Amount
exceeds the related Targeted Overcollateralization Amount, a portion of the     
Principal Payment Amount will not be applied in reduction of the Class Principal
Amounts of the Notes, but will instead be applied as described below.           

     Application of Monthly Excess Cashflow. The Monthly Excess Interest for any
Payment Date (see "--Payments--Payments of Interest" above) and the Aggregate   
Overcollateralization Release Amount for such date will constitute the "Monthly 
Excess Cashflow" for such Payment Date, which will, on each Payment Date be paid
in the following orders of priority, as applicable:                             

    (1) For each Payment Date occurring (a) before the Stepdown Date or (b) on
or after the Stepdown Date but for which a Trigger Event is in effect,          

 (a)  up to the Overcollateralization Deficiency Amount for such Payment
Date, in the following order of priority:                   

     (i)  concurrently, in proportion to the aggregate Class Principal
           Amounts of each Class of Senior Notes, after giving effect to
               previous principal payments on such Payment Date (as described in
           "--Payments--Payments of Principal" above), to the Class 1-A,
             Class 2-A1, Class 2-A2 and Class 2-A3 Notes, in accordance with
         the applicable Senior Priorities, until the Class Principal
 Amount of each such class has been reduced to zero;

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     (ii) to the Class M1 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

      (iii) to the Class M2 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (iv) to the Class M3 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (v)  to the Class M4 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (vi) to the Class M5 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

      (vii) to the Class M6 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

       (viii) to the Class M7 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (ix) to the Class M8 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (x)  to the Class M9 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

      (xi) to the Class M10 Notes, in reduction of their Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (xii) to the Class M11 Notes, in reduction of the Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

      (xiii) to the Class M12 Notes, in reduction of the Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (xiv) to the Class M13 Notes, in reduction of the Class Principal
             Amount, until the Class Principal Amount of such class has been
reduced to zero;                                  

     (b)  to the extent of any Available Funds Shortfall, to the payment of such
          amounts to the Notes, in the order of priority of the classes of Notes
          as set forth immediately above, and with respect to the Class A Notes,
       in proportion to their respective amounts of unpaid Available Funds
         Shortfalls, until each such class has received in full all amounts of
any Available Funds Shortfall;                              

    (c)  to the Swap Counterparty, to the extent not previously paid, the swap
          termination amounts payable to the Swap Counterparty in the event that
          the Swap Counterparty is a defaulting party or the sole affected party
under the terms of the Swap Agreement;                      

   (d)  sequentially, to the Class M1 Notes, Class M2 Notes, Class M3 Notes,
         Class M4 Notes, Class M5 Notes, Class M6 Notes, Class M7 Notes, Class
       M8 Notes, Class M9 Notes, Class M10, Class M11, Class M12 and Class
       M13 Notes in that order, Deferred Interest, if any, for such class,
         until each such class has received in full its Deferred Interest; and

   (e)  to the Ownership Certificate, the amount distributable thereon under
the Transfer and Servicing Agreement; or                    

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   (2) for each Payment Date occurring on or after the Stepdown Date and for
which a Trigger Event is not in effect, in the following order of priority:     

   (a)  concurrently, in proportion to the aggregate Class Principal Amounts
  of the Senior Notes, after giving effect to previous principal
        payments on such Payment Date (as described in "--Payments--Payments
      of Principal" above), to the Class 1-A, Class 2-A1, Class 2-A2 and
          Class 2-A3 Notes (with respect to the Class 2-A1, Class 2-A2 and Class
        2-A3 Notes, to be paid sequentially, in that order; provided that if
         on any Payment Date the Total Principal Deficiency Amount exceeds the
        aggregate Class Principal Amounts of the Class M Notes, all payments
    pursuant to this clause will be made concurrently, on a pro rata
      basis, to the Class 2-A1 Notes, the Class 2-A2 Notes and the Class
         2-A3 Notes ), until the aggregate Class Principal Amount of the Class
         A Notes, after giving effect to payments on such Payment Date, equals
the Senior Target Amount;                                   

   (b)  to the Class M1 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
         Class M1 Notes, after giving effect to payments on such Payment Date,
equals the M1 Target Amount;                                

   (c)  to the Class M2 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
        Class M1 and Class M2 Notes, after giving effect to payments on such
Payment Date, equals the M2 Target Amount;                  

   (d)  to the Class M3 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
          Class M1, Class M2 and Class M3 Notes, after giving effect to payments
on such Payment Date, equals the M3 Target Amount;          

   (e)  to the Class M4 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
        Class M1, Class M2, Class M3 and Class M4 Notes, after giving effect
  to payments on such Payment Date, equals the M4 Target Amount;

   (f)  to the Class M5 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
    Class M1, Class M2, Class M3, Class M4 and Class M5 Notes, after
        giving effect to payments on such Payment Date, equals the M5 Target
Amount;                                                     

   (g)  to the Class M6 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
        Class M1, Class M2, Class M3, Class M4, Class M5 and Class M6 Notes,
       after giving effect to payments on such Payment Date, equals the M6
Target Amount;                                              

   (h)  to the Class M7 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
        Class M1, Class M2, Class M3, Class M4, Class M5, Class M6 and Class
          M7 Notes, after giving effect to payments on such Payment Date, equals
the M7 Target Amount;                                       

   (i)  to the Class M8 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
        Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7
       and Class M8 Notes, after giving effect to payments on such Payment
Date, equals the M8 Target Amount;                          

   (j)  to the Class M9 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
         Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7,
        Class M8 and Class M9 Notes, after giving effect to payments on such
Payment Date, equals the M9 Target Amount;                  

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    (k)  to the Class M10 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
         Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7,
  Class M8, Class M9 and Class M10 Notes, after giving effect to
payments on such Payment Date, equals the M10 Target Amount;

    (l)  to the Class M11 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
         Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7,
          Class M8, Class M9, Class M10 and Class M11 Notes, after giving effect
   to payments on such Payment Date, equals the M11 Target Amount;

    (m)  to the Class M12 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
         Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7,
       Class M8, Class M9, Class M10, Class M11 and Class M12 Notes, after
         giving effect to payments on such Payment Date, equals the M12 Target
Amount;                                                     

    (n)  to the Class M13 Notes, in reduction of their Class Principal Amount,
          until the aggregate Class Principal Amount of the Senior Notes and the
         Class M1, Class M2, Class M3, Class M4, Class M5, Class M6, Class M7,
     Class M8, Class M9, Class M10, Class M11, Class M12 and Class M13
       Notes, after giving effect to payments on such Payment Date, equals
the M13 Target Amount;                                      

     (o)  to the extent of any Available Funds Shortfall, to the payment of such
          amounts to the Notes, in the order of priority of the classes of Notes
         as set forth immediately above, and with respect to the Senior Notes,
       in proportion to their amount of unpaid Available Funds Shortfalls,
 until each such class has received in full all amounts of any
Available Funds Shortfall;                                  

    (p)  to the Swap Counterparty, to the extent not previously paid, the swap
          termination amounts payable to the Swap Counterparty in the event that
          the Swap Counterparty is a defaulting party or the sole affected party
under the terms of the Swap Agreement;                      

   (q)  sequentially, to the Class M1 Notes, Class M2 Notes, Class M3 Notes,
         Class M4 Notes, Class M5 Notes, Class M6 Notes, Class M7 Notes, Class
         M8 Notes, Class M9 Notes, Class M10 Notes, Class M11 Notes, Class M12
        Notes and Class M13 Notes, in that order, Deferred Interest, if any,
  for such class, until each such class has received in full its
Deferred Interest; and                                      

   (r)  to the Ownership Certificate, the amount distributable thereon under
the Transfer and Servicing Agreement.                       

Calculation of One-Month LIBOR                                                  

     On each Interest Determination Date, the Trust Administrator will determine
One-Month LIBOR for the related Accrual Period on the basis of (1) the offered  
rates for one-month United States dollar deposits, as such rates appear on      
Moneyline Telerate Page 3750, as of 11:00 a.m. (London time) on such Interest   
Determination Date or (2) if such rate does not appear on Moneyline Telerate    
Page 3750 as of 11:00 a.m. (London time), the Trust Administrator will determine
such rate on the basis of the offered rates of the Reference Banks for one-month
United States dollar deposits, as such rates appear on the Reuters Screen LIBO  
Page, as of 11:00 a.m. (London time) on such Interest Determination Date.       

   If One-Month LIBOR is determined under clause (2) above, on each Interest
Determination Date, One-Month LIBOR for the related Accrual Period for the Notes
will be established by the Trust Administrator as follows:                      

               (1)  If on such Interest Determination Date two or more Reference
                  Banks provide such offered quotations, One-Month LIBOR for
             the related Accrual Period for the Notes shall be the
                   arithmetic mean of such offered quotations (rounded upwards
                if necessary to the nearest whole multiple of 0.03125%).

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        (2)  If on such Interest Determination Date fewer than two
                  Reference Banks provide such offered quotations, One-Month
                   LIBOR for the related Accrual Period shall be the higher of
                  (x) One-Month LIBOR as determined on the previous Interest
             Determination Date and (y) the Reserve Interest Rate.

     The establishment of One-Month LIBOR on each Interest Determination Date by
the Trust Administrator and the Trust Administrator's calculation of the rate of
interest applicable to the Notes, for the related Accrual Period for the Notes  
shall (in the absence of manifest error) be final and binding.                  

The Swap Agreement                                                              

 The Swap Agreement. On or before the Closing Date, the Trust will enter
into a Swap Agreement with the Swap Counterparty which will be assigned to the  
Indenture Trustee. Such Swap Agreement will be for the benefit of the Notes.    
Under the Swap Agreement, the Swap Counterparty will agree to make payments to  
the Trust on the second Business Day prior to each Calculation Period End Date. 
The Swap Notional Balance with respect to the Swap Agreement for each applicable
Calculation Period End Date is set forth in the table below:                    

                                                                [Download Table]

                                        Swap Notional
     Calculation Period End Date           Balance   
-------------------------------------   -------------
                                                     
December 25, 2005....................    $700,000,000
January 25, 2006.....................    $700,000,000
February 25, 2006....................    $600,000,000
March 25, 2006.......................    $600,000,000
April 25, 2006.......................    $550,000,000
May 25, 2006.........................    $550,000,000
June 25, 2006........................    $600,000,000
July 25, 2006........................    $600,000,000
August 25, 2006......................    $600,000,000
September 25, 2006...................    $550,000,000
October 25, 2006.....................    $550,000,000
November 25, 2006....................    $550,000,000
December 25, 2006....................    $500,000,000
January 25, 2007.....................    $450,000,000
February 25, 2007....................    $450,000,000
March 25, 2007.......................    $450,000,000
April 25, 2007.......................    $450,000,000
May 25, 2007.........................    $425,000,000
June 25, 2007........................    $450,000,000
July 25, 2007........................    $325,000,000
August 25, 2007......................    $275,000,000
September 25, 2007...................    $250,000,000
October 25, 2007.....................    $125,000,000
November 25, 2007....................    $100,000,000
December 25, 2007....................    $100,000,000
January 25, 2008.....................    $100,000,000
February 25, 2008....................    $100,000,000
March 25, 2008.......................    $ 75,000,000
April 25, 2008.......................    $ 75,000,000
May 25, 2008.........................    $ 75,000,000
June 25, 2008........................    $ 25,000,000
July 25, 2008........................    $ 25,000,000
August 25, 2008......................    $ 25,000,000
September 25, 2008...................    $ 25,000,000
October 25, 2008.....................    $ 25,000,000
November 25, 2008....................    $ 25,000,000
December 25, 2008....................    $ 25,000,000

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                                                                [Download Table]

                                        Swap Notional
     Calculation Period End Date           Balance   
-------------------------------------   -------------
                                                     
January 25, 2009.....................    $ 25,000,000

Under the Swap Agreement, on the second Business Day prior to each    
Calculation Period End Date, the Trust will be obligated to pay to the Swap     
Counterparty the Swap Fixed Rate Amount (calculated on the basis of a 360-day   
year consisting of twelve 30-day months, except in the case of the first month  
for which the month is calculated to have 32 days), which is an amount based on 
the applicable Swap Fixed Rate and the applicable Swap Notional Balance for such
Calculation Period End Date, and the Swap Counterparty will be obligated to pay 
to the Trust an amount based on One-Month LIBOR (calculated on the basis of a   
360-day year and the actual number of days elapsed during the previous Accrual  
Period, except in the case of the first Accrual Period for which the number of  
days shall be the number of days elapsed since the Closing Date) and the        
applicable Swap Notional Balance for such Calculation Period End Date. If, on   
the second Business Day prior to any Calculation Period End Date, the amount    
received by the Trust under the Swap Agreement from the Swap Counterparty       
exceeds the amount paid by the Trust to the Counterparty, the Trust will have   
Net Swap Receipts. If, on the second Business Day prior to any Calculation      
Period End Date, the amount paid by the Trust under the Swap Agreement to the   
Swap Counterparty exceeds the amount received by the Trust from the Swap        
Counterparty, the Trust will have Net Swap Payments.                            

 On any Payment Date for which the Trust has Net Swap Receipts, such Net
Swap Receipts shall be included in the Interest Funds with respect to each      
Mortgage Group allocated in accordance with the Group 1 Percentage or the Group 
2 Percentage, as applicable, for payment to the Notes as described under        
"--Payments--Payments of Interest." To the extent such amounts are not utilized 
to pay the Notes, such amounts will be distributed to the holder of the         
Ownership Certificate.                                                          

The Swap Agreement is terminable by the Trust or the Swap Counterparty
following the occurrence of certain specified events of default, including      
failure of the Swap Counterparty to make required payments, and certain standard
events under the 1992 International Swaps and Derivatives Association, Inc.     
Master Agreement (Multicurrency--Cross Border).                                 

     The Swap Notional Balances in the table above are not based upon the actual
balances of the Mortgage Loans included in the Mortgage Pool. To the extent that
the Mortgage Loans experience high rates of prepayments or losses, it is        
possible that the interest generated by the Mortgage Loans will decline         
proportionately faster than the related Swap Notional Balance declines, and     
consequently, it is possible that the Interest Funds will be reduced by a       
greater percentage than the concurrent reduction in the related Swap Notional   
Balance. Because the obligation of the Trust to make payments of the Swap Fixed 
Rate Amount under the Swap Agreement to the Swap Counterparty is based upon the 
related Swap Notional Balance, such prepayments or losses could result in the   
reduction of the Interest Funds to fund overcollateralization, Monthly Excess   
Cashflow or Current Interest due on the Notes. In addition, if the Swap         
Agreement terminates as a result of a default of either party, the Trust may not
be entitled to any further payments from the Swap Counterparty, and may result  
in shortfalls in interest on the Notes. We can give you no assurance that the   
Mortgage Loans will prepay at the rate used in establishing the schedule of Swap
Notional Balances set forth above, or that the Mortgage Loans will prepay at any
other rate.                                                                     

The Swap Counterparty. The information set forth in the following     
paragraphs has been provided by the Swap Counterparty. None of the Seller, the  
Depositor, the Indenture Trustee, the Master Servicer, the Servicer, the Trust  
Administrator, the Underwriters nor any of their respective affiliates has made 
or will make any representation as to the accuracy or completeness of this      
information.                                                                    

 Bank of America, N.A. Bank of America, N.A. (the "Bank"), is a national
banking association organized under the laws of the United States, with its     
principal executive offices located in Charlotte, North Carolina. The Bank is a 
wholly-owned indirect subsidiary of Bank of America Corporation (the            
"Corporation") and is engaged in general consumer banking, commercial banking   
and trust business, offering a wide range of commercial, corporate,             
international, financial market, retail and fiduciary banking services. As of   
June 30, 2005, the Bank had consolidated assets of $1,048 billion, consolidated 
deposits of $685 billion and stockholder's equity of $102 billion based on      
regulatory accounting principles.                                               

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    The Corporation is a bank holding company and a financial holding company,
with its principal executive offices located in Charlotte, North Carolina.      
Additional information regarding the Corporation is set forth in its Annual     
Report on Form 10-K for the fiscal year ended December 31, 2004, together with  
any subsequent documents it filed with the Securities and Exchange Commission   
(the "Commission") pursuant to the Securities Exchange Act of 1934, as amended  
(the "Exchange Act").                                                           

    Recent Developments. On April 1, 2004 the Corporation completed its merger
with FleetBoston Financial Corporation, and, on June 13, 2005, the Bank         
completed its merger with Fleet National Bank. On June 30, 2005, the Corporation
announced its intention to acquire MBNA Corporation.                            

Additional information regarding the foregoing is available from the  
filings made by the Corporation with the SEC, which filings can be    
   inspected and copied at the public reference facilities maintained by the
SEC at 100 F Street, N.E., Washington, D.C. 20549, United States, at  
prescribed rates. In addition, the SEC maintains a website at         
http://www.sec.gov, which contains reports, proxy statements and other
     information regarding registrants that file such information electronically
with the SEC.                                                         

The information concerning the Corporation, the Bank and the foregoing
mergers contained herein is furnished solely to provide limited       
 introductory information and does not purport to be comprehensive. Such
information is qualified in its entirety by the detailed information  
appearing in the documents and financial statements referenced herein.

   Moody's currently rates the Bank's long-term debt as "Aa1" and short-term
debt as "P-1." S&P rates the Bank's long-term debt as "AA" and its short-term   
debt as "A-1+." Fitch rates long-term debt of the Bank as "AA-" and short-term  
debt as "F1+." Further information with respect to such ratings may be obtained 
from Moody's, S&P and Fitch, respectively. No assurances can be given that the  
current ratings of the Bank's instruments will be maintained.                   

     The Bank will provide copies of the most recent Bank of America Corporation
Annual Report on Form 10-K, any subsequent reports on Form 10-Q, and any        
required reports on Form 8-K (in each case as filed with the Commission pursuant
to the Exchange Act), and the publicly available portions of the most recent    
quarterly Call Report of the Bank delivered to the Comptroller of the Currency, 
without charge, to each person to whom this document is delivered, on the       
written request of such person. Written requests should be directed to: Bank of 
America Corporate Communications, 100 North Tryon Street, 18th Floor, Charlotte,
North Carolina 28255, Attention: Corporate Communications.                      

     The delivery hereof shall not create any implication that there has been no
change in the affairs of the Corporation or the Bank since the date hereof, or  
that the information contained or referred to in this prospectus supplement is  
correct as of any time subsequent to its date.                                  

   The information contained in the paragraphs above relates to and has been
obtained from the Bank. The information concerning the Corporation and the Bank 
contained herein is furnished solely to provide limited introductory information
regarding the Corporation and the Bank and does not purport to be comprehensive.
Such information is qualified in its entirety by the detailed information       
appearing in the documents and financial statements referenced above. Such      
information shall not create any implication that there has been no change in   
the affairs of the Corporation or the Bank since the date hereof, or that the   
information contained or referred to in this description is correct as of any   
time subsequent to its date.                                                    

Reports to Noteholders                                                          

   On each Payment Date, the Trust Administrator will make available to each
Noteholder, the Servicer, the Subservicer, the Master Servicer, the Depositor   
and any other interested party a statement generally setting forth among other  
information:                                                                    

             (1)  the amount of the related payment to holders of each class
of Notes allocable to principal;        

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               (2)  the amount of such payment to holders of each class of Notes
allocable to interest;                  

           (3)  the Available Funds Shortfall, if any, for each class of
Notes;                                  

          (4)  the Class Principal Amount of each class of Notes after
                 giving effect to the payment of principal on such Payment
Date;                                   

               (5)  the amount of the Servicing Fee and the Master Servicing Fee
                  paid to or retained by the Servicer and the Subservicer or
the Master Servicer, as applicable;     

             (6)  the Interest Rate for each class of Notes for such Payment
Date;                                   

         (7)  the amount of Advances included in the payment on such
Payment Date;                           

           (8)  the cumulative amount of Realized Losses to date, in the
aggregate;                              

             (9)  the amount of Realized Losses with respect to such Payment
Date, in the aggregate;                 

               (10) the number and aggregate principal amounts of Mortgage Loans
                   (A) delinquent (exclusive of Mortgage Loans in foreclosure)
               (1) 31 to 60 days, (2) 61 to 90 days and (3) 91 or more
                days, and (B) in foreclosure and delinquent (1) 31 to 60
                days, (2) 61 to 90 days and (3) 91 or more days, in each
               case as of the close of business on the last day of the
                    calendar month preceding such Payment Date, in the aggregate
                    and with respect to the Group 1 Mortgage Loans and the Group
2 Mortgage Loans;                       

            (11) with respect to Mortgage Loans that became REO Properties
           during the preceding calendar month, the number and
                    aggregate Stated Principal Balance of such Mortgage Loans as
           of the close of business on the Determination Date;

(12) whether a Trigger Event has occurred;        

               (13) the total number and principal balance of any REO Properties
                as of the close of business on the related Determination
Date, in the aggregate;                 

           (14) to the extent such information is provided to the Master
              Servicer by the Servicer or Subservicer, the number of
                   Mortgage Loans with respect to which (i) a reduction in the
                 Mortgage Rate has occurred or (ii) the related Borrower's
                obligation to repay interest on a monthly basis has been
                 suspended or reduced pursuant to the Servicemembers Civil
                    Relief Act, or the California Military and Veterans Code, as
                   amended; and the amount of interest not required to be paid
                  with respect to any such Mortgage Loans during the related
                   Due Period as a result of such reductions, in the aggregate
                    and with respect to the Group 1 Mortgage Loans and the Group
2 Mortgage Loans; and                   

            (15) the amount of any Net Swap Payments, Net Swap Receipts or
                   swap termination amounts received or paid in respect of the
Swap Agreement.                         

  The Trust Administrator may make available each month, to any interested
party, the monthly statement to Noteholders via the Trust Administrator's       
website located at www.ctslink.com. Assistance in using the website can be      
obtained by calling the Trust Administrator's customer service desk at (301)    
815-6600. Parties that are unable to use the above distribution option are      
entitled to have a paper copy mailed to them via first class mail by notifying  
the Trust Administrator at the following address: Wells Fargo Bank, N.A., P.O.  
Box 98, Columbia, Maryland 21046 (or for overnight deliveries at 9062 Annapolis 
Road, Columbia, Maryland 21045). The Trust Administrator will have              

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the right to change the way such reports are distributed in order to make such  
distributions more convenient and/or more accessible, and the Trust             
Administrator will provide timely and adequate notification to such parties     
regarding any such changes.                                                     

In addition, within a reasonable period of time after the end of each 
calendar year, the Trust Administrator will prepare and deliver to each         
Noteholder of record during the previous calendar year a statement containing   
information necessary to enable Noteholders to prepare their tax returns. Such  
statements will not have been examined and reported upon by an independent      
public accountant.                                                              

The Ownership Certificate                                                       

The equity ownership in the Trust will be evidenced by the Ownership  
Certificate. The holder of the Ownership Certificate, the Ownership Certificate 
Holder, will, after all amounts due and owing to the Owner Trustee, and not     
otherwise paid, have been paid, be entitled to receive on each Payment Date any 
remaining Monthly Excess Cashflow for such Payment Date as described under      
"--Application of Monthly Excess Cashflow" above.                               

The Mortgage Loan Purchase Agreement and the
Transfer and Servicing Agreement

General                                                                         

    On the Closing Date, pursuant to the Mortgage Loan Purchase Agreement, the
Seller will sell the Initial Mortgage Loans to the Depositor. Pursuant to the   
Transfer and Servicing Agreement, the Depositor will, in turn, sell the Mortgage
Loans to the Trust.                                                             

Assignment of Mortgage Loans                                                    

 On the Closing Date, the Initial Mortgage Loans will be assigned to the
Trust, together with all principal and interest received with respect to the    
Initial Mortgage Loans on and after the Initial Cut-off Date. On each Subsequent
Transfer Date during the Pre-Funding Period, the Subsequent Mortgage Loans will 
be assigned to the Trust, together with all principal and interest received with
respect to the Subsequent Mortgage Loans on and after the related Subsequent    
Cut-off Date. Pursuant to the Indenture, the Trust will pledge all of its       
interest in such assets and any other property comprising the Trust Estate to   
the Indenture Trustee as security for the Notes.                                

 Each Mortgage Loan will be identified in a schedule to the Transfer and
Servicing Agreement which will specify with respect to each Mortgage Loan, among
other things, the original principal balance and the Stated Principal Balance as
of the close of business on the Cut-off Date, the Mortgage Rate, the Scheduled  
Payment, the maturity date and the Servicer and custodian of the mortgage file, 
and applicable prepayment penalty provisions, if any.                           

As to each Mortgage Loan, the following documents, to the extent      
applicable, are generally required to be delivered to the Indenture Trustee (or 
its custodian): (1) the related original Mortgage Note, endorsed without        
recourse to the Indenture Trustee or in blank, or a lost note affidavit         
conforming to the requirements of the Transfer and Servicing Agreement, together
with a copy of the related Mortgage Note, (2) the original recorded Mortgage    
with evidence of recording indicated thereon (or, if the original recorded      
Mortgage has not yet been returned by the recording office, a copy thereof      
certified to be a true and complete copy of such Mortgage sent for recording),  
(3) for any Mortgage Loan not recorded with MERS System(R), an original         
assignment of the Mortgage to the Indenture Trustee or in blank in recordable   
form (except as described below), (4) any related documents showing a complete  
chain of assignment, (5) the policies of title insurance issued with respect to 
each Mortgage Loan and (6) the originals of any assumption, modification,       
extension or guaranty agreements. It is expected that the Mortgages or          
assignments of Mortgage with respect to each Mortgage Loan will have been       
recorded in the name of an agent on behalf of the holder of the related Mortgage
Note. In that case, no assignment in favor of the Indenture Trustee will be     
required to be prepared, delivered or recorded. Instead, the Seller will be     
required to take all actions as are necessary to cause the Indenture Trustee to 
be shown as the owner of the related Mortgage Loan on the records of            

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the agent for purposes of the system of recording transfers of beneficial       
ownership of mortgages maintained by the agent. With the exception of           
assignments relating to mortgage properties located in certain states, the      
Depositor does not expect to cause the assignments to be recorded.              

   Pursuant to the terms of the Transfer and Servicing Agreement, the Seller
has made to the Trust certain representations and warranties concerning the     
Mortgage Loans that generally include representations and warranties similar to 
those summarized in the prospectus under the heading "Origination and Sale of   
Mortgage Loans--Representations and Warranties." In addition, the Seller has    
represented to the Trust that (i) each Mortgage Loan at the time it was made    
complied in all material respects with applicable local, state and federal laws,
including but not limited to, all applicable anti-predatory and anti-abusive    
lending laws; (ii) none of the Mortgage Loans constitute "high-cost loans" as   
defined by applicable anti-predatory and anti-abusive lending laws; (iii) no    
proceeds from any Mortgage Loan were used to finance single premium credit      
insurance policies; (iv) no Mortgage Loan imposes a prepayment premium for a    
term in excess of three years; and (v) the Seller has no reason to believe any  
Borrower will default under the related Mortgage Loan (or that foreclosure will 
be commenced) within six months following the Closing Date. The Trust will in   
turn pledge its rights in the Seller's representations and warranties to the    
Indenture Trustee for the benefit of holders of Notes. Within the period of time
specified in the Transfer and Servicing Agreement following its discovery or    
notification of a breach of any representation or warranty that materially and  
adversely affects the interests of Noteholders in a Mortgage Loan or receipt of 
notice of such breach, the Seller will be obligated to cure such breach or      
purchase the affected Mortgage Loan from the Trust for a price equal to the     
unpaid principal balance thereof plus accrued interest thereon plus any costs   
and damages incurred by the Trust associated with any violation of applicable   
federal, state or local anti-predatory or abusive lending laws (or, in certain  
circumstances, to substitute another mortgage loan).                            

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

Pre-Funding Account                                                             

   On the Closing Date, the Seller will deposit cash in the aggregate amount
of approximately $290,000,000 into the Pre-Funding Account. Of that amount,     
approximately $103,387,448 will be allocated to Group 1 and approximately       
$186,612,551 will be allocated to Group 2. All Mortgage Loans purchased by the  
Trust for either Mortgage Group through application of amounts on deposit in the
Pre-Funding Account will be considered Subsequent Mortgage Loans. The amount to 
be deposited in the Pre-Funding Account on the Closing Date may be increased by 
an amount equal to the aggregate of the loan balances of any Initial Mortgage   
Loan removed from the mortgage pool prior to the Closing Date.                  

 During the Pre-Funding Period, the amount on deposit in the Pre-Funding
Account will be allocated for purchase of Subsequent Mortgage Loans for each    
Mortgage Group from the Seller in accordance with the applicable provisions of  
the Transfer and Servicing Agreement. Subsequent Mortgage Loans purchased by the
Trust on any date during the Pre-Funding Period, a Subsequent Transfer Date,    
must satisfy the criteria set forth in the Transfer and Servicing Agreement. On 
the Payment Date in February 2006, any remaining amounts in the Pre-Funding     
Account for either Mortgage Group will be applied to reduce the Class Principal 
Amount of the Senior Principal Notes relating to that Mortgage Group.           

  Although it is intended that the principal amount of Subsequent Mortgage
Loans sold to the Trust will require application of substantially all of the    
amount deposited in the Pre-Funding Account on the Closing Date and it is not   
currently anticipated that there will be any material principal payments from   
amounts remaining on deposit in the Pre-Funding Account, no assurance can be    
given that such a payment will not occur on the Payment Date in February 2006.  
In any event, it is unlikely that the Seller will be able to deliver Subsequent 
Mortgage Loans for each Mortgage Group with aggregate loan balances that exactly
equal the amount deposited in the Pre-Funding Account on the Closing Date for   
that Mortgage Group.                                                            

    Amounts on deposit in the Pre-Funding Account will be invested in eligible
investments as described in the Transfer and Servicing Agreement. Such eligible 
investments are required to mature no later than the subsequent transfer date   
and, in any case, no later than the February 2006 Payment Date. All interest and
any other investment                                                            

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earnings on amounts on deposit in the Pre-Funding Account will be paid to the   
Seller on the February 2006 Payment Date.                                       

Administration                                                                  

    The Trust Administrator will agree, to the extent provided in the Transfer
and Servicing Agreement, to provide certain notices and to perform certain other
administrative obligations required to be performed by the Issuer under the     
Transfer and Servicing Agreement, the Indenture and the Trust Agreement. Wells  
Fargo Bank, N.A. will not receive additional compensation for such services as  
Trust Administrator.                                                            

Amendment                                                                       

   The Transfer and Servicing Agreement may be amended by the Depositor, the
Trust, the Master Servicer, the Trust Administrator, the Seller, the Servicer,  
the Subservicer, the Ownership Certificate Holder and the Indenture Trustee,    
with the consent of the Swap Counterparty (to the extent such amendment         
materially adversely affects the amounts, priority of timing of payments under  
the Swap Agreement and the Swap Agreement is in effect), but without consent of 
the Noteholders, (1) to cure any ambiguity, (2) to conform the provisions of the
Transfer and Servicing Agreement to the information contained herein or to      
correct or supplement any provision therein, (3) to make any other provision    
with respect to matters or questions arising under the Transfer and Servicing   
Agreement or (4) to add, delete or amend any provision in order to comply with  
any requirements imposed by the Code, ERISA and their related regulations;      
provided, however, that no such amendment effected pursuant to clause (3) above 
will adversely affect in any material respect the interests of any Noteholder or
result in an entity level tax on the Trust. Any such amendment will be deemed   
not to adversely affect in any material respect the interests of any Noteholder 
if the Rating Agency confirms that such action would not adversely affect the   
then-current ratings on the Notes.                                              

    The Transfer and Servicing Agreement may also be amended by the Depositor,
the Trust, the Trust Administrator, the Master Servicer, the Seller, the        
Servicer, the Subservicer and the Indenture Trustee with the consent of the Swap
Counterparty (to the extent that such amendment materially adversely affects the
Amounts, priority of timing of payments under the Swap Agreement and the Swap   
Agreement is in effect) and with the consent of the holders of each Class of    
Notes affected thereby evidencing Voting Rights aggregating not less than       
66-2/3% of each such Class and the Ownership Certificate Holder, for the purpose
of adding any provisions to or changing in any manner or eliminating any of the 
provisions of the Transfer and Servicing Agreement or modifying in any manner   
the rights of Noteholders; provided, however, that no such amendment may (1)    
reduce in any manner the amount of, or delay the timing of, payments that are   
required to be made in respect of any Notes without the consent of the holder of
each such Note affected thereby or (2) reduce the percentage of Notes the       
holders of which are required to consent to any such amendment without the      
consent of the holders of all Notes affected thereby.                           

Voting Rights                                                                   

   At all times 98% of all voting rights will be allocated among the holders
of the Notes as provided below. The portion of such voting rights allocated to  
such Notes will be based on the fraction, expressed as a percentage, the        
numerator of which is the aggregate Class Principal Amount then outstanding and 
the denominator of which is the aggregate outstanding principal amount of the   
Notes. At all times during the term of the Indenture and the Transfer and       
Servicing Agreement, the holders of the Ownership Certificate shall be allocated
2% of the voting rights. The voting rights allocation to any class of Notes or  
the Ownership Certificate will be allocated among all holders of each such class
or certificate in proportion to the outstanding Class Principal Amount of such  
Notes or Percentage Interest of such Ownership Certificate.                     

 The Trust Agreement and the Indenture

General                                                                         

   The Notes will be issued pursuant to the Indenture. Notes in certificated
form will be transferable and exchangeable at the Corporate Trust Office of the 
Trust Administrator, which will serve as Note Registrar,                        

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Certificate Registrar and Paying Agent. The Trust Administrator will provide to 
a prospective or actual Noteholder, without charge, on written request, an      
electronic copy (without exhibits) of the Indenture, the Trust Agreement and the
Transfer and Servicing Agreement. Requests should be addressed to 9062 Old      
Annapolis Road, Columbia, Maryland 21045, Attention: Fieldstone 2005-3.         

  The following summary describes certain terms of the Trust Agreement and
the Indenture. The summary does not purport to be complete and is subject to,   
and qualified in its entirety by reference to, all the provisions of such       
Agreements.                                                                     

Certain Matters under the Agreements                                            

  Events of Default Under the Indenture. Indenture Defaults will generally
consist of: (i) a default for 30 days or more in the payment of any Current     
Interest due on any class of Notes and if the Class A Notes are no longer       
outstanding, a default for 30 days or more in the payment of the related        
Deferred Interest for the most senior Class of Notes outstanding; (ii) a default
in the payment of the entire principal of any Note when the same becomes due and
payable under the Indenture or on the applicable Maturity Date; (iii) a default 
in the observance or performance of any covenant or agreement of the Issuer made
in the Indenture and the continuation of any such default for a period of 30    
days after notice thereof is given to the Owner Trustee as provided in the      
Indenture; (iv) any representation or warranty made by the Trust in the         
Indenture or in any note delivered pursuant thereto or in connection therewith  
having been incorrect in a material respect when made, and such breach not      
having been cured within 30 days after notice thereof is given to the Owner     
Trustee as provided in the Indenture; (v) the receipt of notice from the holder 
of the Ownership Certificate to the Indenture Trustee of such holder's failure  
to qualify as a REIT, a qualified REIT subsidiary or an entity that is          
disregarded for United States federal income tax purposes that is wholly-owned  
by a REIT or a Qualified REIT Subsidiary; or (vi) certain events of bankruptcy, 
insolvency, receivership or liquidation of the Issuer.                          

    If an Indenture Default occurs and is continuing, the Indenture Trustee or
Holders of a majority by Class Principal Amount of the Priority Class or        
Priority Classes of Notes then outstanding may declare the principal of the     
Notes to be immediately due and payable. Such declaration may, under certain    
circumstances, be rescinded by the Holders of a majority by Class Principal     
Amount of such Priority Class or Priority Classes of Notes.                     

If the Notes are declared immediately due and payable following an    
Indenture Default, the Indenture Trustee may institute proceedings to collect   
amounts due or foreclose on collateral pledged to secure the Notes, exercise    
remedies as a secured party, sell the assets of the Trust Estate pledged to     
secure the Notes, or elect to maintain possession of such assets and continue to
apply collections on such assets as if there had been no declaration of         
acceleration. However, the Indenture Trustee is prohibited from selling the     
assets of the Trust Estate following an Indenture Default, other than a default 
in the payment of any class principal amount of or a default for the payment of 
Current Interest on any Priority Class or Priority Classes of Notes, unless (i) 
the holders of all outstanding Notes consent to such sale, (ii) the proceeds of 
the sale are sufficient to pay in full the principal of and the accrued interest
(including Deferred Interest and any Available Funds Shortfall) on such         
outstanding Notes at the date of such sale or (iii) the Indenture Trustee       
determines that the proceeds of the Trust Estate and the other property of the  
Trust would not be sufficient on an ongoing basis to make all payments on the   
Notes as such payments would have become due if such obligations had not been   
declared due and payable, and the Indenture Trustee obtains the consent of the  
holders of 66-2/3% of the aggregate outstanding amount of the Notes.            

If the collateral securing the Notes is sold following an Indenture   
Default, proceeds of such sale, after deduction of the expenses of such sale,   
will be applied in the order of priority provided in the Indenture.             

 If an Indenture Default occurs and is continuing, the Indenture Trustee
will be under no obligation to exercise any of the rights or powers under the   
Indenture at the request or direction of any of the holders of the Notes, if the
Indenture Trustee reasonably believes it will not be adequately indemnified     
against the costs, expenses and liabilities that might be incurred by it in     
complying with such request. Subject to the provisions for indemnification and  
certain limitations contained in the Indenture, the holders of a majority in    
principal amount of the outstanding Notes will have the right to direct the     
time, method and place of conducting any proceeding or any remedy available to  
the Indenture Trustee, and the holders of a majority in principal amount of the 
Notes then outstanding may, in certain cases, waive any default with respect    
thereto, except a default in the payment of principal or current interest       

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or a default in respect of a covenant or provision of the Indenture that cannot 
be modified without the waiver or consent of all the holders of the outstanding 
Notes.                                                                          

Except as described above in the case of an Indenture Default, no     
Noteholder will have the right to institute any proceeding with respect to the  
Indenture, unless (i) such holder previously has given to the Indenture Trustee 
written notice of a continuing Indenture Default, (ii) the holders of not less  
than 25% in principal amount of the outstanding Notes have made written request 
to the Indenture Trustee to institute such proceeding in its own name as the    
Indenture Trustee, (iii) such holder or holders have offered the Indenture      
Trustee reasonable indemnity, (iv) the Indenture Trustee has, for 60 days after 
receipt of such notice, request and offer of indemnity, failed to institute such
proceeding and (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 in principal amount of such outstanding Notes.                         

  In addition, the Indenture Trustee and the Noteholders, by accepting the
Notes, will covenant that they will not at any time institute against the Trust 
any bankruptcy, reorganization or other proceeding under any federal or state   
bankruptcy or similar law.                                                      

Neither the Indenture Trustee, the Trust Administrator nor the Owner  
Trustee in their respective individual capacities, nor the Ownership Certificate
Holder, nor any of their respective owners, beneficiaries, agents, officers,    
directors, employees, affiliates, successors or assigns will, except as         
expressly set forth in the transaction documents, be personally liable for the  
payment of the principal of or interest on the Notes or for the agreements of   
the Trust contained in the Indenture.                                           

    Redemption. On any Payment Date following the month in which the Aggregate
Collateral Balance is less than 20% of the Aggregate Collateral Balance as of   
the Closing Date, the Servicer will have the option to purchase the Mortgage    
Loans, any REO Property and any other property remaining in the Trust for a     
price equal to the Purchase Price. The Master Servicer, the Servicer and the    
Subservicer will be reimbursed from the Purchase Price for any outstanding      
Advances, servicing advances and unpaid Master Servicing Fees or Servicing Fees,
as applicable, and other amounts not previously reimbursed pursuant to the      
provisions of the Transfer and Servicing Agreement, as applicable, and the Trust
Administrator, the Owner Trustee and the Indenture Trustee shall be reimbursed  
for any previously unreimbursed amounts for which they are entitled to be       
reimbursed pursuant to the Transfer and Servicing Agreement or the Trust        
Agreement. If such option is exercised, the Trust will be terminated resulting  
in a mandatory redemption of the Notes. If the Servicer fails to exercise such  
option, then on any Payment Date following the month in which the Aggregate     
Collateral Balance is less than 10% of the Aggregate Collateral Balance as of   
the Closing Date, the margin on each of the Senior Principal Notes will increase
to 2 times their respective margins set forth in the table on page S-4, the     
margin on each of the Class M Notes (other than the Class M10, Class M11, Class 
M12 and Class M13 Notes) will increase to 1.5 times their respective margins set
forth in the table on page S-4 and the interest rate on the Class M10, Class    
M11, Class M12 and Class M13 Notes will increase to 5.500% (subject to the      
Available Funds Rate).                                                          

     The Indenture will be discharged upon the delivery to the Indenture Trustee
for cancellation of all Notes or, with certain limitations, upon deposit with   
the Indenture Trustee of funds sufficient for the payment in full of all the    
Notes. Upon the payment in full of all outstanding Notes and the discharge of   
the Indenture, the Owner Trustee will succeed to all the rights of the Indenture
Trustee, the Master Servicer and the Trust Administrator, and the Ownership     
Certificate Holder will succeed to all the rights of the Noteholders pursuant to
the Transfer and Servicing Agreement.                                           

Amendment                                                                       

   Generally, the Trust Agreement and the Indenture are subject to amendment
by the parties thereto under conditions similar to those described under "The   
Mortgage Loan Purchase Agreement and the Transfer and Servicing                 
Agreement--Amendment," except that in the case of the Trust Agreement references
to Notes and Noteholders should be read as referring to Ownership Certificate   
and the Ownership Certificate Holder, and in the case of the Indenture such     
references should be read as referring to Notes and Noteholders. Any amendment  
of the provisions of the Indenture will take the form of a supplemental         
indenture. In addition to the purposes described under "The Mortgage Loan       
Purchase Agreement and the Transfer and Servicing Agreement--Amendment," the    
Trust and the Indenture Trustee may enter into supplemental indentures, without 
obtaining the consent of the                                                    

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Noteholders, for the purpose of correcting or amplifying the description of the 
Trust Estate subject to the Indenture, evidencing the succession of a successor 
to the Trust, adding to the covenants of the Trust or surrendering any power    
conferred upon the Trust under the Indenture, or conveying or pledging any      
property to the Indenture Trustee.                                              

 Yield, Prepayment and Maturity Considerations

General                                                                         

 The weighted average life of and the yield to maturity on each class of
Notes will be directly related to the rate of payment of principal (including   
prepayments) of the Mortgage Loans. The actual rate of principal prepayments on 
pools of mortgage loans is influenced by a variety of economic, tax, geographic,
demographic, social, legal and other factors and has fluctuated considerably in 
recent years. In addition, the rate of principal prepayments may differ among   
pools of mortgage loans at any time because of specific factors relating to the 
mortgage loans in a particular pool, including, among other things, the age of  
the mortgage loans, the geographic locations of the properties securing the     
mortgage loans, the extent of the Borrowers' equity in the related properties,  
and changes in the Borrowers' housing needs, job transfers and employment       
status, as well as whether the related mortgage loans are subject to Prepayment 
Penalties. Any such refinancings will affect the rate of principal prepayments  
on the mortgage pool.                                                           

   The timing of changes in the rate of prepayments may significantly affect
the actual yield to investors who purchase the Notes at prices other than par,  
even if the average rate of principal prepayments is consistent with the        
expectations of investors. In general, the earlier the payment of principal of  
the Mortgage Loans the greater the effect on an investor's yield to maturity. As
a result, the effect on an investor's yield of principal prepayments occurring  
at a rate higher (or lower) than the rate anticipated by the investor during the
period immediately following the issuance of the Notes may not be offset by a   
subsequent like reduction (or increase) in the rate of principal prepayments.   
Investors must make their own decisions as to the appropriate prepayment        
assumptions to be used in deciding whether to purchase any of the Notes. The    
Depositor does not make any representations or warranties as to the rate of     
prepayment or the factors to be considered in connection with such              
determinations.                                                                 

    The yields on the Notes may be adversely affected by Net Swap Payments and
swap termination amounts owed to the Swap Counterparty. Any Net Swap Payment or 
swap termination amount payable to the Swap Counterparty will reduce amounts    
available for payment to Noteholders. If the rate of prepayments on the Mortgage
Loans is faster than anticipated, the Swap Notional Balance on which payments   
due under the Swap Agreement are calculated may exceed the Aggregate Loan       
Balance, thereby increasing the relative proportion of interest collections on  
the Mortgage Loans that must be applied to make Net Swap Payments to the Swap   
Counterparty and consequently, the combination of rapid rates of prepayment and 
low prevailing interest rates could adversely affect the yields on the Notes.   

 The prepayment experience of any Mortgage Loans secured by second liens
will likely differ from that on Mortgage Loans secured by first liens. The small
principal balances of second lien mortgage loans relative to the principal      
balances of first lien mortgage loans may reduce the perceived benefits of      
refinancing. In addition, the reduced equity in the related mortgaged property  
due to the existence of a second lien mortgage loan may reduce the opportunities
for refinancing. The reduced opportunity for refinancing may result in a greater
rate of default and will likely result in a greater severity of loss following  
default. On the other hand, many Borrowers do not view second lien mortgage     
loans as permanent financing and may be more inclined to prepay those mortgage  
loans as a result. We cannot assure you as to the prepayment experience of any  
of the Mortgage Loans, including those secured by second liens.                 

   The weighted average life of and yield to maturity on each class of Notes
will also be influenced by the amount of Monthly Excess Cashflow generated by   
the Mortgage Loans and Net Swap Receipts payable by the Swap Counterparty and   
Net Swap Payments, paid by the Trust in respect of the Swap Agreement and       
applied in reduction of the Class Principal Amount of such Notes. The level of  
Monthly Excess Cashflow available on any Payment Date to be applied in reduction
of the Class Principal Amounts of the Senior Notes and Class M Notes will be    
influenced by, among other factors:                                             

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    o    the overcollateralization level of the assets at such time (i.e., the
         extent to which interest on the related Mortgage Loans is accruing on
        a higher Stated Principal Balance than the Class Principal Amount of
the related Senior Principal Notes and Class M Notes);      

    o    the delinquency and default experience of the related Mortgage Loans;

o    the level of One-Month LIBOR;                                    

    o    the applicable Mortgage Index for the adjustable rate Mortgage Loans;

    o    payment of Net Swap Receipts paid by the Swap Counterparty in respect
of the Swap Agreement;                                      

    o    payment of Net Swap Payments by the Trust to the Swap Counterparty in
respect of the Swap Agreement; and                          

     o    the provisions of the Indenture that permit Monthly Excess Cashflow to
       be distributed to the Ownership Certificate when specified payments
have been made in respect of the Notes.                     

   To the extent that greater (or lesser) amounts of Monthly Excess Cashflow
are paid in reduction of the Class Principal Amounts of a class of Notes, the   
weighted average life thereof can be expected to shorten (or lengthen). No      
assurance, however, can be given as to the amount of Monthly Excess Cashflow    
paid at any time or in the aggregate. See "Description of the Notes--Credit     
Enhancement."                                                                   

Prepayments and Yields for Notes                                                

 Generally, if purchased at other than par, the yield to maturity on the
Notes will be affected by the rate of the payment of principal of the Mortgage  
Loans. If the actual rate of payments on the Mortgage Loans is slower than the  
rate anticipated by an investor who purchases Notes at a discount, the actual   
yield to such investor will be lower than such investor's anticipated yield. If 
the actual rate of payments on the Mortgage Loans is faster than the rate       
anticipated by an investor who purchases Notes at a premium, the actual yield to
such investor will be lower than such investor's anticipated yield. Because     
approximately 81.92% of the Statistical Mortgage Loans contain Prepayment       
Penalties, the rate of principal prepayments during the term of such Prepayment 
Penalties may be less than the rate of principal prepayments for Mortgage Loans 
which do not contain Prepayment Penalties; however, principal prepayments of the
Mortgage Loans could be expected to increase, perhaps materially, at or near the
time of the expiration of the terms of such Prepayment Penalties.               

    All of the adjustable rate Mortgage Loans have Mortgage Rates that provide
for a fixed interest rate during an initial period of two, three or five years  
from the date of the origination and thereafter provide for adjustments to the  
Mortgage Rates on a semi-annual basis (or on an annual basis, in the case of 5/1
Treasury ARM Loans). When such Hybrid Mortgage Loans begin their adjustable     
period, increases and decreases in the Mortgage Rate on the Mortgage Loan will  
be limited by the Periodic Rate Cap, except in the case of the first adjustment,
the Maximum Mortgage Rate and the Minimum Mortgage Rate, if any, and will be    
based on the Mortgage Index in effect on the applicable date prior to the       
related Adjustment Date plus the applicable gross margin. Fixed-rate mortgage   
loans do not adjust at all. Mortgage rates generally may not rise and fall      
consistently with Mortgage Rates on the adjustable rate Mortgage Loans. As a    
result, the Mortgage Rates on the Mortgage Loans at any time may be higher than 
the prevailing mortgage interest rates of similar adjustable rate loans, and    
accordingly the prepayment rate may be higher than would otherwise be           
anticipated. Moreover, each adjustable rate Mortgage Loan has a Maximum Mortgage
Rate and a Minimum Mortgage Rate, which in some cases is equal to the related   
gross margin. Further, some Borrowers who prefer the certainty provided by fixed
rate mortgage loans may nevertheless obtain adjustable rate mortgage loans at a 
time when they regard the mortgage interest rates (and, therefore, the payments)
on fixed rate mortgage loans as unacceptably high. These Borrowers may be       
induced to refinance adjustable rate loans when the mortgage interest rates and 
monthly payments on comparable fixed rate mortgage loans decline to levels which
these Borrowers regard as acceptable, even though such mortgage interest rates  
and monthly payments may be significantly higher than the current mortgage      
interest rates and monthly payments on the Borrower's adjustable rate mortgage  
loans. The prepayment experience on Hybrid Mortgage Loans may differ from the   
prepayment                                                                      

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experience on fixed-rate mortgage loans due to provisions which provide for     
conversion to an adjustable Mortgage Rate, Periodic Rate Caps and a Maximum     
Mortgage Rate. In particular, Hybrid Mortgage Loans may be subject to higher    
prepayment rates as they approach the date they are scheduled to start accruing 
interest at an adjustable rate. As a Hybrid Mortgage Loan approaches its initial
Adjustment Date, the Borrower may become more likely to refinance that Mortgage 
Loan to avoid an increase in the Mortgage Rate, even if prevailing fixed rate   
mortgage loans are only available at rates that are slightly lower or higher    
than the related Mortgage Rate before adjustment.                               

Approximately 61.22% of all of the Statistical Mortgage Loans and     
approximately 61.29% and 61.19% of the Statistical Mortgage Loans to be included
in Group 1 and Group 2, respectively, provide for payment of interest at the    
related Mortgage Rates, but no payment of principal for approximately the first 
five years following the origination of the Mortgage Loan. Following such       
interest-only period, the monthly payment with respect to each of these Mortgage
Loans will be increased to, and include a portion allocable to principal in, an 
amount sufficient to amortize the principal balance of the Mortgage Loan over   
the remaining term and to pay interest at the related Mortgage Rate. The        
presence of these Mortgage Loans in Group 1 and Group 2 will, absent other      
considerations, result in longer weighted average lives of the related Notes    
than would have been the case had these loans not been included in the mortgage 
pool. If you purchase such Notes at a discount, you should consider that the    
extension of weighted average lives could result in a lower yield than would be 
the case if these Mortgage Loans provided for the payment of principal and      
interest on every payment date. In addition, a Borrower may view the absence of 
any obligation to make payment of principal during such five-year period as a   
disincentive to prepayment. If a recalculated monthly payment as described above
is substantially higher than a Borrower's previous interest-only monthly        
payment, that loan may be subject to an increased risk of delinquency, loss     
and/or prepayment.                                                              

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

 The ability of a Borrower to refinance a Mortgage Loan will depend on a
number of factors prevailing at the time refinancing is desired, including,     
without limitation, real estate values, the Borrower's financial situation,     
prevailing mortgage interest rates, the Borrowers' equity in the related        
mortgaged property, tax laws and prevailing general economic conditions. In     
addition, as discussed below, the Interest Rate on the Notes beginning with the 
Accrual Period following the first adjustment date may decrease, and may        
decrease significantly, after the Mortgage Rates on the Mortgage Loans begin to 
adjust.                                                                         

     The Interest Rates on the Notes (other than the Class M10, Class M11, Class
M12 and Class M13 Notes) are calculated based upon the value of an index        
(One-Month LIBOR) which is different from the value of the index applicable to  
substantially all of the Mortgage Loans (Six-Month LIBOR) in the mortgage pool. 
As a result, the Interest Rates on the Notes (other than the Class M10, Class   
M11, Class M12 and Class M13 Notes) are subject to the Available Funds Rate and 
the Fixed Rate Cap. The Interest Rate on the Class M10, Class M11, Class M12 and
Class M13 Notes is subject to the Available Funds Rate.                         

  The Available Funds Rate is an interest rate payment cap that limits the
Interest Rates on the Notes to a per annum rate determined on each Payment Date 
generally equal to the quotient of (a) the aggregate of Interest Funds for both 
Mortgage Groups less any Net Swap Payments or swap termination amounts paid     
pursuant to clause (A)(i) or (B)(i), as applicable, under "Description of the   
Notes--Payment--Payments of Interest," divided by (b) the product of (i) the sum
of the Class Principal Amount of each Class of Notes before taking into account 
any                                                                             

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payments of principal on that Payment Date and (ii) (A) the actual number of    
days in the Accrual Period (or, in the case of the Class M10, Class M11, Class  
M12 and Class M13 Notes, 30), divided by (B) 360. For example, for a Payment    
Date with a 31-day Accrual Period as to which the aggregate of Interest Funds   
for both Mortgage Groups less any Net Swap Payments or swap termination amounts 
specified above equaled $1,000 and the aggregate outstanding principal amount of
the Notes equaled $100,000, the "Available Funds Rate" would equal approximately
11.6%, calculated as follows: $1,000 / [100,000 x (31 / 360)]. Any shortfalls   
arising from the application of the Available Funds Rate will be carried over as
described herein with accrued interest at the then-applicable Interest Rate     
(computed without regard to the Available Funds Rate) and, if available, paid   
from Monthly Excess Cashflow in a later distribution. Various factors may cause 
the Available Funds Rate to limit the Interest Rate on the related Notes. First,
this can result if One-Month LIBOR increases more rapidly than Six-Month LIBOR  
or the Treasury Mortgage Index. In addition, the Interest Rates on the Notes    
adjust monthly, while the interest rates on the Mortgage Loans adjust less      
frequently, with the result that the operation of the Available Funds Rate may  
cause the Interest Rates on the related Notes to be reduced for extended periods
in a rising interest rate environment. The Mortgage Loans are also subject to   
Periodic Rate Caps and Maximum Rate Caps, and the weighted average margin is    
subject to change based upon prepayment experience, which also may result in the
Available Funds Rate limiting increases in the Interest Rates for these Notes.  
Consequently, the interest paid on the Mortgage Loans (net of the sum of the    
Servicing Fee, the Master Servicing Fee, the Owner Trustee Fee, certain other   
expenses and Net Swap Payments) with respect to any Payment Date may not equal  
the amount of interest that would accrue at One-Month LIBOR plus the applicable 
margin on those notes during the related period. Furthermore, if the Available  
Funds Rate determines the Interest Rate for a class of Notes for a Payment Date,
the market value of those Notes may be temporarily or permanently reduced.      

     The Interest Rates on the Notes (other than the Class M10, Class M11, Class
M12 and Class M13 Notes) are also subject to a Fixed Rate Cap. The Fixed Rate   
Cap limits the Interest Rate on those Notes to a per annum rate of 12.25%. If   
the Interest Rate for a class of Notes for a Payment Date is limited to the     
Fixed Rate Cap, the market value of those Notes may be temporarily or           
permanently reduced.                                                            

   Mandatory Payment. In the event that at the end of the Pre-Funding Period
there are any remaining amounts on deposit in the Pre-Funding Account allocated 
to a Mortgage Group, the holders of the class or classes of Senior Notes related
to that Mortgage Group will receive an additional payment of principal in an    
amount equal to the amount remaining in the Pre-Funding Account for that        
Mortgage Group in accordance with their related Senior Priorities.              

   Although there can be no assurances, the Depositor anticipates that there
should not be a material principal payment to the holders of the related class  
of Senior Notes due to a lack of Subsequent Mortgage Loans available to be      
purchased by the Trust.                                                         

  Maturity Date. The Maturity Date for each class of Notes is set forth in
the chart appearing on page S-4. The actual final Payment Date with respect to  
each class of Notes could occur significantly earlier than its Maturity Date    
because:                                                                        

   o    prepayments are likely to occur and such prepayments will be applied
to the payment of the Class Principal Amounts thereof;      

o    excess interest to the extent available will be applied as an    
          accelerated payment of principal on the Notes as described herein; and

  o    the Servicer may purchase all of the Mortgage Loans in the mortgage
      pool on the Payment Date after the Payment Date when the Aggregate
   Collateral Balance is less than 20% of the Aggregate Collateral
Balance as of the Closing Date.                             

Collateral Prepayment Assumption. Prepayments on mortgage loans are   
commonly measured relative to a prepayment model or standard. The Prepayment    
Assumption used in this prospectus supplement is based on an assumed rate of    
prepayment each month of the then unpaid principal balance of a pool of mortgage
loans similar to the Mortgage Loans.                                            

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As used in the tables set forth on Annex IV, "0% of the Prepayment    
Assumption" assumes no prepayments on the Mortgage Loans; "50% of the Prepayment
Assumption" assumes the Mortgage Loans will prepay at rates equal to 50% of the 
related Prepayment Assumption; "100% of the Prepayment Assumption" assumes the  
Mortgage Loans will prepay at rates equal to 100% of the related Prepayment     
Assumption; "150% of the Prepayment Assumption" assumes the Mortgage Loans will 
prepay at rates equal to 150% of the related Prepayment Assumption; and "200% of
the Prepayment Assumption" assumes the Mortgage Loans will prepay at rates equal
to 200% of the related Prepayment Assumption.                                   

     There is no assurance, however, that prepayments on the Mortgage Loans will
conform to any level of the Prepayment Assumption, and no representation is made
that the Mortgage Loans will prepay at the prepayment rates shown or any other  
prepayment rate. The rate of principal payments on pools of mortgage loans is   
influenced by a variety of economic, geographic, social and other factors,      
including the level of interest rates. Other factors affecting prepayment of    
mortgage loans include changes in Borrowers' housing needs, job transfers,      
employment status, the solicitation of Borrowers to refinance their mortgage    
loans and the existence of Prepayment Penalties. In the case of mortgage loans  
in general, if prevailing interest rates fall significantly below the interest  
rates on the mortgage loans, the mortgage loans are likely to be subject to     
higher prepayment rates than if prevailing interest rates remain at or above the
rates borne by the mortgage loans. Conversely, if prevailing interest rates rise
above the interest rates on the mortgage loans, the rate of prepayment would be 
expected to decrease.                                                           

  The weighted average lives of the Notes set forth on tables set forth on
Annex IV are determined by (1) multiplying the amount of each assumed principal 
payment by the number of years from the date of issuance of the Notes to the    
related Payment Date, (2) summing the results and (3) dividing the sum by the   
total principal payment on the Notes.                                           

 The tables set forth on Annex IV have been prepared on the basis of the
Modeling Assumptions, including the assumption that Group 1 and Group 2 consist 
of mortgage loans having the approximate characteristics set forth in Annex III 
hereto.                                                                         

Additional Information                                                          

 The Depositor has filed additional yield tables and other computational
materials with respect to the Notes with the Securities and Exchange Commission 
in a report on Form 8-K. Those tables and materials were prepared by the        
Underwriters for prospective investors who made requests for that additional    
information. Those tables and assumptions may be based on assumptions that      
differ from the Modeling Assumptions. Accordingly, those tables and other       
materials may not be relevant to or appropriate for investors other than those  
specifically requesting them.                                                   

 Federal Income Tax Consequences

Tax Classification of the Trust and of the Notes                                

    On the closing date, Hunton & Williams LLP will deliver its opinion to the
effect that based on the application of existing law and assuming compliance    
with the indenture, transfer and servicing agreement, trust agreement and other 
related documents, for U.S. federal income tax purposes, (i) the Notes, other   
than any Retained Notes, will be characterized as indebtedness and (ii) as long 
as all of the Ownership Certificates (and any Retained Notes that are not       
characterized as indebtedness for federal income tax purposes) are held by a    
REIT, a Qualified REIT Subsidiary, or an entity that is disregarded for U.S.    
federal income tax purposes that is wholly-owned by a REIT or a Qualified REIT  
Subsidiary (each such entity, a "Qualifying REIT Entity"), the trust will be    
treated as a Qualified REIT Subsidiary for U.S. federal income tax purposes.    
Because the trust is issuing classes of debt instruments with multiple maturity 
dates that are backed by real estate mortgages, it is anticipated that the trust
will be treated as a taxable mortgage pool (a "TMP") for U.S. federal income tax
purposes. In general, a TMP is treated as a separate corporation not includable 
with any other corporation in a consolidated income tax return, and is subject  
to corporate income taxation. A TMP, however, that is treated as a Qualified    
REIT Subsidiary will not be subject to U.S. corporate income taxation.          
Generally, the trust will be treated as a Qualified REIT Subsidiary so long as  
the trust is wholly-owned by a Qualifying REIT Entity that either itself        
maintains or has a parent REIT that maintains continuing qualification as a     
REIT.                                                                           

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   FIC will hold through FMOC, its wholly-owned subsidiary, a 100% ownership
interest in the Ownership Certificate. FIC represents it filed with its U.S.    
federal income tax return for its taxable year ended December 31, 2003 an       
election to be a REIT, that it has been organized in conformity with the        
requirements for REIT qualification set forth in the Code, that it has operated 
and will continue to operate in a manner that enables it to qualify as a REIT   
and that it will not undertake any action that would cause the Trust to be      
subject to U.S. federal income tax. In rendering its opinion, Hunton & Williams 
LLP has not independently verified FIC's qualification as a REIT, but instead   
has relied solely upon the representations made by FIC concerning its REIT      
status. Under the terms of the Trust Agreement, the Ownership Certificate (and  
any Retained Notes that were not characterized as debt for federal income tax   
purposes) may only be (i) transferred to a Qualifying REIT Entity or (ii)       
pledged to secure indebtedness or be the subject of repurchase agreements       
treated by the Issuer as secured indebtedness for federal income tax purposes.  
If FIC were to fail to qualify as a REIT while it or its subsidiary owns the    
Ownership Certificate, or if the Ownership Certificate (and any Retained Notes  
that were not characterized as debt for federal income tax purposes) were       
transferred to a person that was not a Qualifying REIT Entity, including because
of a default and foreclosure under a secured lending or repurchase agreement,   
the Trust could become subject to U.S. federal income tax as a corporation and  
would not be allowed to file a consolidated U.S. federal income tax return with 
any other corporation. A tax imposed upon the Trust could reduce cash flow that 
would otherwise be available to make payments on the Notes. Any such failure of 
the holder of the Ownership Certificate to qualify as a Qualifying REIT Entity  
would constitute an Indenture Default.                                          

     At the issuance of the Notes, FIC will also acquire beneficial ownership of
the Retained Notes. Because FIC's Qualified REIT Subsidiary will own the        
Ownership Certificate, the Retained Notes will not be considered issued and     
outstanding for U.S. federal income tax purposes. Thus, the Retained Notes will 
not be treated as debt instruments for U.S. federal income tax purposes while   
the same party or related parties hold both the Retained Notes and the Ownership
Certificate. If the Retained Notes were sold to a taxable REIT subsidiary or a  
party unaffiliated with the owner of the Ownership Certificate, then the        
Retained Notes would become characterized as debt instruments for federal income
tax purposes as of the time of the sale if: (i) the owner of the Ownership      
Certificate is a Qualifying REIT Entity; (ii) no modifications have been made to
the transaction documents as of the date of such sale; (iii) the rating of the  
Retained Notes as of the date of such sale is not lower than the rating for such
Retained Note as of the Closing Date; and (iv) no adverse changes have been made
to (or that would adversely affect the application of) the legal authorities    
applicable to the closing date tax opinion. The U.S. federal income tax         
consequences to a beneficial owner of a Retained Note characterized as an equity
interest in the Trust generally would be the same as those described in the     
section captioned "Tax Consequences to Holders of the Notes--Possible           
Alternative Treatment of the Notes" below. The remainder of this discussion,    
other than the portion captioned "Tax Consequences to Holders of the            
Notes--Possible Alternative Treatment of the Notes," assumes that the Notes are 
properly characterized as debt instruments for U.S. federal income tax purposes.

Tax Consequences to Holders of the Notes                                        

Interest Income on the Notes. The Notes may be treated as having been 
issued with OID. A debt instrument is issued with OID to the extent its stated  
redemption price at maturity exceeds its issue price by more than a de minimis  
amount. Although not clear, the de minimis amount for a Class of Notes would    
appear to equal the product of (1) 0.25%, (2) the stated redemption price at    
maturity of the Class and (3) the weighted average maturity of the Class,       
computed by taking into account the prepayment assumption discussed below.      

 The issue price of an issue of debt instruments issued for money is the
first price at which a substantial portion of the issue is sold. The stated     
redemption price at maturity of a debt instrument includes all payments, other  
than Qualified Stated Interest. Interest is unconditionally payable only if     
either (1) reasonable legal remedies exist to compel the timely payment of      
interest or (2) the terms or conditions under which the debt instrument is      
issued make the late payment or nonpayment of interest a remote likelihood.     
Because a portion of the interest payable on the Notes may be deferred, it is   
possible that some or all of such interest may not be treated as unconditionally
payable. Nevertheless, since at the time of issuance such deferral is not       
anticipated, for tax information reporting purposes, the Indenture Trustee will 
treat all stated interest on each Class of Notes as Qualified Stated Interest.  

To the extent stated interest payable on a Note is Qualified Stated   
Interest, such interest will be taxable as ordinary income to a beneficial owner
of the Note in accordance with such beneficial owner's method of tax            

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accounting. If, however, all or a portion of the stated interest payable on the 
Note is not Qualified Stated Interest, then the stated interest, or portion     
thereof, would be included in the Note's stated redemption price at maturity.   
Generally, this means that a beneficial owner of that Note would be required to 
include such interest in income as OID in accordance with the PAC Method.       

     Under the PAC Method, the amount of OID allocable to any accrual period for
a Class of Notes will equal (1) the adjusted issue price of that Class of Notes 
at the end of the accrual period, minus (2) the sum of (i) the adjusted issue   
price of that Class of Notes at the beginning of the accrual period and (ii) any
payments made on that Class of Notes during the accrual period of amounts       
included in the stated redemption price at maturity of that Class of Notes. The 
OID so determined is allocated ratably among the days in the accrual period.    

    The adjusted issue price of a Class of Notes at the beginning of its first
accrual period will be its issue price. The adjusted issue price at the end of  
any accrual period (and, therefore, at the beginning of the subsequent accrual  
period) is determined by discounting the remaining payments due on that Class of
Notes at their yield to maturity. The remaining payments due are determined     
based on the prepayment assumption, but are adjusted to take into account the   
effect of payments actually made on the Mortgage Assets.                        

   For this purpose, the yield to maturity of a Class of Notes is determined
by projecting payments due on that Class of Notes based on a prepayment         
assumption made with respect to the Mortgage Assets. The yield to maturity of a 
Class of Notes is the discount rate that, when applied to the stream of payments
projected to be made on that Class of Notes as of its issue date, produces a    
present value equal to the issue price of that Class of Notes. The Code requires
that the prepayment assumption be determined in the manner prescribed in        
Treasury Department regulations. To date, no such regulations have been issued. 
The legislative history of this Code provision indicates that the regulations   
will provide that the assumed prepayment rate must be the rate used by the      
parties in pricing the particular transaction. For tax information reporting    
purposes, the Trust Administrator will assume a Prepayment Assumption of 100%   
for the Notes as set forth in the Modeling Assumptions. No representation,      
however, is made as to the rate at which principal payments or Recoveries on the
Mortgage Assets actually will occur.                                            

    Under the PAC Method, accruals of OID will increase or decrease (but never
below zero) to reflect the fact that payments on the Mortgage Loans are         
occurring at a rate that is faster or slower than that assumed under the        
prepayment assumption. If the OID accruing on a Class of Notes is negative for  
any period, a beneficial owner of a Note of that Class will be entitled to      
offset such negative accruals only against future positive OID accruals on that 
Note.                                                                           

Market Discount. If a purchaser acquires a Note at a discount from its
outstanding principal amount (or, if the Note is issued with OID, its adjusted  
issue price), the purchaser will acquire the Note with market discount (a       
"market discount bond"). If the market discount is less than a statutorily      
defined de minimis amount (equal to the product of (i) 0.25%, (ii) the stated   
redemption price at maturity of the Note and (iii) the remaining weighted       
average maturity of the Note), the market discount will be considered to be     
zero. Treasury regulations interpreting the market discount rules have not yet  
been issued; therefore, prospective investors should consult their own tax      
advisors regarding the application of those rules and the advisability of making
any of the elections described below.                                           

    Unless the beneficial owner of a market discount bond elects under Section
1278(b) of the Code to include market discount in income as it accrues, any     
principal payment (whether a scheduled payment or a prepayment) or any gain on  
disposition of the market discount bond is treated as ordinary income to the    
extent that it does not exceed the accrued market discount at the time of such  
payment.                                                                        

The Code grants the Treasury Department authority to issue regulations
providing for the computation of accrued market discount on debt instruments,   
such as the Notes, the principal of which is payable in more than one           
installment, but no regulations have been issued. The relevant legislative      
history provides that, until such regulations are issued, the holder of a market
discount bond may elect to accrue market discount either on the basis of a      
constant interest rate or according to a pro rata method described in the       
legislative history. Under that method, the amount of market discount that      
accrues in any accrual period in the case of a Note issued with OID equals the  
product of (i) the market discount that remains to be accrued as of the         
beginning of the accrual period and (ii) a fraction, the numerator of which is  
the OID accrued during the accrual period and the denominator of which is the   
sum of the OID accrued during the accrual period and the amount of OID remaining
to be accrued as of the end of                                                  

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the accrual period. In the case of a Note that was issued without OID, the      
amount of market discount that accrues in any accrual period will equal the     
product of (i) the market discount that remains to be accrued as of the         
beginning of the accrual period and (ii) a fraction, the numerator of which is  
the amount of stated interest accrued during the accrual period and the         
denominator of which is the total amount of stated interest remaining to be     
accrued at the beginning of the accrual period. For purposes of determining the 
amount of OID or interest remaining to be accrued with respect to a Class of    
Notes, the prepayment assumption applicable to calculating the accrual of OID on
such Notes applies.                                                             

If a beneficial owner of a Note incurred or continues indebtedness to 
purchase or hold Notes with market discount, the beneficial owner may be        
required to defer a portion of its interest deductions for the taxable year     
attributable to any such indebtedness. Any such deferred interest expense would 
not exceed the market discount that accrues during such taxable year and is, in 
general, allowed as a deduction not later than the year in which such market    
discount is includible in income. If such beneficial owner elects to include    
market discount in income currently as it accrues on all market discount bonds  
acquired by such beneficial owner in that taxable year or thereafter, the       
interest deferral rule described above will not apply.                          

     Amortizable Bond Premium. A purchaser of a Note that purchases the Note for
an amount (net of accrued interest) greater than its stated redemption price at 
maturity will have premium with respect to that Note in the amount of the       
excess. Such a purchaser need not include in income any remaining OID with      
respect to that Note and may elect to amortize the premium under Section 171 of 
the Code. If a beneficial owner makes this election, the amount of any interest 
payment that must be included in the beneficial owner's income for each period  
will be reduced by a portion of the premium allocable to the period based on a  
constant yield to maturity basis. In addition, the relevant legislative history 
states that premium should be amortized in the same manner as market discount.  

Election to Treat All Interest as OID. The OID Regulations permit a   
beneficial owner of a Note to elect to accrue all interest, discount (including 
de minimis original issue discount and de minimis market discount), and premium 
in income as interest, based on a constant yield method. If such an election    
were to be made and the Notes were to be acquired at a premium, such a          
beneficial owner would be deemed to have made an election to amortize bond      
premium with respect to all debt instruments having amortizable bond premium    
that such beneficial owner owns or acquires. Similarly, if the beneficial owner 
had acquired the Notes with market discount, the beneficial owner would be      
considered to have made an election described in Section 1278(b) of the Code to 
currently include in income accruals of market discount on all market discount  
bonds held or thereafter acquired.                                              

     Sale or Other Disposition. If a beneficial owner of a Note sells, exchanges
or otherwise disposes of the Note (or if the Note is redeemed), the beneficial  
owner will recognize gain or loss in an amount equal to the difference between  
the amount realized by the beneficial owner upon the sale, exchange, redemption 
or other disposition and the beneficial owner's adjusted tax basis in the Note. 
The adjusted tax basis of a Note to a particular beneficial owner generally will
equal the beneficial owner's cost for the Note, increased by any market discount
and OID previously included by such beneficial owner in income with respect to  
the Note and decreased by the amount of bond premium, if any, previously        
amortized and by the amount of payments that are part of the Note's stated      
redemption price at maturity previously received by such beneficial owner. Any  
such gain or loss will be capital gain or loss if the Note was held as a capital
asset, except for gain representing accrued interest and accrued market discount
not previously included in income. Capital losses generally may be used only to 
offset capital gains.                                                           

 Foreign Holders. Interest paid to or accrued by a beneficial owner of a
Note who is a not a U.S. Person (a "foreign person") generally will be          
considered portfolio interest and generally will not be subject to U.S. federal 
income tax and withholding tax, provided the interest is not effectively        
connected with the conduct of a trade or business within the U.S. by the foreign
person and the foreign person (i) is not actually or constructively a 10 percent
shareholder of the holder of the Ownership Certificate and is not a controlled  
foreign corporation with respect to which the holder of the Ownership           
Certificate is a related person (all within the meaning of the Code) and (ii)   
provides the Indenture Trustee or other person who is otherwise required to     
withhold U.S. tax with respect to the Notes (the "withholding agent") with an   
appropriate statement on Form W-8BEN (Certificate of Foreign Status of          
Beneficial Owner for United States Tax Withholding). If a Note is held through a
securities clearing organization or certain other financial institutions, the   
organization or institution may provide the relevant signed statement to the    
withholding agent; in that case, however, the signed statement must be          
accompanied by a Form W-8BEN provided by the foreign person that owns the Note. 
If the information shown on Form W-8BEN changes, a new Form W-                  

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8BEN must be filed. If interest on the Notes is not portfolio interest, then it 
will be subject to U.S. federal income and withholding tax at a rate of 30      
percent, unless reduced or eliminated pursuant to an applicable tax treaty.     

Under recently issued Treasury regulations, a payment to a foreign    
partnership is treated, with some exceptions, as a payment directly to the      
partners, so that the partners are required to provide any required             
certifications. Foreign persons that intend to hold a Note through a partnership
or other pass-through entity should consult their own tax advisors regarding the
application of those Treasury regulations to an investment in a Note.           

Any capital gain realized on the sale, redemption, retirement or other
taxable disposition of a Note by a foreign person will be exempt from U.S.      
federal income and withholding tax, provided that (i) such gain is not          
effectively connected with the conduct of a trade or business in the U.S. by the
foreign person and (ii) in the case of a foreign person who is an individual,   
the foreign person is not present in the U.S. for 183 days or more in the       
taxable year.                                                                   

Information Reporting and Backup Withholding. Payments of interest    
(including OID, if any) on a Note held by a U.S. Person other than a corporation
or other exempt holder are required to be reported to the IRS. Payments of      
interest (including OID, if any) of a Note held by a foreign person are required
to be reported annually on IRS Form 1042-S, which the withholding agent must    
file with the IRS and furnish to the recipient of the income.                   

Each beneficial owner of a Note (other than an exempt owner such as a 
corporation, tax-exempt organization, qualified pension and profit-sharing      
trust, individual retirement account or nonresident alien who provides          
certification as to status as a nonresident) will be required to provide, under 
penalties of perjury, a certificate containing the beneficial owner's name,     
address, correct federal taxpayer identification number and a statement that the
beneficial owner is not subject to backup withholding. Should a non-exempt owner
fail to provide the required certification, backup withholding of U.S. federal  
income tax will apply to payments made in respect of the Notes, as well as to   
payments of proceeds from the sale of the Notes. The withheld amount must be    
remitted to the IRS, and the beneficial owner of the Note may claim the withheld
amount as a credit against the beneficial owner's federal income tax liability. 
In addition, sales of Notes conducted through a broker generally must be        
reported to the IRS unless the broker determines that the seller is an exempt   
owner or the seller certifies its non-U.S. status (and certain other conditions 
are met).                                                                       

Treatment of Notes Held by Certain Holders. Notes owned by domestic   
building and loan associations and other thrift institutions will not be        
considered "loans secured by an interest in real property" or "qualifying real  
property loans." Notes owned by a REIT will not be treated as "real estate      
assets" nor will interest on the Notes be considered "interest on obligations   
secured by mortgages on real property." In addition, the Notes will not be      
"qualified mortgages" for REMICs.                                               

   Possible Alternative Treatments of the Notes. If, contrary to the opinion
of Hunton & Williams LLP, the IRS successfully asserted that a Class of Notes   
did not represent debt instruments for U.S. federal income tax purposes, those  
Notes might be treated as equity interests in the Trust. If, as a result, a     
Qualifying REIT Entity did not hold 100% of the equity in the Trust, the Trust  
could be subject to U.S. corporate income tax. Moreover, if a Class of Notes    
represented equity in the Trust, payments of interest on that Class of Notes to 
a foreign person generally would be subject to U.S. tax and withholding         
requirements.                                                                   

 State and Local Income Tax Considerations

 In addition to the U.S. federal income tax consequences described under
"Federal Income Tax Consequences" above, prospective investors should consider  
the state and local income tax consequences of the acquisition, ownership and   
disposition of the Notes. State and local income tax law may differ             
substantially from the corresponding federal tax law, and this discussion does  
not purport to describe any aspect of the income tax laws of any state or       
municipality. Therefore, prospective investors should consult their own tax     
advisors with respect to the various tax consequences of investments in the     
Notes.                                                                          

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ERISA Considerations

General                                                                         

Section 406 of ERISA prohibits, and Section 4975 of the Code imposes  
adverse tax consequences on, certain transactions between a Plan and persons    
that are "parties in interest" under ERISA or "disqualified persons" under the  
Code with respect to such Plan. A violation of these "prohibited transaction"   
rules may result in excise taxes and other penalties and liabilities under ERISA
and the Code for such persons.                                                  

 Certain transactions involving the assets of a trust might be deemed to
constitute prohibited transactions under Section 406 ERISA and Section 4975 of  
the Code with respect to a Plan that purchased notes issued by that trust if    
assets of the trust were deemed to be assets of the Plan. Under the Plan Asset  
Regulations, the assets of a trust would be treated as plan assets of the Plan  
for the purposes of ERISA and the Code only if the Plan acquired an "equity     
interest" in the trust and none of the exceptions contained in the Plan Asset   
Regulations was applicable. An equity interest is defined under the Plan Asset  
Regulations as an interest other than an instrument which is treated as         
indebtedness under applicable local law and which has no substantial equity     
features.                                                                       

Purchases of the Notes                                                          

Although there is little guidance on the subject, the Notes should be 
treated as indebtedness without substantial equity features for purposes of the 
Plan Asset Regulations. This determination is based in part upon (i) tax        
counsel's opinion that Notes transferred on the Closing Date to parties         
unrelated to the holder of the Ownership Certificate will be classified as debt 
for U. S. federal income tax purposes and that Retained Notes, if later sold to 
a party unrelated to the holder of the Ownership Certificate for cash, will be  
classified as debt instruments for U. S. federal income tax purposes as of the  
date of such sale, if certain assumptions (including that the rating of the     
Notes as of the Closing Date has not declined below investment grade) are       
complied with and (ii) the traditional debt features of the Notes, including the
reasonable expectation of purchasers of the Notes that they will be repaid when 
due, as well as the absence of conversion rights, warrants and other typical    
equity features. Based upon the foregoing and other considerations, subject to  
the considerations described below, the Notes may be purchased by a Plan.       

    Without regard to whether the Notes are considered an "equity interest" in
the Trust under the Plan Asset Regulations, the acquisition or holding of Notes 
by or on behalf of a Plan could be considered to give rise to a prohibited      
transaction if the Underwriters, the Trust, the Owner Trustee or the Indenture  
Trustee, or any of their respective affiliates is or becomes a party in interest
or a disqualified person with respect to such Plan. In that case, certain       
Investor-Based Exemptions from the prohibited transaction rules could be        
applicable, depending on the type of Plan involved and the circumstances of the 
plan fiduciary's decision to acquire a Note. Even if the conditions specified in
one or more of the Investor-Based Exemptions are met, the scope of the relief   
provided by these exemptions might or might not cover all acts that might be    
construed as prohibited transactions. There can be no assurance that any of the 
Investor-Based Exemptions, or any other exemption, will be available with       
respect to any particular transaction involving the Notes.                      

    The Notes should not be purchased with the assets of a Benefit Plan if the
Depositor, the Indenture Trustee, the Owner Trustee, the Underwriters or any of 
their affiliates is a fiduciary or gives investment advice with respect to such 
Benefit Plan or is an employer maintaining or contributing to such Benefit Plan,
unless such purchase and holding of the Notes would be covered by an applicable 
prohibited transaction exemption, and will not cause a non-exempt violation of  
any Similar Law.                                                                

 Each purchaser and transferee of a Note will be deemed to represent and
warrant to the trust that either (i) it is not a Benefit Plan or (ii) it is a   
Benefit Plan and its acquisition and holding of such Notes will not result in a 
non-exempt prohibited transaction under Section 406 of ERISA or Section 4975 of 
the Code which is not covered under an Investor-Based Exemption or some other   
applicable exemption, and will not cause a non-exempt violation of any Similar  
Law.                                                                            

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     Prospective Benefit Plan investors in Notes should consult with their legal
advisors concerning the impact of ERISA and the Code, the availability of other 
exemptions from the prohibited transaction rules that may apply to them, and the
potential consequences in their specific circumstances, prior to making an      
investment in the notes. Each Benefit Plan fiduciary should also determine      
whether under the general fiduciary standards of investment prudence and        
diversification, an investment in the Notes is appropriate for the Benefit Plan,
taking into account the overall investment policy of the Plan and the           
composition of the Benefit Plan's investment portfolio.                         

Legal Investment

None of the Notes will constitute "mortgage related securities" under 
SMMEA. The appropriate characterization of the Notes under various legal        
investment restrictions, and thus the ability of investors subject to those     
restrictions to purchase Notes, may be subject to significant interpretive      
uncertainties. All investors whose investment authority is subject to legal     
restrictions should consult their own legal advisors to determine whether, and  
to what extent, the Notes will constitute legal investments for them.           

    No representations are made as to the proper characterization of the Notes
for legal investment or financial institution regulatory purposes, or other     
purposes, or as to the ability of particular investors to purchase the Notes    
under applicable legal investment restrictions. The uncertainties described     
above (and any unfavorable future determinations concerning legal investment or 
financial institution regulatory characteristics of the Notes) may adversely    
affect the liquidity of the Notes. See "Legal Investment" in the prospectus.    

 Use of Proceeds

   Substantially all of the net proceeds to be received from the sale of the
Notes will be applied by the Depositor to the purchase price of the Mortgage    
Loans, to fund the repayment of any related financing and to fund the           
Pre-Funding Account on the Closing Date.                                        

Method of Distribution

 Subject to the terms and conditions of the underwriting agreement dated
July 29, 2005 between the Underwriters and the Depositor, and the terms         
agreement dated November 15, 2005, between the Depositor and Credit Suisse First
Boston LLC, as an Underwriter and as representative of the Underwriters, the    
Notes are being purchased from the Depositor by the Underwriters in the         
respective initial Class Principal Amount of each class of Notes set forth      
below, in each case upon issuance of each class.                                

                                                        [Enlarge/Download Table]

                                                                                           Merrill Lynch,  
                   Approximate     Credit Suisse   Bear Stearns &                         Pierce, Fenner & 
 Class of Notes    Balance ($)   First Boston LLC     Co. Inc.     Lehman Brothers Inc.  Smith Incorporated
---------------  --------------  ----------------  --------------  --------------------  ------------------
                                                                                                           
1-A............  $  316,989,000    $221,892,300     $ 31,698,900      $   31,698,900        $ 31,698,900   
2-A1...........     294,358,000     206,050,600       29,435,800          29,435,800          29,435,800   
2-A2...........     262,801,000     183,960,700       26,280,100          26,280,100          26,280,100   
2-A3...........      15,000,000      10,500,000        1,500,000           1,500,000           1,500,000   
M1.............      44,283,000      30,998,100        4,428,300           4,428,300           4,428,300   
M2.............      41,369,000      28,958,300        4,136,900           4,136,900           4,136,900   
M3.............      27,968,000      19,577,600        2,796,800           2,796,800           2,796,800   
M4.............      19,811,000      13,867,700        1,981,100           1,981,100           1,981,100   
M5.............      19,228,000      13,459,600        1,922,800           1,922,800           1,922,800   
M6.............      18,645,000      13,051,500        1,864,500           1,864,500           1,864,500   
M7.............      18,645,000      13,051,500        1,864,500           1,864,500           1,864,500   
M8.............      15,149,000      10,604,300        1,514,900           1,514,900           1,514,900   
M9.............      12,819,000      12,819,300               --                  --                  --   
M10............      20,976,000      20,976,000               --                  --                  --   
M11............      11,653,000      11,653,000               --                  --                  --   
M12............       8,740,000       8,740,000               --                  --                  --   
M13............       7,575,000       7,575,000               --                  --                  --   
                 --------------    ------------     ------------      --------------        ------------   
Total..........  $1,156,009,000    $827,735,200     $109,424,600      $  109,424,600        $109,424,600   
                 ==============    ============     ============      ==============        ============   

   Distribution of the Notes (other than the Class M9, Class M10, Class M11,
Class M12 and Class M13 Notes which will be sold to an affiliate of the Seller  
and will constitute Retained Notes) will be made by the Underwriters from time  
to time in negotiated transactions or otherwise at varying prices to be         
determined at the time                                                          

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of sale. The Underwriters may effect such transactions by selling the Notes     
(other than the Retained Notes) to or through dealers and such dealers may      
receive from the Underwriters, for which they act as agent, compensation in the 
form of underwriting discounts, concessions or commissions. The Underwriters and
any dealers that participate with the Underwriters in the distribution of such  
Notes may be deemed to be underwriters, and any discounts, commissions, or      
concessions received by them, and any profits on resale of the classes of Notes 
purchased by them, may be deemed to be underwriting discounts and commissions   
under the Securities Act of 1933, as amended.                                   

     The Depositor has been advised by the Underwriters that they each intend to
make a market in the Notes, but no Underwriter has any obligation to do so.     
There can be no assurance that a secondary market for the Notes will develop or,
if it does develop, that it will continue.                                      

 The Depositor has agreed to indemnify the Underwriters against, or make
contributions to the Underwriters with respect to, certain liabilities,         
including liabilities under the Securities Act of 1933, as amended.             

   Expenses incurred by the Seller and the Depositor in connection with this
offering are expected to be approximately $850,000 in the aggregate.            

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 Summary of Fees and Expenses related to the Issuance of the Notes

  The following table summarizes the fees and expenses associated with the
offering of the Notes, and the on-going costs of the administration and         
servicing of the assets of the Trust.                                           

                                                        [Enlarge/Download Table]

--------------------------------------------------------------------------------------------------------------------
                          Party Entitled to                          Source of funds                                
                           Receive Fees and    General Purpose of     for payment of                    Priority of 
   Fees and Expenses           Expenses        Fees and Expenses    fees and expenses   Amount of fee     Payment   
--------------------------------------------------------------------------------------------------------------------
                                                                                                                    
Master Servicing Fee(1)    Master Servicer      As consideration      Collections in     an aggregate   Prior to any
                                                for supervising       respect of the     monthly fee     payments to
                                                 the servicing        Mortgage Loans    calculated at    Noteholders
                                               activities of the                         0.0030% per                
                                                 servicer, and                          annum on the                
                                               providing certain                            stated                  
                                                 administrative                           principal                 
                                                responsibilities                          balance of                
                                               in respect of the                        each mortgage               
                                                      Trust                               loan as of                
                                                                                        the beginning               
                                                                                            of the                  
                                                                                         related due                
                                                                                            period                  
--------------------------------------------------------------------------------------------------------------------
   Servicing Fee(1)          Servicer and       As consideration      Collections in     an aggregate   Prior to any
                           Subservicer, in     for servicing the      respect of the     monthly fee     payments to
                            the aggregate      mortgage loans and     Mortgage Loans         paid        Noteholders
                                                other assets of                         calculated at               
                                                   the Trust.                             0.50% per                 
                                                                                         annum on the               
                                                                                            stated                  
                                                                                          principal                 
                                                                                          balance of                
                                                                                        each mortgage               
                                                                                          loan as of                
                                                                                        the beginning               
                                                                                            of the                  
                                                                                         related due                
                                                                                            period                  
--------------------------------------------------------------------------------------------------------------------
 Indenture Trustee Fee    Indenture Trustee     As consideration      Collections in     a negotiated   Prior to any
                                               for acting in the      respect of the     amount that     payments to
                                                capacity as the       Mortgage Loans       will be       Noteholders
                                               indenture trustee                         payable from               
                                              under the operative                         the Master                
                                                   documents.                           Servicing Fee               
--------------------------------------------------------------------------------------------------------------------
   Owner Trustee Fee        Owner Trustee       As consideration      For the first       an annual     Prior to any
                                                 for the owner       year, the owner      amount of      payments to
                                               trustee to perform     trustee fee is        $3,000       Noteholders
                                                    certain           paid up-front                                 
                                                 administrative      from the closing                               
                                                responsibilities     proceeds and for                               
                                                on behalf of the    subsequent years,                               
                                                      Trust         the owner trustee                               
                                                                       fee shall be                                 
                                                                       payable from                                 
                                                                      Collections in                                
                                                                      respect of the                                
                                                                      Mortgage Loans                                
--------------------------------------------------------------------------------------------------------------------
   Net Swap Payments      Swap Counterparty     As consideration      Collections in     Varies--see    Prior to any
  and Swap Termination                           for the Trust        respect of the     "Description    payments to
         Amount                                entering into the      Mortgage Loans        of the       Noteholders
                                                 Swap Agreement                           Notes--The                
                                                                                             Swap                   
                                                                                          Agreement"                
--------------------------------------------------------------------------------------------------------------------

----------                                                                      
(1) Each of the Master Servicing Fee and the Servicing Fee is subject to        
reduction, in respect of any Payment Date, to account for the payment of        
compensating interest. See "Servicing of the Mortgage Loans--Adjustment to      
Servicing Fees in Connection with Certain Prepaid Mortgage Loans" in this       
prospectus supplement.                                                          

 Legal Matters

 Certain legal matters will be passed upon for the Depositor by Hunton &
Williams LLP and for the Underwriters by McKee Nelson LLP.                      

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 Ratings

  It is a condition of the issuance of the Notes that they be assigned the
ratings designated below by Fitch, Moody's and S&P.                             

                                                                [Download Table]

Class of Notes   Fitch   Moody's   S&P 
--------------   -----   -------   ----
                                       
1-A...........    AAA       Aaa     AAA
2-A1..........    AAA       Aaa     AAA
2-A2..........    AAA       Aaa     AAA
2-A3..........    AAA       Aaa     AAA
M1............    AA+       Aa1     AA+
M2............     AA       Aa2     AA+
M3............    AA-       Aa3     AA+
M4............     A+       A1      AA+
M5............     A        A2      AA 
M6............     A-       A3      AA 
M7............    BBB+     Baa1     A+ 
M8............    BBB      Baa2     A+ 
M9............    BBB-     Baa3      A 
M10...........     NR       NR      A- 
M11...........     NR       NR     BBB+
M12...........     NR       NR      BBB
M13...........     NR       NR     BBB-

    The ratings of "AAA" and "Aaa" are the highest ratings that the applicable
rating agency assigns to securities. A securities rating is not a recommendation
to buy, sell or hold securities and may be subject to revision or withdrawal at 
any time by the assigning rating agency. A securities rating addresses the      
likelihood of receipt by holders of Notes of timely payments of interest and    
ultimate payment of principal, based on the amount of Scheduled Payments on the 
Mortgage Loans. The rating takes into consideration the characteristics of the  
Mortgage Loans and the structural and legal aspects associated with the Notes.  
The ratings do not take into consideration any of the tax aspects associated    
with the Notes. The ratings on the Notes do not represent any assessment of the 
likelihood or rate of principal prepayments. The ratings do not address the     
possibility that holders of Notes might suffer a lower than anticipated yield   
due to prepayments.                                                             

The ratings do not address the likelihood that any Available Funds    
Shortfall will be repaid to Noteholders from Monthly Excess Cashflow or that any
payments will be paid to Noteholders from the Swap Agreement.                   

The security ratings assigned to the Notes should be evaluated        
independently from similar ratings on other types of securities.                

    The Depositor has not requested a rating of the Notes by any rating agency
other than Fitch, Moody's and S&P. However, there can be no assurance as to     
whether any other rating agency will rate the Notes or, if it does, what ratings
would be assigned by such other rating agency. The ratings assigned by any such 
other rating agency to the Notes could be lower than the respective ratings     
assigned by the Rating Agencies.                                                

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 Glossary of Defined Terms

                                                                [Download Table]
                                                                                
2/28 LIBOR ARM Loan                a Mortgage Loan that bears interest at a     
                                   fixed rate for a period of approximately two 
                                   years after origination and thereafter is    
                                   subject to semi-annual interest rate and     
                                   payment adjustments in substantially the same
                                   manner as a Six-Month LIBOR Loan.            

2/28 LIBOR IO ARM Loan             2/28 LIBOR ARM Loan that provides for the    
                                   payment of interest only for a period of     
                                   approximately five years after origination   
                                   and thereafter provides for the payment of   
                                   interest and principal sufficient to amortize
                                   such Mortgage Loan over its remaining term to
                                   maturity.                                    

3/27 LIBOR ARM Loan                a Mortgage Loan that bears interest at a     
                                   fixed rate for a period of approximately     
                                   three years after origination and thereafter 
                                   is subject to semi-annual interest rate and  
                                   payment adjustments in substantially the same
                                   manner as a Six-Month LIBOR Loan.            

3/27 LIBOR IO ARM Loan             3/27 LIBOR ARM Loan that provides for the    
                                   payment of interest only for a period of     
                                   approximately five years after origination   
                                   and thereafter provides for the payment of   
                                   interest and principal sufficient to amortize
                                   such Mortgage Loan over its remaining term to
                                   maturity.                                    

5/1 Treasury ARM Loan              a Mortgage Loan that bears interest at a     
                                   fixed rate for a period of approximately five
                                   years after origination and thereafter is    
                                   subject to annual interest rate and payment  
                                   adjustments in substantially the same manner 
                                   as a Treasury Loan.                          

5/1 Treasury IO ARM Loan           a 5/1 Treasury IO ARM Loan that provides for 
                                   the payment of interest only for a period of 
                                   approximately five years after origination   
                                   and thereafter is subject to an annual       
                                   interest rate and payment adjustments in     
                                   substantially the same number as a Treasury  
                                   Loan sufficient to amortize such Mortgage    
                                   Loan over its remaining term to maturity.    

30/15 Balloon Loan                 a Mortgage Loan that provides for the payment
                                   of the unamortized principal balance of such 
                                   Mortgage Loan in a single payment at         
                                   maturity. 30/15 Balloon Loans provide for    
                                   equal monthly payments, consisting of        
                                   principal and interest, based on a 30-year   
                                   amortization schedule, and a single payment  
                                   of the remaining balance of the Balloon Loan,
                                   generally 15 years after origination.        

Accounts                           the Custodial Accounts, the Collection       
                                   Account, the Pre-Funding Account, the Basis  
                                   Risk Reserve Account and any other accounts  
                                   maintained by the Trust Administrator, the   
                                   Servicer or the Subservicer pursuant to the  
                                   Transfer and Servicing Agreement.            

Accrual Period                     with respect to each class of Notes (other   
                                   than the Class M10, Class M11, Class M12 and 
                                   Class M13 Notes) and a Payment Date, the     
                                   period from and including the preceding      
                                   Payment Date (or from the Closing Date in the
                                   case of the first Payment Date) to and       
                                   including the day prior to such Payment Date 
                                   and in the case of the Class M10, Class M11, 
                                   Class M12 and Class M13 Notes, the calendar  
                                   month preceding the month in which such      
                                   Payment Date occurs.                         

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                                                                [Download Table]
                                                                                
Adjustable Rate Mortgage Loan      any Mortgage Loan as to which the related    
                                   mortgage note provides for the adjustment of 
                                   the Mortgage Rate applicable thereto.        

Adjustment Date                    with respect to an Adjustable Rate Mortgage  
                                   Loan, generally the first day of the month or
                                   months specified in the related mortgage     
                                   note.                                        

Advance                            with respect to a Servicer Remittance Date,  
                                   an advance of the Subservicer's, Servicer's  
                                   or Master Servicer's own funds, as           
                                   applicable, or funds in the related          
                                   Collection Account that are not required to  
                                   be paid on the related Payment Date, in an   
                                   amount generally equal to the aggregate of   
                                   payments of principal and interest on the    
                                   Mortgage Loans (adjusted to the applicable   
                                   Net Mortgage Rate) that were due on the      
                                   related Due Date and delinquent on the       
                                   related Servicer Remittance Date.            

Aggregate Collateral Balance       as of any date of determination (other than  
                                   the Closing Date), an amount equal to the    
                                   Aggregate Loan Balance plus the amount, if   
                                   any, then on deposit in the Pre-Funding      
                                   Account. With respect to the Closing Date, an
                                   amount equal to the Aggregate Loan Balance as
                                   of the Initial Cut-off Date plus the amount  
                                   on deposit in the Pre-Funding Account as of  
                                   the Closing Date.                            

Aggregate Loan Balance             as of any date of determination, an amount   
                                   equal to the aggregate of the Stated         
                                   Principal Balances of the Mortgage Loans as  
                                   of such date.                                

Aggregate Overcollateralization    for any Payment Date, an amount equal to the 
Release Amount                     lesser of (a) the aggregate of the Principal 
                                   Funds of each Mortgage Group for such Payment
                                   Date and (b) the amount, if any, by which (i)
                                   the Overcollateralization Amount for such    
                                   date (calculated for this purpose on the     
                                   basis of the assumption that 100% of the     
                                   aggregate of the Principal Funds for such    
                                   date is applied on such date in reduction of 
                                   the aggregate of the Class Principal Amounts 
                                   of the Notes) exceeds (ii) the Targeted      
                                   Overcollateralization Amount for such date.  

Available Funds Rate               for any Payment Date and for any Class of    
                                   Notes, (a) the aggregate of Interest Funds   
                                   for both Mortgage Groups less any Net Swap   
                                   Payments or swap termination amounts paid    
                                   pursuant to clause (A)(i) or (B)(i), as      
                                   applicable, under "Description of the        
                                   Notes--Payments--Payments of Interest,"      
                                   divided by (b) the product of (i) the sum of 
                                   the Class Principal Amounts for each Class of
                                   Notes before taking into account any payments
                                   of principal on that Payment Date and (ii)   
                                   (A) the actual number of days in the related 
                                   Accrual Period, (or, in the case of the Class
                                   M10, Class M11, Class M12 and Class M13      
                                   Notes, 30) divided by (B) 360.               

                                   For example, for a Payment Date with a 31-day
                                   Accrual Period as to which the Interest Funds
                                   for both Mortgage Groups less the Net Swap   
                                   Payments and swap termination amounts        
                                   specified above equals $1,000 and the sum of 
                                   the Class Principal Amounts for each Class of
                                   Notes equals $100,000, the "Available Funds  
                                   Rate" for each Class of Notes (other than the
                                   Class M10, Class M11, Class M12 and Class M13
                                   Notes) would equal approximately 11.6%,      
                                   calculated as follows:                       
                                   $1,000 / [100,000 x (31 / 360)].             

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                                                                [Download Table]
                                                                                
Available Funds Shortfall          for any Class of Notes and any Payment Date, 
                                   the sum of (a) the excess, if any, of (i) the
                                   amount that would have been the Current      
                                   Interest for such Class had the Interest Rate
                                   for such Class been determined without regard
                                   to the Available Funds Rate over (ii) the    
                                   actual amount of Current Interest for such   
                                   Class, plus (b) any excess described in      
                                   clause (a) for any prior Payment Date that   
                                   remains unpaid, plus (c) interest accrued    
                                   during the Accrual Period related to such    
                                   Payment Date on the amount described in      
                                   clause (b) at the Interest Rate applicable to
                                   such Class, determined without regard to the 
                                   Available Funds Rate.                        

Bank                               Bank of America, N.A.                        

Basis Risk Reserve Account         the account established by the Trust         
                                   Administrator, for the benefit of the        
                                   Noteholders, into which the Swap Counterparty
                                   is required to deposit or cause to be        
                                   deposited certain payments, as described in  
                                   the Swap Agreement.                          

Benefit Plan                       an employee benefit plan subject to Section  
                                   406 of ERISA or Section 4975 of the Code or  
                                   any Similar Law or any entity deemed to hold 
                                   the assets of the foregoing.                 

Book-Entry Notes                   the Notes other than any Definitive Notes.   

Borrower                           the obligor on a Mortgage Note.              

Business Day                       except with respect to the Swap Agreement,   
                                   any day other than (a) a Saturday or Sunday  
                                   or (b) a day on which banking institutions in
                                   the State of Arizona, State of California,   
                                   State of Delaware, State of Maryland, State  
                                   of Minnesota, or City of New York, New York  
                                   are authorized or obligated by law or        
                                   executive order to be closed. With respect to
                                   the Swap Agreement, "Business Day" means any 
                                   day other than (a) a Saturday or Sunday or   
                                   (b) a day on which banking institutions in   
                                   the City of New York, New York or London,    
                                   England are authorized or obligated by law or
                                   executive order to be closed.                

Calculation Period End Date        with respect to the Swap Agreement, the 25th 
                                   calendar day of each month commencing in     
                                   December 2005, regardless of whether such day
                                   is a Business Day.                           

CHF                                Chase Home Finance LLC.                      

Class A Notes                      the Class 1-A, Class 2-A1, Class 2-A2 and    
                                   Class 2-A3 Notes.                            

Class M Notes                      the Class M1, Class M2, Class M3, Class M4,  
                                   Class M5, Class M6, Class M7, Class M8, Class
                                   M9, Class M10, Class M11, Class M12 and Class
                                   M13 Notes.                                   

Class Principal Amount             with respect to any class of Notes, the      
                                   initial note principal balance of such class,
                                   reduced by all amounts previously paid with  
                                   respect to such Notes as principal on all    
                                   prior Payment Dates.                         

Clearstream Luxembourg             Clearstream Banking Luxembourg.              

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Closing Date                       on or about November 23, 2005.               

CMMC                               Chase Manhattan Mortgage Corporation.        

Code                               the Internal Revenue Code of 1986, as        
                                   amended.                                     

Collateral Value                   with respect to a Mortgage Loan the proceeds 
                                   of which were used to purchase the related   
                                   mortgaged property, the lesser of (a) the    
                                   appraised value of such mortgaged property   
                                   based on an appraisal made for the originator
                                   by an independent fee appraiser at the time  
                                   of the origination of the related Mortgage   
                                   Loan, and (b) the sales price of such        
                                   mortgaged property at such time of           
                                   origination and means, with respect to a     
                                   Mortgage Loan the proceeds of which were used
                                   to refinance an existing Mortgage Loan, the  
                                   appraised value of the mortgaged property    
                                   based upon the appraisal obtained at the time
                                   of refinancing.                              

Collection Account                 the one or more accounts established by the  
                                   Trust Administrator, for the benefit of the  
                                   Noteholders, into which the Servicer and     
                                   Subservicer are required to deposit or cause 
                                   to be deposited certain payments, as         
                                   described in the Transfer and Servicing      
                                   Agreement.                                   

Combined Loan-to-Value Ratio       for any Mortgage Loan, (a) the sum of (i) the
                                   principal balance of such Mortgage Loan at   
                                   the date of origination and (ii) the         
                                   principal balance of any mortgage loan the   
                                   lien on which is junior to the lien on such  
                                   Mortgage Loan, as at the date of origination 
                                   of such second lien mortgage loan, divided by
                                   (b) the Collateral Value of the related      
                                   mortgaged property.                          

Compensating Interest              with respect to any Payment Date, the amount 
                                   required to be paid by the Servicer, the     
                                   Subservicer or the Master Servicer, as       
                                   applicable, in respect of any Prepayment     
                                   Interest Shortfalls incurred during the      
                                   related Prepayment Period, which shall be    
                                   limited to the Servicing Fee and the Master  
                                   Servicing Fee with respect to the Servicer   
                                   and the Master Servicer, respectively, or the
                                   portion of the Servicing Fee payable to the  
                                   Subservicer, with respect to the Subservicer,
                                   payable for such Payment Date.               

Corporation                        Bank of America Corporation.                 

CPR                                the Constant Prepayment Rate model, which    
                                   assumes that the outstanding principal       
                                   balance of a pool of mortgage loans prepays  
                                   at a specified constant annual rate (and is  
                                   converted to an equivalent constant monthly  
                                   rate to generate monthly cash flows).        

Credit Score                       the statistical credit score obtained by many
                                   mortgage lenders in connection with the loan 
                                   application.                                 

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Current Interest                   with respect to any class of Notes and any   
                                   Payment Date, the aggregate amount of        
                                   interest accrued at the applicable Interest  
                                   Rate during the related Accrual Period on the
                                   Class Principal Amount of such class         
                                   immediately prior to such Payment Date,      
                                   provided, however, that for any class of     
                                   Class M Notes and for any Payment Date,      
                                   Current Interest shall be reduced by the     
                                   amount specified in clause (a) of the        
                                   definition of Deferred Interest (calculated  
                                   for purposes of this definition with the     
                                   imposition of the Available Funds Rate), if  
                                   any, for such class and Payment Date.        

Custodial Account                  an account established by the Servicer, for  
                                   the benefit of the Noteholders, into which   
                                   the Servicer or Subservicer are required to  
                                   deposit or cause to be deposited certain     
                                   payments, as described in the Transfer and   
                                   Servicing Agreement.                         

Custodian                          Wells Fargo Bank, N.A.                       

Cut-off Date                       with respect to the Initial Mortgage Loans,  
                                   the Initial Cut-off Date, and with respect to
                                   the Subsequent Mortgage Loans, the Subsequent
                                   Cut-off Date.                                

Cut-off Date Balance               the Aggregate Loan Balance as of the Initial 
                                   Cut-off Date.                                

Deferred Interest                  for any class of Class M Notes and any       
                                   Payment Date, the sum of (a) the aggregate   
                                   amount of interest accrued at the applicable 
                                   Interest Rate (without regard to the         
                                   Available Funds Rate) during the related     
                                   Accrual Period on the Principal Deficiency   
                                   Amount for that class, (b) any amounts due   
                                   pursuant to clause (a) for such class for    
                                   prior Payment Dates that remain unpaid and   
                                   (c) interest accrued during the Accrual      
                                   Period related to such Payment Date on the   
                                   amount in clause (b) at the Interest Rate    
                                   applicable to such class determined without  
                                   regard to the Available Funds Rate.          

Definitive Note                    a physical note representing any Note.       

Depositor                          Fieldstone Mortgage Investment Corporation.  

Determination Date                 with respect to a Payment Date, the fifteenth
                                   day of the month of such Payment Date (or, if
                                   not a Business Day, the immediately preceding
                                   Business Day).                               

DTC                                The Depository Trust Company.                

Due Date                           a scheduled monthly payment date for any     
                                   Mortgage Loan.                               

Due Period                         with respect to any Payment Date, the period 
                                   beginning on the second day of the calendar  
                                   month preceding the calendar month in which  
                                   such Payment Date occurs and ending on the   
                                   first day in the month in which such Payment 
                                   Date occurs.                                 

Eligible Securities                any indebtedness that may be incurred by FMIC
                                   in connection with the issuance of any       
                                   securities that are collateralized or        
                                   otherwise secured or backed by interest in   
                                   mortgage loans or mortgage related assets.   

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

Euroclear                          the Euroclear System.                        

Euroclear Operator                 Euroclear Bank S.A./N.V., a bank incorporated
                                   under the laws of the Kingdom of Belgium.    

European Depositaries              Citibank, N.A., as depositary for Clearstream
                                   Luxembourg, and JPMorgan Chase Bank, as      
                                   depositary for Euroclear, collectively.      

Fannie Mae                         the Federal National Mortgage Association or 
                                   any successor.                               

FIC                                Fieldstone Investment Corporation.           

Fieldstone Underwriting            as defined in "Underwriting Guidelines."     
Guidelines                                                                      

Financial Intermediary             a bank, brokerage firm, thrift institution or
                                   other financial intermediary.                

Fitch                              Fitch Ratings, or any successor.             

Fixed Rate Cap                     with respect to a Payment Date, the per annum
                                   rate, equal to 12.250%.                      

Fixed Rate IO Loan                 Fixed Rate Mortgage Loans that require the   
                                   payment of interest only for a period of     
                                   approximately five years and thereafter      
                                   provide for the payment of interest and      
                                   principal sufficient to amortize such        
                                   Mortgage Loan to maturity.                   

Fixed Rate Mortgage Loan           a Mortgage Loan that bears interest at a     
                                   fixed rate for the term of such Mortgage     
                                   Loan. Fixed Rate Mortgage Loans provide for  
                                   equal monthly payments, consisting of        
                                   principal and interest, generally based on a 
                                   15-year or 30-year amortization schedule.    

FMC                                Fieldstone Mortgage Company.                 

FMIC                               Fieldstone Mortgage Investment Corporation.  

FMOC                               Fieldstone Mortgage Ownership Corp.          

Freddie Mac                        the Federal Home Loan Mortgage Corporation.  

FSC                                Fieldstone Servicing Corp.                   

Group 1                            the portion of the mortgage pool identified  
                                   as "Group 1" in this prospectus supplement.  

Group 1 Percentage                 with respect to Group 1 and any Payment Date,
                                   the fraction, expressed as a percentage, the 
                                   numerator of which is the Group Balance for  
                                   Group 1 for such date and the denominator of 
                                   which is the Aggregate Loan Balance for such 
                                   date.                                        

Group 2                            the portion of the mortgage pool identified  
                                   as "Group 2" in this prospectus supplement.  

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Group 2 Percentage                 with respect to Group 2 and any Payment Date,
                                   the fraction, expressed as a percentage, the 
                                   numerator of which is the Group Balance for  
                                   Group 2 for such date and the denominator of 
                                   which is the Aggregate Loan Balance for such 
                                   date.                                        

Group Balance                      with respect to each Mortgage Group and any  
                                   Payment Date, the aggregate of the Stated    
                                   Principal Balance of the Mortgage Loans in   
                                   such Mortgage Group.                         

HEP                                the Home Equity Prepayment Curve, which is   
                                   the prepayment model utilized with respect to
                                   the Fixed Rate Mortgage Loans. The Home      
                                   Equity Prepayment Curve assumes a mortgage   
                                   loan prepayment rate that increases at a     
                                   uniform percentage of CPR for the first ten  
                                   months and then remains constant thereafter  
                                   at the CPR percentage corresponding to the   
                                   HEP percentage. For example, a rate of 20% of
                                   HEP assumes 2% CPR in the first month, 4% CPR
                                   in the second month, 6% in the third month   
                                   and so on until it levels off at 20% CPR in  
                                   the tenth month.                             

Hybrid Mortgage Loan               an adjustable rate Mortgage Loan which after 
                                   origination has a fixed Mortgage Rate for a  
                                   period specified in the related mortgage     
                                   note, and which converts at a later date to  
                                   an adjustable Mortgage Rate.                 

Indenture                          an indenture, dated as of November 1, 2005   
                                   between the Issuer, the Trust Administrator  
                                   and the Indenture Trustee.                   

Indenture Default                  any event of default under the Indenture.    

Indenture Trustee                  HSBC Bank USA, National Association.         

Indirect Participants              Participants and organizations which have    
                                   indirect access to the DTC system, such as   
                                   banks, brokers, dealers and trust companies  
                                   that clear through or maintain a custodial   
                                   relationship with a Participant, either      
                                   directly or indirectly.                      

Initial Cut-off Date               November 1, 2005.                            

Initial Mortgage Loans             the mortgage loans included in the Trust as  
                                   of the Closing Date.                         

Initial Rate Cap                   a fixed percentage specified in the related  
                                   mortgage note by which the related Mortgage  
                                   Rate generally will not increase or decrease 
                                   on the first Adjustment Date more than such  
                                   fixed percentage.                            

Interest Determination Date        each date that is the second LIBOR Business  
                                   Day preceding the commencement of each       
                                   Accrual Period for the Notes.                

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Interest Funds                     with respect to any Payment Date and either  
                                   Mortgage Group, the sum, without duplication,
                                   of (a) all scheduled interest due during the 
                                   related Due Period that is received before   
                                   the Servicer Remittance Date (less (i) the   
                                   Servicing Fee and the Master Servicing Fee,  
                                   (ii) all non-recoverable Advances relating to
                                   interest and (iii) any fees and expenses of  
                                   any Custodian with respect to the Mortgage   
                                   Loans in any such Mortgage Group to the      
                                   extent not paid by the Seller or its         
                                   affiliates), (b) all Advances relating to    
                                   interest, (c) all Compensating Interest      
                                   relating to the related Prepayment Period,   
                                   (d) liquidation proceeds collected during the
                                   related Prepayment Period (to the extent such
                                   liquidation proceeds relate to interest), (e)
                                   proceeds of any Mortgage Loan in such        
                                   Mortgage Group purchased by the Seller under 
                                   the Mortgage Loan Purchase Agreement during  
                                   the related Prepayment Period for document   
                                   defects, breach of a representation or       
                                   warranty, realization upon default or        
                                   optional redemption (to the extent such      
                                   proceeds relate to interest), and (f) such   
                                   Mortgage Group's pro rata share of any Net   
                                   Swap Receipts paid by the Swap Counterparty  
                                   in respect of the Swap Agreement less, the   
                                   sum of (1) such Mortgage Group's pro rata    
                                   share of: (A) the Owner Trustee Fee, (B) any 
                                   expenses due to the Master Servicer,         
                                   Servicer, the Subservicer, the Indenture     
                                   Trustee, the Owner Trustee, the Custodian or 
                                   the Trust Administrator and (C) any other    
                                   fees and expenses payable from amounts on    
                                   deposit in the Collection Account and any of 
                                   the Custodial Accounts and (2) the Group 1   
                                   Percentage or Group 2 Percentage, as         
                                   applicable, of any Net Swap Payment for such 
                                   Payment Date and any swap termination amounts
                                   paid to the Swap Counterparty in the event   
                                   that the Trust is a defaulting party or      
                                   affected party under the terms of the Swap   
                                   Agreement, in each case, to the extent paid  
                                   from amounts on deposit in the Collection    
                                   Account.                                     

Interest Margin                    for each class of Notes (other than the Class
                                   M10, Class M11, Class M12 and Class M13      
                                   Notes) for any Payment Date on or before the 
                                   first Payment Date described in clause (b)   
                                   below: Class 1-A, 0.245%; Class 2-A1, 0.120%;
                                   Class 2-A2, 0.260%; Class 2-A3, 0.340%; Class
                                   M1, 0.430%; Class M2, 0.450%; Class M3,      
                                   0.480%; Class M4, 0.600%; Class M5, 0.630%;  
                                   Class M6, 0.690%; Class M7, 1.200%; Class M8,
                                   1.450%; and Class M9, 2.000%; and on any     
                                   Payment Date following the month in which the
                                   Aggregate Collateral Balance as of the       
                                   beginning of the related Due Period is less  
                                   than 10% of the Aggregate Collateral Balance 
                                   as of the Closing Date: Class 1-A, 0.490%;   
                                   Class 2-A1, 0.240%; Class 2-A2, 0.520%; Class
                                   2-A3, 0.680%; Class M1, 0.645%; Class M2,    
                                   0.675%; Class M3, 0.720%; Class M4, 0.900%;  
                                   Class M5, 0.945%; Class M6, 1.035%; Class M7,
                                   1.800%; Class M8, 2.175%; and Class M9,      
                                   3.000%.                                      

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Interest Rate                      (a) with respect to the Notes (other than the
                                   Class M10, Class M11, Class M12 and Class M13
                                   Notes) on any Payment Date, the least of (i) 
                                   One-Month LIBOR plus the Interest Margin for 
                                   such Notes, (ii) the Available Funds Rate and
                                   (iii) the Fixed Rate Cap and (b) with respect
                                   to the Class M10, Class M11, Class M12 and   
                                   Class M13 Notes, the lesser of (i) a per     
                                   annum rate of 5.000% and (ii) the Available  
                                   Funds Rate, until the first Payment Date     
                                   after which the Servicer has not exercised   
                                   its cleanup call on the Payment Date on which
                                   the Aggregate Collateral Balance at the      
                                   beginning of the Due Period related to that  
                                   Payment Date is less than 10% of the         
                                   Aggregate Collateral Balance as of the       
                                   Closing Date, then on each subsequent Payment
                                   Date the Interest Rate for the Class M10,    
                                   Class M11, Class M12 and Class M13 Notes will
                                   be the lesser of (i) 5.500% and (ii) the     
                                   Available Funds Rate.                        

Investor-Based Exemptions          PTCE 84-14 (relating to transactions effected
                                   by a "qualified professional asset manager");
                                   PTCE 90-1 (relating to transactions involving
                                   insurance company pooled separate accounts); 
                                   PTCE 91-38 (relating to transactions         
                                   involving bank collective investment funds); 
                                   PTCE 95-60 (relating to transactions         
                                   involving insurance company general          
                                   accounts); PTCE 96-23 (relating to           
                                   transactions effected by an "in-house asset  
                                   manager"); and any other applicable exemption
                                   granted by the U.S. Department of Labor.     

IO ARM Loans                       the 2/28 LIBOR IO ARM Loans, the 3/27 LIBOR  
                                   IO ARM Loans and the 5/1 Treasury IO ARM     
                                   Loans.                                       

IRS                                the Internal Revenue Service.                

Issuer                             Fieldstone Mortgage Investment Trust, Series 
                                   2005-3.                                      

JPMorgan                           JPMorgan Chase Bank, National Association.   

LIBOR Business Day                 a day on which banks are open for dealing in 
                                   foreign currency and exchange in London and  
                                   New York City.                               

M1 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M2 Principal Deficiency Amount,   
                                   (B) the M3 Principal Deficiency Amount, (C)  
                                   the M4 Principal Deficiency Amount, (D) the  
                                   M5 Principal Deficiency Amount, (E) the M6   
                                   Principal Deficiency Amount, (F) the M7      
                                   Principal Deficiency Amount, (G) the M8      
                                   Principal Deficiency Amount, (H) the M9      
                                   Principal Deficiency Amount, (I) the M10     
                                   Principal Deficiency Amount, (J) the M11     
                                   Principal Deficiency Amount, (K) the M12     
                                   Principal Deficiency Amount and (L) the M13  
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date, in each case for that     
                                   Payment Date and (b) the Class Principal     
                                   Amount of the Class M1 Notes immediately     
                                   prior to such Payment Date.                  

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M1 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes, 
                                   in each case after giving effect to payments 
                                   on such Payment Date and (ii) the Class      
                                   Principal Amount of the Class M1 Notes       
                                   immediately prior to such Payment Date       
                                   exceeds (b) the M1 Target Amount.            

M1 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 60.20% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M2 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M3 Principal Deficiency Amount,   
                                   (B) the M4 Principal Deficiency Amount, (C)  
                                   the M5 Principal Deficiency Amount, (D) the  
                                   M6 Principal Deficiency Amount, (E) the M7   
                                   Principal Deficiency Amount, (F) the M8      
                                   Principal Deficiency Amount, (G) the M9      
                                   Principal Deficiency Amount, (H) the M10     
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date, (I) the M11 Principal     
                                   Deficiency Amount, (J) the M12 Principal     
                                   Deficiency Amount and (K) the M13 Principal  
                                   Deficiency Amount, in each case for that     
                                   Payment Date and (b) the Class Principal     
                                   Amount of the Class M2 Notes immediately     
                                   prior to such Payment Date.                  

M2 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and Class M1 Notes, in each case after giving
                                   effect to payments on such Payment Date and  
                                   (ii) the Class Principal Amount of the Class 
                                   M2 Notes immediately prior to such Payment   
                                   Date exceeds (b) the M2 Target Amount.       

M2 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 67.30% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

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M3 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M4 Principal Deficiency Amount,   
                                   (B) the M5 Principal Deficiency Amount, (C)  
                                   the M6 Principal Deficiency Amount, (D) the  
                                   M7 Principal Deficiency Amount, (E) the M8   
                                   Principal Deficiency Amount, (F) the M9      
                                   Principal Deficiency Amount, (G) the M10     
                                   Principal Deficiency Amount, (H) the M11     
                                   Principal Deficiency Amount, (I) the M12     
                                   Principal Deficiency Amount and (J) the M13  
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date, in each case for that     
                                   Payment Date and (b) the Class Principal     
                                   Amount of the Class M3 Notes immediately     
                                   prior to such Payment Date.                  

M3 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1 and Class M2 Notes, in each 
                                   case after giving effect to payments on such 
                                   Payment Date and (ii) the Class Principal    
                                   Amount of the Class M3 Notes immediately     
                                   prior to such Payment Date exceeds (b) the M3
                                   Target Amount.                               

M3 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 72.10% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M4 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M5 Principal Deficiency Amount,   
                                   (B) the M6 Principal Deficiency Amount, (C)  
                                   the M7 Principal Deficiency Amount, (D) the  
                                   M8 Principal Deficiency Amount, (E) the M9   
                                   Principal Deficiency Amount, (F) the M10     
                                   Principal Deficiency Amount, (G) the M11     
                                   Principal Deficiency Amount, (H) the M12     
                                   Principal Deficiency Amount and (I) the M13  
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date, in each case for that     
                                   Payment Date and (b) the Class Principal     
                                   Amount of the Class M4 Notes immediately     
                                   prior to such Payment Date.                  

M4 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2 and Class M3      
                                   Notes, in each case after giving effect to   
                                   payments on such Payment Date and (ii) the   
                                   Class Principal Amount of the Class M4 Notes 
                                   immediately prior to such Payment Date       
                                   exceeds (b) the M4 Target Amount.            

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M4 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 75.50% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M5 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M6 Principal Deficiency Amount,   
                                   (B) the M7 Principal Deficiency Amount, (C)  
                                   the M8 Principal Deficiency Amount, (D) the  
                                   M9 Principal Deficiency Amount, (E) the M10  
                                   Principal Deficiency Amount, (F) the M11     
                                   Principal Deficiency Amount, (G) the M12     
                                   Principal Deficiency Amount and (H) the M13  
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date, and (b) the Class         
                                   Principal Amount of the Class M5 Notes       
                                   immediately prior to such Payment Date.      

M5 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3 and     
                                   Class M4 Notes, in each case after giving    
                                   effect to payments on such Payment Date and  
                                   (ii) the Class Principal Amount of the Class 
                                   M5 Notes immediately prior to such Payment   
                                   Date exceeds (b) the M5 Target Amount.       

M5 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 78.80% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M6 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M7 Principal Deficiency Amount,   
                                   (B) the M8 Principal Deficiency Amount, (C)  
                                   the M9 Principal Deficiency Amount, (D) the  
                                   M10 Principal Deficiency Amount, (E) the M11 
                                   Principal Deficiency Amount, (F) the M12     
                                   Principal Deficiency Amount and (G) the M13  
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date, in each case for that     
                                   Payment Date and (b) the Class Principal     
                                   Amount of the Class M6 Notes immediately     
                                   prior to such Payment Date.                  

M6 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4 and Class M5 Notes, in each case after    
                                   giving effect to payments on such Payment    
                                   Date and (ii) the Class Principal Amount of  
                                   the Class M6 Notes immediately prior to such 
                                   Payment Date exceeds (b) the M6 Target       
                                   Amount.                                      

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M6 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 82.00% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M7 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any of (i) the Total   
                                   Principal Deficiency Amount for that Payment 
                                   Date over (ii) the sum of (A) the M8         
                                   Principal Deficiency Amount, (B) the M9      
                                   Principal Deficiency Amount, (C) the M10     
                                   Principal Deficiency Amount, (D) the M11     
                                   Principal Deficiency Amount, (E) the M12     
                                   Principal Deficiency Amount and (F) the M13  
                                   Principal Deficiency Amount, in each case for
                                   that Payment Date and (b) the Class Principal
                                   Amount of the Class M7 Notes immediately     
                                   prior to such Payment Date.                  

M7 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5 and Class M6 Notes, in each case
                                   after giving effect to payments on such      
                                   Payment Date and (ii) the Class Principal    
                                   Amount of the Class M7 Notes immediately     
                                   prior to such Payment Date exceeds (b) the M7
                                   Target Amount.                               

M7 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 85.20% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M8 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M9 Principal Deficiency Amount,   
                                   (B) the M10 Principal Deficiency Amount, (C) 
                                   the M11 Principal Deficiency Amount, (D) the 
                                   M12 Principal Deficiency Amount and (E) the  
                                   M13 Principal Deficiency Amount, in each case
                                   for that Payment Date and (b) the Class      
                                   Principal Amount of the Class M8 Notes       
                                   immediately prior to such Payment Date.      

M8 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5, Class M6 and Class M7 Notes, in
                                   each case after giving effect to payments on 
                                   such Payment Date and (ii) the Class         
                                   Principal Amount of the Class M8 Notes       
                                   immediately prior to such Payment Date       
                                   exceeds (b) the M8 Target Amount.            

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M8 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 87.80% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M9 Principal Deficiency Amount     with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount over (ii) the sum
                                   of (A) the M10 Principal Deficiency Amount,  
                                   (B) the M11 Principal Deficiency Amount, (C) 
                                   the M12 Principal Deficiency Amount and (D)  
                                   the M13 Principal Deficiency Amount, in each 
                                   case for that Payment Date and (b) the Class 
                                   Principal Amount of the Class M9 Notes       
                                   immediately prior to such Payment Date.      

M9 Principal Payment Amount        for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5, Class M6, Class M7 and Class M8
                                   Notes, in each case after giving effect to   
                                   payments on such Payment Date and (ii) the   
                                   Class Principal Amount of the Class M9 Notes 
                                   immediately prior to such Payment Date       
                                   exceeds (b) the M9 Target Amount.            

M9 Target Amount                   for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 90.00% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M10 Principal Deficiency Amount    with respect to any Payment Date, the lesser 
                                   of (a) the excess, if any, of (i) the Total  
                                   Principal Deficiency Amount for that Payment 
                                   Date over (ii) the sum of (A) the M11        
                                   Principal Deficiency Amount, (B) the M12     
                                   Principal Deficiency Amount and (C) the M13  
                                   Principal Deficiency Amount, and (b) the     
                                   Class Principal Amount of the Class M10 Notes
                                   immediately prior to such Payment Date.      

M10 Principal Payment Amount       for any Payment Date an amount equal, on or  
                                   after the Stepdown Date and as long as a     
                                   Trigger Event is not in effect with respect  
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5, Class M6, Class M7, Class M8   
                                   and Class M9 Notes, in each case after giving
                                   effect to payments on such Payment Date and  
                                   (ii) the Class Principal Amount of the Class 
                                   M10 Notes immediately prior to such Payment  
                                   Date exceeds (b) the M10 Target Amount.      

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M10 Target Amount                  for any Payment Date an amount equal to the  
                                   lesser of (a) the product of (i)             
                                   approximately 93.60% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M11 Principal Deficiency Amount    means, with respect to any Payment Date, the 
                                   lesser of (a) the excess, if any, of (i) the 
                                   Total Principal Deficiency Amount for that   
                                   Payment Date and (ii) the sum of (A) the M12 
                                   Principal Deficiency Amount and (B) the M13  
                                   Principal Deficiency Amount and (b) the Class
                                   Principal Amount of the Class M11 Notes      
                                   immediately prior to such Payment Date.      

M11 Principal Payment Amount       means, for any Payment Date an amount equal, 
                                   on or after the Stepdown Date and as long as 
                                   a Trigger Event is not in effect with respect
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5, Class M6, Class M7, Class M8,  
                                   Class M9 and Class M10 Notes, in each case   
                                   after giving effect to payments on such      
                                   Payment Date and (ii) the Class Principal    
                                   Amount of the Class M11 Notes immediately    
                                   prior to such Payment Date exceeds (b) the   
                                   M11 Target Amount.                           

M11 Target Amount                  means, for any Payment Date an amount equal  
                                   to the lesser of (a) the product of (i)      
                                   approximately 95.60% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M12 Principal Deficiency Amount    means, with respect to any Payment Date, the 
                                   lesser of (a) the excess, if any, of (i) the 
                                   Total Principal Deficiency Amount for that   
                                   Payment Date and (ii) the M13 Principal      
                                   Deficiency Amount and (b) the Class Principal
                                   Amount of the Class M12 Notes immediately    
                                   prior to such Payment Date.                  

M12 Principal Payment Amount       means, for any Payment Date an amount equal, 
                                   on or after the Stepdown Date and as long as 
                                   a Trigger Event is not in effect with respect
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5, Class M6, Class M7, Class M8,  
                                   Class M9, Class M10 and Class M11 Notes, in  
                                   each case after giving effect to payments on 
                                   such Payment Date and (ii) the Class         
                                   Principal Amount of the Class M12 Notes      
                                   immediately prior to such Payment Date       
                                   exceeds (b) the M12 Target Amount.           

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M12 Target Amount                  means, for any Payment Date an amount equal  
                                   to the lesser of (a) the product of (i)      
                                   approximately 97.10% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

M13 Principal Deficiency Amount    means, with respect to any Payment Date, the 
                                   lesser of (a) the Total Principal Deficiency 
                                   Amount and (b) the Class Principal Amount of 
                                   the Class M13 Notes immediately prior to such
                                   Payment Date.                                

M13 Principal Payment Amount       means, for any Payment Date an amount equal, 
                                   on or after the Stepdown Date and as long as 
                                   a Trigger Event is not in effect with respect
                                   to such Payment Date, to the amount, if any, 
                                   by which (a) the sum of (i) the aggregate    
                                   Class Principal Amounts of the Senior Notes  
                                   and the Class M1, Class M2, Class M3, Class  
                                   M4, Class M5, Class M6, Class M7, Class M8,  
                                   Class M9, Class M10, Class M11 and Class M12 
                                   Notes, in each case after giving effect to   
                                   payments on such Payment Date and (ii) the   
                                   Class Principal Amount of the Class M13 Notes
                                   immediately prior to such Payment Date       
                                   exceeds (b) the M13 Target Amount.           

M13 Target Amount                  means, for any Payment Date an amount equal  
                                   to the lesser of (a) the product of (i)      
                                   approximately 98.40% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

Master Servicing Fee               an aggregate monthly fee paid to the Master  
                                   Servicer calculated at the Master Servicing  
                                   Fee Rate on the Stated Principal Balance of  
                                   each Mortgage Loan and the amount on deposit 
                                   in the Pre-funding Account as of the         
                                   beginning of the related Due Period.         

Master Servicing Fee Rate          0.0030% per annum for each Mortgage Loan.    

Maturity Date                      for each class of the Notes, the assumed     
                                   Payment Date following the latest possible   
                                   maturity date of any Mortgage Loan (and      
                                   assuming the Subsequent Mortgage Loans having
                                   a maturity date of January 1, 2036).         

Maximum Mortgage Rate              the rate which the Mortgage Rate on the      
                                   related adjustable rate Mortgage Loan will   
                                   never exceed.                                

Minimum Mortgage Rate              the rate which the Mortgage Rate on the      
                                   related Adjustable Rate Mortgage Loan will   
                                   never be less than.                          

Modeling Assumptions               the following assumptions:                   

                                   (a)  the assumed Mortgage Loans prepay at the
                                        indicated percentage of the Prepayment  
                                        Assumption;                             

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(b)  payments on the Notes are received, in  
     cash, on the 25th day of each month,    
     commencing in December 2005, in         
     accordance with the payment priorities  
     defined in this prospectus supplement;  

(c)  no defaults or delinquencies in, or     
     modifications, waivers or amendments    
     respecting, the payment by the Borrowers
     of principal and interest on the assumed
     Mortgage Loans occur;                   

(d)  scheduled payments are assumed to be    
     received on the related Due Date        
     commencing in December 2005, and        
     prepayments represent payment in full of
     individual assumed Mortgage Loans and   
     are assumed to be received on the last  
     day of each month, commencing in        
     November, and include 30 days' interest 
     thereon;                                

(e)  the level of Six-Month LIBOR remains    
     constant at 4.490%, the level of        
     One-Month LIBOR remains constant at     
     4.090% and the level of the Treasury    
     Mortgage Index remains constant at      
     4.313%;                                 

(f)  the Closing Date for the Notes is       
     November 23, 2005;                      

(g)  the Mortgage Rate for each assumed      
     Mortgage Loan is adjusted on its next   
     Mortgage Rate Adjustment Date (and on   
     any subsequent Mortgage Rate Adjustment 
     Dates, if necessary) to equal the sum of
     (i) the assumed level of the related    
     Mortgage Index and (ii) the applicable  
     gross margin (such sum being subject to 
     the applicable periodic adjustment caps 
     and floors);                            

(h)  the Trust is not terminated by the      
     Servicer pursuant to the Servicer's     
     right to purchase the assets of the     
     Trust as described in this prospectus   
     supplement under "The Trust Agreement   
     and the Indenture--Certain Matters under
     the Agreements--Redemption";            

(i)  the initial overcollateralization amount
     is $9,322,945; the Targeted             
     Overcollateralization Amount is, as of  
     the date of determination, the amount   
     set forth in the definition of Targeted 
     Overcollateralization Amount; and the   
     minimum required overcollateralization  
     amount is 0.50% of the Aggregate        
     Collateral Balance as of the Closing    
     Date, or $5,826,660;                    

(j)  cash on deposit in the Pre-Funding      
     Account does not accrue interest;       

(k)  the Servicing Fee Rate is equal to      
     0.500% per annum and the Master         
     Servicing Fee Rate is equal to 0.0030%  
     per annum; and                          

(l)  the fees payable to the Owner Trust     
     equal the Owner Trustee fee.            

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Monthly Excess Cashflow            the sum of Monthly Excess Interest and the   
                                   Aggregate Overcollateralization Release      
                                   Amount for such Payment Date.                

Monthly Excess Interest            the aggregate of any Interest Funds for Group
                                   1 and Interest Funds for Group 2 remaining   
                                   after application pursuant to clauses (C)(i) 
                                   through (xiv) under "Description of the      
                                   Notes--Payments--Payments of Interest."      

Moody's                            Moody's Investors Service, Inc. or any       
                                   successor.                                   

Mortgage Assets                    the Mortgage Loan assets held as part of the 
                                   Trust.                                       

Mortgage Group                     any of Group 1 or Group 2.                   

Mortgage Index                     either the Six-Month LIBOR Index or the      
                                   Treasury Mortgage Index, as specified in the 
                                   related mortgage note.                       

Mortgage Loan                      each Initial Mortgage Loan and each          
                                   Subsequent Mortgage Loan.                    

Mortgage Loan Purchase Agreement   the mortgage loan purchase agreement dated as
                                   of November 1, 2005, between the Seller and  
                                   the Depositor.                               

Mortgage Note                      the promissory note related to a Mortgage    
                                   Loan.                                        

Mortgage Rate                      the per annum interest rate borne by a       
                                   Mortgage Loan.                               

Net Mortgage Rate                  with respect to any Mortgage Loan, the       
                                   Mortgage Rate with respect to such Mortgage  
                                   Loan less (a) the Servicing Fee Rate and (b) 
                                   the Master Servicing Fee Rate.               

Net Swap Payment                   for the second Business Day prior to any     
                                   Calculation Period End Date, the amount paid 
                                   by the Trust under the Swap Agreement to the 
                                   Swap Counterparty in excess of the amounts   
                                   received by the Trust from the Swap          
                                   Counterparty.                                

Net Swap Receipt                   for the second Business Day prior to any     
                                   Calculation Period End Date, the amount      
                                   received by the Trust under the Swap         
                                   Agreement from the Swap Counterparty in      
                                   excess of the amount paid by the Trust to the
                                   Swap Counterparty.                           

Notes                              the Class A and Class M Notes.               

OID                                with respect to the Notes, the original issue
                                   discount, if any.                            

One-Month LIBOR                    the London interbank offered rate for        
                                   one-month United States dollar deposits.     

Original Loan-to-Value Ratio       for any Mortgage Loan, (a) the principal     
                                   balance of such Mortgage Loan at the date of 
                                   origination, divided by (b) the Collateral   
                                   Value of the related mortgaged property.     

OTS Convention                     a convention established by the Office of    
                                   Thrift Supervision to determine delinquency  
                                   statistics as described in "The Mortgage     
                                   Pool--General."                              

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Overcollateralization Amount       with respect to any Payment Date will be     
                                   equal to the amount, if any, by which (a) the
                                   Aggregate Collateral Balance for such Payment
                                   Date exceeds (b) the aggregate Class         
                                   Principal Amount of the Notes, in each case  
                                   after giving effect to payments on such      
                                   Payment Date.                                

Overcollateralization Deficiency   with respect to any Payment Date the excess, 
Amount                             if any, of the Targeted Overcollateralization
                                   Amount for that Payment Date over the        
                                   Overcollateralization Amount for that Payment
                                   Date.                                        

Ownership Certificate              an ownership certificate issued pursuant to  
                                   the Trust Agreement representing the equity  
                                   ownership in the Trust.                      

Ownership Certificate Holder       the holder of the Ownership Certificate.     

Owner Trustee                      U.S. Bank Trust National Association.        

Owner Trustee Fee                  an annual fee equal to $3,000.               

PAC Method                         with respect to the calculation of interest  
                                   income as OID, the inclusion of such interest
                                   in income on a constant yield to maturity    
                                   basis in accordance with Section 1272(a)(6)  
                                   of the Code.                                 

Participants                       participating organizations that utilize the 
                                   services of DTC, including securities brokers
                                   and dealers, banks and trust companies and   
                                   clearing corporations and certain other      
                                   organizations.                               

Payment Date                       the 25th day of each month beginning in      
                                   December 2005, or if such day is not a       
                                   Business Day, the first Business Day         
                                   thereafter.                                  

Percentage Interest                with respect to any Note or Ownership        
                                   Certificate, the percentage derived by       
                                   dividing the denomination of such Note or    
                                   Ownership Certificate, as applicable, by the 
                                   aggregate denominations of all Notes or      
                                   Ownership Certificates of the applicable     
                                   class.                                       

Periodic Rate Cap                  the maximum amount by which the Mortgage Rate
                                   on any Mortgage Loan may increase or decrease
                                   on an Adjustment Date.                       

Plan                               any Benefit Plan which is subject to Title I 
                                   of ERISA and/or Section 4975 of the Code or  
                                   is an entity which is deemed to hold the     
                                   assets of the foregoing.                     

Plan Asset Regulations             the regulation issued by the United States   
                                   Department of Labor set forth at 29 C.F.R.   
                                   Section 2510.3-101 governing the definition  
                                   of "plan assets" for purposes of the         
                                   fiduciary responsibility and prohibited      
                                   transaction provisions of ERISA and Section  
                                   4975 of the Code.                            

Pre-Funding Account                the account established by the Trust         
                                   Administrator, for the benefit of the        
                                   Noteholders, into which the Seller is        
                                   required to deposit or cause to be deposited 
                                   an amount equal to approximately $290,000,000
                                   on the Closing Date.                         

Pre-Funding Period                 the period from the Closing Date to February 
                                   22, 2006, during which the Seller is expected
                                   to transfer Subsequent Mortgage Loans to the 
                                   Trust.                                       

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Prepayment Assumption              a prepayment assumption which represents (a) 
                                   with respect to the Adjustable Rate Mortgage 
                                   Loans a constant assumed rate of prepayment  
                                   each month relative to the then outstanding  
                                   principal balance of a pool of mortgage loans
                                   for the life of such mortgage loans. 100% of 
                                   the Prepayment Assumption for the Mortgage   
                                   Loans assumes a constant prepayment rate of  
                                   8% for the first month and an additional 2%  
                                   each month thereafter until reaching 30% CPR 
                                   in month 12 and remaining constant through   
                                   month 22, remaining constant at 55% CPR for  
                                   months 23 through 27 and then remaining      
                                   constant at 35% CPR for months 28 and        
                                   thereafter, in each period subject to a      
                                   maximum CPR of 95% and (b) with respect to   
                                   the Fixed Rate Mortgage Loans, 20% of HEP.   

Prepayment Interest Excess         for any Servicer Remittance Date and any     
                                   principal prepayment in full received during 
                                   the portion of the related Prepayment Period 
                                   occurring from and including the first day   
                                   through the fifteenth day of the calendar    
                                   month in which such Servicer Remittance Date 
                                   occurs, an amount equal to interest (to the  
                                   extent received) due in connection with such 
                                   principal prepayment.                        

Prepayment Interest Shortfall      with respect to (a) any voluntary prepayment 
                                   in part by the Borrower on any Mortgage Loan 
                                   that is received during the preceding        
                                   calendar month or (b) any principal          
                                   prepayment in full from the sixteenth day of 
                                   the preceding calendar month through the end 
                                   of such calendar month, the amount, if any,  
                                   by which one month's interest at the Net     
                                   Mortgage Rate for such Mortgage Loan on the  
                                   amount of such prepayment exceeds the amount 
                                   of interest received from such Borrower in   
                                   respect of such prepayment.                  

Prepayment Penalty                 a prepayment premium payable by the Borrower 
                                   in connection with certain full or partial   
                                   prepayments of principal on a Mortgage Loan. 

Prepayment Period                  with respect to any Payment Date and any     
                                   principal prepayment other than a principal  
                                   prepayment in part by a Borrower, the period 
                                   beginning from and including the sixteenth   
                                   day of the month preceding the month in which
                                   such Payment Date occurs to and including the
                                   fifteenth day of the month in which such     
                                   Payment Date occurs. With respect to any     
                                   Payment Date and any principal prepayment in 
                                   part by a Borrower, the calendar month       
                                   immediately preceding the month in which such
                                   Payment Date occurs.                         

Principal Deficiency Amount        any of the M1 Principal Deficiency Amount,   
                                   the M2 Principal Deficiency Amount, the M3   
                                   Principal Deficiency Amount, the M4 Principal
                                   Deficiency Amount, the M5 Principal          
                                   Deficiency Amount, the M6 Principal          
                                   Deficiency Amount, the M7 Principal          
                                   Deficiency Amount, the M8 Principal          
                                   Deficiency Amount, the M9 Principal          
                                   Deficiency Amount, the M10 Principal         
                                   Deficiency Amount, the M11 Principal         
                                   Deficiency Amount, the M12 Principal         
                                   Deficiency Amount or the M13 Principal       
                                   Deficiency Amount, as applicable.            

Principal Funds                    with respect to any Payment Date and for each
                                   Mortgage Group, the sum, without duplication,
                                   of (a) the scheduled principal due during the
                                   related Due Period and received before the   
                                   related Servicer Remittance Date or advanced 
                                   on or before the related Servicer Remittance 
                                   Date, (b) prepayments of principal collected 
                                   in the related Prepayment Period, (c) the    
                                   Stated Principal Balance of each Mortgage    
                                   Loan in such Mortgage                        

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                                   Group that was repurchased by the Seller     
                                   during the related Prepayment Period or, in  
                                   the case of a purchase in connection with an 
                                   optional redemption, on the Business Day     
                                   prior to such Payment Date, (d) the amount,  
                                   if any, by which the aggregate unpaid        
                                   principal balance of any replacement Mortgage
                                   Loans in such Mortgage Group is less than the
                                   aggregate unpaid principal balance of any    
                                   Mortgage Loans delivered by the Seller in    
                                   connection with a substitution of a Mortgage 
                                   Loan, (e) all liquidation proceeds and       
                                   Recoveries collected during the related      
                                   Prepayment Period (to the extent such amounts
                                   related to principal), (f) all other         
                                   collections and Recoveries in respect of     
                                   principal during the related Prepayment      
                                   Period, less, all non-recoverable Advances   
                                   relating to principal and all non-recoverable
                                   servicing advances reimbursed during the     
                                   related Prepayment Period with respect to the
                                   Mortgage Loans in such Mortgage Group and    
                                   such Mortgage Group's pro rata share of      
                                   certain expenses reimbursable to the         
                                   Indenture Trustee, the Owner Trustee, the    
                                   Trust Administrator, the Master Servicer, the
                                   Servicer and the Subservicer, to the extent  
                                   not reimbursed from Interest Funds and (g)   
                                   with respect to the February 2006 Payment    
                                   Date only, the amount remaining in the       
                                   Pre-Funding Account at the end of the        
                                   Pre-Funding Period in respect of that        
                                   Mortgage Group.                              

Principal Payment Amount           for each Mortgage Group and for any Payment  
                                   Date, an amount equal to the Principal Funds 
                                   for such Mortgage Group for such date minus  
                                   the Aggregate Overcollateralization Release  
                                   Amount attributable to such Mortgage Group,  
                                   if any, and such Payment Date.               

Priority Class                     the Class or Classes of Notes then           
                                   outstanding that has the highest priority of 
                                   payment of interest.                         

PTCE                               a Prohibited Transaction Class Exemption     
                                   granted by the U.S. Department of Labor.     

Purchase Price                     the sum of (a) 100% of the aggregate         
                                   outstanding principal balance of the Mortgage
                                   Loans plus accrued interest thereon at the   
                                   applicable Mortgage Rate, (b) the fair market
                                   value of all other property being purchased, 
                                   (c) any unreimbursed servicing advances (d)  
                                   the amount of any swap breakage costs        
                                   resulting from the termination of the Swap   
                                   Agreement as a result of redemption, and (e) 
                                   any Available Funds Shortfalls.              

Qualified REIT Subsidiary          a direct or indirect 100% owned subsidiary of
                                   a REIT that satisfies the requirements of    
                                   Section 856(i) of the Code.                  

Qualified Stated Interest          interest unconditionally payable at fixed    
                                   intervals of one year or less at either a    
                                   fixed rate or a variable rate.               

Qualifying REIT Entity             an entity that qualifies as a REIT or a      
                                   Qualified REIT Subsidiary or an entity that  
                                   is disregarded for federal income tax        
                                   purposes that is wholly-owned by a REIT or a 
                                   Qualified REIT Subsidiary.                   

Rating Agency                      Moody's, S&P or Fitch.                       

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Realized Loss                      the excess of the Stated Principal Balance of
                                   a defaulted Mortgage Loan over the net       
                                   liquidation proceeds of a defaulted Mortgage 
                                   Loan that are allocated to principal.        

Record Date                        for a Payment Date, with respect any class of
                                   Book-Entry Notes (other than the Class M10,  
                                   Class M11, Class M12 and Class M13 Notes),   
                                   the Business Day prior to the related Payment
                                   Date, and with respect to any class of       
                                   Definitive Notes, the Class M10, Class M11,  
                                   Class M12 and Class M13 Notes, the last      
                                   Business Day of the month preceding the month
                                   of such Payment Date.                        

Recoveries                         with respect to any liquidated Mortgage Loan,
                                   amounts received in respect of principal on  
                                   such Mortgage Loan which has previously been 
                                   allocated as a Realized Loss to a class or   
                                   classes of Notes net of reimbursable         
                                   expenses.                                    

Redemption Date                    the first Payment Date on which the Servicer 
                                   is permitted to exercise its right to        
                                   purchase the assets of the Trust as described
                                   in this prospectus supplement under "The     
                                   Trust Agreement and the Indenture--Certain   
                                   Matters under the Agreements--Redemption."   

Reference Banks                    leading banks selected by the Trust          
                                   Administrator and engaged in transactions in 
                                   Eurodollar deposits in the international     
                                   Eurocurrency market (a) with an established  
                                   place of business in London, (b) whose       
                                   quotations appear on the Reuters Screen LIBO 
                                   Page on the Interest Determination Date in   
                                   question, (c) which have been designated as  
                                   such by the Servicer and (d) not controlling,
                                   controlled by, or under common control with, 
                                   the Depositor, the Indenture Trustee, the    
                                   Trust Administrator, the Master Servicer, the
                                   Servicer, the Seller or any successor        
                                   servicer.                                    

REIT                               a real estate investment trust within the    
                                   meaning of section 856 of the Code.          

Related Senior Principal Payment   for each Mortgage Group and for any Payment  
Amount                             Date, an amount equal to the lesser of (a)   
                                   the aggregate Class Principal Amounts of the 
                                   Class 1-A Notes (with respect to Group 1) or 
                                   of the Class 2-A1 Notes, Class 2-A2 Notes and
                                   Class 2-A3 Notes (with respect to Group 2)   
                                   immediately prior to that Payment Date and   
                                   (b) the product of (i) the Senior Principal  
                                   Payment Amount and (ii) the related Senior   
                                   Proportionate Percentage in each case for    
                                   such date.                                   

Relevant Depositary                Citibank, N.A., as depositary for Clearstream
                                   Luxembourg, and JPMorgan Chase Bank, as      
                                   depositary for Euroclear, individually.      

REO Property                       mortgaged property which has been acquired by
                                   the Trust through foreclosure or deed-in-lieu
                                   of foreclosure in connection with a defaulted
                                   Mortgage Loan.                               

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Required Loss Percentage  for any Payment Date, the applicable                                         
                          percentage for such Payment Date set forth in                                
                          the following table:                                                         

                             Payment Date Occurring In                Required Loss Percentage         
                          ------------------------------   --------------------------------------------
                          December 2007 to November 2008   1.60% with respect to December 2007, plus an
                                                           additional 1/12th of 1.95% for each month   
                                                           thereafter                                  

                          December 2008 to November 2009   3.55% with respect to December 2008, plus an
                                                           additional 1/12th of 1.45% for each month   
                                                           thereafter                                  

                          December 2009 to November 2010   5.00% with respect to December 2009, plus an
                                                           additional 1/12th of 1.00% for each month   
                                                           thereafter                                  

                          December 2010 to November 2011   6.00% with respect to December 2010, plus an
                                                           additional 1/12th of 0.25% for each month   
                                                           thereafter                                  

                          December 2011 and thereafter     6.25%                                       

Required Percentage       with respect to a Payment Date after the                                     
                          Stepdown Date, the quotient of (a) (i) the                                   
                          Aggregate Collateral Balance, less (ii) the                                  
                          Class Principal Amount of the most senior                                    
                          class of Notes outstanding as of such Payment                                
                          Date, prior to giving effect to payments to                                  
                          be made on such Payment Date, divided by (b)                                 
                          the Aggregate Collateral Balance. As used                                    
                          herein, the Class Principal Amount of the                                    
                          most senior class of Notes will equal the                                    
                          aggregate Class Principal Amount of the                                      
                          Senior Notes as of such date of calculation.                                 

Reserve Interest Rate     the rate per annum that the Trust                                            
                          Administrator determines to be either (a) the                                
                          arithmetic mean (rounded upwards if necessary                                
                          to the nearest whole multiple of 0.03125%) of                                
                          the one-month United States dollar lending                                   
                          rates which New York City banks selected by                                  
                          the Trust Administrator are quoting on the                                   
                          relevant Interest Determination Date to the                                  
                          principal London offices of leading banks in                                 
                          the London interbank market or, (b) in the                                   
                          event that the Trust Administrator can                                       
                          determine no such arithmetic mean, the lowest                                
                          one-month United States dollar lending rate                                  
                          which New York City banks selected by the                                    
                          Trust Administrator are quoting on such                                      
                          Interest Determination Date to leading                                       
                          European banks.                                                              

Retained Notes            those certain classes, or portions of certain                                
                          classes, of Notes which, at the time of their                                
                          issuance, FIC as the owner of the Ownership                                  
                          Certificate, either directly or indirectly                                   
                          through one or more of its Qualified REIT                                    
                          Subsidiaries or entities that are disregarded                                
                          for United States federal income tax purposes                                
                          that are wholly owned by the related REIT or                                 
                          a related Qualified REIT Subsidiary.                                         

Reuters Screen LIBO Page  the display designated as page "LIBO" on the                                 
                          Reuters Monitor Money Rates Service (or such                                 
                          other page as may replace the LIBO page on                                   
                          that service for the purpose of displaying                                   
                          London interbank offered rates of major                                      
                          banks).                                                                      

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Rules                              the rules, regulations and procedures        
                                   creating and affecting DTC and its           
                                   operations.                                  

S&P                                Standard & Poor's Ratings Services, a        
                                   division of The McGraw-Hill Companies, Inc., 
                                   or any successor.                            

Scheduled Payments                 the scheduled monthly payments required to be
                                   made by the Borrower on a Mortgage Loan      
                                   pursuant to the terms of the related mortgage
                                   note.                                        

Seller                             FIC.                                         

Senior Notes                       Class A Notes.                               

Senior Principal Payment Amount    for any Payment Date on or after the Stepdown
                                   Date and as long as a Trigger Event is not in
                                   effect with respect to such Payment Date, the
                                   lesser of (i) the Principal Payment Amount   
                                   for both Mortgage Groups and (ii) the amount,
                                   if any, by which (A) the aggregate Class     
                                   Principal Amounts of the Class A Notes       
                                   immediately prior to that Payment Date       
                                   exceeds (B) the Senior Target Amount.        

Senior Priorities                  means the priority of payments to the Class A
                                   Notes described in clauses (I)(A)(ii) and    
                                   (iii) and (I)(B)(ii) and (iii), as           
                                   applicable, under the heading "Description of
                                   the Notes-Payments-Payments of Principal"    
                                   herein for the related Mortgage Group.       

Senior Proportionate Percentage    with respect to Group 1 and any Payment Date 
                                   the fraction, expressed as a percentage, the 
                                   numerator of which is the Principal Funds for
                                   Group 1 for such Payment Date and the        
                                   denominator of which is the aggregate of the 
                                   Principal Funds for Group 1 and Group 2 for  
                                   such date. The "Senior Proportionate         
                                   Percentage" for Group 2 with respect to any  
                                   Payment Date will be the fraction, expressed 
                                   as a percentage, the numerator of which is   
                                   the Principal Funds for Group 2 for such     
                                   Payment Date and the denominator of which is 
                                   the aggregate of the Principal Funds for     
                                   Group 1 and Group 2 for such date.           

Senior Target Amount               for any Payment Date, and amount be equal to 
                                   the lesser of (a) the product of (i)         
                                   approximately 52.60% and (ii) the Aggregate  
                                   Collateral Balance for such Payment Date     
                                   determined as of the last day of the related 
                                   Due Period and (b) the amount, if any, by    
                                   which (i) the Aggregate Collateral Balance   
                                   for such Payment Date determined as of the   
                                   last day of the related Due Period exceeds   
                                   (ii) approximately 0.50% of the Aggregate    
                                   Collateral Balance as of the Closing Date.   

Servicer                           FSC.                                         

Servicer Remittance Date           the 21st day (or if such day is not a        
                                   Business Day, the next succeeding Business   
                                   Day) of the month in which the related       
                                   Payment Date occurs.                         

Servicing Fee                      an aggregate monthly fee paid to the Servicer
                                   and Subservicer calculated at the Servicing  
                                   Fee Rate on the Stated Principal Balance of  
                                   each Mortgage Loan as of the beginning of the
                                   related Due Period.                          

Servicing Fee Rate                 0.50% per annum for each Mortgage Loan.      

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Similar Law                        federal, state, local or foreign laws        
                                   substantially similar to ERISA or the Code.  

Six-Month LIBOR                    the London interbank offered rate for        
                                   six-month United States dollar deposits.     

Six-Month LIBOR Index              with respect to the Adjustment Date of a     
                                   Six-Month LIBOR Loan, the average of the     
                                   London interbank offered rates for six-month 
                                   U.S. dollar deposits in the London market, as
                                   set forth in The Wall Street Journal, or, if 
                                   such rate ceases to be published in The Wall 
                                   Street Journal or becomes unavailable for any
                                   reason, then based upon a new index selected 
                                   by the Servicer, as holder of the related    
                                   mortgage note, based on comparable           
                                   information, in each case as most recently   
                                   announced as of a date 45 days prior to such 
                                   Adjustment Date.                             

Six-Month LIBOR Loan               a Mortgage Loan having a Mortgage Rate that  
                                   is generally subject to semi-annual          
                                   adjustment on the first day of the months    
                                   specified in the related mortgage note to    
                                   equal the sum, rounded to the nearest 0.125%,
                                   of (a) the Six-Month LIBOR Index and (b) the 
                                   related gross margin.                        

Six-Month LIBOR IO Loan            a Six-Month LIBOR Loan that provides for the 
                                   payment of interest for a period of          
                                   approximately five years and thereafter      
                                   provide for the payment of interest and      
                                   principal sufficient to amortize such        
                                   Mortgage Loan to maturity.                   

SMMEA                              the Secondary Mortgage Market Enhancement Act
                                   of 1984, as amended.                         

Stated Principal Balance           with respect to a Mortgage Loan and any      
                                   Payment Date, either (a) the amount equal to 
                                   the outstanding principal balance as of the  
                                   Cut-off Date, after giving effect to         
                                   Scheduled Payments due on or before that     
                                   date, reduced by (i) the principal portion of
                                   all Scheduled Payments due on or before the  
                                   Due Date in the Due Period after the Cut-off 
                                   Date immediately preceding such Payment Date,
                                   whether or not received, and (ii) all amounts
                                   allocable to unscheduled principal payments  
                                   received on or before the last day of the    
                                   Prepayment Period immediately preceding such 
                                   Payment Date or (b) in the case of any       
                                   Mortgage Loan liquidated during such Due     
                                   Period, zero.                                

Statistical Mortgage Loans         (a) the Initial Mortgage Loans and (b)       
                                   certain of the Subsequent Mortgage Loans     
                                   expected to be included among the Subsequent 
                                   Mortgage Loans to be delivered to the Trust  
                                   by the Seller during the Pre-Funding Period  
                                   and described in this prospectus supplement. 

Stepdown Date                      The earlier of (a) the first Payment Date on 
                                   which the aggregate Class Principal Amount of
                                   the Class A Notes (after giving effect to    
                                   payments of the Principal Funds amount for   
                                   such Payment Date) has been reduced to zero  
                                   and (b) the later to occur of (i) the Payment
                                   Date in December 2008 or (ii) the first      
                                   Payment Date on which the aggregate Class    
                                   Principal Amount of the Class A Notes (after 
                                   giving effect to payments of the Principal   
                                   Funds amount for such Payment Date) is less  
                                   than or equal to 52.60% of the Aggregate     
                                   Collateral Balance as of the end of the      
                                   immediately preceding Due Period.            

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Subsequent Cut-Off Date            the date specified in the related subsequent 
                                   transfer agreement.                          

Subsequent Transfer Date           with respect to any Subsequent Mortgage Loan,
                                   the date that mortgage loan is transferred to
                                   the Trust.                                   

Subsequent Mortgage Loans          the mortgage loans transferred to the Trust  
                                   during the Pre-Funding Period.               

Subservicer                        JPMorgan Chase Bank, National Association.   

Swap Agreement                     the ISDA Master Agreement and the schedule   
                                   thereto dated as of October 27, 2005 between 
                                   the Issuer and the Swap Counterparty.        

Swap Agreement Payment Date        with respect to the Swap Agreement, two      
                                   Business Days prior to the related Payment   
                                   Date, beginning with the Payment Date in     
                                   December 2005 and ending with the Payment    
                                   Date in January 2009.                        

Swap Counterparty                  Bank of America, N.A.                        

Swap Fixed Rate                    the fixed percentage set forth in the Swap   
                                   Agreement which will be determined on or     
                                   before the Closing Date and will be          
                                   approximately 4.358%.                        

Swap Fixed Rate Amount             means the amount, if any, paid to the Swap   
                                   Counterparty by the Trust on the second      
                                   Business Day prior to a Calculation Period   
                                   End Date which is based on the Swap Fixed    
                                   Rate and the applicable Swap Notional Balance
                                   for such Calculation Period End Date.        

Swap Floating Rate Amount          means the amount, if any, paid to the Trust  
                                   by the Swap Counterparty on the second       
                                   Business Day prior to a Calculation Period   
                                   End Date which is based on One-Month LIBOR   
                                   and the applicable Swap Notional Balance for 
                                   such Calculation Period End Date.            

Swap Notional Balance              means, the amounts set forth in the table    
                                   under "Description of the Notes--The Swap    
                                   Agreement."                                  

Targeted Overcollateralization     with respect to any Payment Date prior to the
Amount                             Stepdown Date, will be equal to 0.80% of the 
                                   Aggregate Collateral Balance as of the       
                                   Closing Date; with respect to any Payment    
                                   Date on or after the Stepdown Date, equal to 
                                   the lesser of (a) 0.80% of the Aggregate     
                                   Collateral Balance as of the Closing Date or 
                                   (b) 1.60% of the Aggregate Collateral Balance
                                   as of the end of the related Due Period,     
                                   subject to a floor equal to 0.50% of the     
                                   Aggregate Collateral Balance as of the       
                                   Closing Date; and with respect to any Payment
                                   Date with respect to which a Trigger Event   
                                   has occurred and is continuing, the Targeted 
                                   Overcollateralization Amount for the Payment 
                                   Date immediately preceding such Payment Date.

Terms and Conditions               the Terms and Conditions Governing Use of    
                                   Euroclear and the related Operating          
                                   Procedures of the Euroclear System and       
                                   applicable Belgian law.                      

TMP                                a taxable mortgage pool within the meaning of
                                   Section 7701(i)(2) of the Code.              

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Total Principal Deficiency         with respect to any Payment Date, the excess,
Amount                             if any, of the aggregate Class Principal     
                                   Amount of the Notes immediately prior to such
                                   Payment Date over the sum of the Aggregate   
                                   Collateral Balance and any Recoveries as of  
                                   the last day of the related Due Period.      

Transfer and Servicing Agreement   the transfer and servicing agreement dated as
                                   of November 1, 2005 among the Trust, the     
                                   Indenture Trustee, the Depositor, the Trust  
                                   Administrator, the Master Servicer, the      
                                   Servicer, the Subservicer and the Seller.    

Treasury Loans                     Mortgage Loans having a Mortgage Rate which  
                                   is generally subject to annual adjustment on 
                                   the first day of the months specified in the 
                                   related mortgage note to equal the sum,      
                                   rounded to the nearest 0.125%, of (a) the    
                                   Treasury Mortgage Index and (b) the related  
                                   gross margin.                                

Treasury Mortgage Index            with respect to the Adjustment Date of a     
                                   Treasury Loan, the weekly average yield on   
                                   actively traded U.S. Treasury securities     
                                   adjusted to a constant maturity of one year  
                                   as reported by the Federal Reserve Board in  
                                   statistical release H.15(519).               

Trigger Event                      the occurrence of any of the following with  
                                   respect to any Payment Date after the        
                                   Stepdown Date: (a) the quotient of (1) the   
                                   aggregate Stated Principal Balance of all    
                                   Mortgage Loans 60 or more days delinquent,   
                                   measured on a rolling three-month basis      
                                   (including Mortgage Loans in foreclosure, REO
                                   Properties and Mortgage Loans with respect to
                                   which the applicable Borrower is in          
                                   bankruptcy) divided by (2) the Aggregate     
                                   Collateral Balance as of the preceding       
                                   Servicer Remittance Date, equals or exceeds  
                                   the product of (i) 33.750% and (ii) the      
                                   Required Percentage, (b) the quotient        
                                   (expressed as a percentage) of (1) the       
                                   aggregate Realized Losses incurred from the  
                                   Initial Cut-off Date through the last day of 
                                   the calendar month preceding such Payment    
                                   Date divided by (2) the Aggregate Collateral 
                                   Balance as of the Closing Date exceeds the   
                                   Required Loss Percentage or (c) a Principal  
                                   Deficiency Amount exists for such Payment    
                                   Date.                                        

Trust                              the statutory trust formed under the laws of 
                                   the State of Delaware pursuant to the Trust  
                                   Agreement.                                   

Trust Administrator                Wells Fargo Bank, N.A., in its capacity as   
                                   trust administrator under the Transfer and   
                                   Servicing Agreement, or any successor        
                                   thereto.                                     

Trust Agreement                    the trust agreement dated as of October 25,  
                                   2005, between the Depositor and the Owner    
                                   Trustee, as amended and restated on November 
                                   23, 2005, among the Depositor, the Owner     
                                   Trustee and the Trust Administrator.         

Trust Estate                       the assets held as part of the Trust.        

Underwriters                       Credit Suisse First Boston LLC, Bear, Stearns
                                   & Co. Inc., Lehman Brothers Inc. and Merrill 
                                   Lynch, Pierce, Fenner & Smith Incorporated.  

U.S. Person                        (a) a citizen or resident of the United      
                                   States; (b) a corporation (or entity treated 
                                   as a corporation for tax purposes) created or
                                   organized in the United States or under the  
                                   laws of the United States or of any state    
                                   including the District of Columbia; (c) a    
                                   partnership (or entity treated as            

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                                   a partnership for tax purposes) organized in 
                                   the United States or under the laws of the   
                                   United States or of any state including the  
                                   District of Columbia (unless provided        
                                   otherwise by future Treasury regulations);   
                                   (d) an estate whose income is includible in  
                                   gross income for United States income tax    
                                   purposes regardless of its source; or (e) a  
                                   trust, if a court within the United States is
                                   able to exercise primary supervision over the
                                   administration of the trust and one or more  
                                   U.S. Persons have authority to control all   
                                   substantial decisions of the trust.          
                                   Notwithstanding the last clause of the       
                                   preceding sentence, to the extent provided in
                                   Treasury regulations, certain trusts that    
                                   were in existence on August 20, 1996, that   
                                   were treated as U.S. Persons prior to such   
                                   date and that elect to continue to be treated
                                   as U.S. Persons also will be U.S. Persons.   

Voting Rights                      the voting rights allocated to the Notes and 
                                   the Ownership Certificate as set forth under 
                                   "The Mortgage Loan Purchase Agreement and the
                                   Transfer and Servicing Agreement--Voting     
                                   Rights."                                     

Wells Fargo                        Wells Fargo Bank, N.A.                       

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 Annex I

 Global Clearance, Settlement and Tax Documentation Procedures

   Except in limited circumstances, the globally offered Fieldstone Mortgage
Investment Trust, Series 2005-3 Mortgage Backed Notes, known as "Global         
Securities," will be available only in book-entry form. Investors in the Global 
Securities may hold such Global Securities through any of DTC, Clearstream      
Luxembourg or Euroclear. The Global Securities will be tradeable as home market 
instruments in both the European and U.S. domestic markets. Initial settlement  
and all secondary trades will settle in same-day funds.                         

Secondary market trading between investors holding Global Securities  
through Clearstream Luxembourg and Euroclear will be conducted in the ordinary  
way in accordance with their normal rules and operating procedures and in       
accordance with conventional Eurobond practice (i.e., seven calendar day        
settlement).                                                                    

Secondary market trading between investors holding Global Securities  
through DTC will be conducted according to the rules and procedures applicable  
to U.S. corporate debt obligations and prior mortgage pass-through security     
issues.                                                                         

    Secondary cross-market trading between Clearstream Luxembourg or Euroclear
and DTC Participants holding securities will be effected on a                   
delivery-against-payment basis through the respective European Depositaries of  
Clearstream Luxembourg and Euroclear (in such capacity) and as DTC Participants.

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

Initial Settlement                                                              

     All Global Securities will be held in book-entry form by DTC in the name of
Cede & Co. as nominee of DTC. Investors' interests in the Global Securities will
be represented through financial institutions acting on their behalf as direct  
and indirect Participants in DTC. As a result, Clearstream Luxembourg and       
Euroclear will hold positions on behalf of their Participants through their     
respective European Depositaries, which in turn will hold such positions in     
accounts as DTC Participants.                                                   

    Investors electing to hold their Global Securities through DTC will follow
the settlement practices applicable to prior mortgage pass-through security     
issues. Investors' securities custody accounts will be credited with their      
holdings against payment in same-day funds on the settlement date.              

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

Secondary Market Trading                                                        

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

Trading Between DTC Participants. Secondary market trading between DTC
Participants will be settled using the procedures applicable to prior mortgage  
pass-through security issues in same-day funds.                                 

Trading Between Clearstream Luxembourg and/or Euroclear Participants. 
Secondary market trading between Clearstream Luxembourg Participants or         
Euroclear Participants will be settled using the procedures applicable to       
conventional Eurobonds in same-day funds.                                       

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Trading Between DTC Seller and Clearstream Luxembourg or Euroclear    
Purchaser. When Global Securities are to be transferred from the account of a   
DTC Participant to the account of a Clearstream Luxembourg Participant or a     
Euroclear Participant, the purchaser will send instructions to Clearstream      
Luxembourg or Euroclear through a Clearstream Luxembourg Participant or         
Euroclear Participant at least one business day prior to settlement. Clearstream
Luxembourg or Euroclear will instruct the respective European Depositary to     
receive the Global Securities against payment. Payment will include interest    
accrued on the Global Securities from and including the last coupon payment date
to and excluding the settlement date, on the basis of either the actual number  
of days in such accrual period and a year assumed to consist of 360 days or a   
360-day year of twelve 30-day months, as applicable to the related class of     
Global Securities. For transactions settling on the 31st of the month, payment  
will include interest accrued to and excluding the first day of the following   
month. Payment will then be made by the respective European Depositary of the   
DTC Participant's account against delivery of the Global Securities. After      
settlement has been completed, the Global Securities will be credited to the    
respective clearing system and by the clearing system, in accordance with its   
usual procedures, to the Clearstream Luxembourg Participant's or Euroclear      
Participant's account. The securities credit will appear the next day (European 
time) and the cash debt will be back-valued to, and the interest on the Global  
Securities will accrue from, the value date (which would be the preceding day   
when settlement occurred in New York). If settlement is not completed on the    
intended value date (i.e., the trade fails), the Clearstream Luxembourg or      
Euroclear cash debt will be valued instead as of the actual settlement date.    

     Clearstream Luxembourg Participants and Euroclear Participants will need to
make available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to pre-position 
funds for settlement, either from cash on hand or existing lines of credit, as  
they would for any settlement occurring within Clearstream Luxembourg or        
Euroclear. Under this approach, they may take on credit exposure to Clearstream 
Luxembourg or Euroclear until the Global Securities are credited to their       
accounts one day later.                                                         

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

  Since the settlement is taking place during New York business hours, DTC
Participants can employ their usual procedures for sending Global Securities to 
the respective European Depositary for the benefit of Clearstream Luxembourg    
Participants or Euroclear Participants. The sale proceeds will be available to  
the DTC seller on the settlement date. Thus, to the DTC Participants a          
cross-market transaction will settle no differently than a trade between two DTC
Participants.                                                                   

Trading Between Clearstream Luxembourg or Euroclear Seller and DTC    
Purchaser. Due to time zone differences in their favor, Clearstream Luxembourg  
Participants and Euroclear Participants may employ their customary procedures   
for transactions in which Global Securities are to be transferred by the        
respective clearing system, through the respective European Depositary, to a DTC
Participant. The seller will send instructions to Clearstream Luxembourg or     
Euroclear through a Clearstream Luxembourg Participant or Euroclear Participant 
at least one business day prior to settlement. In these cases, Clearstream      
Luxembourg or Euroclear will instruct the respective European Depositary, as    
appropriate, to deliver the Global Securities to the DTC Participant's account  
against payment. Payment will include interest accrued on the Global Securities 
from and including the last coupon payment date to and excluding the settlement 
date on the basis of either the actual number of days in such accrual period and
a year assumed to consist of 360 days or a 360-day year of twelve 30-day months,
as applicable to the related class of Global Securities. For transactions       
settling on the 31st of the month, payment will include interest accrued to and 
excluding the first day of the following month. The payment will then be        
reflected in the account of the Clearstream Luxembourg Participant or Euroclear 
Participant the following day, and receipt of the cash proceeds in the          
Clearstream Luxembourg Participant's or Euroclear Participant's account would be
back-valued to the value                                                        

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date (which would be the preceding day, when settlement occurred in New York).  
Should the Clearstream Luxembourg Participant or Euroclear Participant have a   
line of credit with its respective clearing system and elect to be in debt in   
anticipation of receipt of the sale proceeds in its account, the back-valuation 
will extinguish any overdraft incurred over that one-day period. If settlement  
is not completed on the intended value date (i.e., the trade fails), receipt of 
the cash proceeds in the Clearstream Luxembourg Participant's or Euroclear      
Participant's account would instead be valued as of the actual settlement date. 

    Finally, day traders that use Clearstream Luxembourg or Euroclear and that
purchase Global Securities from DTC Participants for delivery to Clearstream    
Luxembourg Participants or Euroclear Participants should note that these trades 
would automatically fail on the sale side unless affirmative action were taken. 
At least three techniques should be readily available to eliminate this         
potential problem:                                                              

            (1)  borrowing through Clearstream Luxembourg or Euroclear for
            one day (until the purchase side of the day trade is
              reflected in their Clearstream Luxembourg or Euroclear
                    accounts) in accordance with the clearing system's customary
procedures;                             

         (2)  borrowing the Global Securities in the U.S. from a DTC
                    Participant no later than one day prior to settlement, which
              would give the Global Securities sufficient time to be
              reflected in their Clearstream Luxembourg or Euroclear
                  accounts in order to settle the sale side of the trade; or

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

Certain U.S. Federal Income Tax Documentation Requirements                      

   A beneficial owner of Global Securities that is a non-U.S. Person will be
subject to the 30% U.S. withholding tax that generally applies to payments of   
interest (including original issue discount) on registered debt issued by U.S.  
Persons, unless (1) each clearing system, bank or other financial institution   
that holds customers' securities in the ordinary course of its trade or business
in the chain of intermediaries between such beneficial owner and the U.S. entity
required to withhold tax complies with applicable certification requirements and
(2) such beneficial owner takes one of the following steps to obtain an         
exemption or reduced tax rate:                                                  

   Exemption for non-U.S. Persons (Form W-8BEN). Beneficial owners of Global
Securities that are non-U.S. Persons and are neither "10-percent shareholders"  
of the issuer within the meaning of Code Section 871(h)(3)(B) nor controlled    
foreign corporations related to the issuer within the meaning of Code Section   
881(c)(3)(C) can obtain a complete exemption from the withholding tax by filing 
a signed Form W-8BEN (Certificate of Foreign Status of Beneficial Owner for     
United States Tax Withholding). Further, non-U.S. Persons that are beneficial   
owners residing in a country that has a tax treaty with the United States and   
are eligible for benefits under that treaty can obtain an exemption or reduced  
tax rate (depending on the treaty terms) by filing a properly completed Form    
W-8BEN claiming eligibility for treaty benefits. If the information shown on    
Form W-8BEN changes, a new Form W-8BEN must be filed within 30 days of such     
change. If the owner of Global Securities is a partnership or other type of     
pass-through entity that is not treated for U.S. withholding tax purposes as the
beneficial owner of the income with respect to such Global Securities, the owner
generally must receive the statement described in the previous sentence from the
owner's partners or other beneficial owners of the income with respect to the   
Global Securities and may be required to provide such statements, and certain   
additional information, to the person through whom the owner holds the Global   
Securities.                                                                     

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

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The term "U.S. Person" means                                          

(1)  a citizen or resident of the United States,  

              (2)  a corporation or partnership organized in or under the laws
                  of the United States, any state thereof or the District of
                Columbia (unless, in the case of a partnership, Treasury
                   regulations provide otherwise), including an entity treated
              as a corporation or partnership for federal income tax
purposes,                               

              (3)  an estate the income of which is includable in gross income
                    for United States tax purposes, regardless of its source, or

         (4)  a trust if a court within the United States is able to
                 exercise primary supervision of the administration of the
            trust and one or more United States persons have the
                    authority to control all substantial decisions of the trust.
             Notwithstanding the preceding sentence, to the extent
           provided in Treasury regulations, certain trusts in
                  existence on August 20, 1996, and treated as United States
                persons prior to such date, that elect to continue to be
                   treated as United States persons will also be U.S. Persons.

This summary does not deal with all aspects of U.S. federal income tax
withholding that may be relevant to foreign holders of the Global Securities.   
Investors are advised to consult their own tax advisors for specific tax advice 
concerning their holding and disposing of the Global Securities.                

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Annex II

 Certain Characteristics of the Statistical Mortgage Loans

     The following tables set forth, as of the Cut-off Date, the number,
aggregate Scheduled Principal Balance and percentage of the aggregate mortgage  
pool, the Group 1 Statistical Mortgage Loans and the Group 2 Statistical        
Mortgage Loans, in each case having the stated characteristics show in the      
tables in each range. Amounts in the following tables may not sum due to        
rounding.                                                                       

The Statistical Mortgage Loans

      The following tables describe the Statistical Mortgage Loans and the
related mortgaged properties as of the close of business on the Cut-off Date.   

Mortgage Rates

                                                                [Download Table]

                                      Aggregate       Percent              Weighted
                         Number of    Principal          of      Weighted   Average
                         Mortgage      Balance        Mortgage    Average   Credit 
Range of Mortgage Rates    Loans     Outstanding        Pool      Coupon     Score 
-----------------------  ---------  ---------------   --------   --------  --------
                                                                                   
6.001% to 6.500%......       595    $172,248,921.30    19.68%      6.387%    669   
6.501% to 7.000%......     1,160     290,814,980.08    33.22       6.812     660   
7.001% to 7.500%......       759     162,574,306.70    18.57       7.302     648   
7.501% to 8.000%......       654     126,360,139.50    14.44       7.779     627   
8.001% to 8.500%......       255      42,125,217.03     4.81       8.300     603   
8.501% to 9.000%......       245      29,594,925.05     3.38       8.785     602   
9.001% to 9.500%......       187      15,732,985.31     1.80       9.367     624   
9.501% to 10.000%.....       285      20,678,345.69     2.36       9.890     671   
10.001% to 10.500%....       180      10,552,039.73     1.21      10.291     675   
10.501% to 11.000%....        82       4,650,084.95     0.53      10.662     688   
                         --------   ---------------   ------     -------    ----   
    Total:............     4,402    $875,331,945.33   100.00%      7.278%    650   
                         ========   ===============   ======     =======    ====   


                            Average    Weighted                                    
                           Principal   Average        Percent                      
                            Balance    Original        Full                        
Range of Mortgage Rates   Outstanding    LTV      Documentation                    
-----------------------  ------------  --------   -------------                    
                                                                                   
6.001% to 6.500%......   $289,493.99     80.41%       44.82%                       
6.501% to 7.000%......    250,702.57     81.05        37.64                        
7.001% to 7.500%......    214,195.40     81.95        40.20                        
7.501% to 8.000%......    193,211.22     83.08        38.77                        
8.001% to 8.500%......    165,196.93     84.89        48.96                        
8.501% to 9.000%......    120,795.61     85.64        53.45                        
9.001% to 9.500%......     84,133.61     87.65        49.45                        
9.501% to 10.000%.....     72,555.60     94.53        22.90                        
10.001% to 10.500%....     58,622.44     94.35        16.81                        
10.501% to 11.000%....     56,708.35     95.81         9.31                        
                         -----------    ------       ------                        
    Total:............   $198,848.69     82.40%       40.23%                       
                         ===========    ======       ======                        

    As of the Cut-off Date, Mortgage Rates borne by the Mortgage Loans
ranged from 6.150% per annum to 10.990% per annum and the weighted average      
Mortgage Rate of the Mortgage Loans was approximately 7.278% per annum.         

 Lien Type

                                                        [Enlarge/Download Table]

                                             Aggregate      Percent             Weighted
                              Number of      Principal        of      Weighted   Average
                               Mortgage       Balance       Mortgage   Average   Credit 
Lien Type                       Loans       Outstanding       Pool     Coupon     Score 
----------------------------  ---------   ---------------   --------  --------  --------
                                                                                        
First.......................     3,810    $841,387,685.73     96.12%    7.169%    647   
Second......................       592      33,944,259.60      3.88     9.996     715   
                                ------    ---------------    ------     -----     ---   
     Total:.................     4,402    $875,331,945.33    100.00%    7.278%    650   
                                ======    ===============    ======     =====     ===   


                                 Average    Weighted                                    
                                Principal    Average      Percent                       
                                 Balance    Original        Full                        
Lien Type                      Outstanding     LTV     Documentation                    
----------------------------  ------------  --------   -------------                    
                                                                                        
First.......................  $220,836.66     81.70%      41.53%                        
Second......................    57,338.28     99.64        8.12                         
                              -----------     -----       -----                         
     Total:.................  $198,848.69     82.40%      40.23%                        
                              ===========     =====       =====                         

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Outstanding Mortgage Loan Principal Balances

                                                        [Enlarge/Download Table]

                                          Aggregate                            Weighted
Range of Outstanding       Number of      Principal     Percent of   Weighted   Average
Mortgage Loan              Mortgage        Balance       Mortgage    Average    Credit 
Principal Balances           Loans       Outstanding       Pool       Coupon     Score 
-------------------------  ---------   --------------   ----------   --------  --------
                                                                                       
$50,000 or less..........     318      $11,142,284.40      1.27%       9.846%     703  
$50,001 to $100,000......     861       65,020,936.76      7.43        8.481      640  
$100,001 to $150,000.....     873      108,491,096.38     12.39        7.603      634  
$150,001 to $200,000.....     663      115,068,179.58     13.15        7.304      635  
$200,001 to $250,000.....     414       92,606,743.54     10.58        7.271      642  
$250,001 to $300,000.....     336       91,501,183.90     10.45        7.159      647  
$300,001 to $350,000.....     293       94,265,899.42     10.77        6.961      653  
$350,001 to $400,000.....     231       86,380,442.11      9.87        6.955      654  
$400,001 to $450,000.....     142       60,329,619.26      6.89        7.069      661  
$450,001 to $500,000.....     107       51,135,770.30      5.84        6.883      665  
$500,001 to $550,000.....      55       28,746,391.57      3.28        6.833      671  
$550,001 to $600,000.....      44       25,237,601.33      2.88        6.890      673  
$600,001 to $650,000.....      30       18,871,372.33      2.16        6.801      675  
$650,001 to $700,000.....      11        7,455,123.26      0.85        6.836      664  
$700,001 to $750,000.....      13        9,427,971.31      1.08        6.975      720  
$750,001 to $800,000.....       3        2,383,400.00      0.27        6.846      682  
$800,001 to $850,000.....       4        3,325,000.00      0.38        6.762      675  
$850,001 to $900,000.....       2        1,746,200.00      0.20        6.872      656  
$950,001 to $1,000,000...       1        1,000,000.00      0.11        6.850      669  
Greater than or equal to                                                               
$1,000,001...............       1        1,196,729.87      0.14        6.500      648  
                            -----     ---------------    ------        -----      ---  
    Total:...........       4,402     $875,331,945.33    100.00%       7.278%     650  
                            =====     ===============    ======        =====      ===  


                              Average       Weighted                                   
Range of Outstanding         Principal       Average      Percent                      
Mortgage Loan                 Balance       Original        Full                       
Principal Balances          Outstanding        LTV     Documentation                   
-------------------------  -------------     --------   -------------                  
                                                                                       
$50,000 or less..........  $   35,038.63      96.11%        24.09%                     
$50,001 to $100,000......      75,517.93      84.79         59.08                      
$100,001 to $150,000.....     124,273.88      82.51         64.08                      
$150,001 to $200,000.....     173,556.83      80.44         59.45                      
$200,001 to $250,000.....     223,687.79      80.99         47.62                      
$250,001 to $300,000.....     272,324.95      81.46         38.76                      
$300,001 to $350,000.....     321,726.62      82.28         31.28                      
$350,001 to $400,000.....     373,941.31      82.23         30.26                      
$400,001 to $450,000.....     424,856.47      83.03         23.75                      
$450,001 to $500,000.....     477,904.40      82.71         14.16                      
$500,001 to $550,000.....     522,661.66      83.03          7.28                      
$550,001 to $600,000.....     573,581.85      83.22         11.30                      
$600,001 to $650,000.....     629,045.74      84.83         23.04                      
$650,001 to $700,000.....     677,738.48      81.92          0.00                      
$700,001 to $750,000.....     725,228.56      84.41         15.79                      
$750,001 to $800,000.....     794,466.67      87.67          0.00                      
$800,001 to $850,000.....     831,250.00      84.86         50.38                      
$850,001 to $900,000.....     873,100.00      82.48        100.00                      
$950,001 to $1,000,000...   1,000,000.00      80.00        100.00                      
Greater than or equal to                                                               
$1,000,001...............   1,196,729.87      62.34        100.00                      
                           -------------      -----        ------                      
    Total:...........      $  198,848.69      82.40%        40.23%                     
                           =============      =====        ======                      

   As of the Cut-off Date, the outstanding principal balances of the
Mortgage Loans ranged from approximately $19,788.65 to approximately            
$1,196,729.87 and the average outstanding principal balance of the Mortgage     
Loans was approximately $198,848.69.                                            

Loan Program

                                                                [Download Table]

                                       Aggregate                            Weighted
                       Number of       Principal      Percent of  Weighted   Average
                       Mortgage         Balance        Mortgage    Average   Credit 
Program                  Loans        Outstanding        Pool      Coupon     Score 
---------------------  ---------   ---------------    ----------  --------  --------
                                                                                    
High Street..........    1,091     $186,654,128.52      21.32%     7.252%      616  
Main Street..........      444       80,597,698.22       9.21      7.979       575  
Wall Street..........    2,867      608,080,118.60      69.47      7.193       670  
                                   ---------------     ------      -----       ---  
    Total:...........    4,402     $875,331,945.33     100.00%     7.278%      650  
                                   ===============     ======      =====       ===  


                                      Weighted                                      
                                      Average       Percent                         
                          Average     Original        Full                          
Program                   Balance       LTV      Documentation                      
---------------------   -----------   --------   -------------                      
                                                                                    
High Street..........   $171,085.36    82.44%        68.54%                         
Main Street..........    181,526.35     80.56        63.76                          
Wall Street..........    212,096.31     82.63        28.43                          
                        -----------    -----         -----                          
    Total:...........   $198,848.69    82.40%        40.23%                         
                        ===========    =====         =====                          

 Product Types

                                                        [Enlarge/Download Table]

                                           Aggregate                            Weighted
                            Number of      Principal      Percent of  Weighted   Average
                            Mortgage        Balance        Mortgage    Average   Credit 
Product Types                 Loans       Outstanding        Pool      Coupon     Score 
--------------------------  ---------   ---------------   ----------  --------  --------
                                                                                        
2/28 LIBOR ARM............     1,353    $216,229,600.33      24.70%     7.540%     620  
2/28 LIBOR IO ARM.........     1,608     457,723,019.78      52.29      6.963      663  
30/15 BALLOON.............       590      33,903,489.21       3.87      9.990      715  
3/27 LIBOR ARM............       224      35,600,038.67       4.07      7.560      617  
3/27 LIBOR IO ARM.........       219      59,447,365.59       6.79      7.022      657  
5/1 TREASURY ARM..........         8       2,461,854.46       0.28      6.684      652  
5/1 TREASURY IO ARM.......        31       9,414,839.46       1.08      6.998      663  
Fixed.....................       332      51,217,726.16       5.85      7.430      632  
Fixed IO..................        37       9,334,011.68       1.07      7.015      651  

    Total:................     4,402    $875,331,945.33     100.00%     7.278%     650  


                              Average     Weighted                                      
                             Principal    Average       Percent                         
                              Balance     Original       Full                           
Product Types               Outstanding     LTV      Documentation                      
--------------------------  -----------   --------   -------------                      
                                                                                        
2/28 LIBOR ARM............  $159,814.93     81.98%        54.67%                        
2/28 LIBOR IO ARM.........   284,653.62     82.01         29.47                         
30/15 BALLOON.............    57,463.54     99.60          8.33                         
3/27 LIBOR ARM............   158,928.74     82.95         61.28                         
3/27 LIBOR IO ARM.........   271,449.16     80.88         44.30                         
5/1 TREASURY ARM..........   307,731.81     70.46         82.96                         
5/1 TREASURY IO ARM.......   303,704.50     80.94         57.94                         
Fixed.....................   154,270.26     78.92         68.74                         
Fixed IO..................   252,270.59     80.22         57.73                         

    Total:................  $198,848.69     82.40%        40.23%                        

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                                                        [Enlarge/Download Table]

                              Amortization Types                                         

                                            Aggregate                            Weighted
                            Number of       Principal      Percent of  Weighted   Average
                            Mortgage         Balance        Mortgage    Average   Credit 
Amortization Type             Loans        Outstanding        Pool      Coupon     Score 
--------------------------  ---------    ---------------   ----------  --------  --------
                                                                                         
Fully Amortizing..........   1,917       $305,509,219.61     34.90%      7.517%     622  
30/15 Balloon.............     590         33,903,489.21      3.87       9.990      715  
5 Year IO.................   1,895        535,919,236.51     61.22       6.971      662  
                             -----       ---------------    ------       -----      ---  
    Total:................   4,402       $875,331,945.33    100.00%      7.278%     650  
                             =====       ===============    ======       =====      ===  


                               Average       Weighted                                    
                              Principal      Average       Percent                       
                               Balance       Original       Full                         
Amortization Type            Outstanding       LTV      Documentation                    
--------------------------  ------------     --------   -------------                    
                                                                                         
Fully Amortizing..........  $159,368.40       81.49%      58.03%                         
30/15 Balloon.............    57,463.54       99.60        8.33                          
5 Year IO.................   282,806.98       81.83       32.11                          
                            -----------       -----       -----                          
    Total:................  $198,848.69       82.40%      40.23%                         
                            ===========       =====       =====                          

State Distribution of Mortgaged Properties

                                                        [Enlarge/Download Table]

                                          Aggregate                           Weighted
                           Number of      Principal     Percent of  Weighted   Average
State Distributions of     Mortgage        Balance       Mortgage    Average   Credit 
Mortgaged Properties         Loans       Outstanding       Pool      Coupon     Score 
-----------------------    ---------    --------------  ----------  --------  --------
                                                                                      
Arizona................       312       $59,721,550.45      6.82%     7.326%   636    
Arkansas...............        11         1,126,427.17      0.13      8.255    604    
California.............     1,168       352,965,791.76     40.32      6.968    668    
Colorado...............       176        26,890,143.41      3.07      7.207    650    
Connecticut............         4           726,457.84      0.08      7.704    608    
Delaware...............         5           825,252.97      0.09      7.941    570    
Florida................       356        64,740,916.39      7.40      7.404    641    
Georgia................       122        16,463,382.76      1.88      7.349    629    
Idaho..................        30         4,164,168.80      0.48      7.211    615    
Illinois...............       396        70,626,060.82      8.07      7.739    650    
Indiana................        28         2,528,559.72      0.29      8.199    622    
Iowa...................        82         7,779,731.23      0.89      8.358    614    
Kansas.................        95        10,070,361.44      1.15      7.959    625    
Kentucky...............        10           960,461.60      0.11      8.187    592    
Louisiana..............         3           222,726.59      0.03      7.882    615    
Maine..................         9         1,263,456.50      0.14      7.982    612    
Maryland...............        89        21,263,307.20      2.43      7.549    643    
Massachusetts..........       100        24,258,316.77      2.77      7.599    637    
Michigan...............        75        10,481,578.88      1.20      7.782    631    
Minnesota..............        61         9,876,042.32      1.13      7.099    653    
Mississippi............         4           483,431.34      0.06      7.436    624    
Missouri...............       158        17,960,702.98      2.05      8.002    612    
Nebraska...............        25         2,194,950.31      0.25      7.785    631    
Nevada.................        69        12,908,651.20      1.47      7.135    635    
New Hampshire..........        22         4,158,281.90      0.48      7.388    625    
New Jersey.............        28         6,443,533.75      0.74      7.889    639    
New Mexico.............         9         1,825,240.26      0.21      7.544    611    
North Carolina.........        11         1,340,139.04      0.15      7.370    623    
North Dakota...........         1            66,462.91      0.01      8.900    614    
Ohio...................         3           459,776.57      0.05      7.929    648    
Oklahoma...............        17         2,059,211.04      0.24      7.590    604    
Oregon.................        64        10,850,796.53      1.24      7.063    637    
Pennsylvania...........        20         3,066,035.35      0.35      7.452    621    
Rhode Island...........        19         3,573,456.83      0.41      6.958    659    
South Carolina.........         7           987,747.14      0.11      7.175    620    
South Dakota...........         1           111,017.17      0.01      7.000    586    
Tennessee..............        38         3,928,687.32      0.45      8.189    613    
Texas..................       337        35,300,200.30      4.03      7.444    635    
Utah...................        35         4,648,423.76      0.53      7.618    639    
Vermont................         3           550,381.47      0.06      8.628    639    
Washington.............       294        52,919,979.32      6.05      7.249    640    
Virginia...............        82        19,501,763.33      2.23      7.351    652    
West Virginia..........         4           799,113.44      0.09      8.064    617    
Wisconsin..............        17         2,004,893.48      0.23      7.800    609    
Wyoming................         2           234,373.97      0.03      6.693    636    
                            -----      ---------------    ------      -----    ---    
    Total:.............     4,402      $875,331,945.33    100.00%     7.278%   650    
                            =====      ================   ======      =====    ===    


                            Average     Weighted                                      
                           Principal    Average        Percent                        
State Distributions of      Balance     Original        Full                          
Mortgaged Properties      Outstanding     LTV       Documentation                     
-----------------------  ------------   --------    -------------                     
                                                                                      
Arizona................  $191,415.23      81.85%       58.13%                         
Arkansas...............   102,402.47      84.44        65.94                          
California.............   302,196.74      82.29        22.10                          
Colorado...............   152,784.91      82.15        55.29                          
Connecticut............   181,614.46      84.66        16.83                          
Delaware...............   165,050.59      86.49        83.84                          
Florida................   181,856.51      82.12        36.98                          
Georgia................   134,945.76      83.05        60.75                          
Idaho..................   138,805.63      80.89        51.71                          
Illinois...............   178,348.64      83.01        40.93                          
Indiana................    90,305.70      82.50        75.71                          
Iowa...................    94,874.77      84.55        77.96                          
Kansas.................   106,003.80      83.02        73.51                          
Kentucky...............    96,046.16      84.10        88.07                          
Louisiana..............    74,242.20      83.19       100.00                          
Maine..................   140,384.06      81.28        50.26                          
Maryland...............   238,913.56      81.84        45.27                          
Massachusetts..........   242,583.17      82.24        31.36                          
Michigan...............   139,754.39      84.90        55.86                          
Minnesota..............   161,902.33      82.60        62.24                          
Mississippi............   120,857.83      86.54       100.00                          
Missouri...............   113,675.34      84.24        65.27                          
Nebraska...............    87,798.01      81.70        77.91                          
Nevada.................   187,081.90      81.18        70.79                          
New Hampshire..........   189,012.81      84.32        38.65                          
New Jersey.............   230,126.21      83.22        32.39                          
New Mexico.............   202,804.47      82.86       100.00                          
North Carolina.........   121,830.82      81.96        78.12                          
North Dakota...........    66,462.91      95.00       100.00                          
Ohio...................   153,258.86      81.30        54.33                          
Oklahoma...............   121,130.06      80.80        83.46                          
Oregon.................   169,543.70      82.11        53.83                          
Pennsylvania...........   153,301.77      82.21        56.75                          
Rhode Island...........   188,076.68      81.07        42.40                          
South Carolina.........   141,106.73      80.99        56.82                          
South Dakota...........   111,017.17      80.00       100.00                          
Tennessee..............   103,386.51      86.17        68.51                          
Texas..................   104,748.37      80.59        63.89                          
Utah...................   132,812.11      85.87        61.64                          
Vermont................   183,460.49      85.06        28.11                          
Washington.............   179,999.93      82.36        58.67                          
Virginia...............   237,826.38      83.13        42.22                          
West Virginia..........   199,778.36      88.70       100.00                          
Wisconsin..............   117,934.91      83.69        85.52                          
Wyoming................   117,186.99      79.09       100.00                          
                         -----------      -----       ------                          
    Total:.............  $198,848.69      82.40%       40.23%                         
                         ===========      =====       ======                          

        No more than approximately 0.54% of the Mortgage Loans will be secured
by mortgaged properties located in any one zip code.                            

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 Original Loan-to-Value Ratios

                                                        [Enlarge/Download Table]

                                     Aggregate                            Weighted     Average  
Range of Original      Number of     Principal     Percent of  Weighted     Average   Principal 
Range of Original      Mortgage       Balance       Mortgage   Average      Credit     Balance  
Loan-to-Value Ratios     Loans      Outstanding       Pool      Coupon      Score    Outstanding
---------------------  ---------  ---------------  ----------  ---------  ---------  -----------
                                                                                                
50.00% or less.......        46     $6,923,348.74      0.79%     7.324%     602      $150,507.58
50.01% to 55.00%.....        22      4,081,985.63      0.47      6.935      606       185,544.80
55.01% to 60.00%.....        42      7,420,580.73      0.85      7.292      598       176,680.49
60.01% to 65.00%.....        41      9,169,038.61      1.05      7.345      609       223,635.09
65.01% to 70.00%.....       115     24,021,461.98      2.74      7.426      613       208,882.28
70.01% to 75.00%.....       197     30,686,609.66      3.51      7.539      608       155,769.59
75.01% to 80.00%.....     1,990    419,828,529.89     47.96      6.986      656       210,969.11
80.01% to 85.00%.....       580    163,173,535.96     18.64      7.071      659       281,333.68
85.01% to 90.00%.....       622    144,721,680.73     16.53      7.501      636       232,671.51
90.01% to 95.00%.....       186     32,795,447.03      3.75      8.040      630       176,319.61
95.01% to 100.00%....       561     32,509,726.36      3.71      9.991      715        57,949.60
                          -----   ---------------    ------      -----      ---      -----------
     Total:..........     4,402   $875,331,945.33    100.00%     7.278%     650      $198,848.69
                          =====   ===============    ======      =====      ===      ===========


                       Weighted                                                                 
Range of Original       Average       Percent                                                   
Range of Original      Original        Full                                                     
Loan-to-Value Ratios      LTV      Documentation                                                
---------------------  ---------   -------------                                                
                                                                                                
50.00% or less.......    42.27%        62.19%                                                   
50.01% to 55.00%.....    53.09         53.90                                                    
55.01% to 60.00%.....    58.09         73.37                                                    
60.01% to 65.00%.....    62.80         59.27                                                    
65.01% to 70.00%.....    68.93         40.78                                                    
70.01% to 75.00%.....    73.79         50.12                                                    
75.01% to 80.00%.....    79.84         38.92                                                    
80.01% to 85.00%.....    84.75         29.45                                                    
85.01% to 90.00%.....    89.72         50.81                                                    
90.01% to 95.00%.....    94.75         66.92                                                    
95.01% to 100.00%....    99.98          8.27                                                    
                         -----         -----                                                    
     Total:..........    82.40%        40.23%                                                   
                         =====         =====                                                    

  As of the Cut-off Date, the Original Loan-to-Value Ratios of the
Mortgage Loans ranged from 14.41% to 100.00% and the weighted average Original  
Loan-to-Value was approximately 82.40%.                                         

 Combined Loan-to-Value Ratios

                                                                [Download Table]

                                     Aggregate       Percent             Weighted
                      Number of      Principal          of     Weighted   Average
Range of Combined      Mortgage       Balance        Mortgage  Average    Credit 
Loan-to-Value Ratios    Loans       Outstanding        Pool     Coupon     Score 
--------------------  ---------   ---------------    --------  --------  --------
                                                                                 
50.00% or less......      45        $6,836,444.33       0.78%   7.303%      602  
50.01% - 55.00%.....      23         4,168,890.03       0.48    6.978       604  
55.01% - 60.00%.....      40         7,247,568.06       0.83    7.276       598  
60.01% - 65.00%.....      39         7,868,903.75       0.90    7.475       602  
65.01% - 70.00%.....     107        24,484,395.12       2.80    7.345       615  
70.01% - 75.00%.....     127        25,547,608.49       2.92    7.559       601  
75.01% - 80.00%.....     354        81,245,493.95       9.28    7.378       622  
80.01% - 85.00%.....     230        51,641,392.37       5.90    7.446       618  
85.01% - 90.00%.....     522       123,012,585.71      14.05    7.517       631  
90.01% - 95.00%.....     282        59,341,886.31       6.78    7.609       646  
95.01% - 100.00%....   2,633       483,936,777.22      55.29    7.123       671  
                       -----      ---------------     ------    -----       ---  
    Total:..........   4,402      $875,331,945.33     100.00%   7.278%      650  
                       =====      ===============     ======    =====       ===  


                        Average     Weighted                                     
                       Principal     Average      Percent                        
Range of Combined       Balance     Original        Full                         
Loan-to-Value Ratios  Outstanding      LTV     Documentation                     
--------------------  -----------   ---------  -------------                     
                                                                                 
50.00% or less......  $151,920.99      42.27%       61.71%                       
50.01% - 55.00%.....   181,256.09      52.86        54.86                        
55.01% - 60.00%.....   181,189.20      58.06        74.16                        
60.01% - 65.00%.....   201,766.76      62.88        53.86                        
65.01% - 70.00%.....   228,826.12      68.59        42.63                        
70.01% - 75.00%.....   201,162.27      73.68        47.51                        
75.01% - 80.00%.....   229,507.05      79.44        43.31                        
80.01% - 85.00%.....   224,527.79      84.47        54.43                        
85.01% - 90.00%.....   235,656.29      88.95        50.65                        
90.01% - 95.00%.....   210,432.22      88.99        50.76                        
95.01% - 100.00%....   183,796.73      82.86        32.60                        
                      -----------      -----        -----                        
    Total:..........  $198,848.69      82.40%       40.23%                       
                      ===========      =====        =====                        

  As of the Cut-off Date, the Combined Loan-to-Value Ratios of the
Mortgage Loans ranged from 14.41% to 100.00% and the weighted average Combined  
Loan-to-Value was approximately 92.35%.                                         

Loan Purpose

                                                        [Enlarge/Download Table]

                                       Aggregate                                        
                         Number of     Principal      Percent of  Weighted    Weighted  
                         Mortgage       Balance        Mortgage    Average    Average   
Loan Purpose               Loans      Outstanding        Pool      Coupon   Credit Score
-----------------------  ---------  ---------------   ----------  --------  ------------
                                                                                        
Purchase...............    2,819    $526,831,575.00      60.19%     7.233%       666    
Refinance - Rate/Term..    1,210     262,886,312.91      30.03      7.359        627    
Refinance - Cashout....      373      85,614,057.42       9.78      7.311        624    
                           -----    ---------------     ------      -----        ---    
    Total:.............    4,402    $875,331,945.33     100.00%     7.278%       650    
                           =====    ===============     ======      =====        ===    


                           Average    Weighted                                          
                          Principal   Average      Percent                              
                           Balance    Original       Full                               
Loan Purpose             Outstanding     LTV    Documentation                           
-----------------------  -----------  --------  -------------                           
                                                                                        
Purchase...............  $186,885.98    83.31%       31.23%                             
Refinance - Rate/Term..   217,261.42    81.10        54.37                              
Refinance - Cashout....   229,528.30    80.81        52.27                              
                         -----------    -----        -----                              
    Total:.............  $198,848.69    82.40%       40.23%                             
                         ===========    =====        =====                              

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 Types of Mortgaged Properties

                                                        [Enlarge/Download Table]

                                           Aggregate                            Weighted 
                             Number of     Principal     Percent of  Weighted    Average 
                             Mortgage       Balance       Mortgage   Average     Credit  
Property Type                  Loans      Outstanding       Pool       Coupon     Score  
---------------------------  ---------  ---------------  ----------  ---------  ---------
                                                                                         
Single Family Detached.....    3,059    $592,873,455.08     67.73%     7.288%      648   
Planned Unit Development...      718     149,678,982.75      17.10      7.239      645   
Two-to-Four Family.........      228      63,479,664.08       7.25      7.306      676   
Condominium................      344      61,538,368.64       7.03      7.239      660   
Single Family Attached.....       36       4,935,124.04       0.56      7.450      650   
Townhouse..................       16       2,421,350.74       0.28      7.399      616   
Manufactured Home..........        1         405,000.00       0.05      6.675      637   
                               -----    ---------------    ------       -----      ---   
     Total:................    4,402    $875,331,945.33    100.00%      7.278%     650   
                               =====    ===============    ======       =====      ===   


                               Average    Weighted                                       
                              Principal    Average       Percent                         
                               Balance    Original        Full                           
Property Type                Outstanding     LTV      Documentation                      
---------------------------  -----------  ---------   -------------                      
                                                                                         
Single Family Detached.....  $193,812.83    82.42%        40.69%                         
Planned Unit Development...   208,466.55    82.21         46.90                          
Two-to-Four Family.........   278,419.58    82.20         21.23                          
Condominium................   178,890.61    82.79         37.49                          
Single Family Attached.....   137,086.78    82.18         51.31                          
Townhouse..................   151,334.42    86.16         68.65                          
Manufactured Home..........   405,000.00    69.83          0.00                          
                             -----------    -----         -----                          
     Total:................  $198,848.69    82.40%        40.23%                         
                             ===========    =====         =====                          

 Documentation Summary

                                                        [Enlarge/Download Table]

                                             Aggregate      Percent             Weighted
                              Number of      Principal         of     Weighted   Average
                               Mortgage       Balance       Mortgage  Average    Credit 
Documentation                   Loans       Outstanding       Pool     Coupon     Score 
----------------------------  ---------   ---------------  ---------  --------  --------
                                                                                        
Full Documentation..........     2,089    $352,187,174.19    40.23%    7.232%      616  
Stated Income Wage Earner...     1,359     282,374,251.62    32.26     7.361       685  
Stated Income Self-Employed.       668     168,594,954.14    19.26     7.247       674  
12 Month Bank Statements....       203      49,885,870.43     5.70     7.255       623  
24 Month Bank Statements....        66      18,378,201.00     2.10     7.255       618  
Limited Documentation.......        17       3,911,493.95     0.45     7.254       653  
                                 -----    ---------------   ------     -----       ---  
     Total:.................     4,402    $875,331,945.33   100.00%    7.278%      650  
                                 =====    ===============   ======     =====       ===  


                                Average    Weighted                                     
                               Principal    Average      Percent                        
                                Balance    Original        Full                         
Documentation                 Outstanding     LTV     Documentation                     
----------------------------  -----------  --------   -------------                     
                                                                                        
Full Documentation..........  $168,591.28    81.82%      100.00%                        
Stated Income Wage Earner...   207,780.91    83.11         0.00                         
Stated Income Self-Employed.   252,387.66    82.41         0.00                         
12 Month Bank Statements....   245,743.20    82.51         0.00                         
24 Month Bank Statements....   278,457.59    82.74         0.00                         
Limited Documentation.......   230,087.88    80.47         0.00                         
                              -----------    -----        -----                         
     Total:.................  $198,848.69    82.40%       40.23%                        
                              ===========    =====        =====                         

 Occupancy Types

                                                        [Enlarge/Download Table]

                                             Aggregate      Percent              Weighted
                              Number of      Principal         of     Weighted    Average
                               Mortgage       Balance       Mortgage  Average     Credit 
Occupancy                       Loans       Outstanding       Pool     Coupon      Score 
----------------------------  ---------   ---------------  ---------  --------   --------
                                                                                         
Primary Home................   4,280      $852,772,358.52     97.42%     7.267%      650 
Investment Property.........     122        22,559,586.82      2.58      7.725       663 
                               -----      ---------------    ------      -----       --- 
      Total:................   4,402      $875,331,945.33    100.00%     7.278%      650 
                               =====      ===============    ======      =====       === 


                                Average    Weighted                                      
                               Principal    Average      Percent                         
                                Balance    Original        Full                          
Occupancy                     Outstanding     LTV     Documentation                      
----------------------------  -----------  --------   -------------                      
                                                                                         
Primary Home................   $199,245.88     82.56%      40.53%                        
Investment Property.........    184,914.65     76.33       29.16                         
                               -----------     -----       -----                         
      Total:................   $198,848.69     82.40%      40.23%                        
                               ===========     =====       =====                         

         The information set forth above with respect to occupancy is based upon
representations of the related mortgagors at the time of origination.           

 Mortgage Loan Age Summary

                                                        [Enlarge/Download Table]


                                             Aggregate      Percent             Weighted
                              Number of      Principal         of     Weighted   Average
                               Mortgage       Balance       Mortgage  Average    Credit 
Mortgage Loan Age (Months)      Loans       Outstanding       Pool     Coupon     Score 
----------------------------  ---------   ---------------  ---------  --------  --------
                                                                                        
0...........................     254       $47,262,977.00     5.40%     7.432%      663 
1...........................   1,980       397,027,734.90    45.36      7.275       653 
2...........................   1,627       308,349,839.92    35.23      7.347       645 
3...........................     523       118,087,634.65    13.49      7.066       648 
4...........................      17         4,542,933.47     0.52      6.834       635 
5...........................       1            60,825.39     0.01      8.850       553 
                               -----      ---------------   ------      -----       --- 
     Total:.................   4,402      $875,331,945.33   100.00%     7.278%      650 
                               =====      ===============   ======      =====       === 


                                Average    Weighted                                     
                               Principal    Average      Percent                        
                                Balance    Original        Full                         
Mortgage Loan Age (Months)    Outstanding     LTV     Documentation                     
----------------------------  -----------  --------   -------------                     
                                                                                        
0...........................     $186,074.71   82.38%      32.00%                       
1...........................      200,519.06   82.47       39.73                        
2...........................      189,520.49   82.30       41.99                        
3...........................      225,788.98   82.54       40.84                        
4...........................      267,231.38   80.30       34.24                        
5...........................       60,825.39   72.62      100.00                        
                                 -----------   -----      ------                        
     Total:.................     $198,848.69   82.40%      40.23%                       
                                 ===========   =====      ======                        

        As of the Cut-off Date, the weighted average age of the Mortgage Loans
was approximately 2 months.                                                     

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Original Prepayment Penalty Term

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
Original Prepayment            Mortgage       Balance        Mortgage  Average    Credit 
Penalty Term                    Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         

None........................   1,001      $158,264,952.06     18.08%     7.879%      645 
6 Months....................      91         9,853,157.07      1.13      7.907       624 
12 Months...................      72        20,384,220.19      2.33      7.407       667 
24 Months...................   2,726       586,881,337.93     67.05      7.124       653 
30 Months...................       1           180,000.00      0.02      7.450       597 
36 Months...................     511        99,768,278.08     11.40      7.141       642 
                               -----      ---------------    ------      -----       --- 
    Total:..................   4,402      $875,331,945.33    100.00%     7.278%      650 
                               =====      ===============    ======      =====       === 


                                 Average     Weighted                                    
                                Principal     Average      Percent                       
Original Prepayment              Balance     Original        Full                        
Penalty Term                   Outstanding      LTV     Documentation                    
----------------------------   -----------   --------   -------------                    
                                                                                         

None........................   $158,106.85     83.47%        41.39%                      
6 Months....................    108,276.45     82.65         74.83                       
12 Months...................    283,114.17     82.52         32.35                       
24 Months...................    215,290.29     82.47         36.30                       
30 Months...................    180,000.00     80.00        100.00                       
36 Months...................    195,241.25     80.24         59.62                       
                               -----------     -----        ------                       
    Total:..................   $198,848.69     82.40%        40.23%                      
                               ===========     =====        ======                       

  The weighted average prepayment penalty term at origination with
respect to the Mortgage Loans having prepayment penalties is approximately 25   
months.                                                                         

 Credit Scores

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
                               Mortgage       Balance        Mortgage  Average    Credit 
Range of Credit Scores          Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
501 to 525..................      33        $5,477,627.92     0.63%    8.856%      518   
526 to 550..................     139        22,080,956.18     2.52     8.354       541   
551 to 575..................     343        60,970,897.74     6.97     7.952       563   
576 to 600..................     518        89,917,573.45    10.27     7.358       589   
601 to 625..................     622       124,443,496.37    14.22     7.201       613   
626 to 650..................     599       125,417,296.26    14.33     7.103       638   
651 to 675..................     606       154,070,668.07    17.60     7.010       664   
676 to 700..................     693       133,027,066.28    15.20     7.262       687   
701 to 725..................     425        79,469,121.77     9.08     7.243       712   
726 to 750..................     236        45,623,495.49     5.21     7.198       736   
751 to 775..................     119        23,147,695.44     2.64     7.326       761   
776 to 800..................      64         9,855,458.47     1.13     7.357       785   
801 to 825..................       5         1,830,591.90     0.21     6.747       805   
                               -----      ---------------   ------     -----       ---   
    Total:..................   4,402      $875,331,945.33   100.00%    7.278%      650   
                               =====      ===============   ======     =====       ===   


                                Average     Weighted                                     
                               Principal     Average      Percent                        
                                Balance     Original        Full                         
Range of Credit Scores        Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
501 to 525..................  $165,988.72     72.72%       81.21%                        
526 to 550..................   158,855.80     79.09        73.16                         
551 to 575..................   177,757.72     81.05        72.88                         
576 to 600..................   173,586.05     80.57        75.09                         
601 to 625..................   200,069.93     81.87        68.17                         
626 to 650..................   209,377.79     81.91        50.09                         
651 to 675..................   254,242.03     82.07        25.98                         
676 to 700..................   191,958.25     83.89        11.60                         
701 to 725..................   186,986.17     84.56         9.66                         
726 to 750..................   193,319.90     84.74        10.21                         
751 to 775..................   194,518.45     84.45        13.35                         
776 to 800..................   153,991.54     84.52         6.29                         
801 to 825..................   366,118.38     86.28        25.22                         
                              -----------     -----        -----                         
    Total:..................  $198,848.69     82.40%       40.23%                        
                              ===========     =====        =====                         

    The Credit Scores of the Mortgage Loans that were scored as of the
Cut-off Date ranged from 502 to 815 and the weighted average Credit Score of the
Mortgage Loans that were scored As of the Cut-off Date was approximately 650.   

Credit Grade Summary

                                                                [Download Table]

                                             Aggregate       Percent            
                              Number of      Principal          of      Weighted
                               Mortgage       Balance        Mortgage   Average 
Credot Grade                    Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
A..........................    4,110      $818,412,229.16    93.50%     7.228%  
A-.........................      147        32,214,981.32     3.68      7.752   
B..........................       96        17,305,012.54     1.98      7.937   
C..........................       36         5,431,098.21     0.62      8.996   
D..........................       13         1,968,624.11     0.22      9.789   
                               -----      ---------------   ------      -----   
     Total:................    4,402      $875,331,945.33   100.00%     7.278%  
                               =====      ===============   ======      =====   


                              Weighted    Average     Weighted                  
                               Average   Principal     Average      Percent     
                               Credit     Balance     Original        Full      
Credot Grade                    Score   Outstanding      LTV     Documentation  
----------------------------  --------  -----------   --------   -------------  
                                                                                
A..........................     655     $199,127.06    82.83%        38.62%     
A-.........................     592      219,149.53    79.71         59.83      
B..........................     577      180,260.55    72.64         62.34      
C..........................     563      150,863.84    70.44         75.27      
D..........................     555      151,432.62    67.49        100.00      
                                ---     -----------    -----        ------      
     Total:................     650     $198,848.69    82.40%        40.23%     
                                ===     ===========    =====        ======      

II-6

424B5
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 Gross Margins

                                                                [Download Table]

                                             Aggregate       Percent            
                              Number of      Principal          of      Weighted
                               Mortgage       Balance        Mortgage   Average 
Gross Margins                   Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
2.501% to 3.000%...........        4          $568,912.57     0.07%     7.400%  
3.001% to 3.500%...........        5           697,013.10     0.09      7.373   
3.501% to 4.000%...........      130        21,730,998.77     2.78      7.387   
4.001% to 4.500%...........        5           956,977.46     0.12      7.245   
4.501% to 5.000%...........        2           869,029.40     0.11      6.570   
5.001% to 5.500%...........      754       192,941,611.12    24.71      7.094   
5.501% to 6.000%...........    1,779       443,455,483.16    56.79      7.060   
6.001% to 6.500%...........      763       119,540,837.70    15.31      7.557   
6.501% to 7.000%...........        1           115,855.00     0.01      6.850   
                               -----      ---------------   ------      -----   
     Total:................    3,443      $780,876,718.29   100.00%     7.154%  
                               =====      ===============   ======      =====   


                              Weighted    Average     Weighted                  
                               Average   Principal     Average      Percent     
                               Credit     Balance     Original        Full      
Gross Margins                   Score   Outstanding      LTV     Documentation  
----------------------------  --------  -----------   --------   -------------  
                                                                                
2.501% to 3.000%...........     624     $142,228.14     81.70%      100.00%     
3.001% to 3.500%...........     663      139,402.62     80.00        29.24      
3.501% to 4.000%...........     656      167,161.53     80.37        45.81      
4.001% to 4.500%...........     646      191,395.49     80.25        28.27      
4.501% to 5.000%...........     678      434,514.70     85.55         0.00      
5.001% to 5.500%...........     631      255,890.73     82.76        53.97      
5.501% to 6.000%...........     657      249,272.33     81.77        31.66      
6.001% to 6.500%...........     645      156,672.13     81.31        44.45      
6.501% to 7.000%...........     634      115,855.00     85.00       100.00      
                                ---     -----------     -----       ------      
     Total:................     648     $226,801.25     81.91%       39.54%     
                                ===     ===========     =====       ======      

   As of the Cut-off Date, the Gross Margins for the Adjustable Rate
Mortgage Loans ranged from 3.000% per annum to 6.750% per annum and the weighted
average Gross Margin of the Adjustable Rate Mortgage Loans was approximately    
5.729% per annum.                                                               

Maximum Mortgage Rates

                                                                [Download Table]

                                             Aggregate       Percent            
                              Number of      Principal          of      Weighted
Range of                       Mortgage       Balance        Mortgage   Average 
Maximum Mortgage Rates          Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
12.001% to 12.500%..........     565      $163,792,617.59    20.98%     6.385%  
12.501% to 13.000%..........   1,079       272,987,978.04    34.96      6.812   
13.001% to 13.500%..........     676       148,758,883.15    19.05      7.301   
13.501% to 14.000%..........     578       116,733,940.00    14.95      7.778   
14.001% to 14.500%..........     212        36,473,454.18     4.67      8.300   
14.501% to 15.000%..........     178        25,320,255.76     3.24      8.777   
15.001% to 15.500%..........      75         8,748,752.32     1.12      9.307   
15.501% to 16.000%..........      50         5,340,258.61     0.68      9.774   
16.001% to 16.500%..........      24         2,166,217.49     0.28     10.346   
16.501% to 17.000%..........       6           554,361.15     0.07     10.563   
                               -----      ---------------   ------      -----   
     Total:.................   3,443      $780,876,718.29   100.00%     7.154%  
                               =====      ===============   ======      =====   


                              Weighted    Average     Weighted                  
                               Average   Principal     Average      Percent     
Range of                       Credit     Balance     Original        Full      
Maximum Mortgage Rates          Score   Outstanding      LTV     Documentation  
----------------------------  --------  -----------   --------   -------------  
                                                                                
12.001% to 12.500%..........    670     $289,898.44    80.60%        42.44%     
12.501% to 13.000%..........    661      253,000.91    81.17         36.00      
13.001% to 13.500%..........    649      220,057.52    82.18         37.78      
13.501% to 14.000%..........    627      201,961.83    83.43         36.49      
14.001% to 14.500%..........    601      172,044.60    85.14         47.88      
14.501% to 15.000%..........    594      142,248.63    86.04         55.79      
15.001% to 15.500%..........    569      116,650.03    81.96         63.38      
15.501% to 16.000%..........    557      106,805.17    80.96         65.70      
16.001% to 16.500%..........    543       90,259.06    73.69         57.61      
16.501% to 17.000%..........    529       92,393.53    76.06         57.27      
                                ---     -----------     -----       ------      
     Total:.................    648     $226,801.25    81.91%        39.54%     
                                ===     ===========     =====       ======      

       As of the Cut-off Date, the Maximum Mortgage Rates for the Adjustable
Rate Mortgage Loans ranged from 12.150% per annum to 16.600% per annum and the  
weighted average Maximum Mortgage Rate of the Adjustable Rate Mortgage Loans was
approximately 13.154% per annum.                                                

 Next Rate Adjustment Date

                                                                [Download Table]

                                             Aggregate       Percent            
                              Number of      Principal          of      Weighted
                               Mortgage       Balance        Mortgage   Average 
Next Rage Adjustment Date       Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
July 2007..................        6        $1,777,928.71     0.23%     6.879%  
August 2007................      279        76,007,127.57     9.73      6.893   
September 2007.............    1,060       225,669,788.63    28.90      7.227   
October 2007...............    1,438       331,172,188.20    42.41      7.142   
November 2007..............      178        39,325,587.00     5.04      7.244   
June 2008..................        1            60,825.39     0.01      8.850   
July 2008..................        7         1,926,082.82     0.25      6.669   
August 2008................      132        29,871,117.00     3.83      7.054   
September 2008.............      208        43,139,481.13     5.52      7.374   
October 2008...............       91        19,454,457.93     2.49      7.205   
November 2008..............        4           595,440.00     0.08      6.987   
August 2010................        6         2,398,629.33     0.31      6.662   
September 2010.............       15         3,060,670.13     0.39      6.771   
October 2010...............       15         5,572,294.46     0.71      7.148   
November 2010..............        3           845,100.00     0.11      6.874   
                               -----      ---------------   ------      -----   
     Total:................    3,443      $780,876,718.29   100.00%     7.154%  
                               =====      ===============   ======      =====   


                              Weighted    Average     Weighted                  
                               Average   Principal     Average      Percent     
                               Credit     Balance     Original        Full      
Next Rage Adjustment Date       Score   Outstanding      LTV     Documentation  
----------------------------  --------  -----------   --------   -------------  
                                                                                
July 2007..................     638     $296,321.45    81.85%         12.37%    
August 2007................     649      272,426.98    83.14          37.20     
September 2007.............     645      212,896.03    81.89          37.58     
October 2007...............     651      230,300.55    81.82          38.59     
November 2007..............     659      220,930.26    81.93          30.55     
June 2008..................     553       60,825.39    72.62         100.00     
July 2008..................     623      275,154.69    79.85          34.11     
August 2008................     639      226,296.34    80.57          46.05     
September 2008.............     639      207,401.35    81.97          55.12     
October 2008...............     655      213,785.25    82.86          49.20     
November 2008..............     687      148,860.00    81.04          54.20     
August 2010................     639      399,771.55    67.09         100.00     
September 2010.............     669      204,044.68    81.12          53.33     
October 2010...............     663      371,486.30    82.57          51.48     
November 2010..............     673      281,700.00    78.33          70.71     
                                ---     -----------     -----       ------      
     Total:................     648     $226,801.25    81.91%         39.54%    
                                ===     ===========     =====       ======      

II-7

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The Group 1 Statistical Mortgage Loans

 Mortgage Rates for the Group 1 Statistical Mortgage Loans

                                                                [Download Table]

                                             Aggregate       Percent            
                              Number of      Principal          of      Weighted
                               Mortgage       Balance        Mortgage   Average 
Range of Mortgage Rates         Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
6.001% to 6.500%............     231       $48,288,138.85    15.47%     6.380%  
6.501% to 7.000%............     500        95,568,920.68    30.62      6.820   
7.001% to 7.500%............     353        62,086,169.98    19.90      7.305   
7.501% to 8.000%............     320        55,147,238.38    17.67      7.795   
8.001% to 8.500%............     134        19,572,282.57     6.27      8.293   
8.501% to 9.000%............     129        14,509,217.50     4.65      8.784   
9.001% to 9.500%............      75         5,488,523.67     1.76      9.345   
9.501% to 10.000%...........     103         5,942,824.46     1.90      9.838   
10.001% to 10.500%..........      77         3,599,509.83     1.15     10.315   
10.501% to 11.000%..........      42         1,860,404.09     0.60     10.674   
                               -----      ---------------   ------      -----   
     Total:.................   1,964      $312,063,230.01   100.00%     7.370%  
                               =====      ===============   ======      =====   


                              Weighted    Average      Weighted                 
                               Average   Principal      Average      Percent    
                               Credit     Balance      Original        Full     
Range of Mortgage Rates         Score   Outstanding       LTV     Documentation 
----------------------------  --------  -----------    --------   ------------- 
                                                                                
6.001% to 6.500%............    656       $209,039.56   78.91%        76.16%    
6.501% to 7.000%............    654        191,137.84   79.85         57.33     
7.001% to 7.500%............    642        175,881.50   80.31         52.94     
7.501% to 8.000%............    628        172,335.12   82.65         43.73     
8.001% to 8.500%............    614        146,061.81   84.74         48.88     
8.501% to 9.000%............    607        112,474.55   85.06         49.52     
9.001% to 9.500%............    623         73,180.32   85.02         60.61     
9.501% to 10.000%...........    643         57,697.32   91.71         42.52     
10.001% to 10.500%..........    660         46,746.88   91.70         35.66     
10.501% to 11.000%..........    674         44,295.34   93.86         10.89     
                                ---       -----------   -----         -----     
     Total:.................    642       $158,891.66   81.38%        55.32%    
                                ===       ===========   =====         =====     

      As of the Cut-off Date, Mortgage Rates borne by the Group 1 Mortgage
Loans ranged from 6.150% per annum to 10.990% per annum and the weighted average
Mortgage Rate of the Group 1 Mortgage Loans was approximately 7.370% per annum. 

Lien Type for the Group 1 Mortgage Loans

                                                                [Download Table]

                                             Aggregate       Percent            
                              Number of      Principal          of      Weighted
                               Mortgage       Balance        Mortgage   Average 
Lien Type                       Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
tion                                                                            
First.......................   1,719      $302,875,953.71    97.06%     7.290%  
Second......................     245         9,187,276.30     2.94      9.989   
                               -----      ---------------   ------      -----   
     Total:.................   1,964      $312,063,230.01   100.00%     7.370%  
                               =====      ===============   ======      =====   


                              Weighted    Average     Weighted                  
                               Average   Principal     Average      Percent     
                               Credit     Balance     Original        Full      
Lien Type                       Score   Outstanding      LTV     Documentation  
----------------------------  --------  -----------   --------   -------------  
                                                                                
tion                                                                            
First.......................    640     $176,193.11     80.83%       56.38%     
Second......................    717       37,499.09     99.36        20.37      
                                ---     -----------     -----        -----      
     Total:.................    642     $158,891.66     81.38%       55.32%     
                                ===      ==========     =====        =====      

Outstanding Mortgage Loan Principal Balances for the Group 1
Statistical Mortgage Loans

                                                                [Download Table]

                                             Aggregate       Percent            
Range of Outstanding          Number of      Principal          of      Weighted
Mortgage Loan                  Mortgage       Balance        Mortgage   Average 
Principal Balances              Loans       Outstanding        Pool      Coupon 
----------------------------  ---------   ---------------   ---------   --------
                                                                                
$50,000 or less............      214      $7,252,068.43      2.32%      9.892%  
$50,001 to $100,000........      362      27,413,211.46      8.78       8.125   
$100,001 to $150,000.......      437      54,831,057.46     17.57       7.377   
$150,001 to $200,000.......      377      65,693,842.12     21.05       7.251   
$200,001 to $250,000.......      235      52,624,235.49     16.86       7.264   
$250,001 to $300,000.......      172      46,920,024.00     15.04       7.195   
$300,001 to $350,000.......      123      39,657,818.01     12.71       6.996   
$350,001 to $400,000.......       26       9,409,166.01      3.02       7.148   
$400,001 to $450,000.......       12       4,979,603.61      1.60       7.409   
$450,001 to $500,000.......        2         985,671.15      0.32       6.878   
$500,001 to $550,000.......        1         531,000.00      0.17       7.250   
$550,001 to $600,000.......        3       1,765,532.26      0.57       7.037   
                               -----    ---------------    ------       -----   
     Total:................    1,964    $312,063,230.01    100.00%      7.370%  
                               =====    ===============    ======       =====   


                              Weighted    Average     Weighted                  
Range of Outstanding           Average   Principal     Average      Percent     
Mortgage Loan                  Credit     Balance     Original        Full      
Principal Balances              Score   Outstanding      LTV     Documentation  
----------------------------  --------  -----------   --------   -------------  
                                                                                
$50,000 or less............   710       $33,888.17    98.11%        26.09%      
$50,001 to $100,000........   629        75,727.10    81.61         69.54       
$100,001 to $150,000.......   639       125,471.53    81.48         67.22       
$150,001 to $200,000.......   641       174,254.22    79.75         57.87       
$200,001 to $250,000.......   639       223,932.92    80.40         55.45       
$250,001 to $300,000.......   640       272,790.84    80.49         53.49       
$300,001 to $350,000.......   640       322,421.28    82.09         42.72       
$350,001 to $400,000.......   659       361,891.00    84.78         41.66       
$400,001 to $450,000.......   662       414,966.97    82.33         33.55       
$450,001 to $500,000.......   677       492,835.57    87.52          0.00       
$500,001 to $550,000.......   712       531,000.00    90.00          0.00       
$550,001 to $600,000.......   700       588,510.75    76.41          0.00       
                              ---      -----------    -----         -----       
     Total:................   642      $158,891.66    81.38%        55.32%      
                              ===      ===========    =====         =====       

         As of the Cut-off Date, the outstanding principal balances of the Group
1 Mortgage Loans ranged from approximately $19,788.65 to approximately          
$600,000.00 and the average outstanding principal balance of the Group 1        
Mortgage Loans was approximately $158,891.66.                                   

II-8

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 Loan Program for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent              Weighted
                              Number of      Principal          of      Weighted   Average
                               Mortgage       Balance        Mortgage   Average    Credit 
Program                         Loans       Outstanding        Pool      Coupon     Score 
----------------------------  ---------   ---------------   ---------   --------  --------
                                                                                          
High Street...........           475       $70,727,252.77      22.66%     7.297%     621  
Main Street...........           239        39,787,974.92      12.75      7.954      576  
Wall Street...........         1,250       201,548,002.32      64.59      7.280      663  
                               -----      ---------------     ------      -----      ---  
     Total:...........         1,964      $312,063,230.01     100.00%     7.370%     642  
                               =====      ===============     ======      =====      ===  


                                Average      Weighted                                     
                               Principal      Average       Percent                       
                                Balance      Original         Full                        
Program                       Outstanding       LTV      Documentation                    
----------------------------  -----------    --------    -------------                    
                                                                                          
High Street...........          $148,899.48    82.22%        76.57%                       
Main Street...........           166,476.88    80.53         72.11                        
Wall Street...........           161,238.40    81.25         44.55                        
                                -----------    -----         -----                        
     Total:...........          $158,891.66    81.38%        55.32%                       
                                ===========    =====         =====                        

Product Types for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent              Weighted
                              Number of      Principal          of      Weighted   Average
                               Mortgage       Balance        Mortgage   Average    Credit 
Product Types                   Loans       Outstanding        Pool      Coupon     Score 
----------------------------  ---------   ---------------   ---------   --------  --------
                                                                                          
2/28 LIBOR ARM............      531      $75,580,749.84     24.22%     7.593%      629    
2/28 LIBOR IO ARM.........      763      156,269,362.19     50.08      7.122       645    
30/15 BALLOON.............      244        9,158,358.30      2.93      9.989       717    
3/27 LIBOR ARM............      100       14,311,401.70      4.59      7.607       623    
3/27 LIBOR IO ARM.........      128       25,644,450.73      8.22      7.151       644    
5/1 TREASURY ARM..........        5          975,245.02      0.31      6.946       661    
5/1 TREASURY IO ARM.......       19        3,893,219.46      1.25      6.947       671    
Fixed.....................      148       20,766,851.39      6.65      7.534       632    
Fixed IO..................       26        5,463,591.38      1.75      7.139       657    
                              -----     ---------------    ------      -----       ---    
     Total:...............    1,964     $312,063,230.01    100.00%     7.370%      642    
                              =====     ===============    ======      =====       ===    


                                Average     Weighted                                      
                               Principal     Average      Percent                         
                                Balance     Original        Full                          
Product Types                 Outstanding      LTV     Documentation                      
----------------------------  -----------   --------   -------------                      
                                                                                          
2/28 LIBOR ARM............    $142,336.63    81.99%       56.66%                          
2/28 LIBOR IO ARM.........     204,809.12    80.78        51.93                           
30/15 BALLOON.............      37,534.26    99.36        20.43                           
3/27 LIBOR ARM............     143,114.02    82.56        62.53                           
3/27 LIBOR IO ARM.........     200,347.27    79.99        60.23                           
5/1 TREASURY ARM..........     195,049.00    77.58        56.98                           
5/1 TREASURY IO ARM.......     204,906.29    75.97        67.43                           
Fixed.....................     140,316.56    78.26        74.33                           
Fixed IO..................     210,138.13    79.72        69.22                           
                              -----------    -----        -----                           
     Total:...............    $158,891.66    81.38%       55.32%                          
                              ===========    =====        =====                           

Amortization Type for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
                               Mortgage       Balance        Mortgage  Average    Credit 
Amortization Types              Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
Fully Amortizing........         784     $111,634,247.95      35.77%     7.578%     629  
30/15 Balloon...........         244       9,158,358.30        2.93      9.989      717  
5 Year IO...............         936     191,270,623.76       61.29      7.123      646  
                               -----     ---------------     ------      -----      ---  
     Total:.............       1,964     $312,063,230.01     100.00%     7.370%     642  
                               =====     ===============     ======      =====      ===  


                                Average     Weighted                                     
                               Principal     Average      Percent                        
                                Balance     Original        Full                         
Amortization Types            Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
Fully Amortizing........      $142,390.62     81.33%       60.70%                        
30/15 Balloon...........        37,534.26     99.36        20.43                         
5 Year IO...............       204,348.96     80.54        53.85                         
                              -----------     -----        -----                         
     Total:.............      $158,891.66     81.38%       55.32%                        
                              ===========     =====        =====                         

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State Distribution of Mortgaged Properties for the
Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
State Distributions            Mortgage       Balance        Mortgage  Average    Credit 
of Mortgaged Properties         Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
Arizona...............            166     $27,154,063.31     8.70%     7.429%     634    
Arkansas..............              4         322,798.02     0.10      8.505      573    
California............            295      72,681,200.19    23.29      6.947      643    
Colorado..............            131      18,695,459.28     5.99      7.236      658    
Connecticut...........              1         147,200.00     0.05      8.900      550    
Florida...............            132      19,318,661.42     6.19      7.392      643    
Georgia...............             64       7,963,703.07     2.55      7.436      628    
Idaho.................             11       1,353,645.29     0.43      7.207      623    
Illinois..............            220      34,169,558.09    10.95      7.741      648    
Indiana...............             12       1,056,284.70     0.34      7.954      630    
Iowa..................             36       3,384,728.37     1.08      8.324      610    
Kansas................             47       4,782,021.21     1.53      8.054      630    
Kentucky..............              2         228,000.87     0.07      9.002      552    
Louisiana.............              1         113,855.59     0.04      8.300      641    
Maine.................              3         202,948.36     0.07      8.683      600    
Maryland..............             55      10,730,327.42     3.44      7.687      646    
Massachusetts.........             56      11,491,140.49     3.68      7.601      649    
Michigan..............             45       5,779,306.96     1.85      7.793      638    
Minnesota.............             43       6,406,719.90     2.05      7.134      654    
Mississippi...........              2         196,248.61     0.06      7.369      640    
Missouri..............             80       7,818,584.25     2.51      8.095      610    
Nebraska..............             17       1,415,790.44     0.45      7.816      648    
Nevada................             43       7,687,365.56     2.46      7.095      645    
New Hampshire.........             13       1,922,691.16     0.62      7.328      645    
New Jersey............             13       2,559,290.98     0.82      7.763      666    
New Mexico............              2         246,831.78     0.08      7.959      629    
North Carolina........              6         764,817.10     0.25      7.396      626    
Ohio..................              2         371,876.12     0.12      7.711      670    
Oklahoma..............              5         478,723.31     0.15      7.629      602    
Oregon................             34       5,165,565.58     1.66      7.225      654    
Pennsylvania..........              4         501,570.90     0.16      7.380      603    
Rhode Island..........             10       2,253,985.94     0.72      6.784      645    
South Carolina........              1         123,250.00     0.04      7.250      626    
South Dakota..........              1         111,017.17     0.04      7.000      586    
Tennessee.............             16       1,405,113.27     0.45      8.524      617    
Texas.................            142      12,266,467.34     3.93      7.541      640    
Utah..................             19       2,024,679.10     0.65      7.520      634    
Vermont...............              3         550,381.47     0.18      8.628      639    
Washington............            173      28,175,665.92     9.03      7.198      645    
Virginia..............             38       7,887,522.97     2.53      7.179      650    
West Virginia.........              3         597,251.75     0.19      8.119      614    
Wisconsin.............             12       1,398,916.76     0.45      7.796      620    
Wyoming...............              1         158,000.00     0.05      6.550      633    
                                -----    ---------------   ------      -----      ---    
     Total:...........          1,964    $312,063,230.01   100.00%     7.370%     642    
                                =====    ===============   ======      =====      ===    


                                Average     Weighted                                     
                               Principal     Average      Percent                        
State Distributions             Balance     Original        Full                         
of Mortgaged Properties       Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
Arizona...............         $163,578.69     81.68%       65.21%                       
Arkansas..............           80,699.50     88.59       100.00                        
California............          246,376.95     78.01        47.51                        
Colorado..............          142,713.43     82.69        53.46                        
Connecticut...........          147,200.00     80.00         0.00                        
Florida...............          146,353.50     81.37        50.32                        
Georgia...............          124,432.86     82.89        72.15                        
Idaho.................          123,058.66     80.21        45.39                        
Illinois..............          155,316.17     82.83        43.81                        
Indiana...............           88,023.73     84.07        71.08                        
Iowa..................           94,020.23     82.99        75.24                        
Kansas................          101,745.13     82.69        69.13                        
Kentucky..............          114,000.44     89.41       100.00                        
Louisiana.............          113,855.59     95.00       100.00                        
Maine.................           67,649.45     91.42        37.25                        
Maryland..............          195,096.86     80.22        47.84                        
Massachusetts.........          205,198.94     82.59        38.44                        
Michigan..............          128,429.04     85.57        58.64                        
Minnesota.............          148,993.49     82.46        63.33                        
Mississippi...........           98,124.30     84.10       100.00                        
Missouri..............           97,732.30     84.85        76.17                        
Nebraska..............           83,281.79     83.63        77.69                        
Nevada................          178,775.94     80.41        66.26                        
New Hampshire.........          147,899.32     86.25        50.70                        
New Jersey............          196,868.54     81.32        35.72                        
New Mexico............          123,415.89     81.86       100.00                        
North Carolina........          127,469.52     83.50        89.28                        
Ohio..................          185,938.06     81.60        43.53                        
Oklahoma..............           95,744.66     83.14        84.61                        
Oregon................          151,928.40     82.84        48.37                        
Pennsylvania..........          125,392.72     82.01        75.97                        
Rhode Island..........          225,398.59     79.34        51.97                        
South Carolina........          123,250.00     85.00       100.00                        
South Dakota..........          111,017.17     80.00       100.00                        
Tennessee.............           87,819.58     85.80        75.67                        
Texas.................           86,383.57     80.95        58.43                        
Utah..................          106,562.06     85.17        78.10                        
Vermont...............          183,460.49     85.06        28.11                        
Washington............          162,865.12     82.73        69.92                        
Virginia..............          207,566.39     81.82        43.98                        
West Virginia.........          199,083.92     90.47       100.00                        
Wisconsin.............          116,576.40     82.37        79.25                        
Wyoming...............          158,000.00     79.00       100.00                        
                               -----------     -----       ------                        
     Total:...........         $158,891.66     81.38%       55.32%                       
                               ===========     =====       ======                        

        No more than approximately 0.53% of the Group 1 Mortgage Loans will be
secured by mortgaged properties located in any one zip code.                    

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Original Loan-to-Value Ratios for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                          Aggregate       Percent             Weighted
                           Number of      Principal          of     Weighted   Average
Range of Original           Mortgage       Balance        Mortgage  Average    Credit 
Loan-to-Value Ratios         Loans       Outstanding        Pool     Coupon     Score 
----------------------     ---------   ---------------   ---------  --------  --------
                                                                                      
50.00% or less........         25      $4,234,662.81        1.36%    7.222%      606  
50.01% to 55.00%......         14       3,074,059.45        0.99     6.882       614  
55.01% to 60.00%......         26       4,660,273.60        1.49     7.383       605  
60.01% to 65.00%......         22       4,202,627.90        1.35     7.394       624  
65.01% to 70.00%......         63      12,106,007.09        3.88     7.473       619  
70.01% to 75.00%......        104      14,579,235.29        4.67     7.447       612  
75.01% to 80.00%......        873     149,014,659.62       47.75     7.081       652  
80.01% to 85.00%......        223      42,242,828.12       13.54     7.303       642  
85.01% to 90.00%......        292      55,714,974.15       17.85     7.601       631  
90.01% to 95.00%......         85      13,369,976.01        4.28     8.064       621  
95.01% to 100.00%.....        237       8,863,925.97        2.84     9.987       718  
                            -----    ---------------      ------     -----       ---  
      Total:..........      1,964    $312,063,230.01      100.00%    7.370%      642  
                            =====    ===============      ======     =====       ===  


                          Average     Weighted                                        
                         Principal     Average      Percent                           
Range of Original         Balance     Original        Full                            
Loan-to-Value Ratios    Outstanding      LTV     Documentation                        
----------------------  -----------   --------   -------------                        
                                                                                      
50.00% or less........  $169,386.51     43.08%       52.33%                           
50.01% to 55.00%......   219,575.68     53.13        50.49                            
55.01% to 60.00%......   179,241.29     57.83        65.51                            
60.01% to 65.00%......   191,028.54     62.62        65.95                            
65.01% to 70.00%......   192,158.84     68.99        43.25                            
70.01% to 75.00%......   140,184.95     73.78        57.51                            
75.01% to 80.00%......   170,692.62     79.76        53.23                            
80.01% to 85.00%......   189,429.72     84.53        52.25                            
85.01% to 90.00%......   190,804.71     89.73        63.00                            
90.01% to 95.00%......   157,293.84     94.59        83.33                            
95.01% to 100.00%.....    37,400.53     99.94        20.32                            
                        -----------     -----        -----                            
      Total:..........  $158,891.66     81.38%       55.32%                           
                        ===========     =====        =====                            

        As of the Cut-off Date, the Original Loan-to-Value Ratios of the Group
1 Mortgage Loans ranged from 30.33% to 100.00% and the weighted average Original
Loan-to-Value of the Group 1 Mortgage Loans was approximately 81.38%.           

Combined Loan-to-Value Ratios for the Group 1 Statistical Mortgage Loans

                                                                [Download Table]

                                      Aggregate       Percent             Weighted
                       Number of      Principal          of     Weighted   Average
Range of Combined       Mortgage       Balance        Mortgage  Average    Credit 
Loan-to-Value Ratios     Loans       Outstanding        Pool     Coupon     Score 
---------------------  ---------   ---------------   ---------  --------  --------
                                                                                  
50.00% or less.......     24        $4,147,758.40       1.33%    7.185%      607  
50.01% - 55.00%......     15         3,160,963.85       1.01     6.940       612  
55.01% - 60.00%......     26         4,660,273.60       1.49     7.383       605  
60.01% - 65.00%......     21         4,099,222.90       1.31     7.398       622  
65.01% - 70.00%......     57        11,538,926.42       3.70     7.393       620  
70.01% - 75.00%......     68        11,969,613.18       3.84     7.436       607  
75.01% - 80.00%......    196        38,908,209.09      12.47     7.431       629  
80.01% - 85.00%......    119        22,154,986.64       7.10     7.468       627  
85.01% - 90.00%......    243        47,990,428.29      15.38     7.578       631  
90.01% - 95.00%......    122        21,257,701.59       6.81     7.704       635  
95.01% - 100.00%.....  1,073       142,175,146.04      45.56     7.223       661  
                       -----      ---------------     ------     -----       ---  
     Total:..........  1,964      $312,063,230.01     100.00%    7.370%      642  
                       =====      ===============     ======     =====       ===  


                         Average     Weighted                                     
                        Principal     Average      Percent                        
Range of Combined        Balance     Original        Full                         
Loan-to-Value Ratios   Outstanding      LTV     Documentation                     
---------------------  -----------   --------   -------------                     
                                                                                  
50.00% or less.......  $172,823.27     43.09%       51.33%                        
50.01% - 55.00%......   210,730.92     52.84        51.85                         
55.01% - 60.00%......   179,241.29     57.83        65.51                         
60.01% - 65.00%......   195,201.09     62.63        67.61                         
65.01% - 70.00%......   202,437.31     68.95        42.01                         
70.01% - 75.00%......   176,023.72     73.64        56.03                         
75.01% - 80.00%......   198,511.27     79.31        47.75                         
80.01% - 85.00%......   186,176.36     84.35        56.05                         
85.01% - 90.00%......   197,491.47     89.20        59.70                         
90.01% - 95.00%......   174,243.46     89.63        70.47                         
95.01% - 100.00%.....   132,502.47     82.33        54.07                         
                       -----------     -----        -----                         
     Total:..........  $158,891.66     81.38%       55.32%                        
                       ===========     =====        =====                         

        As of the Cut-off Date, the Combined Loan-to-Value Ratios of the Group
1 Mortgage Loans ranged from 30.33% to 100.00% and the weighted average Combined
Loan-to-Value of the Group 1 Mortgage Loans was approximately 89.81%.           

 Loan Purpose for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
                               Mortgage       Balance        Mortgage  Average    Credit 
Loan Purpose                    Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
Purchase....................     1,022   $131,593,397.81      42.17%    7.372%      659  
Refinance - Rate/Term.......       726    138,507,111.61      44.38     7.396       630  
Refinance - Cashout.........       216     41,962,720.60      13.45     7.276       630  
                                 -----   ---------------     ------     -----       ---  
     Total:.................     1,964   $312,063,230.01     100.00%    7.370%      642  
                                 =====   ===============     ======     =====       ===  


                                Average     Weighted                                     
                               Principal     Average      Percent                        
                                Balance     Original        Full                         
Loan Purpose                  Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
Purchase....................  $128,760.66     82.74%       49.95%                        
Refinance - Rate/Term.......   190,781.15     80.66        58.88                         
Refinance - Cashout.........   194,271.85     79.47        60.44                         
                              -----------     -----        -----                         
     Total:.................  $158,891.66     81.38%       55.32%                        
                              ===========     =====        =====                         

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Types of Mortgaged Properties for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
                               Mortgage       Balance        Mortgage  Average    Credit 
Property Type                   Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
Single Family Detached......     1,373    $208,261,766.05     66.74%    7.402%     637   
Planned Unit Development....       291     49,210,629.16      15.77     7.247      645   
Two-to-Four Family..........       107     26,822,139.79       8.60     7.377      669   
Condominium.................       167     24,456,916.45       7.84     7.332      652   
Single Family Attached......        18      2,136,347.15       0.68     7.403      652   
Townhouse...................         8      1,175,431.42       0.38     7.339      625   
                                 -----   ---------------     ------     -----      ---   
    Total:..................     1,964   $312,063,230.01     100.00%    7.370%     642   
                                 =====   ===============     ======     =====      ===   


                                Average     Weighted                                     
                               Principal     Average      Percent                        
                                Balance     Original        Full                         
Property Type                 Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
Single Family Detached......  $151,683.73     81.29%       58.25%                        
Planned Unit Development....   169,108.69     81.51        58.26                         
Two-to-Four Family..........   250,674.20     80.81        27.27                         
Condominium.................   146,448.60     81.96        52.68                         
Single Family Attached......   118,685.95     84.90        77.43                         
Townhouse...................   146,928.93     86.05        69.38                         
                              -----------     -----        -----                         
    Total:..................  $158,891.66     81.38%       55.32%                        
                              ===========     =====        =====                         

Documentation Summary for the Group 1 Statistical Mortgage Loans    

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
                               Mortgage       Balance        Mortgage  Average    Credit 
Documentaton                    Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
Full Documentation..........    1,107     $172,642,754.32     55.32%     7.230%    621   
Stated Income Wage Earner         542       81,940,583.03     26.26      7.594     680   
Stated Income Self-Employed.      215       39,144,443.55     12.54      7.439     665   
12 Month Bank Statements....       73       13,139,821.60      4.21      7.528     624   
24 Month Bank Statements....       24        4,705,965.85      1.51      7.591     620   
Limited Documentation.......        3          489,661.66      0.16      7.240     650   
                                -----     ---------------    ------      -----     ---   
     Total:.................    1,964     $312,063,230.01    100.00%     7.370%    642   
                                =====     ===============    ======      =====     ===   


                                Average     Weighted                                     
                               Principal     Average      Percent                        
                                Balance     Original        Full                         
Documentaton                  Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
Full Documentation..........  $155,955.51     81.53%      100.00%                        
Stated Income Wage Earner      151,181.89     81.58         0.00                         
Stated Income Self-Employed.   182,067.18     80.14         0.00                         
12 Month Bank Statements....   179,997.56     82.00         0.00                         
24 Month Bank Statements....   196,081.91     81.05         0.00                         
Limited Documentation.......   163,220.55     81.29         0.00                         
                              -----------     -----        -----                         
     Total:.................  $158,891.66     81.38%       55.32%                        
                              ===========     =====        =====                         

Occupancy Types for the Group 1 Statistical Mortgage Loans

                                                                [Download Table]

                                       Aggregate      Percent             Weighted
                         Number of     Principal         of     Weighted   Average
                          Mortgage      Balance       Mortgage  Average    Credit 
Occupancy                  Loans      Outstanding       Pool     Coupon     Score 
-----------------------  ---------  ---------------  ---------  --------  --------
                                                                                  
Primary Home...........    1,871    $295,912,296.33    94.82%     7.342%     641  
Investment Property....       93      16,150,933.69     5.18      7.868      665  
                           -----    ---------------   ------      -----      ---  
     Total:............    1,964    $312,063,230.01   100.00%     7.370%     642  
                           =====    ===============   ======      =====      ===  


                                                                [Download Table]

                              Average     Weighted                
                             Principal     Average      Percent   
                              Balance     Original        Full    
Occupancy                   Outstanding      LTV     Documentation
-----------------------     -----------   --------   -------------
                                                                  
Primary Home...........     $158,157.29     81.67%       56.78%   
Investment Property....      173,665.95     76.11        28.54    
                            -----------     -----         -----   
     Total:............     $158,891.66     81.38%       55.32%   
                            ===========     =====         =====   

         The information set forth above with respect to occupancy is based upon
representations of the related mortgagors at the time of origination.           

Mortgage Loan Age Summary for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
Mortgage Loans                 Mortgage       Balance        Mortgage  Average    Credit 
Age Summary                     Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
0........................       124       $19,144,036.00       6.13%    7.580%      655  
1........................       891        142,447,128.79      45.65    7.361       644  
2........................       741        114,433,868.44      36.67    7.434       638  
3........................       200         34,030,993.97      10.91    7.093       640  
4........................         8          2,007,202.82       0.64    7.031       619  
                              -----       ---------------     ------    -----       ---  
      Total:.............     1,964       $312,063,230.01     100.00%   7.370%      642  
                              =====       ===============     ======    =====       ===  


                                Average     Weighted                                     
                               Principal     Average      Percent                        
Mortgage Loans                  Balance     Original        Full                         
Age Summary                   Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
0........................     $154,387.39     81.14%      42.41%                         
1........................      159,873.32     81.47       55.39                          
2........................      154,431.67     81.40       56.16                          
3........................      170,154.97     81.00       59.98                          
4........................      250,900.35     82.24       47.13                          
                              -----------     -----       -----                          
      Total:.............     $158,891.66     81.38%      55.32%                         
                              ===========     =====       =====                          

 As of the Cut-off Date, the weighted average age of the Group 1
Mortgage Loans was approximately 2 months.                                      

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 Original Prepayment Penalty Term for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent                Weighted
                              Number of      Principal          of     Weighted      Average
Original Prepayment            Mortgage       Balance        Mortgage  Average       Credit 
Penalty Term                    Loans       Outstanding        Pool     Coupon        Score 
----------------------------  ---------   ---------------   ---------  --------     --------
                                                                                            
None.......................       548      $73,589,780.35      23.58%       7.897%     648  
6 Months...................        46        4,759,013.81       1.53        8.041      630  
12 Months..................        25        5,911,097.98       1.89        7.116      656  
24 Months..................     1,090      186,235,463.78      59.68        7.188      639  
30 Months..................         1          180,000.00       0.06        7.450      597  
36 Months..................       254       41,387,874.09      13.26        7.209      644  
                                -----     ---------------     ------        -----      ---  
     Total:................     1,964     $312,063,230.01     100.00%       7.370%     642  
                                =====     ===============     ======        =====      ===  


                                Average      Weighted                                       
                               Principal      Average      Percent                          
Original Prepayment             Balance      Original        Full                           
Penalty Term                  Outstanding       LTV     Documentation                       
----------------------------  -----------    --------   -------------                       
                                                                                            
None.......................   $134,287.92      83.26%       45.14%                          
6 Months...................    103,456.82      82.63        69.46                           
12 Months..................    236,443.92      81.38        45.56                           
24 Months..................    170,858.22      80.98        56.33                           
30 Months..................    180,000.00      80.00       100.00                           
36 Months..................    162,944.39      79.69        68.47                           
                              -----------      -----       ------                           
     Total:................   $158,891.66      81.38%       55.32%                          
                              ===========      =====       ======                           

  The weighted average prepayment penalty term at origination with
respect to the Group 1 Mortgage Loans having prepayment penalties is            
approximately 25 months.                                                        

Credit Scores for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                             Aggregate       Percent             Weighted
                              Number of      Principal          of     Weighted   Average
                               Mortgage       Balance        Mortgage  Average    Credit 
Range of Credit Scores          Loans       Outstanding        Pool     Coupon     Score 
----------------------------  ---------   ---------------   ---------  --------  --------
                                                                                         
501 to 525..................        9       $1,084,930.63      0.35%     9.520%     512  
526 to 550..................       50        7,169,069.73      2.30      8.617      543  
551 to 575..................      161       27,686,596.69      8.87      7.932      563  
576 to 600..................      231       37,103,615.60     11.89      7.454      589  
601 to 625..................      319       55,229,720.27     17.70      7.235      613  
626 to 650..................      292       50,148,638.05     16.07      7.161      638  
651 to 675..................      267       50,063,012.63     16.04      7.126      662  
676 to 700..................      268       37,089,372.67     11.89      7.381      687  
701 to 725..................      174       22,514,979.28      7.21      7.398      711  
726 to 750..................      101       12,900,262.38      4.13      7.297      736  
751 to 775..................       52        6,209,572.37      1.99      7.265      759  
776 to 800..................       39        4,512,459.72      1.45      7.546      785  
801 to 825..................        1          351,000.00      0.11      6.800      804  
                                -----     ---------------    ------      -----      ---  
     Total:.................    1,964     $312,063,230.01    100.00%     7.370%     642  
                                =====     ===============    ======      =====      ===  


                                Average     Weighted                                     
                               Principal     Average      Percent                        
                                Balance     Original        Full                         
Range of Credit Scores        Outstanding      LTV     Documentation                     
----------------------------  -----------   --------   -------------                     
                                                                                         
501 to 525..................  $120,547.85     66.46%       100.00%                       
526 to 550..................   143,381.39     78.81         69.89                        
551 to 575..................   171,966.44     79.05         75.86                        
576 to 600..................   160,621.71     80.11         77.82                        
601 to 625..................   173,133.92     81.41         78.88                        
626 to 650..................   171,741.91     81.31         65.07                        
651 to 675..................   187,501.92     81.40         42.97                        
676 to 700..................   138,393.18     82.89         24.54                        
701 to 725..................   129,396.43     82.79         21.92                        
726 to 750..................   127,725.37     83.49         19.66                        
751 to 775..................   119,414.85     83.82         28.14                        
776 to 800..................   115,704.10     84.40          6.38                        
801 to 825..................   351,000.00     90.00        100.00                        
                              -----------     -----        ------                        
     Total:.................  $158,891.66     81.38%        55.32%                       
                              ===========     =====        ======                        

        The Credit Scores of the Group 1 Mortgage Loans that were scored As of
the Cut-off Date ranged from 503 to 804 and the weighted average Credit Score of
the Group 1 Mortgage Loans that were scored As of the Cut-off Date was          
approximately 642.                                                              

 Credit Grade Summary for the Group 1 Statistical Mortgage Loans

                                                                [Download Table]

                                  Aggregate                               Weighted
                    Number of     Principal                     Weighted  Average 
                    Mortgage       Balance        Percent of    Average   Credit  
Credit Grade          Loans      Outstanding     Mortgage Pool   Coupon    Score  
------------------  ---------   ---------------  -------------  --------  --------
                                                                                  
A.................   1,816      $284,526,419.63       91.18%      7.313%      648 
A-................      87        16,650,178.33        5.34       7.734       596 
B.................      42         8,044,805.70        2.58       7.788       579 
C.................      15         2,158,695.52        0.69       9.580       537 
D.................       4           683,130.83        0.22      10.040       551 
                     -----      ---------------      ------      ------       --- 
     Total:.......   1,964      $312,063,230.01      100.00%      7.370%      642 
                     =====      ===============      ======      ======       === 


                      Average                                                     
                     Principal       Weighted       Percent                       
                      Balance        Average          Full                        
Credit Grade        Outstanding    Original LTV  Documentation                    
------------------  ------------   ------------  -------------                    
                                                                                  
A.................   $156,677.54       81.98%         54.20%                      
A-................    191,381.36       78.40          65.81                       
B.................    191,542.99       70.12          63.23                       
C.................    143,913.03       71.72          78.90                       
D.................    170,782.71       65.61         100.00                       
                     -----------       -----         -------                      
     Total:.......   $158,891.66       81.38%         55.32%                      
                     ===========       =====         =======                      

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Gross Margins for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                    Aggregate                                Weighted
                      Number of     Principal                      Weighted  Average 
                      Mortgage       Balance         Percent of    Average   Credit  
Range of Margins        Loans      Outstanding      Mortgage Pool   Coupon     Score 
------------------    ---------   ---------------   -------------  --------  --------
                                                                                     
2.501% to 3.000%.....         3        $450,203.42        0.16%     7.414%    612    
3.001% to 3.500%.....         4         465,986.41        0.17      7.335     641    
3.501% to 4.000%.....        75      11,783,505.40        4.26      7.385     661    
4.001% to 4.500%.....         1         310,593.64        0.11      7.800     614    
5.001% to 5.500%.....       246      49,566,194.10       17.91      7.239     617    
5.501% to 6.000%.....       804     157,196,833.35       56.82      7.158     643    
6.001% to 6.500%.....       412      56,785,257.62       20.52      7.603     647    
6.501% to 7.000%.....         1         115,855.00        0.04      6.850     634    
                          -----   ----------------      ------      -----     ---    
     Total:..........     1,546    $276,674,428.94      100.00%     7.275%    640    
                          =====   ================      ======      =====     ===    


                        Average                                                      
                       Principal       Weighted        Percent                       
                        Balance        Average           Full                        
Range of Margins      Outstanding    Original LTV   Documentation                    
------------------    ------------   ------------   -------------                    
                                                                                     
2.501% to 3.000%..... $150,067.81       79.86%         100.00%                       
3.001% to 3.500%.....  116,496.60       80.00           43.74                        
3.501% to 4.000%.....  157,113.41       80.20           47.64                        
4.001% to 4.500%.....  310,593.64       75.00            0.00                        
5.001% to 5.500%.....  201,488.59       83.06           73.65                        
5.501% to 6.000%.....  195,518.45       80.70           52.36                        
6.001% to 6.500%.....  137,828.30       80.50           46.43                        
6.501% to 7.000%.....  115,855.00       85.00          100.00                        
                      -----------       -----          ------                        
     Total:.......... $178,961.47       81.05%          54.78%                       
                      ===========       =====          ======                        

      As of the Cut-off Date, the Gross Margins for the Group 1 Adjustable
Rate Mortgage Loans ranged from 3.000% per annum to 6.750% per annum and the    
weighted average Gross Margin of the Group 1 Adjustable Rate Mortgage Loans was 
approximately 5.755% per annum.                                                 

 Maximum Mortgage Rates for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                     Aggregate                               Weighted
                       Number of     Principal                     Weighted  Average 
Range of Maximum       Mortgage       Balance        Percent of    Average   Credit  
Mortgage Rates           Loans      Outstanding     Mortgage Pool   Coupon     Score 
---------------------  ---------   ---------------  -------------  --------  --------
                                                                                     
12.001% to 12.500%...     217       $45,424,539.01     16.42%       6.378%      655  
12.501% to 13.000%...     464        88,471,632.98     31.98        6.822       655  
13.001% to 13.500%...     314        56,090,035.53     20.27        7.304       641  
13.501% to 14.000%...     283        50,141,120.01     18.12        7.795       628  
14.001% to 14.500%...     113        16,963,876.94      6.13        8.287       612  
14.501% to 15.000%...      88        12,131,340.84      4.38        8.776       600  
15.001% to 15.500%...      28         3,550,448.95      1.28        9.303       580  
15.501% to 16.000%...      24         2,470,518.57      0.89        9.754       562  
16.001% to 16.500%...      12         1,106,892.92      0.40       10.340       537  
16.501% to 17.000%...       3           324,023.20      0.12       10.573       547  
                        -----      ---------------    ------       ------       ---  
     Total:..........   1,546      $276,674,428.94    100.00%       7.275%      640  
                        =====      ===============    ======       ======       ===  


                         Average                                                     
                        Principal       Weighted       Percent                       
Range of Maximum         Balance        Average          Full                        
Mortgage Rates         Outstanding    Original LTV  Documentation                    
---------------------  ------------   ------------  -------------                    
                                                                                     
12.001% to 12.500%...  $209,329.67        79.07%       74.65%                        
12.501% to 13.000%...   190,671.62        80.09        56.08                         
13.001% to 13.500%...   178,630.69        80.44        50.22                         
13.501% to 14.000%...   177,177.10        83.02        40.92                         
14.001% to 14.500%...   150,122.80        84.87        48.38                         
14.501% to 15.000%...   137,856.15        85.52        50.97                         
15.001% to 15.500%...   126,801.75        79.44        61.77                         
15.501% to 16.000%...   102,938.27        83.09        72.86                         
16.001% to 16.500%...    92,241.08        74.12        78.66                         
16.501% to 17.000%...   108,007.73        79.35        26.90                         
                       -----------        -----        -----                         
     Total:..........  $178,961.47        81.05%       54.78%                        
                       ===========        =====        =====                         

    As of the Cut-off Date, the Maximum Mortgage Rates for the Group 1
Adjustable Rate Mortgage Loans ranged from 12.150% per annum to 16.600% per     
annum and the weighted average Maximum Mortgage Rate of the Group 1 Adjustable  
Rate Mortgage Loans was approximately 13.275% per annum                         

Next Rate Adjustment Date for the Group 1 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                    Aggregate                                 Weighted
                      Number of     Principal                       Weighted  Average 
Next Rate             Mortgage       Balance         Percent of     Average   Credit  
Adjustment Date         Loans      Outstanding      Mortgage Pool    Coupon     Score 
------------------    ---------   ---------------   -------------   --------  --------
                                                                                      
July 2007............         3       $719,920.00       0.26%     7.625%      624     
August 2007..........        92     17,789,891.69       6.43      6.867       638     
September 2007.......       463     80,389,630.81      29.06      7.336       637     
October 2007.........       651    117,727,831.54      42.55      7.268       641     
November 2007........        85     15,222,838.00       5.50      7.470       652     
July 2008............         4        972,282.82       0.35      6.748       600     
August 2008..........        61     12,070,676.70       4.36      7.184       634     
September 2008.......       114     18,434,018.46       6.66      7.448       631     
October 2008.........        45      7,883,434.44       2.85      7.296       652     
November 2008........         4        595,440.00       0.22      6.987       687     
August 2010..........         4        834,399.46       0.30      6.591       652     
September 2010.......        11      2,182,470.56       0.79      6.839       673     
October 2010.........         7      1,444,094.46       0.52      7.164       675     
November 2010........         2        407,500.00       0.15      7.491       655     
                          -----   ---------------     ------      -----       ---     
     Total:..........     1,546   $276,674,428.94     100.00%     7.275%      640     
                          =====   ===============     ======      =====       ===     


                       Average                                                        
                      Principal       Weighted        Percent                         
Next Rate              Balance        Average           Full                          
Adjustment Date      Outstanding    Original LTV   Documentation                      
------------------   -----------    ------------   -------------                      
                                                                                      
July 2007............$239,973.33        82.27%        30.56%                          
August 2007.......... 193,368.39        81.76         60.92                           
September 2007....... 173,627.71        81.16         52.82                           
October 2007......... 180,841.52        81.10         54.42                           
November 2007........ 179,092.21        81.08         41.96                           
July 2008............ 243,070.70        79.69         42.28                           
August 2008.......... 197,879.95        79.99         58.42                           
September 2008....... 161,701.92        80.74         64.31                           
October 2008......... 175,187.43        82.86         60.30                           
November 2008........ 148,860.00        81.04         54.20                           
August 2010.......... 208,599.87        70.43        100.00                           
September 2010....... 198,406.41        81.56         61.51                           
October 2010......... 206,299.21        71.66         58.45                           
November 2010........ 203,750.00        76.54         39.26                           
                     -----------        -----         -----                           
     Total:..........$178,961.47        81.05%        54.78%                          
                     ===========        =====         =====                           

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The Group 2 Statistical Mortgage Loans

 Mortgage Rates for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                         Aggregate                           Weighted
                          Number of      Principal    Percent of  Weighted   Average 
                          Mortgage        Balance      Mortgage   Average     Credit 
Range of Mortgage Rates     Loans       Outstanding      Pool      Coupon     Score  
------------------------  ---------   --------------- ----------  ---------  --------
                                                                                     
6.001% to 6.500%........     364      $123,960,782.45    22.01%      6.390%      674 
6.501% to 7.000%........     660       195,246,059.39    34.66       6.808       663 
7.001% to 7.500%........     406       100,488,136.72    17.84       7.301       652 
7.501% to 8.000%........     334        71,212,901.12    12.64       7.767       625 
8.001% to 8.500%........     121        22,552,934.46     4.00       8.306       594 
8.501% to 9.000%........     116        15,085,707.55     2.68       8.786       596 
9.001% to 9.500%........     112        10,244,461.63     1.82       9.380       625 
9.501% to 10.000%.......     182        14,735,521.23     2.62       9.912       683 
10.001% to 10.500%......     103         6,952,529.90     1.23      10.279       683 
10.501% to 11.000%......      40         2,789,680.86     0.50      10.654       697 
                           -----      ---------------   ------      ------       --- 
     Total:.............   2,438      $563,268,715.32   100.00%      7.228%      654 
                           =====      ===============   ======      ======       === 


                            Average       Weighted                                   
                           Principal       Average      Percent                      
                            Balance       Original        Full                       
Range of Mortgage Rates   Outstanding        LTV     Documentation                   
------------------------   -----------    --------   -------------                   
                                                                                     
6.001% to 6.500%........    $340,551.60     80.99%        32.62%                     
6.501% to 7.000%........     295,827.36     81.64         28.00                      
7.001% to 7.500%........     247,507.73     82.96         32.33                      
7.501% to 8.000%........     213,212.28     83.40         34.94                      
8.001% to 8.500%........     186,387.89     85.02         49.02                      
8.501% to 9.000%........     130,049.20     86.20         57.23                      
9.001% to 9.500%........      91,468.41     89.07         43.47                      
9.501% to 10.000%.......      80,964.40     95.67         14.98                      
10.001% to 10.500%......      67,500.29     95.72          7.05                      
10.501% to 11.000%......      69,742.02     97.11          8.26                      
                            -----------     -----         -----                      
     Total:.............    $231,037.21     82.97%        31.88%                     
                            ===========     =====         =====                      

      As of the Cut-off Date, Mortgage Rates borne by the Group 2 Mortgage
Loans ranged from 6.150% per annum to 10.900% per annum and the weighted average
Mortgage Rate of the Group 2 Mortgage Loans was approximately 7.228% per annum. 

Lien Type for the Group 2 Mortgage Loans

                                                                [Download Table]

                                  Aggregate                               Weighted
                    Number of     Principal                     Weighted  Average 
                    Mortgage       Balance        Percent of    Average   Credit  
Lien Type             Loans      Outstanding     Mortgage Pool   Coupon     Score 
------------------  ---------   ---------------  -------------  --------  --------
                                                                                  
First.............    2,091     $538,511,732.02      95.60%      7.100%      652  
Second............      347       24,756,983.30       4.40       9.998       714  
                      -----     ---------------     ------       ------      ---  
     Total:.......    2,438     $563,268,715.32     100.00%      7.228%      654  
                      =====     ===============     ======       ======      ===  


                      Average                                                     
                     Principal       Weighted       Percent                       
                      Balance        Average          Full                        
Lien Type           Outstanding    Original LTV  Documentation                    
------------------  ------------   ------------  -------------                    
                                                                                  
First.............  $257,537.89       82.19%        33.18%                        
Second............    71,345.77       99.75          3.58                         
                    -----------       ------        -----                         
     Total:.......  $231,037.21       82.97%        31.88%                        
                    ===========       ======        =====                         

Outstanding Mortgage Loan Principal Balances for the
Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                         Aggregate                           Weighted
Range of Outstanding      Number of      Principal    Percent of  Weighted   Average 
Mortgage Loan             Mortgage        Balance      Mortgage   Average     Credit 
Prnicipal Balances          Loans       Outstanding      Pool      Coupon     Score  
------------------------  ---------   --------------- ----------  ---------  --------
                                                                                     
$50,000 or less..........     104       $3,890,215.97       0.69%     9.758%      690
$50,001 to $100,000......     499       37,607,725.30       6.68      8.740       648
$100,001 to $150,000.....     436       53,660,038.91       9.53      7.834       629
$150,001 to $200,000.....     286       49,374,337.46       8.77      7.374       626
$200,001 to $250,000.....     179       39,982,508.05       7.10      7.279       645
$250,001 to $300,000.....     164       44,581,159.91       7.91      7.121       655
$300,001 to $350,000.....     170       54,608,081.41       9.69      6.935       663
$350,001 to $400,000.....     205       76,971,276.10      13.67      6.932       653
$400,001 to $450,000.....     130       55,350,015.65       9.83      7.039       661
$450,001 to $500,000.....     105       50,150,099.15       8.90      6.883       665
$500,001 to $550,000.....      54       28,215,391.57       5.01      6.825       670
$550,001 to $600,000.....      41       23,472,069.07       4.17      6.878       671
$600,001 to $650,000.....      30       18,871,372.33       3.35      6.801       675
$650,001 to $700,000.....      11        7,455,123.26       1.32      6.836       664
$700,001 to $750,000.....      13        9,427,971.31       1.67      6.975       720
$750,001 to $800,000.....       3        2,383,400.00       0.42      6.846       682
$800,001 to $850,000.....       4        3,325,000.00       0.59      6.762       675
$850,001 to $900,000.....       2        1,746,200.00       0.31      6.872       656
$950,001 to $1,000,000...       1        1,000,000.00       0.18      6.850       669
Greater than or equal to                                                             
$1,000,001...............       1        1,196,729.87       0.21      6.500       648
                            -----     ---------------     ------      -----       ---
     Total:..............   2,438     $563,268,715.32     100.00%     7.228%      654
                            =====     ===============     ======      =====       ===


                            Average       Weighted                                   
Range of Outstanding       Principal       Average      Percent                      
Mortgage Loan               Balance       Original        Full                       
Prnicipal Balances        Outstanding        LTV     Documentation                   
------------------------   -----------    --------   -------------                   
                                                                                     
$50,000 or less..........      $37,405.92   92.39%        20.35%                     
$50,001 to $100,000......       75,366.18   87.10         51.45                      
$100,001 to $150,000.....      123,073.48   83.57         60.87                      
$150,001 to $200,000.....      172,637.54   81.35         61.55                      
$200,001 to $250,000.....      223,365.97   81.77         37.32                      
$250,001 to $300,000.....      271,836.34   82.49         23.25                      
$300,001 to $350,000.....      321,224.01   82.41         22.97                      
$350,001 to $400,000.....      375,469.64   81.91         28.86                      
$400,001 to $450,000.....      425,769.35   83.09         22.87                      
$450,001 to $500,000.....      477,619.99   82.62         14.44                      
$500,001 to $550,000.....      522,507.25   82.90          7.42                      
$550,001 to $600,000.....      572,489.49   83.73         12.15                      
$600,001 to $650,000.....      629,045.74   84.83         23.04                      
$650,001 to $700,000.....      677,738.48   81.92          0.00                      
$700,001 to $750,000.....      725,228.56   84.41         15.79                      
$750,001 to $800,000.....      794,466.67   87.67          0.00                      
$800,001 to $850,000.....      831,250.00   84.86         50.38                      
$850,001 to $900,000.....      873,100.00   82.48        100.00                      
$950,001 to $1,000,000...    1,000,000.00   80.00        100.00                      
Greater than or equal to                                                             
$1,000,001...............    1,196,729.87   62.34        100.00                      
                             ------------   -----        ------                      
     Total:..............     $231,037.21   82.97%        31.88%                     
                             ============   =====        ======                      

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         As of the Cut-off Date, the outstanding principal balances of the Group
2 Mortgage Loans ranged from approximately $19,978.07 to approximately          
$1,196,729.87 and the average outstanding principal balance of the Group 2      
Mortgage Loans was approximately $231,037.21.                                   

 Loan Program for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                      Aggregate                             Weighted 
                       Number of      Principal      Percent of   Weighted   Average 
                        Mortgage       Balance        Mortgage    Average    Credit  
Program                  Loans       Outstanding        Pool       Coupon      Score 
---------------------  ---------    ---------------  ----------   --------   --------
                                                                                     
High Street..........      616      $115,926,875.75      20.58%    7.225%       613  
Main Street..........      205        40,809,723.30       7.25     8.003        575  
Wall Street..........    1,617       406,532,116.27      72.17     7.151        674  
                         -----      ---------------     ------     -----        ---  
     Total:..........    2,438      $563,268,715.32     100.00%    7.228%       654  
                         =====      ===============     ======     =====        ===  


                        Average                                                      
                        Principal     Weighted        Percent                        
                         Balance      Average           Full                         
Program                Outstanding  Original LTV   Documentation                     
---------------------  -----------  ------------   -------------                     
                                                                                     
High Street..........  $188,192.98      82.57%         63.64%                        
Main Street..........   199,071.82      80.60          55.62                         
Wall Street..........   251,411.33      83.32          20.43                         
                       -----------      -----          -----                         
     Total:..........  $231,037.21      82.97%         31.88%                        
                       ===========      =====          =====                         

Product Types for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                         Aggregate                           Weighted
                          Number of      Principal    Percent of  Weighted   Average 
                          Mortgage        Balance      Mortgage   Average     Credit 
Product Types               Loans       Outstanding      Pool      Coupon     Score  
------------------------  ---------   --------------- ----------  ---------  --------
                                                                                     
2/28 LIBOR ARM...........     822       $140,648,850.48    24.97%     7.512%      614
2/28 LIBOR IO ARM........     845        301,453,657.59    53.52      6.880       672
30/15 BALLOON............     346         24,745,130.90     4.39      9.990       713
3/27 LIBOR ARM...........     124         21,288,636.97     3.78      7.528       614
3/27 LIBOR IO ARM........      91         33,802,914.86     6.00      6.923       668
5/1 TREASURY ARM.........       3          1,486,609.43     0.26      6.512       646
5/1 TREASURY IO ARM......      12          5,521,620.00     0.98      7.034       657
Fixed....................     184         30,450,874.77     5.41      7.358       632
Fixed IO.................      11          3,870,420.30     0.69      6.840       642
                            -----       ---------------   ------      -----       ---
     Total:..............   2,438       $563,268,715.32   100.00%     7.228%      654
                            =====       ===============   ======      =====       ===


                            Average       Weighted                                   
                           Principal       Average      Percent                      
                            Balance       Original        Full                       
Product Types             Outstanding        LTV     Documentation                   
------------------------   -----------    --------   -------------                   
                                                                                     
2/28 LIBOR ARM...........     $171,105.66   81.97%       53.60%                      
2/28 LIBOR IO ARM........      356,749.89   82.64        17.83                       
30/15 BALLOON............       71,517.72   99.68         3.85                       
3/27 LIBOR ARM...........      171,682.56   83.22        60.44                       
3/27 LIBOR IO ARM........      371,460.60   81.56        32.21                       
5/1 TREASURY ARM.........      495,536.48   65.78       100.00                       
5/1 TREASURY IO ARM......      460,135.00   84.45        51.25                       
Fixed....................      165,493.88   79.38        64.92                       
Fixed IO.................      351,856.39   80.92        41.51                       
                              -----------   -----       ------                       
     Total:..............     $231,037.21   82.97%       31.88%                      
                              ===========   =====       ======                       

Amortization Type for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                         Aggregate                           Weighted
                          Number of      Principal    Percent of  Weighted   Average 
                          Mortgage        Balance      Mortgage   Average     Credit 
Amortization Type           Loans       Outstanding      Pool      Coupon     Score  
------------------------  ---------   --------------- ----------  ---------  --------
                                                                                     
Fully Amortizing........    1,133     $193,874,971.67   34.42%       7.482%     617  
30/15 Balloon...........      346       24,745,130.90    4.39        9.990      713  
5 Year IO...............      959      344,648,612.75   61.19        6.886      671  
                            -----     ---------------  ------        -----      ---  
     Total:.............    2,438     $563,268,715.32  100.00%       7.228%     654  
                            =====     ===============  ======        =====      ===  


                            Average       Weighted                                   
                           Principal       Average      Percent                      
                            Balance       Original        Full                       
Amortization Type         Outstanding        LTV     Documentation                   
------------------------   -----------    --------   -------------                   
                                                                                     
Fully Amortizing........   $171,116.48      81.58%       56.49%                      
30/15 Balloon...........     71,517.72      99.68         3.85                       
5 Year IO...............    359,383.33      82.54        20.04                       
                          ------------      -----        -----                       
     Total:.............   $231,037.21      82.97%       31.88%                      
                          ============      =====        =====                       

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State Distribution of Mortgaged Properties for the
Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                       Aggregate                            Weighted 
                         Number of     Principal    Percent of    Weighted  Average  
State Distributions of   Mortgage       Balance      Mortgage     Average   Credit   
Mortgaged Properties       Loans      Outstanding      Pool        Coupon     Score  
-----------------------  ---------  --------------  ----------    --------  ---------
                                                                                     
Arizona................     146     $32,567,487.13     5.78%       7.240%       639  
Arkansas...............       7         803,629.16     0.14        8.154        616  
California.............     873     280,284,591.57    49.76        6.974        675  
Colorado...............      45       8,194,684.13     1.45        7.140        630  
Connecticut............       3         579,257.84     0.10        7.401        623  
Delaware...............       5         825,252.97     0.15        7.941        570  
Florida................     224      45,422,254.97     8.06        7.409        640  
Georgia................      58       8,499,679.69     1.51        7.267        630  
Idaho..................      19       2,810,523.51     0.50        7.212        610  
Illinois...............     176      36,456,502.73     6.47        7.737        652  
Indiana................      16       1,472,275.02     0.26        8.374        617  
Iowa...................      46       4,395,002.87     0.78        8.384        616  
Kansas.................      48       5,288,340.23     0.94        7.873        621  
Kentucky...............       8         732,460.73     0.13        7.933        604  
Louisiana..............       2         108,871.00     0.02        7.445        588  
Maine..................       6       1,060,508.14     0.19        7.847        614  
Maryland...............      34      10,532,979.78     1.87        7.409        640  
Massachusetts..........      44      12,767,176.28     2.27        7.598        626  
Michigan...............      30       4,702,271.92     0.83        7.769        623  
Minnesota..............      18       3,469,322.41     0.62        7.036        650  
Mississippi............       2         287,182.73     0.05        7.481        614  
Missouri...............      78      10,142,118.73     1.80        7.930        614  
Nebraska...............       8         779,159.87     0.14        7.728        598  
Nevada.................      26       5,221,285.64     0.93        7.194        620  
New Hampshire..........       9       2,235,590.74     0.40        7.440        608  
New Jersey.............      15       3,884,242.78     0.69        7.971        621  
New Mexico.............       7       1,578,408.49     0.28        7.479        608  
North Carolina.........       5         575,321.94     0.10        7.335        619  
North Dakota...........       1          66,462.91     0.01        8.900        614  
Ohio...................       1          87,900.45     0.02        8.850        555  
Oklahoma...............      12       1,580,487.73     0.28        7.578        605  
Oregon.................      30       5,685,230.95     1.01        6.915        622  
Pennsylvania...........      16       2,564,464.45     0.46        7.466        625  
Rhode Island...........       9       1,319,470.89     0.23        7.254        683  
South Carolina.........       6         864,497.14     0.15        7.164        619  
Tennessee..............      22       2,523,574.05     0.45        8.003        610  
Texas..................     195      23,033,732.96     4.09        7.393        632  
Utah...................      16       2,623,744.66     0.47        7.694        642  
Washington.............     121      24,744,313.40     4.39        7.306        634  
Virginia...............      44      11,614,240.36     2.06        7.468        653  
West Virginia..........       1         201,861.69     0.04        7.900        626  
Wisconsin..............       5         605,976.71     0.11        7.807        586  
Wyoming................       1          76,373.97     0.01        6.990        641  
                          -----    ---------------   ------        -----        ---  
    Total:.............   2,438    $563,268,715.32   100.00%       7.228%       654  
                          =====    ===============   ======        =====        ===  


                           Average                                                   
                          Principal     Weighted       Percent                       
State Distributions of     Balance      Average          Full                        
Mortgaged Properties     Outstanding  Original LTV  Documentation                    
-----------------------  -----------  ------------  -------------                    
                                                                                     
Arizona................  $223,064.98      81.98%      52.22%                         
Arkansas...............   114,804.17      82.77       52.27                          
California.............   321,059.10      83.40       15.51                          
Colorado...............   182,104.09      80.92       59.47                          
Connecticut............   193,085.95      85.84       21.11                          
Delaware...............   165,050.59      86.49       83.84                          
Florida................   202,777.92      82.43       31.30                          
Georgia................   146,546.20      83.20       50.07                          
Idaho..................   147,922.29      81.22       54.76                          
Illinois...............   207,139.22      83.17       38.24                          
Indiana................    92,017.19      81.39       79.02                          
Iowa...................    95,543.54      85.75       80.06                          
Kansas.................   110,173.75      83.32       77.47                          
Kentucky...............    91,557.59      82.44       84.36                          
Louisiana..............    54,435.50      70.84      100.00                          
Maine..................   176,751.36      79.33       52.75                          
Maryland...............   309,793.52      83.48       42.64                          
Massachusetts..........   290,163.10      81.92       24.98                          
Michigan...............   156,742.40      84.07       52.45                          
Minnesota..............   192,740.13      82.87       60.23                          
Mississippi............   143,591.37      88.21      100.00                          
Missouri...............   130,027.16      83.77       56.88                          
Nebraska...............    97,394.98      78.17       78.31                          
Nevada.................   200,818.68      82.31       77.48                          
New Hampshire..........   248,398.97      82.67       28.30                          
New Jersey.............   258,949.52      84.47       30.20                          
New Mexico.............   225,486.93      83.02      100.00                          
North Carolina.........   115,064.39      79.90       63.27                          
North Dakota...........    66,462.91      95.00      100.00                          
Ohio...................    87,900.45      80.00      100.00                          
Oklahoma...............   131,707.31      80.09       83.11                          
Oregon.................   189,507.70      81.45       58.79                          
Pennsylvania...........   160,279.03      82.25       52.99                          
Rhode Island...........   146,607.88      84.03       26.05                          
South Carolina.........   144,082.86      80.41       50.67                          
Tennessee..............   114,707.91      86.38       64.52                          
Texas..................   118,121.71      80.40       66.79                          
Utah...................   163,984.04      86.42       48.93                          
Washington.............   204,498.46      81.94       45.87                          
Virginia...............   263,960.01      84.02       41.03                          
West Virginia..........   201,861.69      83.47      100.00                          
Wisconsin..............   121,195.34      86.73      100.00                          
Wyoming................    76,373.97      79.27      100.00                          
                         -----------      -----      ------                          
    Total:.............  $231,037.21      82.97%      31.88%                         
                         ===========     ======      ======                          

        No more than approximately 0.82% of the Group 2 Mortgage Loans will be
secured by mortgaged properties located in any one zip code.                    

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Original Loan-to-Value Ratios for the Group 2 Statistical Mortgage Loans

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                                    Aggregate                             Weighted
                      Number of     Principal     Percent of    Weighted  Average 
Range of Original     Mortgage       Balance       Mortgage     Average   Credit  
Loan-to-Value Ratios    Loans      Outstanding       Pool        Coupon    Score  
--------------------  --------     -----------    ----------    --------  ------- 
                                                                                  
50.00% or less.......     21       $2,688,685.93     0.48%       7.484%       594 
50.01% to 55.00%.....      8        1,007,926.18     0.18        7.097        580 
55.01% to 60.00%.....     16        2,760,307.13     0.49        7.138        588 
60.01% to 65.00%.....     19        4,966,410.71     0.88        7.304        597 
65.01% to 70.00%.....     52       11,915,454.90     2.12        7.379        607 
70.01% to 75.00%.....     93       16,107,374.37     2.86        7.623        604 
75.01% to 80.00%.....  1,117      270,813,870.27    48.08        6.934        659 
80.01% to 85.00%.....    357      120,930,707.84    21.47        6.989        665 
85.01% to 90.00%.....    330       89,006,706.58    15.80        7.438        639 
90.01% to 95.00%.....    101       19,425,471.02     3.45        8.024        635 
95.01% to 100.00%....    324       23,645,800.39     4.20        9.992        714 
                       -----     ---------------   ------        -----        --- 
     Total:..........  2,438     $563,268,715.32   100.00%       7.228%       654 
                       =====     ===============   ======        =====        === 


                        Average                                                   
                       Principal     Weighted       Percent                       
Range of Original       Balance      Average          Full                        
Loan-to-Value Ratios  Outstanding  Original LTV  Documentation                    
--------------------  -----------  ------------  -------------                    
                                                                                  
50.00% or less....... $128,032.66      41.00%        77.71%                       
50.01% to 55.00%.....  125,990.77      52.94         64.33                        
55.01% to 60.00%.....  172,519.20      58.53         86.64                        
60.01% to 65.00%.....  261,390.04      62.95         53.63                        
65.01% to 70.00%.....  229,143.36      68.86         38.27                        
70.01% to 75.00%.....  173,197.57      73.80         43.42                        
75.01% to 80.00%.....  242,447.51      79.89         31.05                        
80.01% to 85.00%.....  338,741.48      84.83         21.49                        
85.01% to 90.00%.....  269,717.29      89.71         43.18                        
90.01% to 95.00%.....  192,331.40      94.86         55.62                        
95.01% to 100.00%....   72,980.87      99.99          3.75                        
                      -----------      -----         -----                        
     Total:.......... $231,037.21      82.97%        31.88%                       
                      ===========      =====         =====                        

        As of the Cut-off Date, the Original Loan-to-Value Ratios of the Group
2 Mortgage Loans ranged from 14.41% to 100.00% and the weighted average Original
Loan-to-Value of the Group 2 Mortgage Loans was approximately 82.97%.           

Combined Loan-to-Value Ratios for the Group 2 Statistical Mortgage Loans

                                                                [Download Table]

                                      Aggregate                             Weighted
                        Number of     Principal     Percent of    Weighted  Average 
Range of Combined       Mortgage       Balance       Mortgage     Average    Credit 
Loan-to-Value Ratios      Loans      Outstanding       Pool        Coupon    Score  
----------------------- ---------    -----------    ----------    -------   --------
                                                                                    
50.00% or less.........     21      $2,688,685.93      0.48%       7.484%      594  
50.01% - 55.00%........      8       1,007,926.18      0.18        7.097       580  
55.01% - 60.00%........     14       2,587,294.45      0.46        7.085       586  
60.01% - 65.00%........     18       3,769,680.85      0.67        7.559       581  
65.01% - 70.00%........     50      12,945,468.70      2.30        7.302       610  
70.01% - 75.00%........     59      13,577,995.31      2.41        7.668       595  
75.01% - 80.00%........    158      42,337,284.86      7.52        7.329       616  
80.01% - 85.00%........    111      29,486,405.72      5.23        7.429       611  
85.01% - 90.00%........    279      75,022,157.42     13.32        7.477       631  
90.01% - 95.00%........    160      38,084,184.72      6.76        7.557       652  
95.01% - 100.00%.......  1,560     341,761,631.18     60.67        7.082       675  
                         -----     ---------------   ------        -----       ---  
     Total:............  2,438     $563,268,715.32   100.00%       7.228%      654  
                         =====     ===============   ======        =====       ===  


                          Average                                                   
                         Principal     Weighted       Percent                       
Range of Combined         Balance      Average          Full                        
Loan-to-Value Ratios    Outstanding  Original LTV  Documentation                    
----------------------- -----------  ------------  --------------                   
                                                                                    
50.00% or less......... $128,032.66       41.00%        77.71%                      
50.01% - 55.00%........ 125,990.77        52.94         64.33                       
55.01% - 60.00%........ 184,806.75        58.48         89.73                       
60.01% - 65.00%........ 209,426.71        63.14         38.90                       
65.01% - 70.00%........ 258,909.37        68.26         43.18                       
70.01% - 75.00%........ 230,135.51        73.72         40.01                       
75.01% - 80.00%........ 267,957.50        79.56         39.23                       
80.01% - 85.00%........ 265,643.29        84.57         53.21                       
85.01% - 90.00%........ 268,896.62        88.80         44.87                       
90.01% - 95.00%........ 238,026.15        88.62         39.76                       
95.01% - 100.00%....... 219,077.97        83.09         23.67                       
                        -----------       -----         -----                       
     Total:............ $231,037.21       82.97%        31.88%                      
                        ===========       =====         =====                       

        As of the Cut-off Date, the Combined Loan-to-Value Ratios of the Group
2 Mortgage Loans ranged from 14.41% to 100.00% and the weighted average Combined
Loan-to-Value of the Group 2 Mortgage Loans was approximately 93.76%.           

 Loan Purpose for the Group 2 Statistical Mortgage Loans

                                                                [Download Table]


                                     Aggregate                             Weighted
                        Number of    Principal     Percent of    Weighted  Average 
                        Mortgage      Balance       Mortgage     Average   Credit  
Loan Purpose              Loans     Outstanding       Pool        Coupon    Score  
----------------------- ---------   -----------    ----------    --------  ------- 
                                                                                   
Purchase...............   1,797    $395,238,177.19   70.17%       7.186%      668  
Refinance - Rate/Term..     484     124,379,201.31   22.08        7.318       624  
Refinance - Cashout....     157      43,651,336.82    7.75        7.345       619  
                          -----    ---------------  ------        -----       ---  
     Total:............   2,438    $563,268,715.32  100.00%       7.228%      654  
                          =====    ===============  ======        =====       ===  


                          Average                                                  
                         Principal     Weighted       Percent                      
                          Balance      Average          Full                       
Loan Purpose            Outstanding  Original LTV  Documentation                   
----------------------- -----------  ------------  -------------                   
                                                                                   
Purchase............... $219,943.34      83.49%       24.99%                       
Refinance - Rate/Term..  256,981.82      81.58        49.35                        
Refinance - Cashout....  278,033.99      82.11        44.42                        
                        -----------      -----        -----                        
     Total:............ $231,037.21      82.97%       31.88%                       
                        ===========      =====        =====                        

II-18 

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Types of Mortgaged Properties for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                        Aggregate     Percent               Weighted   
                          Number of     Principal       of        Weighted  Average    
                          Mortgage       Balance      Mortgage    Average   Credit     
Property Type               Loans      Outstanding     Pool        Coupon    Score     
------------------------  ---------    -----------    -------     --------  --------  -
                                                                                       
Single Family Detached..   1,686      $384,611,689.03   68.28%     7.226%      654     
Planned Unit Development     427       100,468,353.59   17.84      7.236       645     
Condominium.............     177        37,081,452.20    6.58      7.178       665     
Two-to-Four Family......     121        36,657,524.30    6.51      7.255       681     
Single Family Attached..      18         2,798,776.89    0.50      7.486       648     
Townhouse...............       8         1,245,919.31    0.22      7.455       607     
Manufactured Home.......       1           405,000.00    0.07      6.675       637     
                           -----      ---------------  ------      -----       ---     
     Total:.............   2,438      $563,268,715.32  100.00%     7.228%      654     
                           =====      ===============  ======      =====       ===     


                             Average     Weighted                                      
                            Principal     Average    Percent                           
                             Balance     Original     Full                             
Property Type             Outstanding      LTV     Documentation                       
------------------------  ------------   --------  -------------                       
                                                                                       
Single Family Detached..   $228,120.81    83.04%        31.18%                         
Planned Unit Development    235,288.88    82.55         41.34                          
Condominium.............    209,499.73    83.34         27.48                          
Two-to-Four Family......    302,954.75    83.22         16.81                          
Single Family Attached..    155,487.61    80.10         31.37                          
Townhouse...............    155,739.91    86.27         67.96                          
Manufactured Home.......    405,000.00    69.83          0.00                          
                           -----------    -----         -----                          
     Total:.............   $231,037.21    82.97%        31.88%                         
                           ===========    =====         =====                          

Documentation Summary for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                           Aggregate                           Weighted 
                             Number of     Principal    Percent of   Weighted   Average 
                             Mortgage       Balance      Mortgage     Average    Credit 
Documentation                  Loans      Outstanding      Pool       Coupon     Score  
--------------------------   ---------    -----------   ----------   --------  ---------
                                                                                        
Stated Income Wage Earner       817     $200,433,668.59    35.58%       7.265%    687   
Full Documentation.......       982      179,544,419.88    31.88        7.235     611   
Stated Income Self-Employed     453      129,450,510.59    22.98        7.188     676   
12 Month Bank Statements.       130       36,746,048.84     6.52        7.157     623   
24 Month Bank Statements.        42       13,672,235.15     2.43        7.139     617   
Limited Documentation....        14        3,421,832.29     0.61        7.256     653   
                              -----     ---------------   ------        -----     ---   
     Total:..............     2,438     $563,268,715.32   100.00%       7.228%    654   
                              =====     ===============   ======        =====     ===   


                               Average      Weighted                                    
                               Principal     Average      Percent                       
                                 Balance     Original      Full                         
Documentation                Outstanding       LTV     Documentation                    
--------------------------   -----------     --------  -------------                    
                                                                                        
Stated Income Wage Earner     $245,328.85     83.73%        0.00%                       
Full Documentation.......      182,835.46     82.10       100.00                        
Stated Income Self-Employed    285,762.72     83.09         0.00                        
12 Month Bank Statements.      282,661.91     82.70         0.00                        
24 Month Bank Statements.      325,529.41     83.32         0.00                        
Limited Documentation....      244,416.59     80.35         0.00                        
                              -----------     -----        -----                        
     Total:..............     $231,037.21     82.97%       31.88%                       
                              ===========     =====        =====                        

Occupancy Types for the Group 2 Statistical Mortgage Loans

                                                                [Download Table]

                                       Aggregate                            Weighted
                         Number of     Principal     Percent of   Weighted  Average 
                         Mortgage       Balance       Mortgage    Average   Credit  
Occupancy                  Loans      Outstanding       Pool       Coupon    Score  
-----------------------  ---------    -----------    ----------   --------  --------
                                                                                    
Primary Home...........   2,409      $556,860,062.19   98.86%      7.226%       654 
Investment Property....      29         6,408,653.13    1.14       7.362        658 
                          -----      ---------------  ------       -----        --- 
     Total:............   2,438      $563,268,715.32  100.00%      7.228%       654 
                          =====      ===============  ======       =====        === 


                           Average      Weighted                                    
                          Principal      Average      Percent                       
                           Balance      Original        Full                        
Occupancy                Outstanding       LTV     Documentation                    
-----------------------  -----------    --------   -------------                    
                                                                                    
Primary Home...........  $231,158.18      83.04%       31.89%                       
Investment Property....   220,988.04      76.90        30.73                        
                         -----------      -----        -----                        
     Total:............  $231,037.21      82.97%       31.88%                       
                         ===========      =====        =====                        

         The information set forth above with respect to occupancy is based upon
representations of the related mortgagors at the time of origination.           

Mortgage Loan Age Summary for the Group 2 Statistical Mortgage Loans

                                                                [Download Table]

                                      Aggregate                           Weighted
                       Number of      Principal     Percent of  Weighted  Average 
Mortgage Loans          Mortgage       Balance       Mortgage   Average   Credit  
Age Summary              Loans       Outstanding       Pool      Coupon    Score  
---------------------  ---------     -----------    ----------  --------  --------
                                                                                  
0....................      130       $28,118,941.00    4.99%     7.331%      668  
1....................    1,089       254,580,606.12   45.20      7.227       658  
2....................      886       193,915,971.48   34.43      7.296       650  
3....................      323        84,056,640.68   14.92      7.055       652  
4....................        9         2,535,730.66    0.45      6.677       648  
5....................        1            60,825.39    0.01      8.850       553  
                         -----      ---------------  ------      -----       ---  
     Total:..........    2,438      $563,268,715.32  100.00%     7.228%      654  
                         =====      ===============  ======      =====       ===  


                         Average      Weighted                                    
                        Principal      Average      Percent                       
Mortgage Loans           Balance      Original        Full                        
Age Summary            Outstanding       LTV     Documentation                    
---------------------  -----------    ---------  -------------                    
                                                                                  
0....................   $216,299.55     83.22%       24.92%                       
1....................    233,774.66     83.02        30.97                        
2....................    218,866.78     82.82        33.62                        
3....................    260,237.28     83.16        33.09                        
4....................    281,747.85     78.76        24.04                        
5....................     60,825.39     72.62       100.00                        
                        -----------     -----        -----                        
     Total:..........   $231,037.21     82.97%       31.88%                       
                        ===========     =====        =====                        

 As of the Cut-off Date, the weighted average age of the Group 2
Mortgage Loans was approximately 2 months.                                      

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 Original Prepayment Penalty Term for the Group 2 Statistical Mortgage Loans

                                                                [Download Table]

                                       Aggregate                            Weighted
                         Number of     Principal     Percent of   Weighted  Average 
Original Prepayment      Mortgage       Balance       Mortgage     Average  Credit  
Penalty Term               Loans      Outstanding       Pool       Coupon     Score 
-----------------------  ---------    -----------    ----------   -------   ------- 
                                                                                    
None...................     453       $84,675,171.71   15.03%       7.864%      643 
6 Months...............      45         5,094,143.26    0.90        7.782       618 
12 Months..............      47        14,473,122.22    2.57        7.525       672 
24 Months..............   1,636       400,645,874.15   71.13        7.095       659 
36 Months..............     257        58,380,403.99   10.36        7.093       640 
                          -----      ---------------  ------        -----       --- 
     Total:............   2,438      $563,268,715.32  100.00%       7.228%      654 
                          =====      ===============  ======        =====       === 


                           Average      Weighted                                    
                          Principal      Average      Percent                       
Original Prepayment        Balance      Original        Full                        
Penalty Term             Outstanding       LTV     Documentation                    
-----------------------  -----------    --------   -------------                    
                                                                                    
None...................  $186,920.91      83.65%       38.13%                       
6 Months...............   113,203.18      82.68        79.85                        
12 Months..............   307,938.77      82.99        26.95                        
24 Months..............   244,893.57      83.16        26.99                        
36 Months..............   227,161.11      80.63        53.34                        
                         -----------      -----        -----                        
     Total:............  $231,037.21      82.97%       31.88%                       
                         ===========      =====        =====                        

  The weighted average prepayment penalty term at origination with
respect to the Group 2 Mortgage Loans having prepayment penalties is            
approximately 25 months.                                                        

Credit Scores for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                      Aggregate                                       
                      Number of       Principal     Percent of  Weighted    Weighted  
Range of               Mortgage        Balance       Mortgage   Average     Average   
Credit Scores           Loans        Outstanding       Pool      Coupon   Credit Score
--------------------  ---------     --------------  ----------  --------  ------------
                                                                                      
501 to 525..........      24         $4,392,697.29     0.78%      8.692%   519        
526 to 550..........      89         14,911,886.45     2.65       8.228    540        
551 to 575..........     182         33,284,301.04     5.91       7.968    563        
576 to 600..........     287         52,813,957.85     9.38       7.291    589        
601 to 625..........     303         69,213,776.11    12.29       7.173    613        
626 to 650..........     307         75,268,658.21    13.36       7.064    639        
651 to 675..........     339        104,007,655.44    18.47       6.954    665        
676 to 700..........     425         95,937,693.61    17.03       7.216    687        
701 to 725..........     251         56,954,142.49    10.11       7.182    712        
726 to 750..........     135         32,723,233.10     5.81       7.159    737        
751 to 775..........      67         16,938,123.07     3.01       7.348    761        
776 to 800..........      25          5,342,998.75     0.95       7.197    786        
801 to 825..........       4          1,479,591.90     0.26       6.735    805        
                       -----       ---------------   ------       -----    ---        
     Total:.........   2,438       $563,268,715.32   100.00%      7.228%   654        
                       =====       ===============   ======       =====    ===        


                        Average     Weighted                                          
                       Principal     Average      Percent                             
Range of                Balance     Original        Full                              
Credit Scores         Outstanding      LTV     Documentation                          
--------------------  -----------   --------   -------------                          
                                                                                      
501 to 525..........   $183,029.05    74.27%       76.57%                             
526 to 550..........    167,549.29    79.23        74.74                              
551 to 575..........    182,880.77    82.70        70.41                              
576 to 600..........    184,020.76    80.88        73.18                              
601 to 625..........    228,428.30    82.23        59.62                              
626 to 650..........    245,174.78    82.32        40.11                              
651 to 675..........    306,807.24    82.39        17.80                              
676 to 700..........    225,735.75    84.27         6.60                              
701 to 725..........    226,908.93    85.26         4.81                              
726 to 750..........    242,394.32    85.23         6.48                              
751 to 775..........    252,807.81    84.68         7.93                              
776 to 800..........    213,719.95    84.61         6.20                              
801 to 825..........    369,897.98    85.39         7.48                              
                       -----------    -----        -----                              
     Total:.........   $231,037.21    82.97%       31.88%                             
                       ===========    =====        =====                              

        The Credit Scores of the Group 2 Mortgage Loans that were scored As of
the Cut-off Date ranged from 502 to 815 and the weighted average Credit Score of
the Group 2 Mortgage Loans that were scored As of the Cut-off Date was          
approximately 654.                                                              

 Credit Grade Summary for the Group 2 Statistical Mortgage Loans

                                                                [Download Table]

                                       Aggregate                           Weighted
                                       Principal     Percent of  Weighted  Average 
                      Number of         Balance       Mortgage   Average   Credit  
Credit Grade        Mortgage Loans    Outstanding       Pool      Coupon     Score 
------------------  --------------  ---------------  ----------  --------  --------
                                                                                   
A.................     2,294        $533,885,809.53    94.78%     7.183%      658  
A-................        60          15,564,802.99     2.76      7.771       589  
B.................        54           9,260,206.84     1.64      8.066       575  
C.................        21           3,272,402.69     0.58      8.611       580  
D.................         9           1,285,493.27     0.23      9.655       556  
     Total:.......     2,438        $563,268,715.32   100.00%     7.228%      654  


                      Average      Weighted                                        
                     Principal      Average      Percent                           
                      Balance      Original        Full                            
Credit Grade        Outstanding       LTV     Documentation                        
------------------  -----------    ---------  -------------                        
                                                                                   
A.................  $232,731.39      83.28%        30.32%                          
A-................   259,413.38      81.11         53.43                           
B.................   171,485.31      74.84         61.57                           
C.................   155,828.70      69.60         72.88                           
D.................   142,832.59      68.49        100.00                           
     Total:.......  $231,037.21      82.97%        31.88%                          

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Gross Margins for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                       Aggregate                             Weighted
                         Number of     Principal     Percent of   Weighted   Average 
                         Mortgage       Balance       Mortgage    Average     Credit 
Range of Margins           Loans      Outstanding       Pool       Coupon      Score 
-----------------------  ---------   --------------  ----------   ---------  --------
                                                                                     
2.501% to 3.000%.......       1         $118,709.15      0.02%      7.350%        672
3.001% to 3.500%.......       1          231,026.69      0.05       7.450         707
3.501% to 4.000%.......      55        9,947,493.37      1.97       7.389         651
4.001% to 4.500%.......       4          646,383.82      0.13       6.979         661
4.501% to 5.000%.......       2          869,029.40      0.17       6.570         678
5.001% to 5.500%.......     508      143,375,417.01     28.44       7.044         635
5.501% to 6.000%.......     975      286,258,649.81     56.77       7.006         664
6.001% to 6.500%.......     351       62,755,580.09     12.45       7.516         642
     Total:............   1,897     $504,202,289.34   100.00%      7.087%        653 


                           Average      Weighted                                     
                          Principal      Average      Percent                        
                           Balance      Original        Full                         
Range of Margins         Outstanding       LTV     Documentation                     
-----------------------  ------------   ---------  -------------                     
                                                                                     
2.501% to 3.000%.......   $118,709.15      88.66%       100.00%                      
3.001% to 3.500%.......    231,026.69      80.00          0.00                       
3.501% to 4.000%.......    180,863.52      80.58         43.65                       
4.001% to 4.500%.......    161,595.95      82.78         41.85                       
4.501% to 5.000%.......    434,514.70      85.55          0.00                       
5.001% to 5.500%.......    282,235.07      82.66         47.17                       
5.501% to 6.000%.......    293,598.62      82.36         20.29                       
6.001% to 6.500%.......    178,790.83      82.05         42.67                       
     Total:............  $265,789.29      82.38%        31.18%                       

      As of the Cut-off Date, the Gross Margins for the Group 2 Adjustable
Rate Mortgage Loans ranged from 3.000% per annum to 6.250% per annum and the    
weighted average Gross Margin of the Group 2 Adjustable Rate Mortgage Loans was 
approximately 5.715% per annum.                                                 

 Maximum Mortgage Rates for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                        Aggregate                           Weighted 
                          Number of     Principal     Percent of  Weighted  Average  
Range of Maximum          Mortgage       Balance       Mortgage   Average   Credit   
Mortgage Rates              Loans      Outstanding       Pool      Coupon     Score  
-----------------------   ---------  ---------------  ----------  --------  ---------
                                                                                     
12.001% to 12.500%.....    348       $118,368,078.58    23.48%     6.387%      676   
12.501% to 13.000%.....    615       184,516,345.06     36.60      6.807       664   
13.001% to 13.500%.....    362        92,668,847.63     18.38      7.299       654   
13.501% to 14.000%.....    295        66,592,819.99     13.21      7.766       625   
14.001% to 14.500%.....     99        19,509,577.23      3.87      8.311       590   
14.501% to 15.000%.....     90        13,188,914.92      2.62      8.779       589   
15.001% to 15.500%.....     47         5,198,303.37      1.03      9.310       561   
15.501% to 16.000%.....     26         2,869,740.04      0.57      9.792       554   
16.001% to 16.500%.....     12         1,059,324.57      0.21     10.353       548   
16.501% to 17.000%.....      3           230,337.96      0.05     10.550       503   
     Total:............  1,897      $504,202,289.34    100.00%     7.087%      653   


                           Average      Weighted                                     
                          Principal      Average      Percent                        
Range of Maximum           Balance      Original        Full                         
Mortgage Rates           Outstanding       LTV     Documentation                     
-----------------------  -----------    --------   -------------                     
                                                                                     
12.001% to 12.500%.....  $340,138.16     81.19%        30.07%                        
12.501% to 13.000%.....   300,026.58     81.69         26.36                         
13.001% to 13.500%.....   255,991.29     83.23         30.25                         
13.501% to 14.000%.....   225,738.37     83.74         33.15                         
14.001% to 14.500%.....   197,066.44     85.38         47.45                         
14.501% to 15.000%.....   146,543.50     86.51         60.22                         
15.001% to 15.500%.....   110,602.20     83.68         64.48                         
15.501% to 16.000%.....   110,374.62     79.12         59.54                         
16.001% to 16.500%.....    88,277.05     73.24         35.61                         
16.501% to 17.000%.....    76,779.32     71.43        100.00                         
     Total:............  $265,789.29     82.38%        31.18%                        

    As of the Cut-off Date, the Maximum Mortgage Rates for the Group 2
Adjustable Rate Mortgage Loans ranged from 12.150% per annum to 16.550% per     
annum and the weighted average Maximum Mortgage Rate of the Group 2 Adjustable  
Rate Mortgage Loans was approximately 13.087% per annum.                        

Next Rate Adjustment Date for the Group 2 Statistical Mortgage Loans

                                                        [Enlarge/Download Table]

                                                                              Weighted
                         Number of      Aggregate      Percent of  Weighted   Average 
Next Rate                Mortgage   Principal Balance   Mortgage   Average    Credit  
Adjustment Date            Loans       Outstanding        Pool       Coupon     Score 
-----------------------  ---------  -----------------  ----------  --------   --------
                                                                                      
July 2007..............       3         $1,058,008.71     0.21%       6.371%      647 
August 2007............     187         58,217,235.88    11.55        6.902       653 
September 2007.........     597        145,280,157.82    28.81        7.167       649 
October 2007...........     787        213,444,356.66    42.33        7.073       656 
November 2007..........      93         24,102,749.00     4.78        7.101       664 
June 2008..............       1             60,825.39     0.01        8.850       553 
July 2008..............       3            953,800.00     0.19        6.588       647 
August 2008............      71         17,800,440.29     3.53        6.967       643 
September 2008.........      94         24,705,462.66     4.90        7.319       645 
October 2008...........      46         11,571,023.49     2.29        7.143       658 
August 2010............       2          1,564,229.87     0.31        6.700       632 
September 2010.........       4            878,199.57     0.17        6.603       657 
October 2010...........       8          4,128,200.00     0.82        7.143       659 
November 2010..........       1            437,600.00     0.09        6.300       689 
                          -----       ---------------   ------        -----       --- 
     Total:............   1,897       $504,202,289.34   100.00%       7.087%      653 
                          =====       ===============   ======        =====       === 


                           Average     Weighted                                       
                          Principal     Average      Percent                          
Next Rate                  Balance     Original        Full                           
Adjustment Date          Outstanding      LTV     Documentation                       
-----------------------  -----------   --------   -------------                       
                                                                                      
July 2007..............   $352,669.57    81.57%         0.00%                         
August 2007............    311,322.12    83.56         29.96                          
September 2007.........    243,350.35    82.29         29.15                          
October 2007...........    271,212.65    82.21         29.86                          
November 2007..........    259,169.34    82.46         23.35                          
June 2008..............     60,825.39    72.62        100.00                          
July 2008..............    317,933.33    80.00         25.79                          
August 2008............    250,710.43    80.96         37.67                          
September 2008.........    262,824.07    82.89         48.27                          
October 2008...........    251,543.99    82.86         41.64                          
August 2010............    782,114.93    65.31        100.00                          
September 2010.........    219,549.89    80.00         33.01                          
October 2010...........    516,025.00    86.39         49.04                          
November 2010..........    437,600.00    80.00        100.00                          
                          -----------    -----        ------                          
     Total:............   $265,789.29    82.38%        31.18%                         
                          ===========    =====        ======                          

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 Annex III

 Assumed Mortgage Loan Characteristics

Assumed Characteristics of the Group 1 Initial Fixed Rate Mortgage Loans

                                                        [Enlarge/Download Table]

                                                                           Original                     
                    Original  Remaining    Remaining                       Interest                     
                     Term to   Term to   Amortization    Gross      Net      Only    Original Months to 
 Principal          Maturity   Maturity      Term      Mortgage  Mortgage    Term    Prepayment Penalty 
Balance ($)         (months)   (months)    (months)     Rate(%)   Rate(%)  (months)  Expiration (months)
------------------  --------  ---------  ------------  --------  --------  --------  -------------------
                                                                                                        
      6,237,368.43     180       178          358       10.070     9.567       0              0         
      2,875,259.48     180       179          359        9.811     9.308       0             24         
         45,730.40     180       179          359       10.150     9.647       0             36         
      3,551,068.67     331       330          330        7.950     7.447       0              0         
        870,046.05     360       358          358        8.529     8.026       0              6         
        179,703.59     360       358          358        6.990     6.487       0             12         
        586,876.17     360       359          359        8.103     7.600       0             24         
        180,000.00     360       360          360        7.450     6.947       0             30         
     15,399,156.91     358       356          356        7.368     6.865       0             36         
        110,250.00     360       358          300        7.775     7.272      60              0         
      5,353,341.38     360       358          300        7.126     6.623      60             36         

 III-1

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 Assumed Characteristics of the Group 1 Initial Adjustable Rate Mortgage Loans

                                                        [Enlarge/Download Table]


                Original                                                                             
                  Term    Remaining   Remaining                                                      
                   to       Term to  Amortization   Gross       Net                            Gross 
  Principal     Maturity   Maturity      Term      Mortgage  Mortgage    Maximum    Minimum   Margin 
 Balance ($)    (months)   (months)    (months)    Rate (%)  Rate (%)   Rate (%)   Rate (%)     (%)  
--------------  --------  ---------  ------------  --------  --------   --------   --------   -------
                                                                                                     
 21,470,889.57    360        359          359        7.825      7.322     13.825      7.825     5.343
  3,116,459.28    360        359          359        7.888      7.385     13.888      7.888     5.926
  1,739,995.39    360        358          358        7.113      6.610     13.113      7.113     5.911
 48,708,056.37    360        358          358        7.488      6.985     13.488      7.488     5.785
    545,349.23    360        359          359        7.619      7.116     13.619      7.619     5.877
 24,005,968.22    360        359          300        7.585      7.082     13.585      7.585     5.487
    445,820.00    360        359          300        7.943      7.440     13.943      7.943     5.962
  3,072,564.00    360        358          300        7.268      6.765     13.268      7.268     5.918
127,748,689.97    360        359          300        7.028      6.525     13.028      7.028     5.855
    996,320.00    360        358          300        7.219      6.716     13.219      7.219     5.787
  7,516,487.55    360        358          358        7.795      7.292     13.795      7.795     5.236
    326,688.48    360        358          358        8.340      7.837     14.340      8.340     5.993
  1,356,876.16    360        358          358        7.375      6.872     13.375      7.375     5.701
  5,111,349.51    360        358          358        7.345      6.842     13.345      7.345     5.845
 10,537,747.92    360        358          300        7.531      7.028     13.531      7.531     5.715
    918,835.00    360        358          300        6.639      6.136     12.639      6.639     5.653
  4,959,705.63    360        357          300        6.688      6.185     12.688      6.688     5.810
  9,228,162.18    360        358          300        7.018      6.515     13.018      7.018     5.928
    975,245.02    360        358          358        6.946      6.443     12.946      6.946     5.807
    160,000.00    360        360          300        7.400      6.897     13.400      7.400     6.000
  3,733,219.46    360        358          300        6.928      6.425     12.928      6.928     6.182


                                                                                       Original      
                                                              Original                Months to      
                                         Rate                 Interest               Prepayment      
                Initial   Subsequent  Adjustment  Next Rate     Only                   Penalty       
  Principal     Periodic   Periodic   Frequency   Adjustment    Term                 Expiration      
 Balance ($)    Cap (%)    Cap (%)     (months)      Date     (months)     Index      (months)       
--------------  --------   ---------  ----------  ----------  ---------   ------     ----------      
                                                                                                     
 21,470,889.57    3.000      1.000         6        10/2007       0       LIBOR_6MO        0         
  3,116,459.28    3.000      1.000         6        10/2007       0       LIBOR_6MO        6         
  1,739,995.39    3.000      1.000         6         9/2007       0       LIBOR_6MO       12         
 48,708,056.37    3.000      1.000         6         9/2007       0       LIBOR_6MO       24         
    545,349.23    3.000      1.000         6        10/2007       0       LIBOR_6MO       36         
 24,005,968.22    3.000      1.000         6        10/2007       60      LIBOR_6MO        0         
    445,820.00    3.000      1.000         6        10/2007       60      LIBOR_6MO        6         
  3,072,564.00    3.000      1.000         6         9/2007       60      LIBOR_6MO       12         
127,748,689.97    3.000      1.000         6        10/2007       60      LIBOR_6MO       24         
    996,320.00    3.000      1.000         6         9/2007       60      LIBOR_6MO       36         
  7,516,487.55    3.000      1.000         6         9/2008       0       LIBOR_6MO        0         
    326,688.48    3.000      1.000         6         9/2008       0       LIBOR_6MO        6         
  1,356,876.16    3.000      1.000         6         9/2008       0       LIBOR_6MO       24         
  5,111,349.51    3.000      1.000         6         9/2008       0       LIBOR_6MO       36         
 10,537,747.92    3.000      1.000         6         9/2008       60      LIBOR_6MO        0         
    918,835.00    3.000      1.000         6         9/2008       60      LIBOR_6MO       12         
  4,959,705.63    3.000      1.000         6         8/2008       60      LIBOR_6MO       24         
  9,228,162.18    3.000      1.000         6         9/2008       60      LIBOR_6MO       36         
    975,245.02    2.000      1.000         12        9/2010       0        CMT_1YR        36         
    160,000.00    2.000      1.000         12       11/2010       60       CMT_1YR         0         
  3,733,219.46    2.000      1.000         12        9/2010       60       CMT_1YR        36         

III-2 

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Assumed Characteristics of the Group 2 Initial Fixed Rate Mortgage Loans

                                                        [Enlarge/Download Table]

                                                                                  Original  
                                                                       Original  Months to  
                Original  Remaining    Remaining     Gross     Net     Interest  Prepayment 
                Term to    Term to   Amortization  Mortgage  Mortgage    Only     Penalty   
   Principal    Maturity   Maturity      Term        Rate      Rate      Term    Expiration 
  Balance ($)   (months)   (months)    (months)       (%)      (%)     (months)   (months)  
--------------  --------  ---------  ----------    -------   --------  --------  -----------
                                                                                            
  5,985,903.77    180        178          358       10.182    9.679       0          0      
    464,214.11    180        179          359       10.441    9.938       0          12     
 18,227,170.22    180        178          358        9.926    9.423       0          24     
     67,842.80    180        177          357        7.340    6.837       0          36     
  3,144,137.95    342        341          341        8.017    7.514       0          0      
    935,976.19    360        358          358        7.892    7.389       0          6      
    920,657.90    360        358          358        7.854    7.351       0          24     
 25,450,102.73    356        354          354        7.239    6.736       0          36     
    328,000.00    360        359          300        7.585    7.082       60         0      
  3,542,420.30    360        358          300        6.771    6.268       60         36     

III-3 

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 Assumed Characteristics of the Group 2 Initial Adjustable Rate Mortgage Loans

                                                        [Enlarge/Download Table]


                 Original  Remaining   Remaining                                                           
                  Term to    Term to  Amortization   Gross     Net                         Gross   Initial 
  Principal      Maturity  Maturity      Term      Mortgage  Mortgage  Maximum   Minimum   Margin  Periodic
  Balance ($)    (months)  (months)    (months)    Rate (%)  Rate (%)  Rate (%)  Rate (%)   (%)     Cap (%)
---------------  --------  ---------  -----------  --------  --------  -------   -------   ------  --------
                                                                                                           
  37,186,687.28    360        359         359        7.808    7.305    13.808     7.808     5.465    3.000 
   3,060,074.01    360        358         358        8.011    7.508    14.011     8.011     5.820    3.000 
   3,108,034.64    360        359         359        7.410    6.907    13.410     7.410     6.016    3.000 
  96,650,360.80    360        358         358        7.383    6.880    13.383     7.383     5.752    3.000 
     643,693.75    360        358         358        7.881    7.378    13.881     7.881     5.959    3.000 
  19,827,680.00    360        359         300        7.457    6.954    13.457     7.457     5.580    3.000 
     885,443.00    360        359         300        6.899    6.396    12.899     6.899     5.675    3.000 
  10,038,126.40    360        358         300        7.453    6.950    13.453     7.453     5.809    3.000 
 269,898,902.19    360        358         300        6.816    6.313    12.816     6.816     5.731    3.000 
     803,506.00    360        357         300        6.981    6.478    12.981     6.981     5.867    3.000 
  10,567,455.71    360        358         358        7.832    7.329    13.832     7.832     5.571    3.000 
     212,650.05    360        357         357        7.672    7.169    13.672     7.672     5.715    3.000 
     303,747.07    360        358         358        7.500    6.997    13.500     7.500     6.000    3.000 
   2,894,055.26    360        357         357        6.915    6.412    12.915     6.915     5.785    3.000 
   7,310,728.89    360        358         358        7.329    6.826    13.329     7.329     5.819    3.000 
   7,635,307.00    360        358         300        7.365    6.862    13.365     7.365     5.462    3.000 
     559,000.00    360        358         300        7.061    6.558    13.061     7.061     5.665    3.000 
  11,425,727.78    360        357         300        6.711    6.208    12.711     6.711     5.783    3.000 
  14,182,880.08    360        358         300        6.851    6.348    12.851     6.851     5.770    3.000 
   1,486,609.43    360        357         357        6.512    6.009    12.512     6.512     6.043    2.000 
     629,000.00    360        359         300        7.250    6.747    13.250     7.250     6.250    2.000 
   4,892,620.00    360        359         300        7.007    6.504    13.007     7.007     6.053    2.000 

                                                                [Download Table]

                                                                           Original 
                                                     Original              Months to
                                 Rate        Next    Interest             Prepayment
                  Subsequent  Adjustment     Rate      Only                 Penalty 
  Principal        Periodic   Frequency   Adjustment   Term               Expiration
  Balance ($)      Cap (%)     (months)     Date     (months)    Index     (months) 
----------------  ----------  ----------  ---------  -------   -------    ----------
                                                                                    
  37,186,687.28     1.000         6        10/2007      0      LIBOR_6MO       0    
   3,060,074.01     1.000         6        9/2007       0      LIBOR_6MO       6    
   3,108,034.64     1.000         6        10/2007      0      LIBOR_6MO      12    
  96,650,360.80     1.000         6        9/2007       0      LIBOR_6MO      24    
     643,693.75     1.000         6        9/2007       0      LIBOR_6MO      36    
  19,827,680.00     1.000         6        10/2007     60      LIBOR_6MO       0    
     885,443.00     1.000         6        10/2007     60      LIBOR_6MO       6    
  10,038,126.40     1.000         6        9/2007      60      LIBOR_6MO      12    
 269,898,902.19     1.000         6        9/2007      60      LIBOR_6MO      24    
     803,506.00     1.000         6        8/2007      60      LIBOR_6MO      36    
  10,567,455.71     1.000         6        9/2008       0      LIBOR_6MO       0    
     212,650.05     1.000         6        8/2008       0      LIBOR_6MO       6    
     303,747.07     1.000         6        9/2008       0      LIBOR_6MO      12    
   2,894,055.26     1.000         6        8/2008       0      LIBOR_6MO      24    
   7,310,728.89     1.000         6        9/2008       0      LIBOR_6MO      36    
   7,635,307.00     1.000         6        9/2008      60      LIBOR_6MO       0    
     559,000.00     1.000         6        9/2008      60      LIBOR_6MO      12    
  11,425,727.78     1.000         6        8/2008      60      LIBOR_6MO      24    
  14,182,880.08     1.000         6        9/2008      60      LIBOR_6MO      36    
   1,486,609.43     1.000        12        8/2010       0       CMT_1YR       36    
     629,000.00     1.000        12        10/2010     60       CMT_1YR       24    
   4,892,620.00     1.000        12        10/2010     60       CMT_1YR       36    

 III-4

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Assumed Characteristics of the Group 1 Subsequent Fixed Rate Mortgage Loans*

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                                                                                     Original 
                                                                          Original  Months to 
                  Original  Remaining   Remaining                         Interest  Prepayment
                   Term to    Term to  Amortization    Gross      Net       Only     Penalty  
    Principal     Maturity   Maturity     Term        Mortgage  Mortgage    Term    Expiration
   Balance ($)    (months)   (months)   (months)      Rate(%)    Rate(%)  (months)   (months) 
----------------  --------  ---------  ------------   --------  --------  --------  ----------
                                                                                              
   2,066,458.16   180        180         360         10.070      9.567       0           0    
     952,581.76   180        180         360          9.811      9.308       0          24    
      15,150.61   180        180         360         10.150      9.647       0          36    
   1,176,479.30   331        331         331          7.950      7.447       0           0    
     288,248.77   360        360         360          8.529      8.026       0           6    
      59,536.32   360        360         360          6.990      6.487       0          12    
     194,433.77   360        360         360          8.103      7.600       0          24    
      59,634.52   360        360         360          7.450      6.947       0          30    
   5,101,785.13   358        358         358          7.368      6.865       0          36    
      36,526.14   360        360         300          7.775      7.272      60           0    
   1,773,577.45   360        360         300          7.126      6.623      60          36    

---------------------                                                         
* Assumes that the Group 1 Subsequent Fixed Rate Mortgage Loans will be       
purchased by the Trust during the first month after the month in which the
Closing Date occurs.                                                      

III-5 

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Assumed Characteristics of the Group 1 Subsequent 
Adjustable Rate Mortgage Loans*   

                                                        [Enlarge/Download Table]

                Original  Remaining   Remaining                                                     Initial
                 Term to   Term to   Amortization   Gross      Net                         Gross   Periodic
   Principal    Maturity  Maturity       Term      Mortgage  Mortgage  Maximum    Minimum  Margin     Cap  
  Balance ($)   (months)  (months)     (months)    Rate(%)   Rate(%)   Rate(%)    Rate(%)    (%)      (%)  
--------------  --------  --------   -----------  --------   -------   -------    -------  ------  --------
                                                                                                           
  7,113,367.69    360       360         360        7.825     7.322     13.825      7.825    5.343    3.000 
  1,032,491.95    360       360         360        7.888     7.385     13.888      7.888    5.926    3.000 
    576,465.49    360       360         360        7.113     6.610     13.113      7.113    5.911    3.000 
 16,137,119.66    360       360         360        7.488     6.985     13.488      7.488    5.785    3.000 
    180,675.77    360       360         360        7.619     7.116     13.619      7.619    5.877    3.000 
  7,953,246.56    360       360         300        7.585     7.082     13.585      7.585    5.487    3.000 
    147,701.45    360       360         300        7.943     7.440     13.943      7.943    5.962    3.000 
  1,017,949.32    360       360         300        7.268     6.765     13.268      7.268    5.918    3.000 
 42,323,509.72    360       360         300        7.028     6.525     13.028      7.028    5.855    3.000 
    330,083.69    360       360         300        7.219     6.716     13.219      7.219    5.787    3.000 
  2,490,234.02    360       360         360        7.795     7.292     13.795      7.795    5.236    3.000 
    108,232.84    360       360         360        8.340     7.837     14.340      8.340    5.993    3.000 
    449,536.99    360       360         360        7.375     6.872     13.375      7.375    5.701    3.000 
  1,693,404.85    360       360         360        7.345     6.842     13.345      7.345    5.845    3.000 
  3,491,186.30    360       360         300        7.531     7.028     13.531      7.531    5.715    3.000 
    304,412.69    360       360         300        6.639     6.136     12.639      6.639    5.653    3.000 
  1,643,164.79    360       360         300        6.688     6.185     12.688      6.688    5.810    3.000 
  3,057,316.77    360       360         300        7.018     6.515     13.018      7.018    5.928    3.000 
    323,101.49    360       360         360        6.946     6.443     12.946      6.946    5.807    2.000 
     53,008.46    360       360         300        7.400     6.897     13.400      7.400    6.000    2.000 
  1,236,826.38    360       360         300        6.928     6.425     12.928      6.928    6.182    2.000 


                                                                             Original                      
                                                     Original                Months to                     
                Subsequent     Rate                  Interest                Prepayment                    
                Periodic    Adjustment   Next Rate     Only                   Penalty                      
  Principal       Cap       Frequency    Adjustment    Term                  Expiration                    
 Balance ($)      (%)        (months)       Date     (months)      Index      (months)                     
--------------  ---------   ----------  ----------   --------      -----    ------------                   
                                                                                                           
  7,113,367.69    1.000          6        11/2007        0       LIBOR_6MO        0                        
  1,032,491.95    1.000          6        11/2007        0       LIBOR_6MO        6                        
    576,465.49    1.000          6        11/2007        0       LIBOR_6MO       12                        
 16,137,119.66    1.000          6        11/2007        0       LIBOR_6MO       24                        
    180,675.77    1.000          6        11/2007        0       LIBOR_6MO       36                        
  7,953,246.56    1.000          6        11/2007       60       LIBOR_6MO        0                        
    147,701.45    1.000          6        11/2007       60       LIBOR_6MO        6                        
  1,017,949.32    1.000          6        11/2007       60       LIBOR_6MO       12                        
 42,323,509.72    1.000          6        11/2007       60       LIBOR_6MO       24                        
    330,083.69    1.000          6        11/2007       60       LIBOR_6MO       36                        
  2,490,234.02    1.000          6        11/2008        0       LIBOR_6MO        0                        
    108,232.84    1.000          6        11/2008        0       LIBOR_6MO        6                        
    449,536.99    1.000          6        11/2008        0       LIBOR_6MO       24                        
  1,693,404.85    1.000          6        11/2008        0       LIBOR_6MO       36                        
  3,491,186.30    1.000          6        11/2008       60       LIBOR_6MO        0                        
    304,412.69    1.000          6        11/2008       60       LIBOR_6MO       12                        
  1,643,164.79    1.000          6        11/2008       60       LIBOR_6MO       24                        
  3,057,316.77    1.000          6        11/2008       60       LIBOR_6MO       36                        
    323,101.49    1.000         12        11/2010        0        CMT_1YR        36                        
     53,008.46    1.000         12        11/2010       60        CMT_1YR         0                        
  1,236,826.38    1.000         12        11/2010       60        CMT_1YR        36                        

---------------                                                                 
* Assumes that the Group 1 Subsequent Adjustable Rate Mortgage Loans will be    
purchased by the Trust during the first month after the month which the     
Closing Date occurs.                                                        

III-6 

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 Assumed Characteristics of the Group 2 Subsequent Fixed Rate Mortgage Loans

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                                                                                   Original 
                                                                        Original  Months to 
                 Original  Remaining   Remaining                        Interest  Prepayment
                  Term to    Term to  Amortization   Gross      Net       Only     Penalty  
  Principal      Maturity   Maturity     Term       Mortgage  Mortgage    Term    Expiration
 Balance ($)     (months)   (months)   (months)     Rate(%)    Rate(%)  (months)   (months) 
---------------  --------   --------  ------------  --------  --------  --------  ----------
                                                                                            
   1,983,147.20    180        180         360        10.182     9.679       0           0   
     153,795.47    180        180         360        10.441     9.938       0          12   
   6,038,714.10    180        180         360         9.926     9.423       0          24   
      22,476.52    180        180         360         7.340     6.837       0          36   
   1,041,661.98    342        342         342         8.017     7.514       0           0   
     310,091.61    360        360         360         7.892     7.389       0           6   
     305,016.62    360        360         360         7.854     7.351       0          24   
   8,431,692.49    356        356         356         7.239     6.736       0          36   
     108,667.35    360        360         300         7.585     7.082      60           0   
   1,173,614.07    360        360         300         6.771     6.268      60          36   

------------                                                                    
* Assumes that the Group 2 Subsequent Fixed Rate Mortgage Loans will be         
purchased by the Trust during the first month after the month which the     
Closing Date ccurs.                                                         

III-7 

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Assumed Characteristics of the Group 2 Subsequent   
Adjustable Rate Mortgage Loans*     

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                Term to   Term to   Amortization   Gross       Net                                     Initial 
  Principal     Maturity  Maturity     Term       Mortgage   Mortgage   Maximum    Minimum   Gross     Periodic
  Balance ($)   (months)  (months)    (months)    Rate(%)    Rate(%)    Rate(%)    Rate(%)  Margin(%)   Cap(%) 
--------------  --------  --------  ------------  --------   --------   -------    -------  ---------  --------
                                                                                                               
 12,320,056.83    360       360        360         7.808     7.305      13.808      7.808    5.465      3.000  
  1,013,811.35    360       360        360         8.011     7.508      14.011      8.011    5.820      3.000  
  1,029,700.85    360       360        360         7.410     6.907      13.410      7.410    6.016      3.000  
 32,020,543.50    360       360        360         7.383     6.880      13.383      7.383    5.752      3.000  
    213,257.60    360       360        360         7.881     7.378      13.881      7.881    5.959      3.000  
  6,568,967.61    360       360        300         7.457     6.954      13.457      7.457    5.580      3.000  
    293,349.82    360       360        300         6.899     6.396      12.899      6.899    5.675      3.000  
  3,325,660.25    360       360        300         7.453     6.950      13.453      7.453    5.809      3.000  
 89,418,285.32    360       360        300         6.816     6.313      12.816      6.816    5.731      3.000  
    266,203.86    360       360        300         6.981     6.478      12.981      6.981    5.867      3.000  
  3,501,028.58    360       360        360         7.832     7.329      13.832      7.832    5.571      3.000  
     70,451.58    360       360        360         7.672     7.169      13.672      7.672    5.715      3.000  
    100,632.28    360       360        360         7.500     6.997      13.500      7.500    6.000      3.000  
    958,808.86    360       360        360         6.915     6.412      12.915      6.915    5.785      3.000  
  2,422,065.58    360       360        360         7.329     6.826      13.329      7.329    5.819      3.000  
  2,529,599.25    360       360        300         7.365     6.862      13.365      7.365    5.462      3.000  
    185,198.31    360       360        300         7.061     6.558      13.061      7.061    5.665      3.000  
  3,785,376.59    360       360        300         6.711     6.208      12.711      6.711    5.783      3.000  
  4,698,829.11    360       360        300         6.851     6.348      12.851      6.851    5.770      3.000  
    492,518.00    360       360        360         6.512     6.009      12.512      6.512    6.043      2.000  
    208,389.52    360       360        300         7.250     6.747      13.250      7.250    6.250      2.000  
  1,620,939.13    360       360        300         7.007     6.504      13.007      7.007    6.053      2.000  


                                                                          Original                             
                                                   Original               Months to                            
                                Rate      Next     Interest               Prepayment                           
                 Subsequent  Adjustment   Rate      Only                  Penalty                              
  Principal       Periodic   Frequency  Adjustment  Term                  Expiration                           
  Balance ($)       Cap(%)    (months)    Date     (months)    Index       (months)                            
--------------   ----------  ---------  ---------  --------    -----      ----------                           
                                                                                                               
 12,320,056.83     1.000         6       11/2007      0      LIBOR_6MO        0                                
  1,013,811.35     1.000         6       11/2007      0      LIBOR_6MO         6                               
  1,029,700.85     1.000         6       11/2007      0      LIBOR_6MO        12                               
 32,020,543.50     1.000         6       11/2007      0      LIBOR_6MO        24                               
    213,257.60     1.000         6       11/2007      0      LIBOR_6MO        36                               
  6,568,967.61     1.000         6       11/2007     60      LIBOR_6MO         0                               
    293,349.82     1.000         6       11/2007     60      LIBOR_6MO         6                               
  3,325,660.25     1.000         6       11/2007     60      LIBOR_6MO        12                               
 89,418,285.32     1.000         6       11/2007     60      LIBOR_6MO        24                               
    266,203.86     1.000         6       11/2007     60      LIBOR_6MO        36                               
  3,501,028.58     1.000         6       11/2008      0      LIBOR_6MO         0                               
     70,451.58     1.000         6       11/2008      0      LIBOR_6MO         6                               
    100,632.28     1.000         6       11/2008      0      LIBOR_6MO        12                               
    958,808.86     1.000         6       11/2008      0      LIBOR_6MO        24                               
  2,422,065.58     1.000         6       11/2008      0      LIBOR_6MO        36                               
  2,529,599.25     1.000         6       11/2008     60      LIBOR_6MO         0                               
    185,198.31     1.000         6       11/2008     60      LIBOR_6MO        12                               
  3,785,376.59     1.000         6       11/2008     60      LIBOR_6MO        24                               
  4,698,829.11     1.000         6       11/2008     60      LIBOR_6MO        36                               
    492,518.00     1.000        12       11/2010      0       CMT_1YR         36                               
    208,389.52     1.000        12       11/2010     60       CMT_1YR         24                               
  1,620,939.13     1.000        12       11/2010     60       CMT_1YR         36                               

-------------------                                                           
* Assumes that the Group 2 Subsequent Adjustable Rate Mortgage Loans will be  
purchased by the Trust during the first month after the month in which the
Closing Date occurs.                                                      

III-8 

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Annex IV
Decrement Tables

Percentage of Initial Class Principal Amount Outstanding
at the Respective Percentages of the Prepayment Assumption

                                                        [Enlarge/Download Table]

                                                    Class 1-A                                  Class 2-A1              
                                    ----------------------------------------    ---------------------------------------
Payment Date                         0%     50%      100%      150%      200%     0%      50%    100%     150%     200%
--------------------------------    ---     ---      ----      ----      ----    ---      ---    ----     ----     ----
                                                                                                                       
Initial.........................    100     100      100       100       100     100      100    100      100      100 
November 25, 2006...............    100      87       74        60        47      99       73     47       21        0 
November 25, 2007...............     99      66       37        11         0      98       33      0        0        0 
November 25, 2008...............     99      48       12         0         0      97        0      0        0        0 
November 25, 2009...............     98      35       12         0         0      97        0      0        0        0 
November 25, 2010...............     98      29       11         0         0      96        0      0        0        0 
November 25, 2011...............     97      24        7         0         0      93        0      0        0        0 
November 25, 2012...............     95      20        5         0         0      91        0      0        0        0 
November 25, 2013...............     94      17        4         0         0      88        0      0        0        0 
November 25, 2014...............     92      14        3         0         0      84        0      0        0        0 
November 25, 2015...............     90      11        2         0         0      81        0      0        0        0 
November 25, 2016...............     88       9        1         0         0      77        0      0        0        0 
November 25, 2017...............     86       8        1         0         0      72        0      0        0        0 
November 25, 2018...............     83       6        1         0         0      68        0      0        0        0 
November 25, 2019...............     81       5        *         0         0      62        0      0        0        0 
November 25, 2020...............     75       4        0         0         0      50        0      0        0        0 
November 25, 2021...............     71       3        0         0         0      41        0      0        0        0 
November 25, 2022...............     68       3        0         0         0      34        0      0        0        0 
November 25, 2023...............     64       2        0         0         0      27        0      0        0        0 
November 25, 2024...............     59       2        0         0         0      18        0      0        0        0 
November 25, 2025...............     54       2        0         0         0       9        0      0        0        0 
November 25, 2026...............     49       1        0         0         0       0        0      0        0        0 
November 25, 2027...............     43       1        0         0         0       0        0      0        0        0 
November 25, 2028...............     37       1        0         0         0       0        0      0        0        0 
November 25, 2029...............     32       *        0         0         0       0        0      0        0        0 
November 25, 2030...............     28       0        0         0         0       0        0      0        0        0 
November 25, 2031...............     23       0        0         0         0       0        0      0        0        0 
November 25, 2032...............     18       0        0         0         0       0        0      0        0        0 
November 25, 2033...............     13       0        0         0         0       0        0      0        0        0 
November 25, 2034...............      7       0        0         0         0       0        0      0        0        0 
November 25, 2035...............      0       0        0         0         0       0        0      0        0        0 
Weighted Average Life in Years                                                                                         
(to maturity)...................  19.96    4.54     2.26      1.27      1.02   14.38    1.62    1.00     0.73     0.59 
Weighted Average Life in Years                                                                                         
(to 10% call)...................  19.93    4.24     2.07      1.27      1.02   14.38    1.62    1.00     0.73     0.59 
Weighted Average Life in Years                                                                                         
(to 20% call)...................  19.80    3.87     1.89      1.27      1.02   14.38    1.62    1.00     0.73     0.59 

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

  IV-1

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Percentage of Initial Class Principal Amount Outstanding
at the Respective Percentages of the Prepayment Assumption

                                                        [Enlarge/Download Table]


                                                   Class 2A-2                                   Class 2A-3              
                                    ------------------------------------------   ---------------------------------------
Payment Date                         0%     50%      100%      150%      200%      0%      50%     100%    150%     200%
--------------------------------    ---     ---      ----      ----      ----     ---      ---     ----    ----     ----
                                                                                                                        
Initial.........................    100     100      100       100       100      100      100     100     100      100 
November 25, 2006...............    100     100      100       100        92      100      100     100     100      100 
November 25, 2007...............    100     100       72        14         0      100      100     100     100        0 
November 25, 2008...............    100      98       19         0         0      100      100     100       0        0 
November 25, 2009...............    100      69       19         0         0      100      100     100       0        0 
November 25, 2010...............    100      56       16         0         0      100      100     100       0        0 
November 25, 2011...............    100      46        9         0         0      100      100     100       0        0 
November 25, 2012...............    100      37        4         0         0      100      100     100       0        0 
November 25, 2013...............    100      29        1         0         0      100      100     100       0        0 
November 25, 2014...............    100      23        0         0         0      100      100      80       0        0 
November 25, 2015...............    100      18        0         0         0      100      100      55       0        0 
November 25, 2016...............    100      14        0         0         0      100      100      37       0        0 
November 25, 2017...............    100      11        0         0         0      100      100      25       0        0 
November 25, 2018...............    100       8        0         0         0      100      100      11       0        0 
November 25, 2019...............    100       5        0         0         0      100      100       0       0        0 
November 25, 2020...............    100       2        0         0         0      100      100       0       0        0 
November 25, 2021...............    100       1        0         0         0      100      100       0       0        0 
November 25, 2022...............    100       0        0         0         0      100       89       0       0        0 
November 25, 2023...............    100       0        0         0         0      100       71       0       0        0 
November 25, 2024...............    100       0        0         0         0      100       56       0       0        0 
November 25, 2025...............    100       0        0         0         0      100       44       0       0        0 
November 25, 2026...............     99       0        0         0         0      100       34       0       0        0 
November 25, 2027...............     86       0        0         0         0      100       26       0       0        0 
November 25, 2028...............     72       0        0         0         0      100       15       0       0        0 
November 25, 2029...............     62       0        0         0         0      100        5       0       0        0 
November 25, 2030...............     53       0        0         0         0      100        0       0       0        0 
November 25, 2031...............     43       0        0         0         0      100        0       0       0        0 
November 25, 2032...............     32       0        0         0         0      100        0       0       0        0 
November 25, 2033...............     20       0        0         0         0      100        0       0       0        0 
November 25, 2034...............      7       0        0         0         0      100        0       0       0        0 
November 25, 2035...............      0       0        0         0         0        0        0       0       0        0 
Weighted Average Life in Years                                                                                          
(to maturity)...................  25.29    6.72     3.01      1.75      1.41    29.72    19.97   10.65     2.22    1.84 
Weighted Average Life in Years                                                                                          
(to 10% call)...................  25.27    6.57     2.93      1.75      1.41    29.01    12.67    6.17     2.22    1.84 
Weighted Average Life in Years                                                                                          
(to 20% call)...................  25.09    6.01     2.67      1.75      1.41    27.84     9.01    4.34     2.22    1.84 

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* Less than 0.5% but greater than 0.0%.                                         

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Percentage of Initial Class Principal Amount Outstanding
at the Respective Percentages of the Prepayment Assumption

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                                                      Class M1                                   Class M2                
                                     -----------------------------------------     --------------------------------------
Payment Date                          0%     50%       100%      150%      200%     0%     50%     100%     150%     200%
---------------------------------    ---     ---       ----      ----      ----    ---     ---     ----     ----     ----
                                                                                                                         
Initial.........................     100     100       100       100       100     100     100     100      100      100 
November 25, 2006...............     100     100       100       100       100     100     100     100      100      100 
November 25, 2007...............     100     100       100       100        24     100     100     100      100      100 
November 25, 2008...............     100     100       100        90        24     100     100     100      100       77 
November 25, 2009...............     100     100       100        90        24     100     100      59       47       20 
November 25, 2010...............     100      83        30        66        18     100      83      30        8        0 
November 25, 2011...............     100      69        20        38         4     100      69      20        5        0 
November 25, 2012...............     100      57        14        23         0     100      57      14        2        0 
November 25, 2013...............     100      47        10        10         0     100      47      10        0        0 
November 25, 2014...............     100      39         7         1         0     100      39       7        0        0 
November 25, 2015...............     100      32         5         0         0     100      32       5        0        0 
November 25, 2016...............     100      27         3         0         0     100      27       3        0        0 
November 25, 2017...............     100      22         1         0         0     100      22       0        0        0 
November 25, 2018...............     100      18         0         0         0     100      18       0        0        0 
November 25, 2019...............     100      15         0         0         0     100      15       0        0        0 
November 25, 2020...............     100      11         0         0         0     100      11       0        0        0 
November 25, 2021...............     100       9         0         0         0     100       9       0        0        0 
November 25, 2022...............     100       7         0         0         0     100       7       0        0        0 
November 25, 2023...............     100       6         0         0         0     100       6       0        0        0 
November 25, 2024...............     100       5         0         0         0     100       5       0        0        0 
November 25, 2025...............     100       4         0         0         0     100       4       0        0        0 
November 25, 2026...............     100       3         0         0         0     100       2       0        0        0 
November 25, 2027...............     100       1         0         0         0     100       0       0        0        0 
November 25, 2028...............     100       0         0         0         0     100       0       0        0        0 
November 25, 2029...............      92       0         0         0         0      92       0       0        0        0 
November 25, 2030...............      80       0         0         0         0      80       0       0        0        0 
November 25, 2031...............      66       0         0         0         0      66       0       0        0        0 
November 25, 2032...............      52       0         0         0         0      52       0       0        0        0 
November 25, 2033...............      35       0         0         0         0      35       0       0        0        0 
November 25, 2034...............      18       0         0         0         0      18       0       0        0        0 
November 25, 2035...............       0       0         0         0         0       0       0       0        0        0 
Weighted Average Life in Years                                                                                           
(to maturity)...................   26.98    9.09      5.36      5.73      2.76   26.98    9.08    5.09     4.19     3.53 
Weighted Average Life in Years                                                                                           
(to 10% call)...................   26.89    8.33      4.90      3.53      2.04   26.89    8.33    4.64     3.66     2.42 
Weighted Average Life in Years                                                                                           
(to 20% call)...................   26.55    7.29      4.32      2.56      1.96   26.55    7.29    4.13     2.59     2.09 

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* Less than 0.5% but greater than 0.0%.                                         

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at the Respective Percentages of the Prepayment Assumption

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                                                Class M3                                    Class M4                
                                -------------------------------------------------  ---------------------------------
Payment Date                     0%      50%    100%      150%     200%      0%     50%     100%     150%      200% 
                                ---      ---    ----      ----     ----     ---     ---     ----     ----      ---- 
                                                                                                                    
Initial......................   100      100    100       100      100      100     100     100      100       100  
November 25, 2006............   100      100    100       100      100      100     100     100      100       100  
November 25, 2007............   100      100    100       100      100      100     100     100      100       100  
November 25, 2008............   100      100    100       100       11      100     100     100       74        11  
November 25, 2009............   100      100     44        15        5      100     100      44       15         5  
November 25, 2010............   100       83     30         8        0      100      83      30        8         0  
November 25, 2011............   100       69     20         5        0      100      69      20        5         0  
November 25, 2012............   100       57     14         0        0      100      57      14        0         0  
November 25, 2013............   100       47     10         0        0      100      47      10        0         0  
November 25, 2014............   100       39      7         0        0      100      39       7        0         0  
November 25, 2015............   100       32      5         0        0      100      32       5        0         0  
November 25, 2016............   100       27      2         0        0      100      27       0        0         0  
November 25, 2017............   100       22      0         0        0      100      22       0        0         0  
November 25, 2018............   100       18      0         0        0      100      18       0        0         0  
November 25, 2019............   100       15      0         0        0      100      15       0        0         0  
November 25, 2020............   100       11      0         0        0      100      11       0        0         0  
November 25, 2021............   100        9      0         0        0      100       9       0        0         0  
November 25, 2022............   100        7      0         0        0      100       7       0        0         0  
November 25, 2023............   100        6      0         0        0      100       6       0        0         0  
November 25, 2024............   100        5      0         0        0      100       5       0        0         0  
November 25, 2025............   100        4      0         0        0      100       1       0        0         0  
November 25, 2026............   100        0      0         0        0      100       0       0        0         0  
November 25, 2027............   100        0      0         0        0      100       0       0        0         0  
November 25, 2028............   100        0      0         0        0      100       0       0        0         0  
November 25, 2029............    92        0      0         0        0       92       0       0        0         0  
November 25, 2030............    80        0      0         0        0       80       0       0        0         0  
November 25, 2031............    66        0      0         0        0       66       0       0        0         0  
November 25, 2032............    52        0      0         0        0       52       0       0        0         0  
November 25, 2033............    35        0      0         0        0       35       0       0        0         0  
November 25, 2034............    18        0      0         0        0       18       0       0        0         0  
November 25, 2035............     0        0      0         0        0        0       0       0        0         0  
Weighted Average Life in                                                                                            
Years (to maturity).......... 26.98     9.05   4.94      3.68     2.75    26.97    9.03    4.86     3.47      2.53  
Weighted Average Life in                                                                                            
Years (to 10% call).......... 26.89     8.33   4.51      3.41     2.42    26.89    8.33    4.44     3.21      2.35  
Weighted Average Life in                                                                                            
Years (to 20% call).......... 26.55     7.29   3.99      2.59     2.09    26.55    7.29    3.92     2.59      2.09  

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

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                                                   Class M5                                   Class M6                 
                                  -----------------------------------------   -----------------------------------------
Payment Date                         0%     50%      100%     150%     200%     0%      50%      100%     150%     200%
--------------------------------    ---     ---      ----     ----     ----    ---      ---      ----     ----     ----
                                                                                                                       
Initial.........................    100     100      100      100      100     100      100      100      100      100 
November 25, 2006...............    100     100      100      100      100     100      100      100      100      100 
November 25, 2007...............    100     100      100      100      100     100      100      100      100      100 
November 25, 2008...............    100     100      100       28       11     100      100      100       28       11 
November 25, 2009...............    100     100       44       15        5     100      100       44       15        1 
November 25, 2010...............    100      83       30        8        0     100       83       30        8        0 
November 25, 2011...............    100      69       20        5        0     100       69       20        1        0 
November 25, 2012...............    100      57       14        0        0     100       57       14        0        0 
November 25, 2013...............    100      47       10        0        0     100       47       10        0        0 
November 25, 2014...............    100      39        7        0        0     100       39        7        0        0 
November 25, 2015...............    100      32        4        0        0     100       32        0        0        0 
November 25, 2016...............    100      27        0        0        0     100       27        0        0        0 
November 25, 2017...............    100      22        0        0        0     100       22        0        0        0 
November 25, 2018...............    100      18        0        0        0     100       18        0        0        0 
November 25, 2019...............    100      15        0        0        0     100       15        0        0        0 
November 25, 2020...............    100      11        0        0        0     100       11        0        0        0 
November 25, 2021...............    100       9        0        0        0     100        9        0        0        0 
November 25, 2022...............    100       7        0        0        0     100        7        0        0        0 
November 25, 2023...............    100       6        0        0        0     100        6        0        0        0 
November 25, 2024...............    100       4        0        0        0     100        0        0        0        0 
November 25, 2025...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2026...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2027...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2028...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2029...............     92       0        0        0        0      92        0        0        0        0 
November 25, 2030...............     80       0        0        0        0      80        0        0        0        0 
November 25, 2031...............     66       0        0        0        0      66        0        0        0        0 
November 25, 2032...............     52       0        0        0        0      52        0        0        0        0 
November 25, 2033...............     35       0        0        0        0      35        0        0        0        0 
November 25, 2034...............     18       0        0        0        0      18        0        0        0        0 
November 25, 2035...............      0       0        0        0        0       0        0        0        0        0 
Weighted Average Life in                                                                                               
Years (to maturity).............  26.97    9.01     4.80     3.34     2.43   26.97     8.97     4.74     3.24     2.37 
Weighted Average Life in                                                                                               
Years (to 10% call).............  26.89    8.33     4.39     3.09     2.26   26.89     8.33     4.36     3.01     2.22 
Weighted Average Life in                                                                                               
Years (to 20% call).............  26.55    7.29     3.88     2.59     2.09   26.55     7.29     3.85     2.59     2.09 

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

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at the Respective Percentages of the Prepayment Assumption

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                                                   Class M7                                   Class M8                 
                                  ------------------------------------------  -----------------------------------------
Payment Date                         0%     50%      100%     150%     200%     0%      50%      100%     150%     200%
--------------------------------    ---     ---      ----     ----     ----    ---      ---      ----     ----     ----
                                                                                                                       
Initial.........................    100     100      100      100      100     100      100      100      100      100 
November 25, 2006...............    100     100      100      100      100     100      100      100      100      100 
November 25, 2007...............    100     100      100      100      100     100      100      100      100      100 
November 25, 2008...............    100     100      100       28       11     100      100      100       28       11 
November 25, 2009...............    100     100       44       15        0     100      100       44       15        0 
November 25, 2010...............    100      83       30        8        0     100       83       30        8        0 
November 25, 2011...............    100      69       20        0        0     100       69       20        0        0 
November 25, 2012...............    100      57       14        0        0     100       57       14        0        0 
November 25, 2013...............    100      47       10        0        0     100       47       10        0        0 
November 25, 2014...............    100      39        6        0        0     100       39        0        0        0 
November 25, 2015...............    100      32        0        0        0     100       32        0        0        0 
November 25, 2016...............    100      27        0        0        0     100       27        0        0        0 
November 25, 2017...............    100      22        0        0        0     100       22        0        0        0 
November 25, 2018...............    100      18        0        0        0     100       18        0        0        0 
November 25, 2019...............    100      15        0        0        0     100       15        0        0        0 
November 25, 2020...............    100      11        0        0        0     100       11        0        0        0 
November 25, 2021...............    100       9        0        0        0     100        9        0        0        0 
November 25, 2022...............    100       7        0        0        0     100        3        0        0        0 
November 25, 2023...............    100       1        0        0        0     100        0        0        0        0 
November 25, 2024...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2025...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2026...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2027...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2028...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2029...............     92       0        0        0        0      92        0        0        0        0 
November 25, 2030...............     80       0        0        0        0      80        0        0        0        0 
November 25, 2031...............     66       0        0        0        0      66        0        0        0        0 
November 25, 2032...............     52       0        0        0        0      52        0        0        0        0 
November 25, 2033...............     35       0        0        0        0      35        0        0        0        0 
November 25, 2034...............     18       0        0        0        0      18        0        0        0        0 
November 25, 2035...............      0       0        0        0        0       0        0        0        0        0 
Weighted Average Life in                                                                                               
Years (to maturity).............  26.97    8.93     4.68     3.14     2.31   26.96     8.87     4.62     3.07     2.30 
Weighted Average Life in                                                                                               
Years (to 10% call).............  26.89    8.33     4.33     2.92     2.17   26.89     8.33     4.30     2.87     2.17 
Weighted Average Life in                                                                                               
Years (to 20% call).............  26.55    7.29     3.82     2.59     2.09   26.55     7.29     3.78     2.58     2.09 

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

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                                                   Class M9                                   Class M10                
                                  ------------------------------------------  -----------------------------------------
Payment Date                         0%     50%      100%     150%     200%     0%      50%      100%     150%     200%
--------------------------------    ---     ---      ----     ----     ----    ---      ---      ----     ----     ----
                                                                                                                       
Initial.........................    100     100      100      100      100     100      100      100      100      100 
November 25, 2006...............    100     100      100      100      100     100      100      100      100      100 
November 25, 2007...............    100     100      100      100       58     100      100      100      100       34 
November 25, 2008...............    100     100      100       28       11     100      100      100       28        2 
November 25, 2009...............    100     100       44       15        0     100      100       44       14        0 
November 25, 2010...............    100      83       30        1        0     100       83       30        0        0 
November 25, 2011...............    100      69       20        0        0     100       69       20        0        0 
November 25, 2012...............    100      57       14        0        0     100       57       11        0        0 
November 25, 2013...............    100      47        7        0        0     100       47        0        0        0 
November 25, 2014...............    100      39        0        0        0     100       39        0        0        0 
November 25, 2015...............    100      32        0        0        0     100       32        0        0        0 
November 25, 2016...............    100      27        0        0        0     100       27        0        0        0 
November 25, 2017...............    100      22        0        0        0     100       22        0        0        0 
November 25, 2018...............    100      18        0        0        0     100       18        0        0        0 
November 25, 2019...............    100      15        0        0        0     100       14        0        0        0 
November 25, 2020...............    100      11        0        0        0     100        4        0        0        0 
November 25, 2021...............    100       4        0        0        0     100        0        0        0        0 
November 25, 2022...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2023...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2024...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2025...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2026...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2027...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2028...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2029...............     92       0        0        0        0      92        0        0        0        0 
November 25, 2030...............     80       0        0        0        0      80        0        0        0        0 
November 25, 2031...............     66       0        0        0        0      66        0        0        0        0 
November 25, 2032...............     52       0        0        0        0      52        0        0        0        0 
November 25, 2033...............     35       0        0        0        0      35        0        0        0        0 
November 25, 2034...............     18       0        0        0        0      18        0        0        0        0 
November 25, 2035...............      0       0        0        0        0       0        0        0        0        0 
Weighted Average Life in                                                                                               
Years (to maturity).............  26.96    8.79     4.56     3.00     2.24   26.94     8.66     4.45     2.90     2.18 
Weighted Average Life in                                                                                               
Years (to 10% call).............  26.89    8.33     4.29     2.83     2.13   26.89     8.33     4.27     2.79     2.11 
Weighted Average Life in                                                                                               
Years (to 20% call).............  26.55    7.29     3.77     2.54     2.05   26.55     7.29     3.75     2.50     2.03 

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

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                                                  Class M11                                   Class M12                
                                  ------------------------------------------- -----------------------------------------
Payment Date                         0%     50%      100%     150%     200%     0%      50%      100%     150%     200%
--------------------------------    ---     ---      ----     ----     ----    ---      ---      ----     ----     ----
                                                                                                                       
Initial.........................    100     100      100      100      100     100      100      100      100      100 
November 25, 2006...............    100     100      100      100      100     100      100      100      100      100 
November 25, 2007...............    100     100      100      100       34     100      100      100      100       33 
November 25, 2008...............    100     100      100       28        0     100      100      100       16        0 
November 25, 2009...............    100     100       44        0        0     100      100       44        0        0 
November 25, 2010...............    100      83       30        0        0     100       83       21        0        0 
November 25, 2011...............    100      69       15        0        0     100       69        0        0        0 
November 25, 2012...............    100      57        0        0        0     100       57        0        0        0 
November 25, 2013...............    100      47        0        0        0     100       47        0        0        0 
November 25, 2014...............    100      39        0        0        0     100       39        0        0        0 
November 25, 2015...............    100      32        0        0        0     100       28        0        0        0 
November 25, 2016...............    100      27        0        0        0     100       12        0        0        0 
November 25, 2017...............    100      21        0        0        0     100        0        0        0        0 
November 25, 2018...............    100       8        0        0        0     100        0        0        0        0 
November 25, 2019...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2020...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2021...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2022...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2023...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2024...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2025...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2026...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2027...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2028...............    100       0        0        0        0     100        0        0        0        0 
November 25, 2029...............     92       0        0        0        0      92        0        0        0        0 
November 25, 2030...............     80       0        0        0        0      80        0        0        0        0 
November 25, 2031...............     66       0        0        0        0      66        0        0        0        0 
November 25, 2032...............     52       0        0        0        0      52        0        0        0        0 
November 25, 2033...............     35       0        0        0        0      35        0        0        0        0 
November 25, 2034...............      6       0        0        0        0       0        0        0        0        0 
November 25, 2035...............      0       0        0        0        0       0        0        0        0        0 
Weighted Average Life in                                                                                               
Years (to maturity).............  26.89    8.37     4.26     2.76     2.11   26.77     7.90     4.01     2.60     2.05 
Weighted Average Life in                                                                                               
Years (to 10% call).............  26.88    8.30     4.23     2.74     2.11   26.77     7.90     4.01     2.60     2.05 
Weighted Average Life in                                                                                               
Years (to 20% call).............  26.55    7.29     3.73     2.46     2.03   26.55     7.29     3.72     2.44     2.03 

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

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Percentage of Initial Class Principal Amount Outstanding
at the Respective Percentages of the Prepayment Assumption

                                                                [Download Table]


                                                     Class M13                  
                                       -----------------------------------------
Payment Date                             0%      50%      100%    150%     200% 
-------------------------------         ---      ---      ----    ----     ---- 
                                                                                
Initial.........................        100      100      100     100      100  
November 25, 2006...............        100      100      100     100      100  
November 25, 2007...............        100      100      100     100        0  
November 25, 2008...............        100      100      100       0        0  
November 25, 2009...............        100      100       21       0        0  
November 25, 2010...............        100       83        0       0        0  
November 25, 2011...............        100       69        0       0        0  
November 25, 2012...............        100       51        0       0        0  
November 25, 2013...............        100       29        0       0        0  
November 25, 2014...............        100       10        0       0        0  
November 25, 2015...............        100        0        0       0        0  
November 25, 2016...............        100        0        0       0        0  
November 25, 2017...............        100        0        0       0        0  
November 25, 2018...............        100        0        0       0        0  
November 25, 2019...............        100        0        0       0        0  
November 25, 2020...............        100        0        0       0        0  
November 25, 2021...............        100        0        0       0        0  
November 25, 2022...............        100        0        0       0        0  
November 25, 2023...............        100        0        0       0        0  
November 25, 2024...............        100        0        0       0        0  
November 25, 2025...............        100        0        0       0        0  
November 25, 2026...............        100        0        0       0        0  
November 25, 2027...............        100        0        0       0        0  
November 25, 2028...............        100        0        0       0        0  
November 25, 2029...............         92        0        0       0        0  
November 25, 2030...............         80        0        0       0        0  
November 25, 2031...............         66        0        0       0        0  
November 25, 2032...............         38        0        0       0        0  
November 25, 2033...............          2        0        0       0        0  
November 25, 2034...............          0        0        0       0        0  
November 25, 2035...............          0        0        0       0        0  
Weighted Average Life in                                                        
Years (to maturity).............      26.35     6.95     3.55    2.38     2.01  
Weighted Average Life in                                                        
Years (to 10% call).............      26.35     6.95     3.55    2.38     2.01  
Weighted Average Life in                                                        
Years (to 20% call).............      26.34     6.91     3.54    2.38     2.01  

----------                                                                      
* Less than 0.5% but greater than 0.0%.                                         

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Prospectus                                                                      
Fieldstone Mortgage Investment Corporation
 Depositor

Mortgage-Backed Securities
Issuable in Series

----------------------------------------                                        
Consider carefully the risk factors                                             
beginning on page 9 in this prospectus                                          

Your securities will represent                                                  
obligations of your trust only and                                              
will not represent interests in or                                              
obligations of Fieldstone Mortgage                                              
Investment Corporation or any of its                                            
affiliates.                                                                     

This prospectus may be used to offer                                            
and sell any series of securities only                                          
if accompanied by the prospectus                                                
supplement for that series.                                                     
----------------------------------------                                        

The Securities                                                                  

Fieldstone Mortgage Investment Corporation may offer to sell mortgage-backed    
notes or mortgage pass-through certificates in one or more series with one      
or more classes.                                                                

o    Each issuance of securities will have its own series designation.          

o    Each class of securities will evidence either the ownership interest in    
the assets of a trust or will evidence a debt obligation of a trust,  
secured by the assets of the related trust.                           

o    Each class of securities will be rated in one of the four highest rating   
categories by at least one nationally recognized statistical rating   
organization.                                                         

o    Holders of the securities will receive interest and principal payments     
   from collections on the related trust's assets but have no entitlement to
   payments from other assets of Fieldstone Mortgage Investment Corporation.

o    No market will exist for the securities of any series before they are      
issued and no assurances can be given that a secondary market for the 
securities will develop or, if developed, will continue.              

o    Your securities may be supported by one or more forms of credit            
enhancement.                                                          

Your trust may include                                                          

o    mortgage loans or participations in mortgage loans secured by one- to      
four-family residential first lien mortgage loans, and may include    
junior-lien mortgage loans                                            

o    non-conforming mortgage loans that do not qualify for purchase by          
government sponsored agencies                                         

o    mortgage pass-through or mortgage participation certificates issued or     
guaranteed by Ginnie Mae, Fannie Mae or Freddie Mac                   

o    mortgage pass-through or mortgage participation certificates or other      
mortgage-backed securities issued or guaranteed by                    
private entities.                                                     

Neither the Securities and Exchange Commission nor any state securities         
commission has approved or disapproved these securities or determined that this 
prospectus is accurate or complete. Any representation to the contrary is a     
criminal offense.                                                               

July 1, 2005

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 TABLE OF CONTENTS

                                                        [Enlarge/Download Table]

                                                                                                                    Page

                                                                                                                        
SUMMARY OF PROSPECTUS.................................................................................................1 

RISK FACTORS..........................................................................................................9 

DESCRIPTION OF THE SECURITIES........................................................................................23 
         General.....................................................................................................23 
         Book-entry Procedures and Definitive Certificates...........................................................25 
         Principal and Interest Payments.............................................................................30 
         Allocation of Realized Losses...............................................................................31 
         Valuation of Trust Assets...................................................................................32 
         Optional Redemption or Termination..........................................................................32 
         Maturity and Prepayment Considerations......................................................................33 

YIELD CONSIDERATIONS.................................................................................................35 

THE TRUSTS...........................................................................................................36 
         General.....................................................................................................36 
         Assignment of Trust Assets..................................................................................36 
         the Trust Assets............................................................................................39 
         Mortgage Loans..............................................................................................39 
         Agency Securities...........................................................................................40 
         Mortgage Pass-through Certificates and Government Obligations...............................................41 
         Private Mortgage-backed Securities..........................................................................42 
         Mortgage Loan Information in Prospectus Supplements.........................................................44 
         Substitution of Trust Assets................................................................................45 
         Pre-funding Account.........................................................................................46 
         Accounts....................................................................................................48 
         Cash Flow Agreements........................................................................................49 
         Credit Enhancement..........................................................................................49 
         Fidelity Bonds and Errors and Omissions Insurance...........................................................56 

DESCRIPTION OF THE SPONSOR AND CERTAIN RELATED PARTIES...............................................................56 
         The Sponsor and the Seller..................................................................................56 
         The Depositor...............................................................................................56 
         The Servicer................................................................................................57 

ORIGINATION AND SALE OF MORTGAGE LOANS...............................................................................57 
         Origination of the Mortgage Loans...........................................................................57 
         Representations and Warranties..............................................................................57 
         Underwriting of the Mortgage Loans..........................................................................59 
         Fieldstone Underwriting Guidelines..........................................................................60 

SERVICING OF THE TRUST ASSETS........................................................................................63 
         General.....................................................................................................63 
         Fieldstone Servicing Corp...................................................................................65 
         Payments On Mortgage Loans..................................................................................65 
         Advances....................................................................................................66 

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         Withdrawals From Collection Account.........................................................................67 
         Collection and Other Servicing Procedures...................................................................68 
         Subservicers................................................................................................69 
         Realization Upon Defaulted Mortgage Loans...................................................................69 
         Evidence as to Compliance...................................................................................70 
         Mortgage-related Assets.....................................................................................70 

DESCRIPTION OF THE AGREEMENTS........................................................................................70 
         the Agreements..............................................................................................70 
         Master Servicer or Trust Administrator......................................................................71 
         Trust Administration........................................................................................71 
         Retained Interest; Servicing Compensation and Payment of Expenses...........................................72 
         the Trustee.................................................................................................72 
         the Owner Trustee...........................................................................................73 
         Duties of the Trustee.......................................................................................73 
         Amendment of the Agreements.................................................................................74 
         Servicer Events of Default and Master Servicer Events of Default............................................75 
         Rights Upon Servicer and Master Servicer Events of Default..................................................76 
         Reports to Securityholders..................................................................................77 
         Termination.................................................................................................77 
         Certain Terms of the Indenture..............................................................................78 
         Redemption..................................................................................................80 
         Discharge of the Indenture..................................................................................80 

CERTAIN LEGAL ASPECTS OF MORTGAGE LOANS..............................................................................81 
         General.....................................................................................................81 
         Mortgage Loans..............................................................................................81 
         Interest in Real Property...................................................................................82 
         Foreclosure.................................................................................................82 
         Junior Mortgages............................................................................................84 
         Rights of Reinstatement and Redemption......................................................................84 
         Consumer Protection Laws With Respect to Mortgage Loans.....................................................85 
         Anti-deficiency Legislation and Other Limitations On Lenders................................................85 
         Servicemembers Civil Relief Act and Similar State-enacted Legislation.......................................87 
         Environmental Considerations................................................................................88 
         "Due-on Sale" Clauses.......................................................................................90 
         Enforceability of Prepayment and Late Payment Fees..........................................................91 
         Equitable Limitations On Remedies...........................................................................91 
         Secondary Financing; Due-on-encumbrance Provisions..........................................................92 
         Alternative Mortgage Instruments............................................................................92 
         Forfeitures in Drug and Rico Proceedings....................................................................93 
         Certain Legal Aspects of the Mortgage-related Assets........................................................93 

USE OF PROCEEDS......................................................................................................93 

FEDERAL INCOME TAX CONSEQUENCES......................................................................................93 
         General.....................................................................................................94 
         Remic Certificates..........................................................................................94 
         Grantor Trusts.............................................................................................130 
         Debt Securities and Partnership Trusts.....................................................................138 

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         Taxation of Debt Securityholders...........................................................................139
         Taxation of Owners of Partnership Securities...............................................................139

STATE AND OTHER TAX CONSIDERATIONS..................................................................................145

ERISA CONSIDERATIONS................................................................................................145
         General....................................................................................................145
         Plan Assets................................................................................................146
         Possible Exemptive Relief..................................................................................147
         Underwriters' Exemption....................................................................................147

LEGAL INVESTMENT CONSIDERATIONS.....................................................................................154

LEGAL MATTERS.......................................................................................................156

PLAN OF DISTRIBUTION................................................................................................156

RATINGS.............................................................................................................157

ADDITIONAL INFORMATION..............................................................................................157
         Financial Information......................................................................................158

INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE.....................................................................158

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IMPORTANT NOTICE ABOUT INFORMATION PRESENTED IN THIS
PROSPECTUS AND THE RELATED PROSPECTUS SUPPLEMENT

     We provide information to you about your investment in two separate
documents that progressively provide more detail: this prospectus, which        
provides general information, some of which may not apply to your series of     
securities, and the related prospectus supplement, which will describe the      
specific terms of your series of securities, including:                         

        o  the principal amount, interest rate and authorized denominations of
each class of securities                                

o  the timing of interest and principal payments              

   o  statistical and other information about the specific assets of
your trust                                              

     o  information concerning the seller or sellers of the trust assets

o  information concerning the related transaction parties     

o  information about credit enhancement for each class        

o  the ratings for each class                                 

o  the method for selling your securities.                    

         You should rely only on the information provided in this prospectus and
the related prospectus supplement, including the information incorporated by    
reference. We have not authorized anyone to provide you with different          
information. Your securities are not offered in any state where the offer is not
permitted. The information provided in this prospectus or any prospectus        
supplement is accurate as of the date on the front cover of these documents.    

         We have included cross-references in this prospectus and in the related
prospectus supplement to captions in these materials where you can find further 
related discussions. The table of contents included in the related prospectus   
supplement provides the pages on which these captions are located.              

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 SUMMARY OF PROSPECTUS

        This summary is qualified in its entirety by reference to the detailed
information appearing elsewhere in this Prospectus and in the related Prospectus
Supplement which will be prepared in connection with each series of securities. 

                                                        [Enlarge/Download Table]

                                                                                                                
Securities....................................... A trust will issue either mortgage-backed notes ("notes,") or 
                                                  mortgage pass-through certificates ("certificates," and       
                                                  together with the notes, the "securities"), which securities  
                                                  will be issued from time to time in series.  Notes will be    
                                                  issued pursuant to the terms of a transfer and servicing      
                                                  agreement and an indenture.  Certificates will be issued      
                                                  pursuant to a pooling and servicing agreement.  A transfer and
                                                  servicing agreement, an indenture and pooling and servicing   
                                                  agreement will be referred to individually as an "agreement"  
                                                  and collectively as the "agreements."                         

Seller........................................... Each of the sellers of mortgage loans or other trust assets to
                                                  Fieldstone Mortgage Investment Corporation ("FMIC") pursuant  
                                                  to a mortgage loan purchase agreement, which sellers may      
                                                  include affiliates of the depositor.                          

Depositor........................................ Fieldstone Mortgage Investment Corporation or FMIC.           

Issuer........................................... A trust created pursuant to either an owner trust agreement,  
                                                  in connection with the issuance of notes, or a pooling and    
                                                  servicing agreement, in connection with the issuance of       
                                                  certificates.                                                 

Master Servicer.................................. A master servicer may supervise the servicing of the mortgage 
                                                  loans of a trust for certain series.  The master servicer,    
                                                  upon a default by a servicer, generally will assume the       
                                                  primary servicing responsibilities with respect to the        
                                                  mortgage loans serviced by the defaulting servicer or engage a
                                                  successor servicer.  Any master servicer shall be set forth in
                                                  the related prospectus supplement.                            

Servicer......................................... Mortgage loans will be serviced by one or more servicers as   
                                                  identified in the prospectus supplement.  Unless otherwise    
                                                  specified in the related prospectus supplement, Fieldstone    
                                                  Servicing Corp. shall serve as the servicer.                  

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Subservicer...................................... Certain of the servicing functions may be performed by one or    
                                                  more subservicers as identified in the related prospectus        
                                                  supplement.  The duties and responsibilities of a servicer may   
                                                  be performed by one or more subservicers.  Unless otherwise      
                                                  specified, a master servicer, servicer or subservicer may be     
                                                  referred to generally as a "servicer."                           

Trustee.......................................... Each trustee under the applicable pooling and servicing agreement
                                                  and named as such in the related prospectus supplement.          

Owner Trustee.................................... Each owner trustee identified in the related trust agreement,    
                                                  which acts on behalf of the issuer and named as such in the      
                                                  related prospectus supplement.                                   

Indenture Trustee................................ Each indenture trustee under the applicable transfer and         
                                                  servicing agreement or indenture and named as such in the        
                                                  related prospectus supplement.                                   

Trust Administrator.............................. The trust administrator, if any, under the applicable pooling    
                                                  and servicing agreement or indenture and named as such in the    
                                                  related prospectus supplement.                                   

Trust Assets..................................... Your trust primarily may include mortgage loans,                 
                                                  mortgage-related assets, a pre-funding account, designated to    
                                                  acquire trust assets, derivative instruments, one or more        
                                                  insurance policies, financial guaranty agreements or other       
                                                  items of credit enhancement described herein.                    

  o   Mortgage Loans............................. Mortgage loans secured by mortgage liens on one- to              
                                                  four-family residential properties.                              

  o   Mortgage-Related Assets.................... Mortgage-backed securities issued by Fannie Mae, Freddie Mac,    
                                                  Ginnie Mae, an agency of the United States government, or a      
                                                  private issuer.                                                  

  o   Pre-Funding Account........................ An account containing funds deposited on the closing date to     
                                                  be used to acquire mortgage-related assets within 90 days of the 
                                                  issuance of securities, unless otherwise specified in the related
                                                  prospectus supplement.                                           

  o   Credit Enhancement......................... One or more items as described under "Credit Enhancement" in     
                                                  this summary of the prospectus.                                  

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Important Dates..................................   The following are certain significant dates and periods       
                                                    related to your securities.                                   

  o   Payment Date...............................   The business day set forth in the related prospectus          
                                                    supplement on which payments are made to the securityholders. 

  o   Servicer Remittance Date...................   The business day set forth in the related prospectus          
                                                    supplement on which the servicer or subservicer remits        
                                                    collections on the trust assets and advances, if any, to the  
                                                    master servicer or the trustee.                               

  o   Determination Date.........................   The business day set forth in the related pooling and         
                                                    servicing agreement, transfer and servicing agreement or      
                                                    indenture, as applicable, on which the servicer or subservicer
                                                    is required to determine among other things the amounts to be 
                                                    advanced with respect to the securities.                      

  o   Record Date................................   Unless otherwise specified in the related prospectus          
                                                    supplement, with respect to fixed rate securities, the last   
                                                    business day of the month preceding the payment date.  Unless 
                                                    otherwise specified in the related prospectus supplement, with
                                                    respect to floating rate securities, the business day         
                                                    preceding the payment date; provided however, that in the case
                                                    of certificated securities, the record date shall be the last 
                                                    day of the month.                                             

  o   Interest Accrual Period.....................  Unless otherwise specified in the related prospectus          
                                                    supplement, with respect to fixed rate securities, the        
                                                    calendar month preceding the payment date.  Unless otherwise  
                                                    specified in the related prospectus supplement, with respect  
                                                    to floating rate securities, the period from the immediately  
                                                    preceding payment date through the business day preceding the 
                                                    payment date.                                                 

  o    Due Period.................................  Unless otherwise specified in the related prospectus          
                                                    supplement, with respect to a payment date, the period from   
                                                    the second day of the calendar month preceding the calendar   
                                                    month in which the payment date occurs through the first day  
                                                    of the calendar month in which the payment date occurs.       

  o    Prepayment Period........................... Unless otherwise specified in the related prospectus          
                                                    supplement, the period beginning on the 16th day of           

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                                                  the preceding calendar month through, and including, the 15th day
                                                  of the calendar month in which the payment date occurs,          
                                                  provided however that, in certain circumstances, prepayments     
                                                  in full and partial prepayments may have different prepayment    
                                                  periods as detailed in any related prospectus supplement.        

Credit Enhancement............................... If so provided in the related prospectus supplement, partial     
                                                  or full protection against certain defaults and losses on the    
                                                  trust assets may be provided to one or more classes of           
                                                  securities in the form of subordination of one or more other     
                                                  classes of securities of such series, or may be provided by      
                                                  one or more other types of credit enhancement, such as           
                                                  subordination and overcollateralization and certain external     
                                                  credit enhancement including one or more derivative              
                                                  instruments, a letter of credit, pool insurance policy,          
                                                  special hazard insurance policy, mortgage bankruptcy             
                                                  insurance, financial guarantee insurance policy, primary         
                                                  mortgage insurance, reserve fund or another type of credit       
                                                  enhancement, or a combination thereof.  The amount and types     
                                                  of coverage, the identification of the entity providing the      
                                                  coverage and related information with respect to each type of    
                                                  credit enhancement will be described in the related prospectus   
                                                  supplement.  The prospectus supplement also will describe the    
                                                  credit support of any mortgage-related assets that are           
                                                  included in the related trust.  See "Risk Factors -- Credit      
                                                  enhancement may not cover all losses on your securities" in      
                                                  this prospectus.                                                 

Advances......................................... The servicers, as specified in the related prospectus            
                                                  supplement, may be obligated as part of their servicing          
                                                  responsibilities to make certain advances that in the            
                                                  servicer's good faith judgment, as applicable, it deems          
                                                  recoverable with respect to delinquent scheduled payments of     
                                                  principal and interest on mortgage loans.  The servicers also    
                                                  may be obligated to advance delinquent payments of taxes,        
                                                  insurance premiums and escrowed items, as well as                
                                                  liquidation-related expenses with respect to mortgage loans.     
                                                  Neither FMIC nor any of its affiliates that are not also         
                                                  servicers will have any responsibility to make such advances.    
                                                  Advances made by any servicer would be reimbursable              


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                                                  generally from subsequent recoveries in respect of such mortgage
                                                  loans and otherwise to the extent described herein and in the   
                                                  related prospectus supplement.  The prospectus supplement will  
                                                  describe any advance obligations in connection with the         
                                                  mortgage loans included in your trust.  To the extent provided  
                                                  in the related prospectus supplement, the master servicer will  
                                                  be obligated to make any required advances if the servicer or   
                                                  the subservicer fails in its obligations to do so, and will be  
                                                  entitled to be reimbursed to the extent specified in the        
                                                  related prospectus supplement.  See "Origination and Sale of    
                                                  Mortgage Loans" in this prospectus.                             

Optional Termination                                                                                              
or Redemption.................................... If so specified in the related prospectus supplement, a series  
                                                  of securities may be subject to optional early termination      
                                                  through the repurchase of the trust assets of your trust by     
                                                  the party specified therein, under the circumstances and in     
                                                  the manner set forth therein.  If so provided in the related    
                                                  prospectus supplement, upon the reduction of the aggregate      
                                                  unpaid principal balance of the trust assets to less than a     
                                                  specified percentage on and after a date specified in such      
                                                  prospectus supplement, the party specified therein will         
                                                  purchase such trust assets at a price determined as set forth   
                                                  in the related prospectus supplement.  In addition, if so       
                                                  provided in the related prospectus supplement, the securities   
                                                  of a series may be redeemed prior to their final scheduled      
                                                  payment date at the option of the seller, the trustee, the      
                                                  trust administrator, the master servicer, the servicer or       
                                                  another party by the purchase of the outstanding securities of  
                                                  such series, under the circumstances and in the manner          
                                                  provided therein.  See "Risk Factors -- Exercise of any right   
                                                  of optional termination or redemption may affect the yield to   
                                                  maturity on your securities" and "Description of the            
                                                  Securities -- Optional Redemption or Termination" in this       
                                                  prospectus.                                                     

Book-Entry Securities............................ If so provided in the related prospectus supplement, one or     
                                                  more classes of the securities will initially be represented    
                                                  by one or more certificates or notes, as applicable,            
                                                  registered in the name of Cede & Co., as the nominee of DTC.    
                                                  No person acquiring an interest in securities so registered     
                                                  will be entitled to                                             

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                                                  receive a definitive certificate or note, as applicable,     
                                                  representing such person's interest except in the event      
                                                  that definitive certificates or notes, as applicable, are    
                                                  issued under the limited circumstances described herein.     
                                                  See "Risk Factors -- Book-Entry registration may affect      
                                                  the liquidity of your securities" and "Description           
                                                  of the Securities -- Book-Entry Procedures and Definitive    
                                                  Certificates" in this prospectus.                            

Tax Status of the Securities..................... The federal income tax consequences to securityholders of any
                                                  series of securities will depend on the characterization of  
                                                  the securities as notes or as certificates.  The prospectus  
                                                  supplement for each series of securities will specify the    
                                                  federal income tax characterization of such series of        
                                                  securities.  The opinion of Hunton & Williams LLP, counsel to
                                                  the depositor, is contained herein regarding the federal     
                                                  income tax treatment of each class of securities.  See       
                                                  "Federal Income Tax Consequences -- General" in this         
                                                  prospectus.                                                  

                                                  Any series of securities constituting notes will be          
                                                  characterized as debt for federal income tax purposes to     
                                                  the extent that they are issued to parties unrelated to      
                                                  the owner of the ownership certificate in the related        
                                                  owner trust. Each noteholder that is unrelated to the        
                                                  owner of the ownership certificate, by its acceptance of a   
                                                  note, will agree to treat the notes as debt.                 

                                                  In certain circumstances, a trust may be classified as a     
                                                  taxable mortgage pool. A trust classified as a taxable       
                                                  mortgage pool will not, however, be subject to federal       
                                                  income tax as a corporation as long as the ownership         
                                                  certificate in the trust is owned exclusively by a "real     
                                                  estate investment trust" or by a "qualified REIT             
                                                  subsidiary." FMIC or an affiliate may hold the ownership     
                                                  certificate and, to the extent specified in the related      
                                                  prospectus supplement, such holder may be required to        
                                                  represent that it qualifies as a "real estate investment     
                                                  trust" and that it will own the ownership certificate        
                                                  directly, or indirectly through a "qualified REIT            
                                                  subsidiary." In addition, the trust agreement may set        
                                                  forth restrictions on the transferability of the ownership   
                                                  certificate to ensure that it will only be held by a "real   
                                                  estate investment                                            


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                                                  trust" or a "qualified REIT subsidiary."                   

                                                  In connection with certain series of securities, one or    
                                                  more elections may be made to treat the related trusts or  
                                                  specified portions thereof as one or more REMICs under the 
                                                  provisions of the Code.                                    

                                                  If an election is made to treat all or a portion of the    
                                                  trust relating to a series of securities as a REMIC, each  
                                                  class of securities of each series will constitute the     
                                                  "regular interests" in a REMIC or the "residual interest"  
                                                  in a REMIC, as specified in the related prospectus         
                                                  supplement.                                                

                                                  A series of securities also may be issued pursuant to an   
                                                  arrangement to be classified as a grantor trust under      
                                                  Subpart E, Part I of Subchapter J of the Code. In that     
                                                  case, holders of securities generally will be treated as   
                                                  the owners of a pro rata undivided interest in each of the 
                                                  Assets.                                                    

                                                  If a trust is classified as a partnership for federal      
                                                  income tax purposes, the trust will not be treated as an   
                                                  association or a publicly traded partnership taxable as a  
                                                  corporation as long as all of the provisions of the        
                                                  applicable agreement are complied with and the statutory   
                                                  and regulatory requirements are satisfied. If notes are    
                                                  issued by a partnership, such notes will be treated as     
                                                  indebtedness for federal income tax purposes.              

                                                  The material federal income tax consequences for investors 
                                                  associated with the purchase, ownership and disposition of 
                                                  the securities are set forth herein under "Federal Income  
                                                  Tax Consequences." The material federal income tax         
                                                  consequences for investors associated with the purchase,   
                                                  ownership and disposition of offered securities will be    
                                                  set forth under the heading "Federal Income Tax            
                                                  Consequences" in the related prospectus supplement. See    
                                                  "Federal Income Tax Consequences" in this prospectus.      

ERISA Considerations............................. A fiduciary of an employee benefit plan and certain other  
                                                  retirement plans and arrangements, including individual    
                                                  retirement accounts, annuities, Keogh plans, and collective
                                                  investment funds and separate                              


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                                                  accounts in which such plans, accounts, annuities or          
                                                  arrangements are invested, that is subject to the Employee    
                                                  Retirement Income Security Act of 1974, as amended            
                                                  ("ERISA"), Section 4975 of the Code, or similar law should    
                                                  carefully review with its legal advisors whether the          
                                                  purchase or holding of securities could give rise to a        
                                                  transaction that is prohibited or is not otherwise            
                                                  permissible either under ERISA, Section 4975 of the Code,     
                                                  or similar law. See "ERISA Considerations" herein and in      
                                                  the related prospectus supplement.                            

Legal Investment................................. The prospectus supplement will specify which, if any, of the  
                                                  classes of offered securities will constitute                 
                                                  "mortgage-related securities" for purposes of the Secondary   
                                                  Mortgage Market Enhancement Act of 1984 ("SMMEA").  Securities
                                                  designated as qualifying as "mortgage-related securities" will
                                                  continue to qualify as such for so long as they are rated in  
                                                  one of the two highest rating categories by at least one      
                                                  nationally recognized statistical rating organization.        
                                                  Classes of securities that qualify as "mortgage-related       
                                                  securities" under SMMEA will be legal investments for persons,
                                                  trusts, corporations, partnerships, associations, business    
                                                  trusts and business entities (including depository            
                                                  institutions, life insurance companies and pension funds)     
                                                  created pursuant to or existing under the laws of the United  
                                                  States or of any state whose authorized investments are       
                                                  subject to state regulation to the same extent as, under      
                                                  applicable law, obligations issued by or guaranteed as to     
                                                  principal and interest by the United States or any agency or  
                                                  instrumentality thereof constitute legal investments for any  
                                                  such entities.  Investors should consult their own legal      
                                                  advisors regarding applicable investment restrictions and the 
                                                  effect of such restrictions on the purchase of any class of   
                                                  securities and the liquidity of any investment in any class of
                                                  securities.  See "Legal Investment Considerations" in this    
                                                  prospectus and in the related prospectus supplement.          

Ratings.......................................... It is a condition to the issuance of the securities that they 
                                                  be rated in one of the four highest rating categories by at   
                                                  least one nationally recognized statistical rating            
                                                  organization.                                                 

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RISK FACTORS

        An investment in the securities involves significant risks. You should
consider the following information and the information under the caption Risk   
Factors in the related prospectus supplement in deciding whether to purchase the
securities.                                                                     

The assets of your trust are the only source of payments for your securities    

       Your securities will be payable solely from the assets of your trust,
including any credit enhancement, and will not have any claims against the      
assets of any other trust or recourse to any other party. Your securities will  
not represent an interest in or obligation of FMIC, the master servicer, the    
servicer, the subservicer, the seller, any of their affiliates, or any other    
person.                                                                         

        Since certain representations and warranties with respect to the trust
assets may have been made and/or assigned in connection with transfers of the   
trust assets prior to the closing date, the rights of the trustee and the       
securityholders with respect to such representations or warranties will be      
limited to their rights as an assignee thereof.                                 

 Neither your securities nor the underlying trust assets will be
guaranteed or insured by any governmental agency or instrumentality, by FMIC,   
the master servicer, the servicer, the subservicer, the seller, any of their    
affiliates, or by any other person, unless identified as guaranteed or insured  
in the related prospectus supplement.                                           

         Proceeds of the assets included in the related trust for each series of
securities (including the assets and any form of credit enhancement) will be the
sole source of payments on the securities, and there will be no recourse to the 
depositor or any other entity in the event that these proceeds are insufficient 
or otherwise unavailable to make all payments provided for under the securities.
As a result, you must depend on payments on the mortgage loans and any related  
credit enhancement for the required payments on your securities.                

      In addition, certain amounts remaining in certain funds or accounts,
including the custodial account, the collection account and any accounts        
maintained as credit enhancement, may be withdrawn under certain conditions, as 
described in the related prospectus supplement. In the event of such withdrawal,
such amounts will not be available for future payments of principal of or       
interest on the securities.                                                     

The timing and amount of prepayments on your securities could reduce your       
yield to maturity                                                               

Prepayments                                                                     

      Prepayment levels are affected by a variety of economic, geographic,
tax, legal, and other factors, including:                                       

o   the extent of prepayments on the underlying trust assets          

     o   how payments of principal are allocated among the classes of securities
of a series, as specified in the prospectus supplement        

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o   if any party has an option to terminate your trust or redeem the  
securities early, the effect of the exercise of the option    

    o   the rate and timing of defaults and losses on the assets in your trust

    o   whether or not the underlying mortgage loans have prepayment penalties
      or the holders of mortgage-related assets are entitled to prepayment
penalties                                                     

   o   the extent that amounts in any pre-funding account have not been used
to purchase additional assets for your trust                  

     o   repurchases of assets in your trust as a result of material breaches of
  representations and warranties made by FMIC, the servicer or the
seller.                                                       

         The assets included in your trust generally may be prepaid at any time.
When interest rates decline, home buyers are more likely to prepay so that they 
may obtain lower alternative financing on their homes. In this event, you may   
not be able to reinvest the proceeds of prepayments in another investment of    
similar credit risk and yield. Conversely, prepayments are likely to decline if 
interest rates rise and you could reinvest prepayment proceeds in investments of
similar credit risk and higher yield.                                           

Yield                                                                           

      In general, if you purchased your securities at a price greater than
their original principal amount, your investment will become less valuable if   
prepayments are higher than you anticipate and will become more valuable if     
prepayments are lower than you anticipate. Conversely, if you purchased your    
securities at a price less than their initial principal amount, your investment 
will become more valuable if prepayments are higher than you anticipate and will
become less valuable if prepayments are lower than you anticipate. The          
sensitivity to prepayments of your securities will be magnified by any          
disproportionate allocation of principal or interest. If your securities are    
entitled to receive a disproportionate allocation of principal or interest, you 
could fail to recover your initial investment if prepayments occur differently  
than you anticipate.                                                            

  The yield to maturity on certain classes of securities including
securities with disproportionate allocations of interest, securities with an    
interest rate that fluctuates inversely with an index or certain other classes  
in a series, may be more sensitive to the rate of prepayments on the mortgage   
loans and the mortgage-related assets and to the occurrence of an early         
retirement of the securities than other classes of securities.                  

The payment performance of your securities will be related to the payment       
performance of your trust assets and there may be greater risk of loss          
associated with certain types of trust assets                                   

  The trust assets backing your securities include mortgage loans.
Certain mortgage loans may have a greater likelihood of delinquency,            
foreclosure, and loss. In the event that the mortgaged properties fail to       
provide adequate security for the mortgage loans included in your trust,        
resulting losses not covered by credit support will be allocated to the         
securities in the                                                               

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manner described in the prospectus supplement. We cannot assure you that the    
values of the mortgaged properties have remained or will remain at the appraised
values on the dates of origination of the mortgage loans. You should consider   
the following risks associated with mortgage loans included in your trust.      

Non-conforming and Sub-prime Loans                                              

      Non-conforming mortgage loans are mortgage loans that do not qualify
for direct purchase or guaranty by government sponsored agencies such as Fannie 
Mae and Freddie Mac. This is due primarily to credit characteristics that do not
satisfy Fannie Mae and Freddie Mac guidelines, including borrowers whose        
creditworthiness and repayment ability do not satisfy Fannie Mae and Freddie Mac
underwriting standards and borrowers who may have a record of derogatory credit 
items. Accordingly, non-conforming mortgage loans are likely to experience rates
of delinquency, foreclosure and loss that are higher, and that may be           
substantially higher, than mortgage loans originated in accordance with Fannie  
Mae or Freddie Mac standards. The principal differences between conforming      
mortgage loans and non-conforming mortgage loans include the applicable         
loan-to-value ratios, the credit and income histories of the borrowers, the     
documentation required for approval of the mortgage loans, the types of         
properties securing the mortgage loans, the loan sizes and the mortgagors'      
occupancy status. The interest rates charged on non-conforming mortgage loans   
are often higher than those charged on conforming mortgage loans. The           
combination of different underwriting criteria and higher rates of interest may 
also lead to higher delinquency, foreclosure and losses on non-conforming       
mortgage loans.                                                                 

Junior Lien Mortgage Loans                                                      

       Your trust may contain mortgage loans secured by junior liens and the
related senior liens may or may not be included in your trust. A decline in     
residential real estate values could reduce the value of a mortgaged property   
securing a junior lien mortgage loan to below that of all liens on the mortgaged
property. Because mortgage loans secured by junior liens are subordinate to the 
rights under senior liens, a decline would adversely affect the position of the 
junior lienholder before having any effect on the position of the senior        
lienholder. Interest rates, the condition of the mortgaged property and other   
factors may also reduce the value of the mortgaged property. This reduction of  
value will reduce the likelihood that, in the event of a default by the         
borrower, liquidation or other proceeds will be sufficient to repay amounts     
owing on the junior lien mortgage loan.                                         

         Other factors may influence the prepayment rate of junior lien mortgage
loans. These include the amounts of, and interest on, the senior mortgage loan  
and the use of senior lien mortgage loans as long-term financing for home       
purchases and junior lien mortgage loans as shorter-term financing. Accordingly,
junior lien mortgage loans may experience a higher rate of prepayments than     
senior lien mortgage loans. Any future limitations on the rights of borrowers to
deduct interest payments on junior lien mortgage loans for federal income tax   
purposes may increase the rate of prepayments on junior lien mortgage loans.    

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Negatively Amortizing Loans                                                     

In the case of mortgage loans that are subject to negative    
amortization, their principal balances could be increased to an amount at or    
above the value of the underlying mortgaged properties. This would increase the 
likelihood of default. To the extent that losses are not covered by credit      
support, your trust will bear the risk of loss resulting from default by        
borrowers and will look primarily to the value of the mortgaged properties for  
recovery of the outstanding principal and unpaid interest on the defaulted      
mortgage loans.                                                                 

Buydown Mortgage Loans                                                          

Certain mortgage loans may be subject to temporary buydown plans in which the   
monthly payments made by the borrower during the early years of the mortgage    
loan will be less than the scheduled monthly payments on the mortgage loan. The 
difference will be made up from an amount contributed by the borrower, the      
seller of the mortgaged property or another source and placed in a custodial    
account, investment earnings on the amount, if any, contributed by the borrower,
or additional buydown funds to be contributed over time by the borrower's       
employer or another source. Generally, the borrower under each buydown mortgage 
loan will be qualified at the lower monthly payment. Accordingly, the repayment 
of a buydown mortgage loan is dependent on the ability of the borrower to make  
larger monthly payments after the buydown funds are depleted and, for some      
buydown mortgage loans, during the initial buydown period. If a borrower is not 
able to make larger monthly payments there could be losses on the mortgage loan.
If these losses are not covered by credit support, they could adversely affect  
your yield to maturity.                                                         

Balloon Loans                                                                   

 Certain mortgage loans may not be fully amortizing - or may not
amortize at all - over their terms to maturity and will require substantial     
payments of principal at their stated maturity. Mortgage loans of this type     
involve a greater degree of risk than fully amortizing loans because the ability
of a borrower to make a balloon payment typically will depend upon his ability  
either to refinance fully the loan or to sell the mortgaged property at a price 
sufficient to permit him to make the balloon payment. The ability of a borrower 
to accomplish either of these goals will be affected by a number of factors,    
including the value of the mortgaged property, the level of mortgage rates, the 
borrower's equity in the mortgaged property, prevailing general economic        
conditions, the availability of credit for loans secured by comparable real     
properties.                                                                     

Adjustable Rate Mortgage Loans                                                  

  The interest rates on adjustable rate mortgage loans will adjust
periodically, generally after an initial period during which the interest rate  
is fixed. Adjustable rates generally equal the sum of an index, for example,    
one-month LIBOR, and a margin. When an index adjusts, the amount of a borrower's
monthly payment will change. As a result, borrowers on adjustable rate mortgage 
loans may be more likely to default on their obligations than borrowers on      
mortgage loans bearing interest at fixed rates. In addition, some adjustable    
rate mortgage loans allow the borrower to elect to convert his mortgage loan to 
a fixed rate mortgage loan. The seller of convertible mortgage loans may be     
required to repurchase a convertible mortgage loans if the                      

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borrower elects conversion. This repurchase of a convertible mortgage loan will 
have the same effect on you as a repayment in full of the mortgage loan. If your
trust includes convertible mortgage loans with this repurchase obligation, your 
securities may experience a higher rate of prepayment than would otherwise be   
the case. Certain adjustable rate mortgage loans may include hybrid mortgage    
loans with an interest rate that is fixed for a period of time or under certain 
circumstances and is followed by an adjustable rate for subsequent periods.     

Limited Recourse and Non-Recourse Obligations                                   

 Some or all of the mortgage loans included in your trust may be
nonrecourse assets or assets for which recourse may be restricted or            
unenforceable. As to those mortgage loans, recourse in the event of borrower    
default will be limited to the specific real property and other assets, if any, 
that were pledged to secure the mortgage loan. However, even with respect to    
those mortgage loans that provide for recourse against the borrower and its     
assets generally, there can be no assurance that enforcement of the recourse    
provisions will be practicable, or that the other assets of the borrower will be
sufficient to permit a recovery in excess of the liquidation value of the       
mortgaged property.                                                             

Mortgage loans with interest-only payments and other non-level amortizing loans 

         Certain of the mortgage loans may provide for payment of interest only,
but no payment of principal, for a specified initial period following the       
origination of the mortgage loan. Following such interest-only period, the      
scheduled payment with respect to each of these mortgage loans will be increased
to, and include a portion allocable to principal in, an amount sufficient to    
amortize the principal balance of the mortgage loan over the remaining term and 
to pay interest at the mortgage interest rate. The presence of these mortgage   
loans in a trust will, absent other considerations, result in longer weighted   
average lives of the related securities than would have been the case had these 
loans not been included in the trust. If you purchase such securities at a      
discount, you should consider that the extension of weighted average lives could
result in a lower yield than would be the case if these mortgage loans provided 
for the payment of principal and interest on every payment date. In addition, a 
borrower may view the absence of any obligation to make payment of principal    
during such period as a disincentive to prepayment. If a recalculated scheduled 
payment as described above is substantially higher than a borrower's previous   
interest-only scheduled payment, that loan may be subject to an increased risk  
of delinquency, loss and/or prepayment. In addition, to the extent that FMC or  
other lenders may provide streamlined refinancing options for mortgage loans at 
the beginning of a mortgage loan's amortization period, the availability of such
refinancing options may result in an increased risk of prepayment.              

        Certain of the mortgage loans may provide for the payment of principal
on the basis of a non-level ammortization schedule. The required amount of      
principal to be paid by the borrower may increase during the term of the        
mortgage loan and the borrower may not be able to pay a scheduled payment that  
is substantially higher than a previous scheduled payment. As a result, a       
non-level ammortizing loan may be subject to an increased risk of delinquency,  
loss and/or prepayment.                                                         

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Mortgage loans with high original loan-to-value ratios may present a greater    
risk of loss                                                                    

     Mortgage loans with high loan-to-value ratios may be more likely to
experience borrower default and foreclosure than mortgage loans with low        
original loan-to-value ratios. Moreover, a high rate of foreclosure on mortgage 
loans with high original loan-to-value ratios is likely to result in significant
losses on such mortgage loans and is more likely to be subject to a judicial    
reduction of the loan amount in bankruptcy or other proceedings than mortgage   
loans with lower original loan-to-value ratios. If a court relieves a borrower's
obligation to repay amounts otherwise due on a mortgage loan, neither the       
servicer, the subservicer nor the master servicer will be required to advance   
funds in respect of such relieved amounts, and any loss in respect thereof may  
reduce the amount available to be paid to securityholders.                      

Mortgage loans with higher combined loan-to-value ratios may be subject to      
higher levels of default                                                        

  At the time of origination of certain of the mortgage loans, the
related borrowers may also have obtained second lien mortgage loans secured by  
the same mortgaged properties as secure the borrowers' mortgage loans included  
in the trust. Mortgage loans with higher combined loan-to-value ratios may      
experience higher rates of default than loans with lower combined loan-to-value 
ratios due to the limited equity of the related borrowers' in the related       
mortgaged properties. Investors also should be aware that borrowers may obtain  
secondary mortgage financing secured by their mortgaged properties following the
date of origination of the mortgage loans included in the trust.                

Mortgage loans originated pursuant to alternative documentation programs may    
have a greater risk of default                                                  

 Certain of the mortgage loans were originated under alternative
documentation programs, such as stated income documentation programs, do not    
require verification of the borrower's income. Alternative documentation        
mortgage loans may involve a greater risk of default than full documentation    
mortgage loans with income verification.                                        

Consumer protection laws may adversely affect your trust's assets               

      A number of federal, state and local laws have been enacted that are
designed to discourage certain predatory lending practices relating to the      
origination and underwriting of mortgage loans, which provide as follows:       

 o   prohibit the inclusion of certain provisions in mortgage loans that
         have mortgage rates or origination costs in excess of prescribed levels

o   require certain disclosures to prospective borrowers regarding the
terms of the loans                                            

o   prohibit discrimination on the basis of age, race, color, sex,    
         religion, marital status, national origin, receipt of public assistance
        or the exercise of any right under the consumer credit protection act,
in the extension of credit                                    

     o   regulate the use and reporting of information related to the borrower's
credit experience                                             

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   o   require additional application disclosures, limit changes that may be
        made to the mortgage loan documents without the borrower's consent and
   restrict a lender's ability to declare a default or to suspend or
reduce a borrower's credit limit to certain enumerated events.

  The trust assets may also be subject to federal laws that impose
additional disclosure requirements on creditors with respect to non-purchase    
money mortgage loans with high interest rates or high up-front fees and charges.
These laws can impose specific liabilities upon creditors that fail to comply,  
including a reduction in the amount payable under the mortgage loans or the     
inability to foreclose on the mortgaged property. These laws may also affect the
enforceability of the terms and provisions of the related mortgage loans. The   
failure to comply with these laws could subject the trust, and other assignees  
of the mortgage loans, to monetary penalties and could result in the borrowers  
rescinding such mortgage loans against either the trust or subsequent holders of
the mortgage loans. Lawsuits have been brought in various states making claims  
against assignees of high cost loans for violations of state law. Named         
defendants in these cases include numerous participants within the secondary    
mortgage market, including some securitization trusts.                          

        If certain provisions of these federal laws are violated, the servicer
may be unable to collect all or part of the principal or interest on the        
mortgage loans. The trust also could be subject to damages and administrative   
enforcement.                                                                    

      Each originator or seller, as the case may be, will warrant that the
origination of each mortgage loan materially complied with all requirements of  
law and that there exists no right of rescission, set-off, counterclaim or      
defense in favor of the borrower under any mortgage loan and that each mortgage 
loan is enforceable against the borrower in accordance with its terms. A breach 
of any warranty that materially and adversely affects your trust's interest in  
any mortgage loan would create an obligation on the part of the originator or   
seller, as the case may be, to repurchase or substitute for the mortgage loan   
unless the breach is cured. However, the failure of an originator or a seller,  
as the case may be, to repurchase the defective asset or pay the liability could
expose your trust to losses.                                                    

Application of Servicemembers Civil Relief Act and similar laws may reduce the  
interest rate borrowers are required to pay on mortgage loans and limit remedies
upon default                                                                    

        The Servicemembers Civil Relief Act, enacted in December 2003, revised
the Soldiers' and Sailors' Civil Relief Act of 1940. The Servicemembers Civil   
Relief Act and comparable state legislation provide relief to borrowers who     
enter active military service and to borrowers in reserve status who are called 
to active duty after the origination of their mortgage loans. Certain state laws
provide relief similar to that of the Servicemembers Civil Relief Act and may   
permit the borrower to delay or forego certain interest and principal payments. 

        The Servicemembers Civil Relief Act provides generally that a borrower
who is covered by the Servicemembers Civil Relief Act may not be charged        
interest on a mortgage loan in excess of 6% per annum during the period of the  
borrower's active duty. These shortfalls are not required to be paid by the     
borrower at any future time. The master servicer, the servicer and the          
subservicer will not advance these shortfalls as delinquent payments and such   
shortfalls are not                                                              

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covered by any form of credit enhancement on the related securities. Shortfalls 
on the mortgage loans due to the application of the Servicemembers Civil Relief 
Act or similar state legislation or regulations will reduce the amount of       
collections available for payment on the securities.                            

  The Servicemembers Civil Relief Act also limits the ability of a
servicer to foreclose on a mortgage loan during the borrower's period of active 
duty and, in some cases, during an additional three-month period thereafter. As 
a result, there may be delays in payment and increased losses on the mortgage   
loans. See "Certain Legal Aspects of the Mortgage Loans -- Anti-Deficiency      
Legislation And Other Limitations On Lenders" in the prospectus.                

State law may limit the servicer's ability to foreclose on assets in a manner   
that maximizes your return                                                      

Substantial delays can be encountered in connection with the  
liquidation of defaulted mortgage loans and corresponding delays in the receipt 
of proceeds could occur. An action to foreclose on a mortgaged property is      
regulated by state statutes, rules and judicial decisions and is subject to many
of the delays and expenses of other lawsuits. In some states an action to obtain
a deficiency judgment is not permitted following a nonjudicial sale of a        
mortgaged property. In the event of a default by a borrower, these restrictions 
may impede the ability of the servicer to foreclose on or sell the mortgaged    
property or to obtain sufficient liquidation proceeds. The servicer, the master 
servicer and the subservicer, as applicable, will be entitled to deduct from    
liquidation proceeds all expenses reasonably incurred in attempting to recover  
amounts due on the liquidated mortgage loan and not yet repaid, including       
payments to prior lienholders, accrued servicing fees, legal fees and costs of  
legal action, real estate taxes, and maintenance and preservation expenses. In  
the event that any mortgaged properties fail to provide adequate security for   
the mortgage loans and insufficient funds are available from any applicable     
credit enhancement, you could experience a loss on your investment.             

       Liquidation expenses do not vary directly or proportionately with the
outstanding principal balance of the mortgage loan at the time of default.      
Assuming that the servicer takes the identical steps in realizing upon defaulted
mortgage loans, the amount realized after payment of liquidation expenses would 
represent a larger percentage of the outstanding principal balance of mortgage  
loans with lower principal balances than of loans with higher principal         
balances. As a result, the amount realized after payment of liquidation expenses
will generally represent a lower percentage recovery for loans with lower       
principal balances, as compared with the percentage recovery for loans with     
higher principal balances.                                                      

The mortgaged properties are subject to environmental risks and the cost of     
repair may increase losses on the mortgage loans                                

       Under various federal, state and local environmental laws, ordinances
and regulations, a current or previous owner of real property may be liable for 
the costs of removal or remediation of hazardous or toxic substances on, under  
or in the property. These laws often impose liability on owners and operators   
whether or not they knew of, or were responsible for, the presence of hazardous 
or toxic substances. A lender also risks liability on foreclosure of the        
mortgage on this property. The presence of hazardous or toxic substances may    
adversely affect the owner's or operator's ability to sell the property.        
Mortgage loans contained in your trust may be secured by                        

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mortgaged properties in violation of environmental laws, ordinances or          
regulations. The master servicer and servicer generally are prohibited from     
foreclosing on a mortgaged property unless they have taken adequate steps to    
ensure environmental compliance. However, to the extent the master servicer or  
servicer forecloses on mortgaged property that is subject to environmental law  
violations, and to the extent a seller does not provide adequate representations
and warranties against these violations or is unable to honor its obligations,  
your trust could experience losses which, to the extent not covered by credit   
support, could adversely affect the yield to maturity of your securities.       

Failure of the seller to repurchase or replace a trust asset may result in      
losses                                                                          

        Each seller will make representations and warranties in respect of the
trust assets sold by it. In the event of a breach of a seller's representation  
or warranty that materially and adversely affects your interests, the related   
seller will be obligated to cure the breach, repurchase or replace the trust    
asset. A seller may not have the resources to honor its obligation to cure,     
repurchase or replace any trust asset as to which such a breach of a            
representation or warranty arises. A seller's failure or refusal to honor its   
repurchase obligation could lead to losses that, to the extent not covered by   
credit enhancement, may adversely affect the yield to maturity of your          
securities.                                                                     

     In instances where a seller is unable or disputes its obligation to
repurchase affected trust assets, the servicer may negotiate and enter into     
settlement agreements that may provide for the repurchase of only a portion of  
the affected trust assets. A settlement could lead to losses on the trust       
assets, which would be borne by the securities. Neither FMIC, the master        
servicer nor the servicer will be obligated to purchase a trust asset if a      
seller defaults on this obligation. We cannot assure you that sellers will carry
out their repurchase obligations. A default by a seller is not a default by     
FMIC, the master servicer, the servicer or the subservicer. Any affected trust  
asset not repurchased or substituted for shall remain in your trust and losses  
shall be allocated first to the reduction of credit enhancement and next to the 
classes of securities.                                                          

         A seller's representations and warranties will have been made as of the
cut-off date, which is prior to the initial issuance of your securities.        
Accordingly, the seller's repurchase and substitution obligation does not attach
to events occurring on or after the cut-off date. The occurrence of events      
during this period could lead to losses that, to the extent not covered by      
credit enhancement, may adversely affect the yield to maturity of your          
securities.                                                                     

Regional economic downturns and the decline in the value of mortgaged properties
could result in losses                                                          

      An investment in the securities may be affected by a decline in real
estate values and changes in borrowers' financial condition. Downturns in       
regional or local economic conditions and other factors (which may or may not   
affect real estate values) may affect the borrowers' timely payment of scheduled
payments of principal and interest on the mortgage loans comprising and         
underlying the trust assets and, accordingly, the frequency of delinquency and  
the amount of losses on the assets in your trust. If residential real estate    
values decline and the balances of the mortgage loans comprising and underlying 
the trust assets exceed the value of the mortgaged properties, the rates of     
delinquencies, foreclosures and losses are likely to increase. Loans with higher
loan-to-value ratios are at greater risk of default than loans with lower       
loan-to-                                                                        

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value ratios because borrowers on loans with higher loan-to-value ratios have   
less equity in the related mortgaged properties than borrowers on loans with low
loan-to-value ratios. Delinquencies, foreclosures and losses due to declining   
values of mortgaged properties, especially loans with higher loan-to-value      
ratios, likely will cause losses and, to the extent not covered by credit       
enhancement, likely will adversely affect your yield to maturity.               

         Localities within the United States periodically will experience weaker
regional economic conditions and housing markets. Consequently, loans secured by
mortgaged properties located in these areas likely will experience higher rates 
of loss and delinquency than will be experienced on mortgage loans generally.   
For example, a region's economic condition and housing market may be adversely  
affected by natural disasters or civil disturbances such as earthquakes,        
hurricanes, floods, fires, eruptions or riots. The mortgage loans comprising and
underlying the trust assets may be concentrated in these regions, and this      
concentration presents risk considerations in addition to those attendant to    
investments in mortgage-backed securities generally.                            

Credit enhancement may not cover all losses on your securities                  

        Credit enhancement is intended to reduce the effect on your securities
of delinquent payments or losses on the underlying trust assets. Regardless of  
the form of credit enhancement, the amount of coverage will be limited in amount
and in most cases will be subject to periodic reduction in accordance with a    
schedule or formula. Furthermore, credit support may provide only very limited  
coverage as to a variety of types of losses or risks, and may provide no        
coverage as to other types of losses or risks. For example, credit support may  
not protect against risks related to the timing of payments, like payments that 
are merely late. In the event losses exceed the amount of coverage provided by  
any credit enhancement or losses of a type not covered by credit enhancement    
occur, these losses will be borne by the holders of the securities.             

         A trust may include one or more financial instruments, such as interest
rate or other swap agreements and interest rate cap, collar or floor agreements,
to provide protection against certain types of risks or to provide certain cash 
flow characteristics for one or more classes of a series. The protection or     
benefit any such financial instrument provides will be dependent on the         
performance of the provider of such financial instrument. If such provider were 
unable or unwilling to perform its obligations under the related financial      
instrument, the related class or classes of securities could be adversely       
affected. Any withdrawal or reduction in a credit rating assigned to such       
provider may reduce the market price of the applicable securities and may affect
a holder's ability to sell them. If a financial instrument is intended to       
provide an approximate or partial hedge for certain risks or cash flow          
characteristics, holders of the applicable class or classes will bear the risk  
that such an imperfect hedge may result in a material adverse effect on the     
yield to maturity, the market price and the liquidity of such class or classes. 

        The amount of any applicable credit enhancement supporting one or more
classes of offered securities, including the subordination of one or more       
classes of securities, will be determined on the basis of criteria established  
by each rating agency rating such classes of securities based on an assumed     
level of defaults, delinquencies, other losses or other factors. We cannot      
assure you, however, that the loss experience on the related assets will not    
exceed these assumed levels.                                                    

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         A rating agency may lower its rating of a class of securities following
the initial issuance of the securities if the obligations of any applicable     
credit enhancement provider have been downgraded, or as a result of losses on   
the related assets substantially in excess of the levels contemplated by that   
rating agency when they performed their initial rating analysis. None of the    
depositor, the seller, the master servicer, any servicer, any subservicer or any
of their respective affiliates will have any obligation to replace or supplement
any credit enhancement or to take any other action to maintain any rating of any
series of securities.                                                           

There is a risk to holders of subordinate securities that losses on the trust   
assets will have a greater impact on them                                       

       The rights of subordinate securityholders to receive distributions to
which they would otherwise be entitled with respect to the assets will be       
subordinate to the rights of any master servicer, any servicer, any subservicer 
the trustee and any trust administrator, to the extent of their respective fees 
and any unreimbursed advances and unreimbursed liquidation expenses, and to the 
senior securityholders, to the extent described in the related prospectus       
supplement. As a result, investors in subordinate securities must be prepared to
bear the risk that payments on their securities may be subject to reduction or  
delays and that, in certain circumstances, such investors may not recover their 
initial investments.                                                            

        The yields on the subordinate securities may be extremely sensitive to
the loss experience of the assets in your trust and the timing of any such      
losses. If the actual rate and amount of losses experienced by the assets in    
your trust exceed the rate and amount of such losses assumed by an investor, the
yields to maturity on the subordinate securities may be lower than you          
anticipated and may, in certain circumstances, be negative.                     

The subordination of other classes to your class may not protect you from all   
losses                                                                          

         The fact that some classes are paid after your class of securities does
not protect you from all risks of loss. If losses cannot be absorbed by the     
subordinated securities or other items of credit enhancement, like a reserve    
fund, then you may have losses on your securities.                              

Exercise of any right of optional termination or redemption may affect the yield
to maturity on your securities                                                  

Your trust may be subject to optional termination prior to the
retirement of your securities. Additionally, your securities may be repurchased 
in whole or in part in the manner described in the related prospectus           
supplement. The exercise of this right may effect an early retirement of the    
securities of your series. Upon the optional termination of your trust or the   
repurchase of your securities you will receive the redemption or termination    
price set forth in the prospectus supplement. After these events, the securities
of your series may be retired, held or resold by the party that elected to      
terminate your trust or redeem your securities.                                 

        The related prospectus supplement sets forth the details concerning an
optional termination or repurchase.                                             

         If one or more REMIC elections are made for your trust, then your trust
also may be terminated and your securities retired upon the master servicer's   
determination, based upon an                                                    

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opinion of counsel, that the REMIC status of the trust has been lost or that a  
substantial risk exists that such status will be lost.                          

      The termination of your trust and the early retirement of securities
may adversely affect your yield.                                                

If amounts in any pre-funding account are not used to purchase trust assets, you
will receive a prepayment on the related securities                             

       The related prospectus supplement may provide that the depositor will
deposit a specified amount in a pre-funding account on the date the securities  
are issued. In this case, the deposited funds may be used only to acquire       
additional assets for the trust during a specified period after the initial     
issuance of the securities. Any amounts remaining in the account at the end of  
the specified period will be distributed as a prepayment of principal to the    
holders of the related securities. The resulting prepayment could adversely     
affect the yield to maturity of those securities.                               

The difference between end of the interest accrual period and the related       
payment date may reduce the effective yield of your securities                  

         Interest payable on the securities on any payment date will include all
interest accrued during the related interest accrual period. The related        
prospectus supplement will specify the interest accrual period for your         
securities. If interest accrues during the calendar month before the payment    
date, your effective yield will be less than it would be if the interest accrual
period ended the day before the payment date. As a result, your effective yield 
at par may be less than the indicated interest rate.                            

There is a possibility that, upon an optional termination of a trust, the       
proceeds may be less than the outstanding principal amount of the securities    
plus accrued interest                                                           

    Under the circumstances and in the manner set forth in the related
prospectus supplement, a series of securities may be subject to optional        
termination through the repurchase of the assets in the related trust by the    
party specified therein. If provided in the related prospectus supplement, upon 
the reduction of the aggregate unpaid principal balance of the trust assets     
balance of a specified class or classes of securities to a specified percentage 
or amount, the party specified therein will purchase the trust assets under the 
circumstances and in the manner set forth therein.                              

    If the related prospectus supplement provides for it, the proceeds
available for distribution to securityholders may be less than the outstanding  
principal amount of their securities plus accrued interest. If this happens,    
these securityholders could incur a loss on their investments.                  

You may experience delays or reductions of payments on your securities if the   
transfer of assets to your trust is not considered a sale in the event of       
bankruptcy                                                                      

      The depositor expects that, in the case of most series issued in the
form of mortgage-backed notes, the seller will treat the overall transaction as 
a financing for accounting purposes,                                            

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but that, nevertheless, the transfer of assets by the seller to the depositor   
will be structured as a sale for contractual and legal purposes, rather than as 
a pledge of the assets to secure indebtedness. If so provided in the related    
prospectus supplement for an offering of securities, the seller and the         
depositor will treat each conveyance of assets by the seller to the depositor as
a sale of those assets. In each case, the depositor will treat each conveyance  
of assets from the depositor to the trust as a sale of those assets.            

        Notwithstanding this intent of the parties to consider the transfer of
assets to the depositor and the trust as a sale for contractual and legal       
purposes, in the event that a seller becomes bankrupt or insolvent, a court may 
recharacterize the sale of the assets as a loan by the depositor to the seller  
secured by a pledge of the assets. Similarly, in the event that the depositor   
becomes bankrupt or insolvent, a court may recharacterize the sale of the assets
as a loan by the trust to the depositor secured by a pledge of the assets. In   
either case, a recharacterization could prevent timely payments of amounts due  
on your securities and result in a reduction of payments due on your securities.

Your ability to resell your securities may be limited                           

   At the time a series of securities is issued, there will not be a
secondary market for them. A secondary market for your securities may not       
develop. If a secondary market does develop, it might not continue or it might  
not be sufficiently liquid to allow you to resell your securities. Your         
securities will not be listed on any trading exchange. Also, ERISA plans and    
investors subject to legal investment restrictions may be prohibited from       
purchasing your securities, if noted in the related prospectus supplement.      

Book-entry registration may affect the liquidity of your securities             

         Transfers and pledges of securities registered in the name of a nominee
of DTC can be effected only through book entries at DTC through participants.   
The liquidity of the secondary market for DTC registered securities may be      
reduced if investors are unwilling to hold securities in book entry form, and   
the ability to pledge DTC registered securities may be limited due to the lack  
of a definitive certificate or note. Beneficial owners of DTC registered        
securities may experience delay in the receipt of payments of principal and     
interest. If DTC or a participant in whose name DTC registered securities are   
recorded becomes insolvent, the ability of beneficial owners to obtain payment  
may be impaired.                                                                

You may have income for tax purposes prior to your receipt of cash              

   Securityholders who purchase securities at a discount or purchase
securities at a premium that are deemed to have original issue discount may     
incur tax liabilities prior to a holder's receiving the related cash payments.  

         In addition, holders of REMIC residual certificates will be required to
report on their federal income tax returns as ordinary income their pro rata    
share of the taxable income of the related REMIC, regardless of the amount or   
timing of their receipt of cash payments, as described in "Federal Income Tax   
Consequences." Accordingly, holders of offered securities that constitute REMIC 
residual certificates may have taxable income and tax liabilities arising from  
their investment during a taxable year in excess of the cash received during    
that year. The                                                                  

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requirement that holders of REMIC residual certificates report their pro rata   
share of the related REMIC's taxable income and net loss will continue until the
outstanding balances of all classes of securities of the series have been       
reduced to zero, even though holders of REMIC residual certificates have        
received full payment of their stated interest and principal. The holder's share
of the REMIC taxable income may be treated as excess inclusion income to the    
holder, which:                                                                  

o   generally, will not be subject to offset by losses from other     
activities,                                                   

    o   for a tax-exempt holder, will be treated as unrelated business taxable
income, and                                                   

   o   for a foreign holder, will not qualify for exemption from withholding
tax.                                                          

     Individual holders of REMIC residual certificates may be limited in
their ability to deduct servicing fees and other expenses of the REMIC. In      
addition, REMIC residual certificates are subject to certain restrictions on    
transfer. Because of the special tax treatment of REMIC residual certificates,  
the taxable income arising in a given year on a REMIC residual certificate will 
not be equal to the taxable income associated with investment in a corporate    
bond or stripped instrument having similar cash flow characteristics and pre-tax
yield. Therefore, the after-tax yield on the REMIC residual certificate may be  
significantly less than that of a corporate bond or stripped instrument having  
similar cash flow characteristics.                                              

ERISA plans that invest in the securities must follow technical benefit plan    
regulations                                                                     

        If you are buying the securities on behalf of an individual retirement
account, Keogh plan or employee benefit plan, special rules may apply to you.   
However, due to the complexity of regulations that govern these plans, if you   
are subject to the Employment Retirement Income Security Act of 1974, as        
amended, Section 4975 of the Code, or similar law, we suggest that you consult  
with your counsel regarding any consequences under ERISA Section 4975 of the    
Code, or similar law, of the acquisition, ownership and disposition of the      
securities.                                                                     

The ratings provided by the rating agencies do not purport to address all risks 
contained in your investment                                                    

 Your securities will be rated in one of the four highest rating
categories by one or more rating agencies. You may obtain further details with  
respect to any rating on your securities from the rating agency that issued the 
rating. A rating generally is based on the credit quality of the underlying     
assets, and will represent only an assessment of the likelihood of receipt by   
you of payments to which you are entitled. The rating is not an assessment of   
the prepayment experience, and does not rate the possibility that you may fail  
to recover your initial investment if you purchase your securities at a premium.
A rating is not a recommendation to buy, sell or hold your securities. Security 
ratings assigned to the securities entitled to disproportionate allocations of  
principal or interest on the assets should be evaluated independently of similar
security ratings assigned to other kinds of securities. There is no assurance   
that any rating will remain in effect for any given period or that any rating   
agency will not lower or withdraw its rating in the future. The rating agency   
could lower or withdraw its rating due to a number of factors including the     
following:                                                                      

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o   any decrease in the adequacy of the value of the underlying trust 
assets or any related credit enhancement,                     

  o   any adverse change in the financial or other condition of any credit
enhancement provider or                                       

 o   any change in the criteria, methodology or guidelines of the rating
agencies that rate your securities.                           

       In the event any rating is reduced or withdrawn, the liquidity or the
market value of the affected security may be adversely affected. As set out in  
the related prospectus supplement, certain classes of securities may be entitled
to payments from assets of the trust that are not taken into consideration by   
the rating agencies in assigning ratings, and any rating of such a class of     
security does not imply an evaluation of the creditworthiness of such payment   
source.                                                                         

 DESCRIPTION OF THE SECURITIES

General                                                                         

         The securities will be issued from time to time in series. A particular
series of securities will consist of notes or certificates. The issuer of a     
series of notes will be either Fieldstone Mortgage Investment Corporation       
("FMIC") or an owner trust established by FMIC for the sole purpose of issuing  
the series of notes pursuant to an "owner trust agreement" between FMIC, the    
trust administrator, if applicable, and the owner trustee. The indenture trustee
and owner trustee, if any, will be named in the related prospectus supplement.  
Each series of certificates will be issued pursuant to a pooling and servicing  
agreement. A "pooling and servicing agreement" may consist of one or more       
agreements such as a securitization servicing agreement and a trust agreement.  
As a matter of administrative convenience, we may refer to a securitization     
servicing agreement and related trust agreement collectively as the "pooling and
servicing agreement." Parties to the pooling and servicing agreement may include
one or more sellers, FMIC, as depositor, Fieldstone Investment Corporation, a   
Maryland corporation ("Fieldstone"), a master servicer, one or more servicers,  
one or more subservicers and the trustee. Each series of notes will be issued   
pursuant to an indenture between an issuer, the trust administrator, if         
applicable, and the indenture trustee. For purposes of the discussion in this   
prospectus, a pooling and servicing agreement, a transfer and servicing         
agreement or an indenture is referred to as an agreement and the trustee, the   
indenture trustee and the owner trustee is referred to as a trustee in certain  
instances. The provisions of each agreement will vary depending on the nature of
the securities to be issued and the nature of the trust. Forms of each of the   
pooling and servicing agreement, transfer and servicing agreement, indenture and
owner trust agreement have been filed as exhibits to the registration statement 
of which this prospectus is a part.                                             

         For purposes of the discussion in this prospectus, we will refer to any
payments of principal and interest to be paid or distributed in respect of any  
series of securities generally as "payments." We will refer to the interest rate
payable in respect of any class of securities generally as an "interest rate."  
In addition, we will refer to the date on which payments are to be made in      
respect of the securities as a "payment date." A prospectus supplement related  
to any series of certificates may use somewhat different terms with similar     
meanings. For example, a                                                        

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prospectus supplement for certificates may refer to "distributions",            
"pass-through rate" and "distribution date" rather than "payment," "interest    
rate" and "payment date." Such terms should be construed to have corresponding  
meanings.                                                                       

         With respect to each trust, FMIC will assign and transfer to such trust
for the benefit of the holders of the securities the related trust assets, a    
collection account, and possibly a reserve fund or other funds, the related     
insurance policies, if applicable, related sale agreement or agreements, the    
related pooling and servicing agreement, transfer and servicing agreement or    
other servicing agreements and any additional assets. See "The Trusts" and      
"Description of the Agreements" in this prospectus. The following summaries     
describe the material provisions common to each series of securities. These     
summaries do not purport to be complete and are subject to and qualified by the 
related prospectus supplement and the specific provisions of the agreements.    
When particular provisions or terms used in an agreement are referred to, the   
actual provisions, including definitions of terms, are incorporated by          
reference.                                                                      

    The indenture or pooling and servicing agreement for a series will
generally provide that securities may be issued up to a maximum aggregate       
principal amount. Each series will consist of one or more classes and may       
include the following:                                                          

o   one or more classes of senior securities entitled to certain      
preferential rights to payments of principal and interest     

o   one or more classes of subordinate securities                     

o   one or more classes representing an interest only in a specified  
     portion of interest payments on the assets in the related trust and
      that may have no principal balance, a nominal principal balance or a
        notional principal amount ("Interest Only Class," "IO Class" or "Strip
Class")                                                       

o   one or more classes representing an interest only in payments of  
         principal on the assets in the related trust ("Principal Only Class" or
"PO Class")                                                   

 o   one or more classes upon which interest will accrue but will not be
      distributed until certain other classes of that series have received
their final distribution, each an "accretion class"           

   o   one or more classes entitled to distributions from specified portions
of the assets in the related trust                            

  o   one or more classes entitled to fixed or targeted principal payments
 under certain conditions ("PAC Classes"), and companion classes
thereto, referred to as companion classes.                    

         As to each series of certificates, one or more elections may be made to
treat the related trust fund or designated portions thereof as a "real estate   
mortgage investment conduit" (a "REMIC") as defined in the Internal Revenue Code
of 1986, as amended (the "Code"). The related prospectus supplement will specify
whether one or more REMIC elections will be made,                               

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as well as any material federal income tax consequences to securityholders not  
otherwise described in this prospectus. If such an election is made with respect
to a series of certificates, one of the classes of certificates comprising such 
series will be designated as evidencing all "residual interests" in the related 
REMIC as defined under the Code (the "Residual Certificates"). All other classes
of certificates in such a series will constitute "regular interests" in the     
related REMIC as defined in the Code and will be referred to as the "REMIC      
regular certificates." See "Federal Income Tax Consequences--REMIC Certificates"
in this prospectus.                                                             

    Similarly, with respect to a series of notes, the ownership of the
equity of a trust will be represented by equity certificates issued under the   
owner trust agreement. Any equity certificate will be subordinate to the notes  
of the same series.                                                             

FMIC may sell to investors one or more classes of a series of 
securities in transactions not requiring registration under the Securities Act  
of 1933. The securities of series offered by this prospectus and a related      
prospectus supplement will be rated on issuance by one or more nationally       
recognized statistical rating organizations, such as Standard & Poor's Ratings  
Services, a division of The McGraw-Hill Companies, Inc., Moody's Investors      
Service, Inc. or Fitch Ratings, Inc.                                            

   The securities will be issued in fully-registered certificated or
book-entry form, as applicable, in the authorized denominations or percentage   
interests for each class specified in the related prospectus supplement. Unless 
otherwise specified in the related prospectus supplement, the trustee will make 
payments of principal and interest to each class of securities in certificated  
form by check mailed to each person in whose name a security is registered as of
the close of business on the record date specified in the related prospectus    
supplement at the address appearing on the security register, except that the   
final payments in retirement of each class of securities in certificated form   
will be made only upon presentation and surrender of such securities at the     
corporate trust office of the trustee or such other office specified in the     
related prospectus supplement. Under certain circumstances, if so provided in   
the related agreement and described in the related prospectus supplement,       
payments of principal and interest may be made to certain holders of a class of 
securities by wire transfer of "immediately available" or "next day" funds.     
Payments with respect to securities in book-entry form will be made as set forth
below.                                                                          

Book-Entry Procedures and Definitive Certificates                               

   If so specified in the related prospectus supplement, one or more
classes of securities of a series will be issued in definitive, certificated    
form and will be transferable and exchangeable at the office of the registrar   
identified in the related prospectus supplement. No service charge will be made 
for any such registration or transfer of such certificates, but the owner may be
required to pay a sum sufficient to cover any tax or other governmental charge. 

   If so specified in the related prospectus supplement, one or more
classes of securities of a series will be issued in book-entry form and may     
initially be represented by one or more securities registered in the name of    
Cede & Co. ("Cede"), as nominee of The Depository Trust Company ("DTC"). If     
specified in the related prospectus supplement, persons acquiring beneficial    
interests in the securities may hold beneficial interests in book-entry         
securities through                                                              

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DTC, in the United States, or Clearstream, Luxembourg or Euroclear, in Europe,  
directly if they are participants of such systems, or indirectly through        
organizations which are participants in such systems. Clearstream, Luxembourg,  
and Euroclear will hold omnibus positions on behalf of their participants       
through customers' securities accounts in their respective names on the books of
their respective depositaries which in turn will hold such positions in         
customers' securities accounts in the depositaries' names on the books of DTC.  
Transfers between DTC participants will occur in accordance with DTC rules.     
Transfers between Clearstream, Luxembourg participants and Euroclear            
participants will occur in accordance with their applicable rules and operating 
procedures.                                                                     

         Beneficial owners, referred to as owners, that are not DTC participants
but desire to purchase, sell or otherwise transfer ownership of, or other       
interests in, book-entry securities may do so only through DTC participants and 
indirect DTC participants. DTC participants who are owners of book-entry        
securities will receive a credit for such securities on DTC's records. The      
beneficial owner's ownership of a book-entry security will be recorded on the   
records of the brokerage firm, bank, thrift institution or other financial      
intermediary that maintains the beneficial owner's account for such purpose. In 
turn, the financial intermediary's ownership of such book-entry security will be
recorded on the records of DTC, or of a participating firm that acts as agent   
for the financial intermediary, whose interest will in turn be recorded on the  
records of DTC, if the beneficial owner's financial intermediary is not a DTC   
participant, and on the records of Clearstream, Luxembourg or Euroclear, as     
appropriate. Unless and until definitive certificates are issued, it is         
anticipated that the only "holder" of book-entry securities of any series will  
be Cede as nominee of DTC. Owners will only permitted to exercise the rights of 
holders indirectly through DTC participants and DTC.                            

        Owners of book-entry securities will receive all payments of principal
and interest on the book-entry securities from the trustee through DTC and DTC  
participants. Under the rules, regulations and procedures creating and affecting
DTC and its operations, DTC is required to make book-entry transfers among DTC  
participants on whose behalf it acts with respect to the book-entry securities  
and is required to receive and transmit payments of principal of and interest on
the book-entry securities. DTC participants and indirect DTC participants with  
which owners have accounts with respect to the book-entry securities similarly  
are required to make book-entry transfers and receive and transmit such payments
on behalf of their respective owners. Accordingly, although owners will not     
possess securities, the DTC rules provide a mechanism by which owners will      
receive distributions and will be able to transfer their interests.             

       Cross-market transfers between persons holding directly or indirectly
through DTC, on the one hand, and directly or indirectly through Clearstream,   
Luxembourg participants or Euroclear participants, on the other, will be        
effected in DTC in accordance with DTC rules on behalf of the relevant European 
international clearing system by its depositary. However, each such cross-market
transaction will require delivery of instructions to the relevant European      
international clearing system by the counterparty in such system in accordance  
with its rules and procedures and within its established deadlines, European    
time. The relevant European international clearing system will, if the          
transaction meets its settlement requirements, deliver instructions to its      
depositary to take action to effect final settlement on its behalf by delivering
or receiving securities through DTC, and making or receiving payment in         
accordance with normal procedures for same-day funds settlement applicable to   
DTC. Clearstream, Luxembourg,                                                   

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participants and Euroclear participants may not deliver instructions directly to
the European depositaries.                                                      

     Because of time zone differences, credits of securities received in
Clearstream, Luxembourg or Euroclear as a result of a transaction with a DTC    
participant will be made during subsequent securities settlement processing and 
dated the business day following the DTC settlement date. Such credits or any   
transactions in such securities settled during such processing will be reported 
to the Clearstream, Luxembourg participants or Euroclear participants on such   
business day. Cash received in Clearstream, Luxembourg or Euroclear as a result 
of sales of securities by or through a Clearstream, Luxembourg participant or a 
Euroclear participant to a DTC participant will be received with value on the   
DTC settlement date but will be available in the relevant Clearstream,          
Luxembourg or Euroclear cash account only as of the business day following      
settlement in DTC.                                                              

        DTC is a limited purpose trust company organized under the laws of the
State of New York, a "banking organization" within the meaning of the New York  
Banking Law, a member of the Federal Reserve System, a "clearing corporation"   
within the meaning of the New York Uniform Commercial Code and a "clearing      
agency" registered pursuant to Section 17A of the Exchange Act. DTC was created 
to hold securities for its participating members, called DTC participants, and  
to facilitate the clearance and settlement of securities transactions between   
DTC participants through electronic book-entries, thereby eliminating the need  
for physical movement of securities. DTC participants include securities brokers
and dealers, banks, trust companies and clearing corporations which may include 
underwriters, agents or dealers with respect to the securities of any class or  
series. Indirect access to the DTC system also is available to others such as   
banks, brokers, dealers and trust companies that clear through or maintain a    
custodial relationship with a DTC participant, either directly or indirectly,   
and are called indirect DTC participants. The rules applicable to DTC and DTC   
participants are on file with the Securities and Exchange Commission.           

         Clearstream, Luxembourg is incorporated under the laws of Luxembourg as
a professional depository. Clearstream, Luxembourg holds securities for its     
participating organizations referred to as Clearstream, Luxembourg participants 
and facilitates the clearance and settlement of securities transactions between 
Clearstream, Luxembourg participants through electronic book entry changes in   
accounts of Clearstream, Luxembourg participants, thereby eliminating the need  
for physical movement of securities. Transactions may be settled in Clearstream,
Luxembourg in multiple currencies, including United States dollars. Clearstream,
Luxembourg provides to Clearstream, Luxembourg participants, among other things,
services for safekeeping, administration, clearance and settlement of           
internationally traded securities and securities lending and borrowing.         
Clearstream, Luxembourg interfaces with domestic markets in several countries.  
As a professional depository, Clearstream, Luxembourg is subject to regulation  
by the Luxembourg Monetary Institute. Clearstream, Luxembourg participants are  
recognized financial institutions around the world, including underwriters,     
securities brokers and dealers, banks, trust companies, clearing corporations   
and certain other organizations and may include any underwriters, agents or     
dealers with respect to any class or series of securities offered hereby.       
Indirect access to Clearstream, Luxembourg is also available to others, such as 
banks, brokers, dealers and trust companies that clear through or maintain a    
custodial relationship with a Clearstream, Luxembourg participant, either       
directly or indirectly.                                                         

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

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

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

       Under a book-entry format, beneficial owners of book-entry securities
may experience some delay in their receipt of payments, since such payments will
be forwarded by the trustee to Cede, as nominee of DTC. Payments and            
distributions with respect to book-entry securities held through Clearstream,   
Luxembourg or Euroclear will be credited to the cash accounts of Clearstream,   
Luxembourg participants or Euroclear participants in accordance with the        
relevant system's rules and procedures, to the extent received by Citibank, N.A.
or The JP Morgan Chase Bank, the relevant depositaries of Clearstream,          
Luxembourg and Euroclear, respectively. Such payments and distributions will be 
subject to tax withholding in accordance with relevant United States tax laws   
and regulations. Because DTC can only act on behalf of DTC participants, the    
ability of a beneficial owner to pledge book-entry securities to persons or     
entities that do not participate in the DTC system may be limited due to the    
lack of physical securities for such book-entry securities. In addition,        
issuance of the book-entry securities in book-entry form may                    

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reduce the liquidity of such securities in the secondary market since some      
potential investors may be unwilling to purchase securities for which they      
cannot obtain physical securities.                                              

     DTC has advised the trustee that, unless and until certificates are
issued, DTC will take any action permitted to be taken by a holder of book-entry
securities only at the direction of one or more DTC participants to whose DTC   
accounts the book-entry securities are credited. DTC has advised the trustee    
that DTC will take such action with respect to any percentage interests of the  
book-entry securities of a series only at the direction of and on behalf of such
DTC participants with respect to such percentage interests of the book-entry    
securities. Clearstream, Luxembourg or the Euroclear Operator, as the case may  
be, will take any other action permitted to be taken by a securityholder under  
the Indenture, the owner trust agreement, or the pooling and servicing          
agreement, as the case may be, on behalf of a Clearstream, Luxembourg           
participant or Euroclear participant only in accordance with its relevant rules 
and procedures and subject to the ability of the relevant depositary to effect  
such actions on its behalf through DTC. DTC may take actions, at the direction  
of the related DTC participants, with respect to some book-entry securities     
which conflict with actions taken with respect to other book-entry securities.  

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

         Book-entry securities of a series will be issued in registered form, as
definitive certificates, to owners or their nominees, rather than to DTC, only  
under the circumstances provided in the related pooling and servicing agreement 
or indenture, as applicable, which generally will include, except if otherwise  
provided therein, if (1) DTC advises the trustee in writing that DTC is no      
longer willing or able to discharge properly its responsibilities as nominee and
depository with respect to the book-entry securities of such series and the     
servicer is unable to locate a qualified successor, (2) the servicer, at its    
sole option, elects to terminate the book-entry system through DTC or (3) after 
the occurrence of an event of default, a majority of the aggregate percentage   
interest of any class of securities of such series advises DTC in writing that  
the continuation of a book-entry system through DTC, or a DTC successor, to the 
exclusion of any physical securities being issued to owners is no longer in the 
best interests of owners of such class of securities. Upon issuance of          
definitive certificates of a series to owners, such book-entry securities will  
be transferable directly, and not exclusively on a book-entry basis and         
registered holders will deal directly with the trustee with respect to          
transfers, notices and distributions.                                           

       Monthly and annual reports on each trust will be provided to Cede, as
nominee of DTC, and may be made available by Cede to beneficial owners upon     
request, in accordance with the rules, regulations and procedures creating and  
affecting DTC, and to the financial intermediaries to whose DTC accounts the    
book-entry securities of such beneficial owners are credited.                   

  None of the depositor, the servicer or the trustee will have any
responsibility for any aspect of the records relating to or payments made on    
account of beneficial ownership interests of the book-entry securities held by  
Cede, as nominee of DTC, or for maintaining, supervising or reviewing any       
records relating to such beneficial ownership interests.                        

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     The information in this section concerning Clearstream, Luxembourg,
Euroclear and DTC has been obtained from sources that the depositor believes to 
be reliable, but the depositor assumes no responsibility for its accuracy.      

Principal and Interest Payments                                                 

   The prospectus supplement will specify the available distribution
amount, which in general will be equal to the amount of principal and interest  
paid on the assets in the related trust with respect to the due date in the     
current month and the amount of principal prepaid during the preceding month,   
net of applicable servicing, administrative, guarantee and other fees, insurance
premiums, the costs of any other credit enhancement and amounts required to     
reimburse any unreimbursed advances. The available distribution amount will be  
allocated among the classes of securities of your series -- including any       
securities not offered through this prospectus -- in the proportion and order of
application found in the pooling and servicing agreement or indenture, as       
applicable, and described in the related prospectus supplement. The available   
distribution amount may be allocated so that amounts paid as interest on the    
trust assets may be distributed as principal on the securities and amounts paid 
as principal on the assets may be paid as interest on the securities.           

    A class of securities entitled to payments of interest may receive
interest at a specified rate, which may be fixed or adjustable. The classes of  
securities within a series may have the same or different interest rates. The   
related prospectus supplement will specify the interest rate, or the method for 
determining the interest rate, for each applicable class, and the method of     
determining the amount to be paid on any Strip Classes on each Payment Date.    
Residual Certificates may or may not have an interest rate or principal balance.
In addition to representing entitlement to regular payments of principal and    
interest, if any, that are allocated to the Residual Certificates, Residual     
Certificates also generally will represent an entitlement to receive amounts    
remaining in the Collection Account on any Payment Date after allocation of     
scheduled distributions to all other outstanding classes of certificates of that
series and after all required deposits have been made into any related reserve  
funds. Strip Classes may have a notional principal amount, which is a notional  
principal amount used solely for determining the class amount of interest       
distributions and other rights. A notional principal amount is determined by    
reference to the principal amount of the assets, a subset of the assets, or one 
or more classes of principal bearing securities. Interest distributions on the  
securities generally will include interest accrued through the end of the       
interest accrual period. Interest will be computed on the basis of a 360-day    
year consisting of twelve 30-day months, or on the basis of actual elapsed days,
as specified in the related prospectus supplement.                              

       For any Payment Date, the trustee will pay to the securityholders all
amounts actually received from the servicers representing scheduled collections 
of principal in the related due period and all unscheduled principal payments   
for the related prepayment period.                                              

     Principal and interest payable on a class of securities may be paid
among the securities of a class pro rata in the proportion that the outstanding 
principal or notional principal amount of each security of the class bears to   
the aggregate outstanding principal or notional principal amount of all         
securities of the class, or in another manner as may be detailed in the related 
prospectus supplement.                                                          

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       The final scheduled payment date for each class of securities will be
the date on which the last payment of the principal thereof is scheduled to     
occur, assuming no prepayments of principal with respect to the assets included 
in the trust for that series, as defined in the prospectus supplement.          

Allocation of Realized Losses                                                   

With respect to a series that includes one or more classes of 
subordinate securities, the senior securities generally will not bear any       
Realized Losses on the related assets in the related trust, until the           
subordinate securities of that series have borne Realized Losses up to a        
specified subordination amount or loss limit or until the amount of Realized    
Losses exceeds the principal amount of the subordinate securities been reduced  
to zero as a result of the allocation of Realized Losses or payments of         
principal, or both. With respect to a series that includes a class of           
subordinate securities, any shortfall may result in a reallocation of amounts   
otherwise distributable to less senior securities for distribution to more      
senior securities.                                                              

"Realized Loss" means:                                        

  o   the amount of any loss realized by a trust in respect of any related
         liquidated mortgage loan, which may be a special hazard loss or a fraud
       loss, which shall generally equal the unpaid principal balance of the
    liquidated mortgage loan, plus accrued and unpaid interest on such
         liquidated mortgage loan, plus amounts reimbursable to the servicer for
   previously unreimbursed servicing advances, minus net liquidation
proceeds in respect of the liquidated mortgage loan,          

  o   the amount of any principal cramdown in connection with any mortgage
        loan that was the subject of a principal cramdown in bankruptcy during
         the calendar month immediately preceding the month in which the related
       Payment Date occurs (a "Prepayment Period") preceding a Payment Date.
        The amount of any principal cramdown is the amount by which the unpaid
principal balance of the mortgage loan exceeds, as applicable,
       depending upon the type of principal cramdown that was applied to the
        mortgage loan, either the portion of the unpaid principal balance that
      remains secured by the mortgaged property after taking the principal
         cramdown into account or the unpaid principal balance after taking into
     account the permanent forgiveness of debt ordered by the bankruptcy
court in connection with the principal cramdown, or           

     o   any other amount of a loss realized by a trust in respect of any asset,
       which has been allocated to the asset in accordance with its terms as
described in the prospectus supplement.                       

 Payments of interest may be reduced to the extent the amount of
interest due on the assets exceeds the amount of interest collected or advanced,
which may be due to Prepayment Interest Shortfalls or Servicemembers Shortfall  
on the trust assets. A "Servicemembers Shortfall" means a shortfall in respect  
of a mortgage loan resulting from application of the federal Servicemembers     
Civil Relief Act or similar state laws. "Prepayment Interest Shortfall" means,  
for any mortgage loan that is prepaid in full or liquidated on any date other   
than a due date for the mortgage loan, the difference between the amount of     
interest that would have accrued on the                                         

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mortgage loan through the day preceding the first due date after the prepayment 
in full or liquidation had the mortgage loan not been prepaid in full or        
liquidated, net of any other administrative fees payable out of such interest   
had it accrued and been paid, and the amount of interest that actually accrued  
on the mortgage loan prior to the prepayment in full or liquidation, net of an  
allocable portion of any other administrative fees payable from interest        
payments on the mortgage loan during the Due Period.                            

Valuation of Trust Assets                                                       

      The trust assets will have an initial aggregate asset value at least
equal to 100% of the initial principal amount of the securities. The asset value
of any mortgage loan in the trust will generally equal                          

o   the scheduled principal balance of the trust asset, or            

  o   the lesser of the present value of the stream of remaining regularly
         scheduled payments of principal and interest due on such trust asset --
  after taking into account charges for servicing, administration,
         insurance and related matters -- discounted at a discount rate, if any,
        and the scheduled principal balance of the mortgage loan multiplied by
the applicable asset value percentage.                        

    The asset value percentage will be the percentage limitation that,
based upon the scheduled net payments on the trust assets, is intended to assure
the availability of sufficient funds to make scheduled distributions on the     
securities in the event of substantial principal prepayments on the mortgage    
loans and the mortgage loans underlying the mortgage-related assets. In each    
case asset value will be determined after the subtraction of applicable         
servicing, master servicing, administrative and guarantee fees, and insurance   
premiums and the addition, if the related prospectus supplement so specifies, of
any reinvestment income on the amounts on deposit in the accounts held by the   
trust. The asset value of an asset that has been liquidated or purchased from   
the trust pursuant to the related sale agreement shall be zero.                 

Optional Redemption or Termination                                              

    To the extent and under the circumstances specified in the related
prospectus supplement, the securities of any series may be redeemed, and/or the 
trust terminated, prior to the final scheduled payment date of the securities of
any series at the option of the seller, the trust administrator, the servicer,  
the master servicer or another party, or parties, specified in the prospectus   
supplement. A redemption or termination may be accomplished by the purchase of  
the outstanding series of securities or the purchase of the assets of the trust.
The right to redeem the securities generally will be conditioned upon the       
following:                                                                      

   o   the passage of a certain date specified in the prospectus supplement,
or                                                            

     o   the asset value or scheduled principal balance of the mortgage loans in
        the trust, or the outstanding principal amount of a specified class of
       securities at the time of purchase aggregating less than a percentage
specified in the prospectus supplement, of the initial        

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asset value of the mortgage loans in the trust or the initial 
principal amount of the applicable class of securities.       

         In the event the option to redeem any series is exercised, the purchase
price to be paid with respect to each security will generally equal 100% of its 
then outstanding principal amount, plus accrued and unpaid interest thereon at  
the applicable interest rate, net of any unreimbursed advances and unrealized   
losses allocated to such security; however, under certain circumstances set     
forth in the related prospectus supplement, the asset value of the mortgage     
loans in the trust may be less than such amount, resulting in a potential loss  
to your securities. Notice of the redemption of the securities of any series    
will be given to related securityholders as provided in the related pooling and 
servicing agreement or indenture.                                               

 In addition, in the case of a trust for which one or more REMIC
elections are made, an early termination will be required to meet the           
requirements of a "qualified liquidation" under Section 860F of the Code, as    
specified in the related pooling and servicing Agreement.                       

Maturity And Prepayment Considerations                                          

         Generally, all of the mortgage loans that are assets of a trust and the
mortgage loans underlying the mortgage-related assets included in a trust for a 
series will consist of first lien residential mortgages or deeds of trust.      
However, if so specified in the prospectus supplement, certain or all of the    
mortgage loans that are assets of the trust and the mortgage loans underlying   
the mortgage-related assets included in the trust for a series may consist of   
second or junior lien, residential mortgages or deeds of trust.                 

 The prepayment experience on the mortgage loans will affect the
following:                                                                      

     o   the average life of the securities and each class thereof issued by the
related trust                                                 

  o   the extent to which the final payment for each class occurs prior to
its final scheduled payment date                              

o   the effective yield on each class of such securities.             

         Because prepayments will be passed through to the holders of securities
as distributions or payments of principal on such securities, it is likely that 
the actual final payments on the classes of securities of a series will occur   
prior to their respective final scheduled payment dates. Accordingly, in the    
event that the mortgage loans of a trust or the mortgage loans underlying the   
mortgage-related assets experience significant prepayments, the actual final    
payments on the securities of the related series may occur substantially before 
their respective final scheduled payment dates causing a shortening of the      
weighted average life of each class of such series.                             

      Weighted average life refers to the average amount of time that will
elapse from the date of issue of a security until each dollar of principal of   
such security will be repaid to the investor. The weighted average life of a    
class of securities of a series will be influenced by the rate at which         
principal on the mortgage loans comprising or underlying the trust assets in the
trust is paid to such class, which may be in the form of scheduled amortization 
or prepayments (for this                                                        

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purpose, the term "prepayment" includes prepayments, in whole or in part, and   
liquidations due to default).                                                   

 In addition, the weighted average life of the securities may be
affected by the varying maturities and mortgage rates of the mortgage loans     
comprising or underlying the assets in a trust. If any mortgage loans comprising
or underlying the assets in a particular trust have actual terms to maturity    
less than those assumed in calculating final scheduled payment dates for the    
classes of securities of the related series, one or more classes of such        
securities may be fully paid prior to their respective final scheduled payment  
dates, even in the absence of prepayments. Accordingly, the prepayment          
experience of the assets will, to some extent, be a function of the mix of      
mortgage rates and maturities of the mortgage loans comprising or underlying    
such assets. Other factors affecting weighted average life include the type of  
mortgage loan, defaults, foreclosures, refinancing, inclusion of due-on-sale    
clauses, changes in borrowers' housing needs, job transfers, unemployment,      
borrowers' net equity in the mortgaged properties and servicing decisions.      

         Prepayments on mortgages are commonly measured relative to a prepayment
standard or model, such as the Constant Prepayment Rate prepayment model        
(referred to as "CPR") or the Standard Prepayment Assumption prepayment model   
(referred to as "SPA") each as described below. CPR represents a constant       
assumed rate of prepayment each month relative to the then outstanding principal
balance of a pool of loans for the life of the loans. SPA represents an assumed 
rate of prepayment each month relative to the then outstanding principal balance
of a pool of loans. A prepayment assumption of 100% SPA assumes prepayment rates
of 0.2% per annum of the then outstanding principal balance of the loans in the 
first month of the life of the loans and an additional 0.2% per annum in each   
month thereafter until the thirtieth month. Beginning in the thirtieth month and
in each month thereafter during the life of the loans, 100% of SPA assumes a    
constant prepayment rate of 6% per annum each month. It is unlikely that the    
prepayment of the mortgage loans comprising or underlying the trust assets of   
any trust will conform to any of the percentages of the prepayment assumption   
model described in any table set forth in the related prospectus supplement.    

   No assurance can be given as to the rate of principal payments or
prepayments on the mortgage loans comprising or underlying the trust assets. The
rate of principal payments on mortgage loans included in a trust (or mortgage   
loans underlying the mortgage-related assets) will be affected by the           
amortization schedules of the mortgage loans and by the rate of principal       
prepayments -- including for this purpose payments resulting from refinancings, 
liquidations due to defaults, casualties, condemnations, and purchases by or on 
behalf of the servicer. The rate of principal prepayments on pools of mortgages 
is influenced by a variety of economic, geographic, tax, legal and other        
factors. In general, however, if prevailing interest rates fall significantly   
below the interest rates on the mortgage loans included in a trust -- or        
mortgage loans underlying the mortgage-related assets --, such mortgage loans   
are likely to be the subject of higher principal prepayments than if prevailing 
rates remain at or above the rates borne by such mortgage loans.                

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YIELD CONSIDERATIONS

        Payments of interest on the securities generally will include interest
accrued through the last day of the interest accrual period. Your effective     
yield may be lower than the yield otherwise produced by the applicable interest 
rate and purchase price for your securities, because payments to you will not be
made until the Payment Date following the applicable interest accrual period.   

     Securities of any class within a series may have fixed, variable or
adjustable interest rates, which may or may not be based upon the mortgage rates
borne by the assets in the related trust. The prospectus supplement with respect
to any series of securities will specify the interest rate for each class of    
such securities or, in the case of a variable or adjustable interest rate, the  
method of determining the interest rate; the effect, if any, of the prepayment  
of any asset on the interest rate of one or more classes of securities; and     
whether the payments of interest on the securities of any class will be         
dependent, in whole or in part, on the performance of any borrower under a cash 
flow agreement.                                                                 

        The yield to maturity of any security will be affected by the rate and
timing of payment of principal of the underlying mortgage loans. If the         
purchaser of a security offered at a discount from its Parity Price, which is   
the price at which a security will yield its coupon, after giving effect to any 
payment delay, calculates the anticipated yield to maturity of a security based 
on an assumed rate of payment of principal that is faster than that actually    
received on the underlying mortgage loans, the actual yield to maturity will be 
lower than that so calculated. Similarly, if the purchaser of a security offered
at a premium over its Parity Price calculates the anticipated yield to maturity 
of a security based on an assumed rate of payment of principal that is slower   
than that actually received on the underlying mortgage loans, the actual yield  
to maturity will be lower than that so calculated.                              

  The timing of changes in the rate of prepayments on the mortgage
comprising or underlying the trust assets loans may significantly affect an     
investor's actual yield to maturity, even if the average rate of principal      
payments experienced over time is consistent with an investor's expectation. In 
general, the earlier a prepayment of principal on an underlying mortgage loan,  
the greater will be the effect on a related investor's yield to maturity. As a  
result, the effect on an investor's yield of principal payments occurring at a  
rate higher -- or lower -- than the rate anticipated by the investor during the 
period immediately following the issuance of the securities would not be fully  
offset by a subsequent like reduction -- or increase -- in the rate of principal
payments. Because the rate of principal payments on the mortgage loans          
comprising or underlying the trust assets affects the weighted average life and 
other characteristics of any class of securities, prospective investors are     
urged to consider their own estimates as to the anticipated rate of future      
prepayments on the mortgage loans comprising or underlying the trust assets and 
the suitability of the applicable securities to their investment objectives. See
"Description of the Securities -- Maturity and Prepayment Considerations" in    
this prospectus.                                                                

       The yield on your securities also will be affected by Realized Losses
or Prepayment Interest Shortfalls allocated to your securities. If Realized     
Losses and shortfalls are not absorbed by securities subordinate to your        
securities or other items of credit enhancement, like a reserve                 

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fund, then you may have losses or delays in payment on your securities. Losses  
on your securities will, in turn, reduce payments to you. Delays in payment will
interrupt the timely payments of amounts owed to you. Losses or delays in       
payment will reduce your yield. See "Description of the Securities -- Allocation
of Realized Losses" in this prospectus.                                         

THE TRUSTS

General                                                                         

FMIC will pledge or sell, assign and transfer to your trust:  

     o   single family mortgage loans -which may be sub-prime or junior lien- or
beneficial interests in these items                           

o   agency securities and private mortgage-backed securities          

o   the collection account for the series                             

o   if applicable, a reserve fund and other funds and accounts for the
series                                                        

o   if applicable, one or more derivative instruments                 

o   if applicable, a pre-funding account                              

o   if applicable, all proceeds that may become due under insurance   
policies for the related series                               

     o   if applicable, FMIC's rights under the pooling and servicing agreement,
        the transfer servicing agreement and mortgage loan purchase agreements

o   all payments on these items, having an aggregate initial unpaid   
    principal balance at least equal to 100% of the original principal
amount of the securities.                                     

Agency securities and private mortgage-backed securities are called             
"mortgage-related assets." Mortgage loans and mortgage-related assets, together 
with other items deposited in your trust as described above, are called "trust  
assets." The trust assets for your series will be assigned and transferred to   
your trust for the sole benefit of securityholders, except that some credit     
enhancement items required by the rating agencies may also be assigned to trusts
for other series of securities or may secure other series of securities issued  
by FMIC. Particular assets that might be assigned to trusts for other series or 
that secure other notes may include pool insurance policies, special hazard     
insurance policies, borrower bankruptcy insurance, reserve funds and additional 
assets.                                                                         

Assignment of Trust Assets                                                      

      In connection with the issuance of certificates, FMIC will cause the
trust assets to be sold, assigned and transferred to the trustee, together with 
all principal and interest paid on the trust assets from the cut-off date under 
a pooling and servicing agreement. The trustee will, in                         

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exchange for the trust assets, deliver to FMIC securities of a series in        
authorized denominations registered in the names that FMIC requests,            
representing the beneficial ownership interest in the trust assets. In          
connection with the issuance of notes by an issuer that is an owner trust, FMIC 
will cause the trust assets to be sold, assigned and transferred to the issuer, 
together with all principal and interest paid on the trust assets from the      
cut-off date pursuant to a transfer and servicing agreement. The issuer, which  
can be either an owner trust or FMIC, will pledge all of its rights in and to   
the trust assets to a trustee pursuant to an indenture. The issuer will direct  
the trustee to deliver notes of a series secured by a first priority security   
interest in the trust assets. The notes will be issued in authorized            
denominations registered in the names requested by FMIC. Each pool of trust     
assets will constitute one or more trusts held by the trustee for the benefit of
the holders of the series of securities. Each mortgage loan and mortgage-related
asset included in your trust will be identified in a schedule appearing as an   
exhibit to the pooling and servicing agreement or the transfer and servicing    
agreement. This schedule will include information as to the scheduled principal 
balance of each mortgage loan and mortgage-related asset as of the cut-off date 
and its mortgage rate, original principal balance and other information.        

   FMIC will deliver or cause to be delivered to your trustee or its
custodian (a) the related original mortgage note, endorsed without recourse to  
the trustee, or in blank, or a lost note affidavit conforming to the            
requirements of the transfer and servicing agreement, together with a copy of   
the related mortgage note, (b) the original recorded mortgage with evidence of  
recording indicated thereon (or, if the original recorded mortgage has not yet  
been returned by the recording office, a copy thereof certified to be a true and
complete copy of such mortgage sent for recording), (c) for any mortgage loan   
not registered on the book-entry system (the "MERS System") of the Mortgage     
Electronic Registration Systems, Inc. ("MERS") an original assignment of the    
mortgage to the trustee or in blank in recordable form (except as described     
below), (d) any related documents showing a complete chain of assignment, (e)   
the policies of title insurance issued with respect to each mortgage loan and   
(f) the originals of any assumption, modification, extension or guaranty        
agreements. It is expected that the mortgages or assignments with respect to    
each mortgage loan will have been recorded in the name of any agent on behalf of
the holder of the related mortgage note. In that case, no assignment in favor of
the trustee will be required to be prepared delivered or recorded. Instead, the 
seller will be required to take all actions as are necessary to cause the       
trustee to be shown as the owner of the related mortgage loan on the records of 
the agent for purposes of the system of recording transfers of beneficial       
ownership of mortgages maintained by the agent. With the exception of           
assignments relating to mortgaged properties located in certain states, FMIC    
does not expect to cause the assignments to be recorded. The original mortgage  
documents other than the documents required to be held by MERS with respect to  
mortgage loans registered on the MERS System will be held by the trustee, the   
issuer or a custodian, except to the extent released to a servicer from time to 
time in connection with servicing the mortgage loan. The servicer, on behalf of 
the securityholders, will hold the original documents and copies of other       
documents not delivered to the trustee or MERS and instruments concerning your  
trust's assets.                                                                 

        In addition, necessary steps will be taken by FMIC to have the trustee
(for an offering of certificates) or the issuer (for an offering of notes)      
become the registered owner of each mortgage-related asset included in your     
trust and to provide for all payments on each mortgage-related asset to be made 
directly to your trustee (including an indenture trustee). With respect to      

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each mortgage-related asset in certificated form, the depositor will deliver or 
cause to be delivered to the trustee (or a custodian) the original certificate  
or other definitive evidence of such mortgage-related asset, together with bond 
power or other instruments, certifications or documents required to transfer    
fully such mortgage-related asset, to the trustee for the benefit of the        
securityholders. With respect to each mortgage-related asset in uncertificated  
or book-entry form or held through a "clearing corporation" within the meaning  
of the UCC, the depositor and the trustee will cause such mortgage-related asset
to be registered directly or on the books of such clearing corporation or of one
or more securities intermediaries in the name of the trustee for the benefit of 
the securityholders. Unless otherwise specified in the related prospectus       
supplement, the related agreement will require that either the depositor or the 
trustee promptly cause any mortgage-related asset in certificated form not      
registered in the name of the trustee to be re-registered, with the applicable  
persons, in the name of the trustee.                                            

      FMIC will make certain representations and warranties in the pooling
and servicing agreement or the transfer and servicing agreement with respect to 
the trust assets, including representations that it either is the owner of the  
trust assets or has a first priority perfected security interest in the trust   
assets. In addition, a seller of a mortgage loan may make certain               
representations and warranties with respect to the trust assets in the mortgage 
loan purchase agreement and the transfer and servicing agreement. See           
"Origination and Sale of Mortgage Loans -- Representations and Warranties" in   
this prospectus.                                                                

    Each seller will make representations and warranties regarding the
characteristics of the trust assets directly to the issuer. In the event that   
the representations and warranties of the seller are breached, and the breach or
breaches adversely affect your interests in your trust's assets, the seller will
be required to cure the breach or, in the alternative, to substitute new trust  
assets, or to repurchase the affected trust assets, generally at a price equal  
to the unpaid principal balance of these trust assets, together with accrued and
unpaid interest at the trust asset's rate. Unless otherwise specified in the    
related prospectus supplement, the purchase price is equal to the sum of the    
unpaid principal balance thereof, plus unpaid accrued interest thereon at the   
mortgage rate from the date as to which interest was last paid to the due date  
in the due period in which the relevant purchase is to occur, plus any costs or 
damages incurred by the issuer as provided in the related agreement. In         
addition, in the event a servicer or subservicer breaches its representations   
and warranties and this breach adversely affects your interests, the servicer or
subservicer, as appropriate, generally will be required to cure this breach, and
if such breach cannot be cured the related defaulting party, at the option of   
the party specified in the pooling and servicing agreement or the transfer and  
servicing agreement, will assign its rights and obligations under the related   
agreement to a successor servicer. In any event, the defaulting party shall be  
obligated to indemnify all other parties to the related agreement for any       
losses, damages, penalties or fines resulting from such defaulting party's      
breach. In addition, the master servicer makes certain representations and      
warranties regarding its capacity to serve as master servicer with respect to   
each series and makes certain covenants regarding its obligations to perform    
servicing functions in respect of the trust assets. To the extent, the master   
servicer breaches any of its representations, warranties and or agreements, the 
master servicer is obligated to provide indemnity to other transaction parties  
for any claims, liabilities, expenses or losses resulting from the master       
servicer's breach. Neither FMIC nor any servicer, master servicer or subservicer
will be obligated to substitute trust assets or to repurchase trust assets if   
the defaulting seller defaults                                                  

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upon its obligation to do so, and no assurance can be given that sellers will   
perform their obligations.                                                      

The Trust Assets                                                                

         Your prospectus supplement describes the type of trust assets that will
be transferred to your trust. The trust assets may include the following:       

o   mortgage loans, which may include single family residential loans,
     balloon loans, sub-prime residential mortgage loans and junior lien
mortgage loans                                                

    o   mortgage pass-through or mortgage participation certificates issued or
  guaranteed by Ginnie Mae, Freddie Mac or Fannie Mae (referred to
        respectively as "Ginnie Mae certificates," "Freddie Mac certificates,"
and "Fannie Mae certificates")                                

   o   direct obligations of the United States, agencies thereof or agencies
created thereby                                               

o   mortgage-backed securities of private issuers                     

o   one or more derivative instruments                                

o   other assets evidencing interests in loans secured by residential 
property.                                                     

Mortgage Loans                                                                  

       The mortgage loans included in your trust will be secured by first or
junior liens on one-family and two- to four-family residential property         
sub-prime loans. Regular monthly installments of principal and interest on each 
mortgage loan paid by the borrower will be collected by the servicer or master  
servicer and ultimately remitted to the trustee.                                

The mortgaged property securing mortgage loans may consist of 

o   detached homes                                                    

o   units having a common wall                                        

o   units located in condominiums                                     

o   other types of homes or units set forth in the related prospectus 
supplement.                                                   

         Each detached or attached home will be constructed on land owned in fee
simple by the borrower or on land leased by the borrower for a term at least one
year greater than the term of the applicable mortgage loan. Attached homes may  
consist of duplexes, triplexes and fourplexes or townhouses. The mortgage loans 
included in your trust may be secured by mortgaged properties that are          
owner-occupied, are owned by investors or serve as second residences or vacation
homes.                                                                          

The mortgage loans included in your trust may                 

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    o   provide for the payment of interest and full repayment of principal in
      level monthly payments with a fixed rate of interest computed on the
declining principal balance                                   

    o   provide for the payment of interest and full repayment of principal in
non-level monthly payments                                    

   o   provide for periodic adjustments to the rate of interest to equal the
sum of a fixed margin and an index                            

    o   consist of mortgage loans for which funds have been provided to reduce
         the borrower's monthly payments during the early period of the mortgage
loans                                                         

o   provide for the one-time reduction of the mortgage rate           

o   provide for monthly payments during a specified period after the  
   origination of the mortgage loan the first year that are at least
sufficient to pay interest due                                

     o   provide for an increase in the monthly payment in subsequent years at a
         predetermined rate resulting in full repayment over a shorter term than
the initial amortization schedule                             

o   include graduated payment mortgage loans, which allow for payments
         during a portion of their term which are or may be less than the amount
        of interest due on the unpaid principal balance of the mortgage loans,
      and which unpaid interest will be added to the principal balance and
  will be paid, together with accrued interest, in the later years

o   include mortgage loans on which only interest is payable until    
       maturity, as well as mortgage loans that provide for the amortization
         of principal over a certain period, although all remaining principal is
due at the end of a shorter period                            

     o   include mortgage loans that provide for borrower payments to be made on
a bi-weekly basis                                             

o   include such other types of mortgage loans as are described in the
related prospectus supplement.                                

Agency Securities                                                               

      Ginnie Mae certificates are mortgage pass-through certificates as to
which the timely payment of principal and interest is guaranteed by the         
Government National Mortgage Association ("Ginnie Mae"), a wholly owned         
corporate instrumentality of the United States within the office of Housing     
Urban Development ("HUD"). Ginnie Mae's guaranty obligations are backed by the  
full faith and credit of the United States. The mortgage loans underlying Ginnie
Mae certificates may consist of loans insured by FHA and secured by mortgages on
one- to four-family residential properties, loans partially guaranteed by VA,   
and other mortgage loans eligible for inclusion in mortgage pools underlying    
Ginnie Mae certificates.                                                        

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     Freddie Mac certificates are mortgage pass-through or participation
certificates as to which Freddie Mac (formally known as Federal Home Loan       
Mortgage Corporation) has guaranteed the timely payment of interest and,        
generally, the ultimate collection of principal. Freddie Mac is a federally     
chartered corporation whose obligations are not guaranteed by the United States 
or any of its agencies or instrumentalities. Each Freddie Mac certificate will  
represent an undivided interest in a group of mortgage loans or participations  
in mortgage loans secured by a first lien on one-to-four family residential     
properties.                                                                     

      Fannie Mae certificates are mortgage pass-through certificates as to
which Fannie Mae (formally known as the Federal National Mortgage Association)  
has guaranteed the timely payment of principal and interest. Fannie Mae is a    
federally chartered and privately owned corporation whose obligations are not   
guaranteed by the United States or any of its agencies or instrumentalities.    
Each Fannie Mae certificate will represent an undivided interest in a pool of   
mortgage loans formed by Fannie Mae. Each mortgage loan will be secured by a    
first lien on one- to four-family residential properties or multifamily         
residential properties.                                                         

Although payment of principal and interest on the Ginnie Mae  
certificates, Freddie Mac certificates and Fannie Mae certificates, if any,     
assigned to your trust is guaranteed by Ginnie Mae, Freddie Mac and Fannie Mae, 
respectively, your securities do not represent an obligation of or an interest  
in FMIC or any of its affiliates and are not guaranteed or insured by Ginnie    
Mae, Freddie Mac, Fannie Mae, FMIC or any of their affiliates, or any other     
person.                                                                         

Mortgage Pass-Through Certificates and Government Obligations                   

Your trust also may include other trust assets consisting of  
conventional mortgage pass-through certificates or collateralized mortgage      
obligations representing interests in the types of mortgage loans described in  
this section, more fully described in the related prospectus supplement.        

 Your trust may include direct obligations of the United States,
agencies thereof or agencies created thereby such as the following:             

o   interest-bearing securities                                       

o   non-interest-bearing securities                                   

    o   originally interest-bearing securities from which coupons representing
the right to payment of interest have been removed            

o   interest-bearing securities from which the right to payment of    
principal has been removed.                                   

 The prospectus supplement for a series of securities evidencing
interests in trust assets that include direct obligations of the United States, 
agencies thereof or agencies created thereby will specify, to the extent        
available                                                                       

    o   the aggregate approximate initial and outstanding principal amounts or
notional principal amounts, as applicable, and types of such  
obligations to be included in the trust                       

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     o   the original and remaining terms to stated maturity of such obligations

   o   whether such obligations are entitled only to interest payments, only
to principal payments or to both                              

     o   the interest rates of such obligations or the formula to determine such
interest rates, if any                                        

o   the applicable payment provisions for such obligations            

   o   to what extent, if any, the obligation evidenced thereby is backed by
the faith and credit of the United States.                    

Private Mortgage-Backed Securities                                              

General                                                       

Private mortgage-backed securities may consist of (a) mortgage
pass-through certificates evidencing a direct or indirect undivided interest in 
a pool of mortgage loans, or (b) collateralized mortgage obligations secured by 
mortgage loans. Private mortgage-backed securities will have been issued        
pursuant to a pooling and servicing agreement -- a "PMBS pooling and servicing  
agreement." The private mortgage-backed securities in a trust fund may include a
class or classes of securities that are callable at the option of another class 
or classes of securities. The seller/servicer, which this prospectus refers to  
as the "PMBS servicer," of the underlying mortgage loans will have entered into 
the PMBS pooling and servicing agreement with the trustee under the PMBS pooling
and servicing agreement. The trustee under the PMBS pooling and servicing       
agreement is referred to as the "PMBS trustee." The PMBS trustee or its agent,  
or a custodian, will possess the mortgage loans underlying such private         
mortgage-backed security. Mortgage loans underlying a private mortgage-backed   
security will be serviced by the PMBS servicer directly or by one or more sub-  
servicers who may be subject to the supervision of the PMBS servicer. The PMBS  
servicer will be a Fannie Mae or Freddie Mac approved servicer and, if FHA Loans
underlie the private mortgage-backed securities, approved by the Department of  
Housing and Urban Development as an FHA mortgagee, or such other servicer as the
related prospectus supplement may specify. The Department of Housing and Urban  
Development is sometimes referred to as HUD.                                    

     Such securities will (a) either (i) have been previously registered
under the Securities Act of 1933, as amended, or (ii) will at the time be       
eligible for sale under Rule 144(k) under such act; and (b) will be acquired in 
bonafide secondary market transactions not from the issuer or its affiliates.   
The PMBS issuer generally will be a financial institution or other entity       
engaged generally in the business of mortgage lending or the acquisition of     
mortgage loans, a public agency or instrumentality of a state, local or federal 
government, or a limited purpose or other corporation organized for the purpose 
of among other things, establishing trusts and acquiring and selling housing    
loans to such trusts and selling beneficial interests in such trusts, provided  
that any PMBS issuer must either (A) have outstanding securities held by        
non-affiliates in excess of $75 million and file periodic reports with the      
Securities and Exchange Commission or (B) be a government-sponsored entity or   
enterprise with market float in excess of $75 million and which makes available 
to the public information comparable to that required in periodic reports with  
the                                                                             

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SEC. The obligations of the PMBS issuer generally will be limited to certain    
representations and warranties with respect to the assets it conveyed to the    
related trust or its assignment of the representations and warranties of another
entity from which it acquired the assets. The PMBS issuer will not generally    
have guaranteed any of the assets conveyed to the related trust or any of the   
private mortgage-backed securities issued under the PMBS pooling and servicing  
agreement. Additionally, although the mortgage loans underlying the private     
mortgage-backed securities may be guaranteed by an agency or instrumentality of 
the United States, the private mortgage-backed securities themselves will not be
so guaranteed.                                                                  

Payments of principal and interest will be made on the private
mortgage-backed securities on the dates specified in the related prospectus     
supplement. The private mortgage-backed securities may be entitled to receive   
nominal or no principal distributions or nominal or no interest distributions.  
The PMBS trustee or the PMBS servicer will make principal and interest          
distributions on the private mortgage-backed securities. The PMBS issuer or the 
PMBS servicer may have the right to repurchase assets underlying the private    
mortgage-backed securities after a certain date or under other circumstances    
specified in the related prospectus supplement.                                 

Underlying Loans                                              

      The mortgage loans underlying the private mortgage-backed securities
may consist of fixed rate, level payment, fully amortizing loans or graduated   
payment mortgage loans, buydown loans, adjustable rate mortgage loans, or loans 
having balloon or other special payment features. Such mortgage loans may be    
secured by single family property. In general, the underlying loans will be     
similar to the mortgage loans which may be directly part of the trust assets.   

Credit Support Relating to Private Mortgage-Backed Securities 

       Credit support in the form of subordination of other private mortgage
pass-through certificates issued under the PMBS pooling and servicing agreement,
reserve funds, insurance policies, letters of credit, financial guarantee       
insurance policies, guarantees or other types of credit support may be provided 
with respect to the mortgage loans underlying the private mortgage-backed       
securities or with respect to the private mortgage-backed securities themselves.

Additional Information                                        

     The prospectus supplement for a series for which the trust includes
private mortgage-backed securities will specify:                                

o   the aggregate approximate principal amount and type of the private
mortgage-backed securities to be included in the trust        

o   certain characteristics of the mortgage loans which comprise the  
         underlying assets for the private mortgage-backed securities including,
to the extent available:                                      

o   the payment features of such mortgage loans               

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   o   the approximate aggregate principal balance, if known, of the
           underlying mortgage loans insured or guaranteed by a governmental
entity                                                

      o   the servicing fee or range of servicing fees with respect to the
mortgage loans                                        

 o   the minimum and maximum stated maturities of the underlying
mortgage loans at origination                         

   o   delinquency status as of the cut-off date with respect to the
mortgage loans                                        

 o   the pass-through or certificate rate of the private mortgage-backed
securities or the method of determining such rate             

    o   the PMBS issuer, the PMBS servicer (if other than the PMBS issuer) and
the PMBS trustee for such private mortgage-backed securities  

o   certain characteristics of credit support, if any, such as        
        subordination, reserve funds, insurance policies, letters of credit or
  guarantees relating to the mortgage loans underlying the private
mortgage- backed securities or to such private mortgage-backed
securities themselves                                         

o   the terms on which the underlying mortgage loans for such private 
        mortgage-backed securities, or such private mortgage-backed securities
       themselves, may, or are required to, be purchased before their stated
maturity or the stated maturity of the private mortgage-backed
securities.                                                   

Mortgage Loan Information in Prospectus Supplements                             

      Each prospectus supplement will contain information, as of the dates
specified in such prospectus supplement and to the extent then applicable and   
specifically known to the depositor, with respect to the mortgage loans, which  
may include the following:                                                      

   o   the aggregate outstanding principal balance and the largest, smallest
       and average outstanding principal balance of the mortgage loans as of
the applicable cut-off date                                   

o   the type of property securing the mortgage loans                  

o   the weighted average (by principal balance) of the original and   
remaining terms to maturity of the mortgage loans             

o   the earliest and latest origination date and maturity date of the 
mortgage loans                                                

  o   the range of the loan-to-value ratios at origination of the mortgage
loans                                                         

    o   the mortgage rates or range of mortgage rates and the weighted average
mortgage rate borne by the mortgage loans                     

o   the state or states in which most of the mortgaged properties are 
located                                                       

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   o   information with respect to the prepayment provisions, if any, of the
mortgage loans                                                

o   with respect to mortgage loans with adjustable mortgage rates, the
      related indices, the frequency of the adjustment dates, the range of
        margins added to the indices, and the maximum mortgage rate or monthly
      payment variation at the time of any adjustment thereof and over the
life of such mortgage loans with adjustable mortgage rates    

o   information regarding the payment characteristics of the mortgage 
loans, including without limitation balloon payment and other 
amortization provisions.                                      

       If specific information respecting the mortgage loans is not known to
the depositor at the time securities are initially offered, more general        
information of the nature described above will be provided in the prospectus    
supplement, and specific information will be set forth in a report which will be
available to purchasers of the related securities at or before the initial      
issuance thereof and will be filed as part of a current report on Form 8-K with 
the Securities and Exchange Commission within fifteen days after such initial   
issuance.                                                                       

    The related prospectus supplement may specify whether the mortgage
loans include closed-end loans or certain balances thereof.                     

Substitution of Trust Assets                                                    

  FMIC or the seller may, within the time specified in the related
prospectus supplement, deliver to the trustee other trust assets in substitution
for any one or more trust assets initially included in your trust. Such right of
substitution will be subject to compliance with certain parameters for          
substitute trust assets, including mortgage rate and maturity ranges, loan types
and loan-to-value ratios. In general, unless otherwise specified in the related 
prospectus supplement, substitute trust assets must, on the date of             
substitution,                                                                   

 o   have an outstanding principal balance not greater than and not less
        than 80% of, the outstanding principal balance of the deleted mortgage
        loan after giving effect to all principal payments due during or prior
to the month of the substitution occurs                       

     o   have an applicable mortgage rate not less than the mortgage rate on the
deleted mortgage loan                                         

   o   have a remaining term to maturity not greater than, and not less than
80% of, that of the replaced trust asset                      

o   comply with each representation and warranty made by the seller   
relating to the trust assets and                              

   o   satisfy the additional requirements specified in the related transfer
and servicing agreement.                                      

        In addition, only like-kind collateral may be substituted. If mortgage
loans are being substituted, the substitute mortgage loan must have a           
loan-to-value ratio as of the first day of the month in which the substitution  
occurs equal to or less than the loan-to-value ratio of the                     

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substituted mortgage loan on this date, using the value at origination, and     
after taking into account the payment due on this date. Further, no             
adjustable-rate loan may be substituted unless the substituted mortgage loan is 
an adjustable-rate loan, in which case, the substituted mortgage loan must also 

    o   have a minimum lifetime applicable mortgage rate that is not less than
  the minimum lifetime applicable mortgage rate on the substituted
mortgage loan                                                 

    o   have a maximum lifetime applicable mortgage rate that is not less than
  the maximum lifetime applicable mortgage rate on the substituted
mortgage loan                                                 

o   have a gross margin not less than the gross margin of the deleted 
mortgage loan,                                                

    o   have a periodic rate cap equal to the periodic rate cap on the deleted
mortgage loan                                                 

 o   have a next adjustment date that is the same as the next adjustment
date for the deleted mortgage loan.                           

    In the event that more than one mortgage loan is substituted for a
deleted mortgage loan, one or more of the foregoing characteristics may be      
applied on a weighted average basis as described in the pooling and servicing   
agreement or indenture.                                                         

Pre-Funding Account                                                             

     If specified in the related prospectus supplement, a portion of the
issuance proceeds of your securities (the "Pre-Funded Amount") will be deposited
into a pre-funding account to be established with the trustee (the "Pre-Funding 
Account"), which will be used to acquire additional trust assets from time to   
time during the time specified in the prospectus supplement (the "Pre-Funding   
Period"). Prior to the investment of the Pre-Funded Amount in additional trust  
assets, at the option of the seller the Pre-Funded Amount may be invested in one
or more "Eligible Investments" which generally include the following:           

   o   obligations of the United States or any agency thereof provided these
   obligations are backed by the full faith and credit of the United
States                                                        

o   securities bearing interest or sold at a discount issued by an    
     corporation incorporated under the laws of the United States or any
        state thereof, which securities are rated by each rating agency at the
     time of investment or the contractual commitment providing for such
     investment in the two highest long-term credit rating categories of
         each rating agency, provided that any such investment will meet certain
concentration limits as provided in the transfer and servicing
agreement                                                     

o   commercial paper which is then rated by each rating agency in the 
highest short-term rating category                            

     o   demand and time deposits, certificates of deposit, bankers' acceptances
      and federal funds sold by an depository institution or trust company
incorporated under the laws of the                            

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United States or any stated thereof, provided that either the 
 short-term debt obligations or commercial paper of a depository
        institution or trust company -- or provided that either the short-term
    debt obligations or commercial paper of the parent company of such
   depository institution or trust company -- are then rated by each
        rating agency in its highest rating category or one of its two highest
long-term rating categories                                   

 o   certificates or receipts representing direct ownership interests in
    future interest or principal payments on obligations of the United
    States or any agency thereof held by a custodian in safekeeping on
behalf of the holders of such receipts                        

o   guaranteed investment contracts issued by any insurance company,  
      corporation or other entity satisfying the requirements specified in
the transfer and servicing agreement                          

   o   repurchase agreements relating to United States government securities

    o   any other demand, money market, common trust fund, or time deposit, or
         obligation , or interest-bearing or other security or investment, rated
        in the highest rating category of each rating agency or that would not
         adversely affect the then current rating assigned by each rating agency
of the securities for the related series.                     

provided however, that no such instrument will qualify as an eligible investment
if such instrument evidences either (a) a right to receive only interest        
payments with respect to the obligations underlying instrument or (b) both      
principal and interest payments derived from obligations underlying such        
instrument and the principal and interest payments with respect to such         
instrument provide a yield to maturity of greater than 120% of the yield to     
maturity at par of such underlying obligations. Any Eligible Investment must    
mature no later than two business days prior to the Servicer Remittance Date for
the next Payment Date, provided if the eligible investment is the obligation of 
an eligible institution (other than the servicer) that maintains the custodial  
account, the eligible investment may mature on the related servicer remittance  
date.                                                                           

        During any Pre-Funding Period, FMIC will be obligated, subject only to
availability, to transfer to your trust subsequent trust assets from time to    
time during the Pre-Funding Period. Subsequent trust assets will be required to 
satisfy eligibility criteria more fully set forth in the prospectus supplement. 
This eligibility criteria will be consistent with the eligibility criteria of   
the trust assets included in your trust on the closing date, but exceptions may 
expressly be stated in the prospectus supplement.                               

         Use of a Pre-Funding Account with respect to any issuance of securities
will be conditioned upon, among other things, the following:                    

  o   unless otherwise specified in the related prospectus supplement, the
       Pre-Funding Period will not exceed three months from the closing date

     o   the subsequent assets to be acquired during the Pre-Funding Period will
         satisfy the same underwriting standards, representations and warranties
         as the trust assets included in the trust on the closing date, although
        additional criteria may also be required to be satisfied, as described
in the prospectus supplement                                  

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  o   unless otherwise specified in the related prospectus supplement, the
      Pre-Funded Amount will not exceed 25% of the principal amount of the
securities issued                                             

o   the Pre-Funded Amount shall be invested in Eligible Investments.  

       To the extent that amounts on deposit in the Pre-Funding Account have
not been fully applied to the purchase of subsequent trust assets by the end of 
the Pre-Funding Period, the securityholders then entitled to receive payments of
principal will receive a prepayment of principal in an amount equal to the      
related Pre-Funded Amount remaining in the Pre-Funding Account on the first     
Payment Date following the end of the Pre-Funding Period. Any prepayment of     
principal would have an adverse effect on the yield to maturity of securities   
purchased at a premium, and would expose securityholders to the risk that       
alternative investments of equivalent value may not be available at a later     
time.                                                                           

       Information regarding subsequent assets acquired by your trust during
the Pre-Funding period comparable to the disclosure regarding the trust assets  
in the prospectus supplement will be filed on a Current Report in Form 8-K      
within fifteen days following the end of the Pre-Funding Period.                

Accounts                                                                        

       For each trust, the trustee, the master servicer or the servicer will
maintain the accounts described below. The prospectus supplement may describe   
additional accounts other than the accounts described in this prospectus.       

Custodial Account                                             

     Each servicer will deposit into a custodial account (the "Custodial
Account") all payments of principal and interest on the mortgage loans for each 
Due Period and all unscheduled prepayments received during the principal        
prepayment period. The Custodial Account will be an eligible account as required
by the rating agencies. As described in the related prospectus supplement, on   
each Servicer Remittance Date, the servicer and subservicer, as applicable,     
shall remit to the trust administrator all amounts deposited in the custodial   
account for the related Due Period and Prepayment Period, along with any        
interest accrued on such amounts; provided that the servicer may retain any fees
owing to such servicer with respect to the related Payment Date.                

Escrow Account                                                

        Each servicer will, to the extent permitted by law and required by the
related mortgage loan documents, establish and maintain a custodial escrow      
account or accounts into which borrowers will deposit amounts sufficient to pay 
taxes, assessments, PMI premiums, standard hazard insurance premiums and other  
comparable items. Some servicers may provide insurance coverage acceptable to   
the servicer and or master servicer against loss occasioned by the failure of   
the borrower to pay the related insurance premiums. Withdrawals from the escrow 
account maintained for borrowers may be made to effect timely payment of taxes, 
assessments, PMI premiums, standard hazard premiums or comparable items, to     
reimburse the servicer for maintaining PMI and standard hazard insurance, to    
refund to borrowers amounts determined to                                       

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be overages, to pay interest to borrowers on balances in the escrow account, if 
required, to repair or otherwise protect the mortgaged properties and to clear  
and terminate this account. The servicer will be responsible for the            
administration of the escrow account and will make advances to this account when
a deficiency exists. Any interest accrued on amounts in the escrow accounts in  
excess of any payments of interest required to be made to borrowers, shall      
either be retained by the servicer or remitted to the trustee as described in   
the related prospectus supplement.                                              

Collection Account                                            

    The trust administrator or its designee will maintain a collection
account (the "Collection Account") into which the servicer and the subservicer  
will generally be required to deposit or cause to be deposited from the         
Custodial Account all amounts received in respect of the trust assets (including
any distributions in respect of the mortgage-related assets). The Collection    
Account will be an eligible account as required by the rating agencies. On the  
related Payment Date, the trustee will make payments of amounts in the          
Collection Account as set forth in the prospectus supplement.                   

Mortgage-Related Asset Custodial Account                      

     Each trustee will deposit all payments received on mortgage-related
assets in a mortgage-related asset custodial account. As described in the       
related prospectus supplement, on each Servicer Remittance Date, the trust      
administrator shall remit all amounts deposited in the mortgage-related asset   
custodial account for the related Due Period, along with any interest accrued on
such amounts.                                                                   

Cash Flow Agreements                                                            

    If so provided in the related prospectus supplement, the trust may
include one or more of the following agreements: interest rate exchange         
agreements, purchase/sale agreements with respect to the trust assets, interest 
rate cap or floor agreements, currency exchange agreements, other swaps and     
derivative instruments or other agreements consistent with the foregoing. The   
principal terms of any such cash flow agreement, including, without limitation, 
provisions relating to the timing, manner and amount of payments thereunder and 
provisions relating to the termination thereof, will be described in the        
prospectus supplement for the related series. In addition, the related          
prospectus supplement will provide certain information with respect to the      
borrower under any such cash flow agreement.                                    

Credit Enhancement                                                              

      If so provided in the related prospectus supplement, partial or full
protection against certain defaults and losses on the trust assets in the       
related trust may be provided to one or more classes of securities in the       
related series. Credit support may be in the form of the subordination of one or
more classes of securities, letters of credit, insurance policies, guarantees,  
the establishment of one or more reserve funds, derivative instruments or       
another method of credit enhancement described in the related prospectus        
supplement, or any combination of the foregoing. If so provided in the related  
prospectus supplement, any form of credit enhancement may be structured so as to
be drawn upon by more than one series to the extent described therein.          

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       Unless otherwise specified in the related prospectus supplement for a
series of securities the credit enhancement will not provide protection against 
all risks of loss and will not guarantee repayment of the entire principal      
amount of the securities and interest thereon. If losses or shortfalls occur    
that exceed the amount covered by credit enhancement or that are not covered by 
credit enhancement, securityholders will bear their allocable share of          
deficiencies. Moreover, if a form of credit enhancement covers more than one    
series of securities (each, a "covered trust"), holders of securities evidencing
interests in any of such covered trusts will be subject to the risk that such   
credit enhancement will be exhausted by the claims of other covered trusts prior
to such covered trust receiving any of its intended share of such coverage.     

Overcollateralization                                         

If so specified in the prospectus supplement for a series of  
securities, the aggregate principal balance of the underlying trust assets as of
the applicable cut-off date may exceed the principal balance of the securities  
being issued, thereby resulting in overcollateralization. In addition, if       
specified in the prospectus supplement, a portion of the interest payment on    
each mortgage loan or mortgage-related asset may be applied as an additional    
payment of principal to reduce the principal balance of a particular class or   
classes of securities and, thus, accelerate the rate of payment of principal on 
the class or classes of securities. Reducing the principal balance of the       
securities without a corresponding reduction in the principal balance of the    
underlying mortgage loan or mortgage-related asset will increase the level of   
overcollateralization.                                                          

Subordinate Securities                                        

   If so specified in the related prospectus supplement, one or more
classes of securities of a series may be subordinate securities. To the extent  
specified in the related prospectus supplement, the rights of the holders of    
subordinate securities to receive payments of principal and interest from the   
Collection Account on any Payment Date will be subordinated to such rights of   
the holders of senior securities. If so provided in the related prospectus      
supplement, the subordination of a class may apply only in the event of (or may 
be limited to) certain types of losses or shortfalls. The related prospectus    
supplement will set forth information concerning the amount of subordination of 
a class or classes of subordinate securities in a series, the circumstances in  
which such subordination will be applicable and the manner, if any, in which the
amount of subordination will be effected.                                       

Cross-Support Provisions                                      

   lf the assets for a series are divided into separate groups, each
supporting a separate class or classes of securities of a series, credit        
enhancement may be provided by cross-support provisions requiring that          
distributions be made on senior securities evidencing interests in one group of 
assets prior to distributions on subordinate securities evidencing interests in 
a different group of assets within the trust. The prospectus supplement for a   
series that includes a cross-support provision will describe the manner and     
conditions for applying such provisions.                                        

Letter of Credit                                              

         If so provided in the prospectus supplement for a series of securities,
deficiencies in amounts otherwise payable on such securities or certain classes 
thereof will be covered by one or                                               

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more letters of credit, issued by a bank or financial institution specified in  
such prospectus supplement (each, an "L/C Bank"). Under a letter of credit, the 
L/C Bank will be obligated to honor draws thereunder in an aggregate fixed      
dollar amount, net of unreimbursed payments thereunder, generally equal to a    
percentage specified in the related prospectus supplement of the aggregate      
principal balance of the assets on the related cut-off date or of the initial   
aggregate security balance of one or more classes of securities. If so specified
in the related prospectus supplement, the letter of credit may permit draws in  
the event of only certain types of losses and shortfalls. The amount available  
under the letter of credit will, in all cases, be reduced to the extent of the  
unreimbursed payments thereunder and may otherwise be reduced as described in   
the related prospectus supplement. The obligations of the L/C Bank under the    
letter of credit for each series of securities will expire at the earlier of the
date specified in the related prospectus supplement or the termination of the   
trust.                                                                          

Reserve Fund or Accounts                                      

       FMIC may deposit or cause to be deposited cash, securities of deposit
or letters of credit in reserve funds or accounts. Such an account may be       
maintained as an interest bearing or a non-interest bearing account, and funds  
held therein may be held as cash or invested in certain short-term, investment  
grade obligations, in each case as described in the related prospectus          
supplement. These accounts may be used by the trustee to make payments of       
principal or interest on your securities to the extent funds are not otherwise  
available, if so provided in the pooling and servicing agreement or indenture   
and described in the related prospectus supplement. The reserve funds will be   
maintained in trust but may or may not constitute trust assets of your trust.   
FMIC may have certain rights on a Payment Date to cause the trustee to make     
withdrawals from the reserve fund and to pay these amounts in accordance with   
the instructions of FMIC, as specified in the related prospectus supplement, to 
the extent that these funds are no longer required to be maintained for you.    

Derivative Instruments                                        

         If specified in the related prospectus supplement, the trust assets may
include one or more swap arrangements, cap contracts or other derivative        
instruments that are intended to meet the following goals:                      

     o   to convert the payments on some or all of the mortgage loans from fixed
         to floating payments, or from floating to fixed, or from floating based
on a particular index to floating based on another index      

  o   to provide payments in the event that any index rises above or falls
below specified levels                                        

  o   to provide protection against interest rate changes, certain type of
        losses, including reduced market value, or other payment shortfalls to
one or more classes of the related series.                    

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Financial Guaranty Insurance Policy                           

   If specified in the related prospectus supplement, your series of
securities may have the benefit of one or more financial guaranty insurance     
policies provided by one or more third-party insurers. Financial guaranty       
insurance may guarantee timely payments of interest and full payments of        
principal on the basis of a schedule of principal payments set forth in or      
determined in the manner specified in the related prospectus supplement. A copy 
of the financial guaranty insurance policy for your securities, if any, will be 
filed with the SEC as an exhibit to a Current Report on Form 8-K within 15 days 
of issuance of your securities.                                                 

Primary Mortgage Insurance                                    

      Conventional mortgage loans included in your trust may be covered by
policies for primary mortgage insurance ("PMI") or one or more pool insurance   
policies or any combination (collectively, the "mortgage insurance policies").  
In lieu of PMI policies, additional trust assets may be delivered to the trustee
to secure the timely payment of principal and interest on the mortgage loans.   
FHA loans and VA loans included in your trust will be covered by FHA insurance  
or VA guarantees and may be covered by a pool insurance policy.                 

       Conventional mortgage loans that have initial loan-to-value ratios of
greater than 80% will, to the extent specified in the related prospectus        
supplement, be covered by PMI policies. PMI policies will provide coverage on at
least the amount of the mortgage loan in excess of 75% of the original fair     
market value of the mortgaged properties, and will remain in force until the    
principal balance of the mortgage loan is reduced to 80% of its original fair   
market value or, with the consent of the servicer and mortgage insurer, after   
the policy has been in effect for more than two years or such other period of   
time that may be required under state and local law if the loan-to-value ratio  
of the mortgage loan has declined to 80% or less based upon its current fair    
market value. The initial loan-to-value ratio of any mortgage loan represents   
the ratio of the principal balance of the mortgage loan outstanding at the      
origination divided by the fair market value of the mortgaged property. The fair
market value of the mortgaged property securing a mortgage loan is the lesser of
the purchase price paid by the borrower or the appraised value of the mortgaged 
property at origination. Some PMI Policies will, subject to their provisions,   
provide full coverage against any loss sustained by reason of nonpayments by the
borrowers.                                                                      

Pool Insurance                                                

     Each pool insurance policy generally will cover, subject to certain
limitations, losses related to mortgage loan defaults not covered by any related
PMI policy. The pool insurance policies, however, are not blanket policies      
against loss, because claims under pool insurance policies may be made only for 
particular defaulted mortgage loans and only upon satisfaction of certain       
conditions precedent. Unless otherwise specified in the related prospectus      
supplement, a pool insurance policy generally will not cover losses due to a    
failure to pay or denial of a claim under a PMI policy. Further, the mortgage   
pool insurance policies will not insure against some losses sustained in the    
event of a personal bankruptcy of the borrower under a mortgage loan. Any pool  
insurance policy also will be subject to a loss limit specified in the related  
prospectus supplement.                                                          

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   The mortgage insurance policies will not provide coverage against
hazard losses. Each mortgage loan will be covered by a standard hazard insurance
policy but these policies typically will exclude from coverage physical damage  
resulting from a number of causes and, even when the damage is covered, may     
afford recoveries that are significantly less than full replacement cost of the 
losses. Further, to the extent that mortgage loans are covered by a special     
hazard insurance policy, the special hazard insurance policy will not cover all 
risks, and the coverage of the policy will be limited. Not all hazard risks will
be covered and losses may reduce distributions to you.                          

         To the extent necessary to restore or prevent a reduction of the rating
assigned by a rating agency, a servicer will use its reasonable best efforts to 
replace a mortgage insurance policy with a new mortgage insurance policy issued 
by an insurer whose claims paying ability is acceptable to each rating agency.  

Hazard Insurance Policies                                     

Standard Hazard Insurance Policies                  

      The servicer must maintain, or assure that the borrower maintains, a
standard hazard insurance policy covering each mortgaged property, to the extent
described in the related prospectus supplement. The coverage amount of each     
standard hazard insurance policy will be at least equal to the lesser of the    
outstanding principal balance of the mortgage loan, or the full replacement     
value of the improvements on the mortgaged property. All amounts collected by   
the servicer under any standard hazard insurance policy -- less amounts to be   
applied to the restoration or repair of the mortgaged property and other amounts
necessary to reimburse the servicer for previously incurred advances or approved
expenses, which may be retained by the servicer -- will be deposited to the     
custodial account or the Collection Account.                                    

     The standard hazard insurance policies will provide for coverage at
least equal to the applicable state standard form of fire insurance policy with 
extended coverage. In general, the standard form of fire and extended coverage  
policy will cover physical damage to, or destruction of, the improvements on the
mortgaged property caused by fire, lightning, explosion, smoke, windstorm, hail,
riot, strike and civil commotion, subject to customary conditions and           
exclusions. Because the mortgage loans' standard hazard insurance policies will 
be underwritten by different insurers and will cover mortgaged property located 
in various states, these policies will not contain identical terms and          
conditions. The basic terms generally will be determined by state law and       
generally will be similar. Most policies typically will not cover any physical  
damage resulting from the following: war, revolution, governmental actions,     
floods and other water-related causes, earth movement -- including earthquakes, 
landslides and mudflows -- , nuclear reaction, wet or dry rot, vermin, rodents, 
insects or domestic animals, theft, terrorism, and, in certain cases, vandalism.
This list is merely indicative of certain kinds of uninsured risks and is not   
intended to be all-inclusive. When mortgaged properties are located in a flood  
area identified by HUD pursuant to the National Flood Insurance Act of 1968 the 
servicer will cause to be maintained flood insurance.                           

      The standard hazard insurance policies covering mortgaged properties
typically will contain a "coinsurance" clause which, in effect, will require the
insured at all times to carry                                                   

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insurance of a specified percentage -- generally 80% to 90% -- of the full      
replacement value of the dwellings, structures and other improvements on the    
mortgaged property in order to recover the full amount of any partial loss. If  
the insured's coverage falls below this percentage, the clause will provide that
the insurer's liability in the event of partial loss will not exceed the greater
of the actual cash value -- the replacement cost less physical depreciation --  
of the dwellings, structures and other improvements damaged or destroyed or the 
proportion of the loss, without deduction for depreciation, as the amount of    
insurance carried bears to the specified percentage of the full replacement cost
of the dwellings, structures and other improvements.                            

     Any losses incurred with respect to mortgage loans due to uninsured
risks -- including earthquakes, mudflows and floods -- or insufficient hazard   
insurance proceeds may reduce the value of the assets included in your trust to 
the extent these losses are not covered by the special hazard insurance policy  
and could affect distributions to you.                                          

Special Hazard Insurance Policy                     

       A special hazard insurance policy may be obtained with respect to the
mortgage loans included in your trust. A special hazard insurance policy        
generally will protect you from                                                 

 o   loss by reason of damage to mortgaged property underlying defaulted
    mortgage loans included in your trust caused by certain hazards --
       including vandalism and earthquakes and, except where the borrower is
        required to obtain flood insurance, floods and mudflows -- not covered
by the standard hazard insurance policies                     

o   loss from partial damage to the mortgaged property securing the   
     defaulted mortgage loans caused by reason of the application of the
coinsurance clause contained in the applicable standard hazard
insurance policies.                                           

     Any special hazard insurance policy, however, will not cover losses
occasioned by war, nuclear reaction, nuclear or atomic weapons, terrorism,      
insurrection or normal wear and tear. Coverage under the special hazard         
insurance policy will be at least equal to the amount specified in the related  
prospectus supplement.                                                          

      The special hazard insurance policy will provide that when there has
been damage to mortgaged property securing a defaulted mortgage loan and this   
damage is not covered by the standard hazard insurance policy maintained by the 
borrower or the servicer, the special hazard insurer will pay the lesser of     

o   the cost of repair of the mortgaged property, or                  

  o   upon transfer of the property to it, the unpaid principal balance of
   the mortgage loan at the time of the acquisition of the mortgaged
    property, plus accrued interest to the date of claim settlement --
    excluding late charges and penalty interest -- , and certain other
expenses.                                                     

    No claim may be validly presented under a special hazard insurance
policy unless                                                 

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o   hazard insurance on the mortgaged property securing the defaulted 
         mortgage loan has been kept in force and other reimbursable protection,
         preservation and foreclosure expenses have been paid, all of which must
be approved in advance as necessary by the insurer, and       

     o   the insured has acquired title to the mortgaged property as a result of
default by the borrower.                                      

     If the sum of the unpaid principal amount plus accrued interest and
certain expenses is paid by the special hazard insurer, the amount of further   
coverage under the special hazard insurance policy will be reduced by this      
amount less any net proceeds from the sale of the mortgaged property. Any amount
paid as the cost of repair of the mortgaged property will reduce coverage by    
this amount.                                                                    

        The servicer will maintain the special hazard insurance policy in full
force and effect. The servicer also is required to present claims, on behalf of 
the trustee, for all losses not otherwise covered by the standard hazard        
insurance policies and take all reasonable steps necessary to permit recoveries 
on these claims.                                                                

     Partially or entirely in lieu of a special hazard insurance policy,
FMIC may deposit or cause to be deposited cash, securities, a certificate of    
deposit, a letter of credit or any other instrument acceptable to each rating   
agency in an amount and for a term acceptable to each rating agency. This       
deposit will be credited to a special hazard fund or similar fund, including a  
fund that may also provide coverage for borrower bankruptcy losses, and the     
trustee will be permitted to draw on the fund to recover losses that would      
otherwise be covered by a special hazard insurance policy. A special hazard     
insurance policy or special hazard fund may insure against losses on mortgage   
loans assigned to trusts for other series of securities or that secure other    
mortgage-backed securities obligations issued by FMIC or one of its affiliates. 
However, the extension of coverage -- and the corresponding assignment of the   
special hazard insurance policy -- to any other series or other securities will 
be permissible only to the extent that any such extension and assignment will   
not result in the downgrading of the credit rating of any outstanding securities
of your series. FMIC may also elect to insure against special hazard losses by  
the delivery of additional assets to your trust rather than through a special   
hazard insurance policy or special hazard fund.                                 

Delivery of Additional Assets                                 

 Rather than providing pool insurance, special hazard insurance,
borrower bankruptcy insurance or other insurance, FMIC may assign to your trust 
non-recourse guaranties of the timely payment of principal and interest on trust
assets included in your trust secured by other assets satisfactory to each      
rating agency rating your series. FMIC may also assign or undertake to deliver  
such other assets to your trust by other means. Other assets may consist of     
additional mortgage loans, mortgage-related assets letters of credit or other   
Eligible Investments.                                                           

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Fidelity Bonds and Errors and Omissions Insurance                               

       Unless otherwise specified in the related prospectus supplement, each
pooling and servicing agreement or transfer and servicing agreement will require
that each of the master servicer, servicer and subservicer obtain and maintain  
in effect a fidelity bond or similar form of insurance coverage (which may      
provide blanket coverage) or any combination thereof insuring against loss      
occasioned by fraud, theft or other intentional misconduct of the officers,     
employees and agents of the master servicer, servicer, or subservicer, as       
applicable.                                                                     

Investment of Funds                                           

     Funds deposited in or remitted to any account or reserve fund for a
series are to be invested by the trustee, as directed by FMIC, in Eligible      
Investments.                                                                    

   Any income, gain or loss from investments for your series will be
credited or charged to the appropriate fund or account for your series.         
Reinvestment income from Eligible Investments may be payable to the servicers as
additional servicing compensation. In that event, these monies will not accrue  
for your benefit.                                                               

DESCRIPTION OF THE SPONSOR AND CERTAIN RELATED PARTIES

         The following summary provides a general description of the sponsor and
certain of its affiliates involved in the issuance of any series of securities. 

The Sponsor and the Seller                                                      

         Fieldstone Investment Corporation, a Maryland corporation ("FIC"), is a
self-managed, fully-integrated mortgage banking company that originates,        
securitizes, sells and services non-conforming and conforming single-family     
residential mortgage loans secured primarily by first liens. FIC's goal is to be
an efficient, low-cost originator of high quality residential mortgages and to  
provide exemplary service to its customers. FIC conducts all of its loan        
origination, processing, underwriting, sales and servicing functions through its
primary operations subsidiary, Fieldstone Mortgage Company ("FMC"). FIC has     
elected to be taxed as a real estate investment trust, or REIT, for federal     
income tax purposes.                                                            

 FIC owns all of the outstanding capital stock of the depositor,
Fieldstone Mortgage Investment Corporation ("FMIC"), and is expected to be the  
sponsor with respect to each series of securities. If so specified in the       
related prospectus supplement, FIC also is expected to act as a seller with     
respect to each series. FIC's principal executive offices are located at 11000  
Broken Land Parkway, Columbia, Maryland 21044 and its telephone number is (410) 
772-7200.                                                                       

The Depositor                                                                   

         Fieldstone Mortgage Investment Corporation ("FMIC") was incorporated in
Maryland in May 27, 2005, as a wholly-owned, limited-purpose financing          
subsidiary of FIC. FMIC organizational documents limit FMIC's activities to     
those directly related to the financing and sale of mortgage loans and          
mortgage-related assets. FMIC does not have, nor is it expected in the future to
have, any significant assets other than those directly related to the financing 
and sale                                                                        

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of mortgage loans and other mortgage-related assets. FIC owns all of the issued 
and outstanding shares of capital stock of FMIC. FMIC's principal executive     
offices are located at 11000 Broken Land Parkway, Columbia, Maryland 21044,     
telephone (866) 365-FMIC (3642).                                                

The Servicer                                                                    

  Fieldstone Servicing Corp., a Maryland corporation ("FSC"), is a
wholly-owned subsidiary of Fieldstone Investment Corporation, and if so         
specified in the related prospectus supplement, is expected to act as a servicer
with respect to each series. FSC has limited experience servicing mortgage      
loans. As a result, FSC is expected to delegate the primarily responsibility for
servicing mortgage loans to one or more subservicers, as described in the       
related prospectus supplement. Notwithstanding any such delegation of servicing 
duties to a subservicer, the servicer is expected to remain responsible for the 
acts and omissions of any subservicer engaged to service the mortgage loans. See
"Servicing of the Trust Assets" in this prospectus. FSC's principal executive   
offices are located at 11000 Broken Land Parkway, Columbia, Maryland 21044 and  
its telephone number is (410) 772-7200.                                         

ORIGINATION AND SALE OF MORTGAGE LOANS

Origination of the Mortgage Loans                                               

      The mortgage loans will be originated by Fieldstone Mortgage Company
("FMC"), a nationwide mortgage banking company and wholly-owned subsidiary of   
Fieldstone Investment Corporation, or by other mortgage lenders generally in    
accordance with underwriting guidelines established and maintained by FMC (the  
"Fieldstone Underwriting Guidelines"), as further described herein and in the   
related prospectus supplement. FMC originates loans primarily in the wholesale  
market through mortgage brokers. FMC also originates loans directly with        
customers through its retail branch network. In addition, FMC acquires mortgage 
loans from correspondent lenders. FIC conducts all of its loan origination,     
processing, underwriting, sales and servicing functions through FMC. If         
specified in the related prospectus supplement, FIC is expected to act as a     
seller of mortgage loans originated or purchased by FMC. The principal executive
offices of FMC are located at 11000 Broken Land Parkway, Suite 600, Columbia,   
Maryland 21044 and can be reached by telephone at (410) 772-7200.               

Representations and Warranties                                                  

        FMIC generally will acquire mortgage loans from FIC or another seller.
A seller or an affiliate of the seller may act as a servicer of mortgage loans  
included in your trust or an unrelated party may act as servicer. The seller    
will make or will assign its rights in representations and warranties concerning
the mortgage loans. Those representations and warranties relate to the following
types of matters, among other things:                                           

     o   compliance in all material respects with all applicable laws, rules and
regulations, including, but not limited to, all applicable    
anti-predatory lending and anti-abusive lending laws          

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     o   the accuracy of the information set forth for such mortgage loan on the
     schedule of trust assets appearing as an exhibit to the pooling and
        servicing agreement or transfer and servicing agreement, as applicable

o   the existence of title insurance insuring the lien priority of the
mortgage loan                                                 

o   authority of the seller to sell the mortgage loan                 

o   the payment status of the mortgage loan                           

    o   the existence of customary provisions in the related mortgage note and
       mortgage to permit realization against the mortgaged property for the
benefit of the security of the mortgage                       

   o   the existence of hazard insurance and other insurance coverage on the
mortgaged property.                                           

         With respect to each mortgage loan, the seller is required to submit to
the trustee (or the custodian on behalf of the trustee) a mortgagee title       
insurance policy, title insurance binder, preliminary title report, or          
satisfactory evidence of title insurance. If a preliminary title report is      
delivered initially, the seller is required to deliver a final title insurance  
policy or satisfactory evidence of the existence of a policy.                   

         In the event the seller breaches a representation or warranty made with
respect to a mortgage loan or if any principal document executed by the borrower
concerning a mortgage loan is found to be defective in any material respect and 
the breaching party cannot cure the breach or defect within the required time,  
the trustee may require the seller to purchase the mortgage loan from your trust
upon deposit with the trustee of funds equal to the then unpaid principal       
balance of the mortgage loan plus accrued interest at the asset rate through the
end of the month in which the purchase occurs plus any additional amounts, as   
provided in the prospectus supplement. This sum will be net of any unreimbursed 
advances of principal made by the servicer and any outstanding servicing fees   
owed to the servicer with respect to this mortgage loan. In the event of a      
breach by the seller of a representation or warranty with respect to any        
mortgage loan or the delivery by the seller to the trustee of a materially      
defective document with respect to a mortgage loan, the seller may, under       
certain circumstances, rather than repurchasing the affected mortgage loan,     
substitute a mortgage loan having characteristics substantially similar to those
of the defective one. See "The Trusts -- Substitution of Trust Assets" in this  
prospectus.                                                                     

A seller's obligation to purchase a mortgage loan will be not 
guaranteed by the master servicer, the servicer, the subservicer or FMIC. If the
seller defaults upon its obligation to purchase a mortgage loan and no one      
elects to assume this obligation, distributions to you could be reduced. See    
"The Trusts -- Assignment of Trust Assets" in this prospectus.                  

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Underwriting of the Mortgage Loans                                              

FMC originates, finances, sells, securitizes and services both
"conforming" loans (i.e., loans that are insured by the FHA or partially        
guaranteed by VA, or which qualify for sale to Fannie Mae or Freddie Mac) and   
"non-conforming" loans (i.e., loans that are not insured or guaranteed by FHA or
VA and do not qualify for sale to Fannie Mae or Freddie Mac) secured by         
single-family, two- to four-family, condominium units, units of planned unit    
developments, townhomes and modular homes. FMC originates mortgage loans        
directly and acquires loans from mortgage lenders and brokers. Mortgage loans   
are underwritten and originated using procedures intended to comply with all    
applicable federal and state laws and regulations. FMC focuses on providing the 
best loan available for a given borrower's needs and credit history. FMC's      
non-conforming borrowers generally have good credit backgrounds, but tend to    
have higher loan-to-value ratios, or LTVs, less income documentation, and/or    
higher debt-to-income ratios than conforming borrowers.                         

         FMC generally underwrites its non-conforming loans to meet the specific
guidelines of one of a variety of loan programs. The Fieldstone Underwriting    
Guidelines are modified and revised continually based on changes in residential 
mortgage underwriting and lending practices and requirements of secondary       
mortgage markets. FMC generally originates its second-lien loans in conjunction 
with a first-lien loan secured by the same mortgaged property. Although FMC's   
first-lien and second-lien programs offer unique features, FMC's underwriting   
and compliance guidelines are generally consistent across all programs.         

 Each originating lender of a mortgage loan will follow a credit
approval process to assess the prospective borrower's ability and likelihood to 
repay the mortgage loan and the adequacy of the prospective mortgaged property  
as collateral. The mortgage credit approval process for non-conforming          
residential loans generally relies on manual underwriting. FMC's credit review  
process includes a review of the prospective borrower's detailed loan           
application and verification of certain information. The review includes an     
evaluation of the applicant's income, liabilities, credit history, employment   
history and personal information. Verification of income data varies by loan    
documentation type, though reduced or stated income documentation programs      
generally require that prospective borrowers have higher credit scores to       
compensate for risks of reliance on less than full income documentation.        
Additionally, a credit report is obtained for each prospective borrower, showing
credit history with merchants and lenders and any record of bankruptcy filings  
for a period of years. Program guidelines or automated underwriting decisions   
determine what documentation must be provided to validate the information       
disclosed on the loan application.                                              

  Based on the information provided by the loan applicant, certain
verifications and an appraisal of the prospective mortgaged property or in lieu 
of an appraisal, a valuation of the property as determined by an automated      
valuation model, the originator determines whether the prospective borrower has 
sufficient monthly income available to meet the borrower's monthly obligations  
on the proposed loan and other expenses related to the residence (for example,  
property taxes, hazard insurance and, if applicable, primary mortgage insurance 
premiums) and other financial obligations and monthly living expenses.          
Originators typically calculate certain percentages (or "ratios") of a          
prospective borrower's income to debt and monthly payment obligations.          
Acceptable ratios are determined by the characteristics of the loan and the     

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applicable loan underwriting guidelines. Originators may originate loans that   
exceed certain ratios if there are compensating factors that may offset a risk  
that the ratio is intended to identify.                                         

    The accompanying prospectus supplement may provide a more detailed
description of the underwriting guidelines used to originate the mortgage loans 
included in your trust. In general, however, mortgage loans will be originated  
in accordance with the Fieldstone Underwriting Guidelines or other loan         
underwriting guidelines approved by FMC as appropriate for the origination of   
loans substantially similar to those originated in accordance with the          
Fieldstone Underwriting Guidelines.                                             

Fieldstone Underwriting Guidelines                                              

      All of FMC's non-conforming loans are underwritten by FMC's on-staff
underwriting personnel, and FMC does not delegate underwriting authority to any 
broker or third party. FMC applies the Fieldstone Underwriting Guidelines in the
origination of non-conforming mortgage loans. The Fieldstone Underwriting       
Guidelines generally are designed to evaluate a prospective borrower's credit   
history and ability to repay the loan, as well as the value and adequacy of the 
related mortgaged property as collateral. The Fieldstone Underwriting Guidelines
allow for certain flexibility and exceptions to the underwriting standards are  
permitted in certain circumstances.                                             

  FMC's underwriting process considers a combination of factors in
deciding whether to approve a loan, including the borrower's income             
documentation, LTV, mortgage and consumer credit payment history, property type 
and credit score. The mortgage loan underwriting process relies upon an         
underwriter's analysis of the prospective borrower's ability to repay the loan  
according to its terms, the risk that the prospective borrower will not repay,  
the fees and rates charged, the value of the related mortgaged property as      
collateral, the benefit the loan is providing to the prospective borrower, and  
the loan amounts relative to the risk. FMC's policy is to analyze the overall   
situation of the prospective borrower and to take into account compensating     
factors that may be used to offset certain areas of weakness. These compensating
factors include credit scores, proposed reductions in the borrower's debt       
service expense, borrower assets, employment stability, number of years in      
residence and net disposable income. FMC's underwriting process and the         
Fieldstone Underwriting Guidelines require a thorough application review and    
documentation designed to maximize the value of the mortgage loans.             

Borrower Information                                          

         Each prospective borrower generally will have been required to complete
an application designed to provide the lender with pertinent credit information 
concerning the borrower. A prospective borrower generally will provide          
information with respect to the borrower's assets, liabilities, income, credit  
history, employment history and personal information, and will furnish the      
lender with authorization to obtain a credit report, which summarizes the       
borrower's credit history.                                                      

Credit Evaluation                                             

      FMC examines a prospective borrower's credit report. Generally, each
credit report provides multiple credit scores for the borrower. Credit scores   
generally range from 350 to 900                                                 

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and are available from three major credit bureaus: Experian (formerly TRW       
Information Systems and Services), Equifax and Trans Union. Credit scores are   
empirically derived from historical credit bureau data and represent a numerical
weighing of a borrower's credit characteristics over a two-year period. A credit
score is generated through the statistical analysis of a number of              
credit-related characteristics or variables. Common characteristics include     
number of credit lines, payment history, past delinquencies, severity of        
delinquencies, current levels of indebtedness, types of credit and length of    
credit history. Attributes are the specific values of each characteristic. A    
scorecard is created with weights or points assigned to each attribute. An      
individual loan applicant's credit score is derived by summing together the     
attribute weights for that applicant.                                           

Employment, Income and Asset Verification and Source of Funds 

       The Fieldstone Underwriting Guidelines include a review of the income
of each applicant. FMC personnel review the loan applicant's source of income,  
calculate the amount of income from sources indicated on the loan application or
similar documentation, and calculate debt-to-income ratios to determine the     
applicant's ability to repay the loan.                                          

 A borrower's debt-to-income ratio is calculated by dividing the
borrower's total monthly payment obligations, including payments due under the  
proposed mortgage loan from FMC, but after any debt consolidation from the      
proceeds of that mortgage loan, by the borrower's monthly gross income. The     
calculation of a borrower's debt-to-income ratio involves a careful review of   
all debts listed on the credit report and the loan application, as well as the  
verification of gross income. Other than with respect to "stated documentation" 
mortgage loans, FMC verifies a borrower's income through various means,         
including applicant interviews, written verifications from employers, and the   
review of pay stubs, bank statements, tax returns and W-2 wage and tax          
statements.                                                                     

      Under certain circumstances, mortgage loans may have been originated
under "limited documentation" underwriting programs in which the prospective    
borrower may not be required to provide employment verification or may be       
permitted to provide only limited income information. Participation in a limited
documentation program generally is limited to prospective borrowers with high   
credit scores.                                                                  

Mortgage Loan Documentation Programs                          

      The mortgage loans generally have been underwritten under one of the
following documentation programs:                                               

     o   Full Documentation - income verification based on current pay stubs and
   W-2s for wage earners or two years' tax returns for self-employed
borrowers                                                     

 o   24 Months of Bank Statements - allowed for all types of employment,
        this program uses an average of deposits for the most recent 24 months

o   12 Months of Bank Statements - allowed for self-employed borrowers
    only, this program requires 12 months of bank statements to verify
income                                                        

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   o   Limited Documentation - generally available for borrowers with higher
    credit scores, this program requires a year-to-date pay stub, most
       recent 1099 or six months of bank statements depending on whether the
borrower is a wage earner, a contractor or is self-employed,  
respectively                                                  

     o   Stated Documentation - this program requires wage earners to verify two
         years' employment in the same profession and self-employed borrowers to
       provide evidence that the business has been owned and operated for at
least two years.                                              

 Each of these documentation programs includes a thorough credit
underwriting. Exceptions to documentation requirements and other modifications  
may be granted on a case-by-case basis for certain prospective borrowers and for
certain loan programs.                                                          

Loan-to-Value Ratios                                          

    The "loan-to-value ratio" or "LTV" of a mortgage loan helps FMC to
evaluate whether the property is likely to constitute sufficient security for   
repayment of the proposed mortgage loan. FMC calculates the "loan-to-value"     
ratio by dividing the principal balance of the proposed mortgage loan by the    
lesser of (a) the sales price of the mortgaged property or (b) the appraised    
value of the mortgaged property at origination (or in the case of a refinanced  
or modified loan, the appraised value at the time of refinancing or             
modification). For mortgaged properties subject to first and second lien        
mortgage loans, FMC calculates a "combined loan-to-value ratio" or "CLTV" which 
takes into account the combined principal balances of both the proposed first   
and second lien mortgage loans secured by the same mortgaged property.          

Appraisals                                                    

        FMC has established appraisal procedure guidelines, and all appraisers
are typically licensed independent appraisers selected in accordance with those 
guidelines. The appraisal procedure guidelines generally require the appraiser, 
or an agent on its behalf, to inspect the property personally and to verify     
whether the property is in good condition and that construction, if new, has    
been substantially completed. The appraisal also considers a market data        
analysis of recent sales of comparable properties and when deemed applicable, an
analysis based on income generated from the property or replacement cost        
analysis based on the current cost of constructing or purchasing a similar      
property.                                                                       

         An appraisal generally will be required to be made on each residence to
be financed. This appraisal generally will be made by an appraiser who at the   
time of the appraisal met the minimum qualifications of Fannie Mae or Freddie   
Mac for appraisers of conventional residential mortgage loans. The appraisal    
generally will be based on the appraiser's judgment of value, giving appropriate
weight to both the market value of comparable homes and the cost of replacing   
the residence. In lieu of an appraisal, the valuation of a residence may be     
determined by an automated valuation model.                                     

    FMC generally requires a full appraisal of each proposed mortgaged
property. Appraisals generally conform to the Uniform Standards of Professional 
Appraisal Practice and must be on forms acceptable to Freddie Mac and Fannie    
Mae. Appraisals are performed by                                                

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licensed, third-party, fee-based appraisers and include an inspection of the    
exterior and interior of the subject property and review and evaluation of      
neighborhood conditions, site and zoning status and the condition and value of  
improvements. Following each appraisal, the appraiser prepares a report which   
includes cost analyses (when appropriate) based upon both the current cost of   
constructing a similar home and a market value analysis based upon recent sales 
of comparable homes in the area. FMC's appraisal review process requires that   
each appraisal be validated, except in limited circumstances under which an FMC 
underwriter is permitted to certify the value of the property without review.   
Appraisals are validated by either a non-affiliated appraisal review firm or by 
one of FMC's qualified underwriters using additional data to evaluate the       
appraisal. In most cases, FMC utilizes automated value measures to validate the 
appraisals. FMC generally requires that an appraisal be not more than 180 days  
old on the day the loan is funded.                                              

Additional Collateral Mortgage Loans                          

     If specified in the related prospectus supplement, certain mortgage
loans with loan-to-value ratios in excess of 80% may be secured by a security   
interest in additional collateral (typically securities). Such loans are        
referred to as "Additional Collateral Mortgage Loans." The amount of additional 
collateral pledged by the borrower will vary from loan to loan based on factors 
present in the underwriting decision. No assurance can be given as to the amount
of proceeds, if any, that might be realized from such additional collateral.    

 SERVICING OF THE TRUST ASSETS

General                                                                         

   If the trust for your series includes mortgage loans, one or more
servicers will provide customary servicing functions pursuant to the pooling and
servicing agreement, the transfer and servicing agreement or other separate     
servicing agreements. For certain series, a master servicer may oversee the     
performance of the servicers. Upon the default of any servicer, the master      
servicer will assume, or cause another servicer to assume, the servicing with   
respect to the mortgage loans previously serviced by the now defaulted servicer.
Certain servicing functions may be performed by one or more subservicers as     
described in the prospectus supplement. For purposes of the following           
discussion, unless specifically stated otherwise, each of the servicer and the  
subservicer is deemed to be a servicer. Each of the servicer and any subservicer
may be entitled to withhold its servicing fee and other fees and charges from   
remittances of payments received on the mortgage loans they service.            

   Each servicer must be approved by the master servicer, if any. In
determining whether to approve a servicer, the master servicer will review the  
credit of the servicer, including capitalization ratios, liquidity,             
profitability and other similar items that indicate financial ability to perform
its obligations. In addition, the master servicer's mortgage servicing personnel
will review the servicer's servicing record and will evaluate the ability of the
servicer to conform with required servicing procedures. Generally, the master   
servicer will be responsible for appointing servicers and successor servicers   
from time to time. Once a servicer is approved, the master servicer will        
continue to monitor on a regular basis the financial position and servicing     
performance of the servicer.                                                    

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    The duties to be performed by the servicers include collection and
remittance of principal and interest payments on the mortgage loans,            
administration of mortgage escrow accounts, collection of insurance claims,     
foreclosure procedures, and, if necessary, the advance of funds to the extent   
certain payments are not made by the borrowers and are considered to be         
recoverable under the applicable insurance policies or from proceeds of         
liquidation of the mortgage loans. Each servicer also will provide necessary    
accounting and reporting services to the trustee, and if applicable, the master 
servicer. Each servicer is entitled to a periodic servicing fee equal to a      
specified percentage of the outstanding principal balance of each mortgage loan 
serviced by it. With the consent of the master servicer or trustee, some        
servicing obligations of a servicer may be delegated to another person approved 
by the master servicer or trustee.                                              

    In some cases, a servicer or subservicer may pledge and assign its
right to reimbursement for outstanding advances and other rights under the      
transfer and servicing agreement, pooling and servicing agreement or separate   
servicing agreement to one or more lenders in order to obtain financing. To the 
extent provided under any such financing arrangement, upon default by any       
servicer or subservicer, as applicable, the lender may appoint a successor      
servicer or subservicer, as applicable, meeting the requirements for appointment
of a successor servicer or successor subservicer, as applicable, under the      
transfer and servicing agreement, pooling and servicing agreement or separate   
servicing agreement.                                                            

      The master servicer will administer and supervise the performance by
the servicers of their duties and responsibilities. The master servicer will be 
entitled to receive a portion of the interest payments on the mortgage loans    
included in your trust to cover its fees as master servicer. The master servicer
or the trustee may terminate a servicer who fails to comply with its covenants  
or breaches one of its representations. Upon termination of a servicer by the   
master servicer, the master servicer will assume certain servicing obligations  
of the terminated servicer, or, at its option, may appoint a substitute servicer
acceptable to the trustee to assume the servicing obligations of the terminated 
servicer.                                                                       

    If the mortgage loans are covered by a pool insurance policy and a
terminated servicer has failed to comply with its obligation to purchase a      
mortgage loan where mortgage insurance coverage has been denied on the grounds  
of fraud or misrepresentation, the master servicer may be obligated to purchase 
the mortgage loan, subject to limitations, if any, as described in the related  
prospectus supplement. If required by the rating agencies, the master servicer  
may secure its performance of this obligation through cash, a letter of credit  
or another instrument acceptable to the rating agencies. Alternatively, a pool  
insurer may agree to waive its right to deny a claim under its pool insurance   
policy resulting from a loss sustained by reason of a default arising from      
fraud, dishonesty or misrepresentation in connection with the mortgage loan,    
subject to the limitations applicable to the master servicer's obligation to    
purchase the mortgage loan. To the extent there are limitations on the master   
servicer's obligation to purchase mortgage loans included in your trust upon    
which mortgage insurance coverage has been denied on the grounds of fraud or    
misrepresentation, payments to you could be affected if a servicer and the      
master servicer fail to honor their obligations.                                

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Fieldstone Servicing Corp.                                                      

  Fieldstone Servicing Corp., a Maryland corporation ("FSC"), is a
wholly-owned subsidiary of Fieldstone Investment Corporation, and if so         
specified in the prospectus supplement, is expected to act as a servicer with   
respect to each series. FSC's principal offices are located at 11000 Broken Land
Parkway, Columbia, Maryland 21044 and its telephone number is (410) 772-7200. It
is expected that FSC will delegate to one or more subservicers, to the extent   
described in the related prospectus supplement, all or substantially all of the 
primary servicing responsibilities with respect to the trust assets, including, 
but not limited to, all collection, advancing and loan level reporting          
obligations, maintenance of custodial and escrow accounts, maintenance of       
insurance and enforcement of foreclosure proceedings with respect to the trust  
assets and the mortgaged properties in accordance with the provisions of the    
agreement. Notwithstanding any such delegation, FSC, in its capacity as servicer
will remain responsible for the acts or omissions of any subservicer engaged by 
FSC in respect of its obligations to service the trust assets.                  

Payments on Mortgage Loans                                                      

   Each servicer and subservicer, as applicable, will be required to
establish and maintain one or more separate, insured custodial accounts into    
which the servicer and subservicer, as applicable, will deposit on a daily basis
payments of principal and interest received with respect to mortgage loans      
serviced by it. See "The Trusts--Accounts--Custodial Account" in this           
prospectus. These amounts will include principal prepayments, insurance proceeds
and liquidation proceeds, any advances by the servicer and subservicer, as      
applicable, and proceeds of any mortgage loans withdrawn from your trust for    
defects in documentation, breach of representations or warranties or otherwise. 

     To the extent deposits in each custodial account are required to be
insured by the FDIC, if at any time the sums in any custodial account exceed the
limits of insurance on the account, the servicer and subservicer, as applicable,
will be required within one business day to withdraw such excess funds from this
account and remit these amounts to another custodial account or to the trust    
administrator for deposit in the Collection Account for your series. The amount 
on deposit in any custodial account or Collection Account will be invested in   
Eligible Investments.                                                           

   On each Servicer Remittance Date, which will be identified in the
related prospectus supplement, each servicer and subservicer, as applicable,    
will be required to remit to the Collection Account amounts representing        
scheduled installments of principal and interest on the mortgage loans received 
or advanced by the servicer and subservicer, as applicable, that were due during
the applicable Due Period, principal prepayments, insurance proceeds or         
guarantee proceeds, and the proceeds of liquidations of mortgaged property,     
including funds paid by the servicer and subservicer, as applicable, for any    
mortgage loans withdrawn from your trust received during the applicable         
Prepayment Period, with interest to the date of prepayment or liquidation       
subject to certain limitations, less applicable servicing fees, insurance       
premiums and amounts representing reimbursement of advances made by the servicer
or subservicer, as applicable. To the extent that a borrower prepays a mortgage 
loan in full or a mortgage loan is liquidated on a date other than a due date   
resulting in a shortfall in interest payable for the month during such          
prepayment, the master servicer, the servicer or the subservicer, as applicable,
may                                                                             

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be obligated to make a payment required to cover the prepayment interest        
shortfall not to exceed the master servicing fee or servicing fee which is owed 
to the master servicer or the servicer or the subservicer, as applicable (any   
such payment shall constitute a "compensating interest payment"). On or before  
the Payment Date, the trust administrator will withdraw from the Collection     
Account those amounts allocable to the payment of the securityholders for such  
Payment Date. In addition, there will be deposited in the Collection Account for
your series advances of principal and interest made by the master servicer,     
servicer or subservicer, as applicable, and any insurance, guarantee or         
liquidation proceeds -- including amounts paid in connection with the withdrawal
of defective mortgage loans from your trust -- to the extent these amounts were 
not deposited in the custodial account or remitted to the Collection Account as 
required by the pooling and servicing agreement or transfer and servicing       
agreement.                                                                      

Advances                                                                        

         If so specified in the related prospectus supplement, each servicer (or
any subservicer acting on behalf of the servicer) or the master servicer will be
required to advance funds to cover, to the extent that these amounts are deemed 
to be recoverable from any subsequent payments from the same mortgage loan the  
following:                                                                      

 o   delinquent payments of principal and interest on the mortgage loans

  o   delinquent payments of taxes, insurance premiums, and other escrowed
items                                                         

o   foreclosure costs, including reasonable attorneys' fees.          

         The failure of a servicer to make advances may constitute a default for
which the servicer may be terminated. Upon a default by the servicer, the master
servicer or the trustee may be required to make advances to the extent necessary
to make required distributions on your securities, provided that the advancing  
party deems the amounts to be recoverable.                                      

         The advance obligation of the master servicer, servicer, subservicer or
trustee may be further limited to an amount specified by the rating agencies    
rating your securities. Any advances by any of the servicer, subservicer, master
servicer, the trustee or the pool insurer, as the case may be, must be deposited
into the servicer custodial account or into the Collection Account and will be  
due not later than the Payment Date to which the delinquent payment relates.    
Amounts advanced by the servicer, subservicer, the master servicer or the       
trustee, as the case may be, will be reimbursable out of future payments on the 
mortgage loans, insurance proceeds, and liquidation proceeds of the mortgage    
loans for which these amounts were advanced. If an advance made by a servicer,  
subservicer, master servicer or the trustee later proves to be nonrecoverable   
subject to the conditions and the limitations specified in the pooling and      
servicing agreement, a servicer, subservicer, master servicer or the trustee, as
the case may be, will be entitled to reimbursement from funds in the Collection 
Account or Custodial Account, as applicable, (including collections in respect  
of other mortgage loans) prior to the distribution of payments to you.          

      Any advances made by a servicer, subservicer, the master servicer or
the trustee are intended to enable the trustee to make timely payment of the    
scheduled payments of principal                                                 

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and interest on your securities. However, neither the master servicer, the      
trustee, any servicer nor subservicer will insure or guarantee your securities  
or the mortgage loans included in your trust.                                   

Withdrawals from Collection Account                                             

     A trustee may, from time to time, unless otherwise specified in the
related prospectus supplement or the related agreement, make certain withdrawals
from the Collection Account for each trust for the following purposes:          

    o   to make payments or other distributions to the securityholders on each
Payment Date                                                  

  o   to reimburse the master servicer or the servicer, as applicable, for
   any previously unreimbursed advances as described under "Sale and
   Servicing of the Trust Assets--Advances," made by any such party,
subject to certain limitations                                

o   to reimburse the master servicer or the servicer following a final
         liquidation of a mortgage loan for any previously unreimbursed advances
made by any such party                                        

o   to reimburse the master servicer or the servicer from liquidation 
     proceeds for liquidation expenses and for amounts expended by it in
        connection with the restoration of damaged property and, to the extent
  of certain excess proceeds, to pay to the master servicer or the
         servicer the amount of any unpaid assumption fees, late payment charges
      or other borrower charges on the related mortgage loan and to retain
      any excess remaining thereafter as additional servicing compensation

  o   to pay amounts received in respect of mortgage loans or REO Property
that have been purchased, including any advances to the extent
specified in the related agreement                            

  o   to pay any insurance premiums with respect to a mortgage loan to the
extent not paid by the servicer                               

    o   to pay to the master servicer income earned on the investment of funds
on deposit in the Collection Account                          

  o   to make payment to the trust administrator, the master servicer, the
  servicer, the subservicer, the trustee, the custodian, the owner
  trustee and others pursuant to any provision of the transfer and
   servicing agreement or pooling and servicing agreement, the trust
agreement, the indenture or the custodial agreement           

o   to withdraw funds deposited in error in the Collection Account    

    o   to clear and terminate the Collection Account pursuant to the transfer
and servicing agreement or pooling and servicing agreement, as
applicable                                                    

o   to make any other withdrawals permitted by the related pooling and
servicing agreement or transfer and servicing agreement.      

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Certain permitted withdrawals shall be prior to the right of  
securityholders to receive payments or other distributions from the Collection  
Account. The master servicer's, servicer's or other person's entitlement to     
certain amounts may be limited to collections or other recoveries on the related
mortgage loan. The subservicer will be entitled to reimbursement for any amounts
advanced and any related servicing fees out of the amounts withdrawn by the     
servicer.                                                                       

Collection and Other Servicing Procedures                                       

    Each servicer, directly or through subservicers, if any, must make
reasonable efforts to collect all payments called for under the mortgage loans  
in your trust and will follow or cause to be followed such collection procedures
as it would follow with respect to mortgage loans that are comparable to the    
mortgage loans and held for its own account, unless otherwise specified in the  
prospectus supplement, provided such procedures are consistent with the         
following:                                                                      

  o   the terms of the related transfer and servicing agreement or pooling
and servicing agreement, as applicable, and any related hazard
        insurance policy or instrument of credit enhancement, if any, included
      in the related trust described herein or under "The Trusts -- Credit
Enhancement"                                                  

o   applicable law                                                    

o   the general servicing standard specified in the related prospectus
supplement or, if no such standard is so specified, its normal
servicing practices.                                          

    The note or security instrument used in originating a conventional
mortgage loan may contain a "due-on-sale" clause. The servicer will be required 
to use reasonable efforts to enforce "due-on-sale" clauses with respect to any  
note or security instrument containing this clause, provided that the coverage  
of any applicable insurance policy will not be adversely affected. In any case  
in which mortgaged properties have been or are about to be conveyed by the      
borrower and the due-on-sale clause has not been enforced or the note is by its 
terms assumable, the servicer will be authorized, on behalf of the trustee, to  
enter into an assumption agreement with the person to whom the mortgaged        
properties have been or are about to be conveyed, if the person meets certain   
loan underwriting criteria, including the criteria necessary to maintain the    
coverage provided by the applicable mortgage insurance policies or otherwise    
required by law. In the event that the servicer enters into an assumption       
agreement in connection with the conveyance of a mortgaged property, the        
servicer, on behalf of the trustee as holder of the note, will release the      
original borrower from liability upon the mortgage loan and substitute the new  
borrower. In no event can the assumption agreement permit a decrease in the     
applicable mortgage rate or an increase in the term of the mortgage loan. Fees  
collected for entering into an assumption agreement may be retained by the      
servicer as additional servicing compensation.                                  

    Each servicer may, directly or through subservicers, establish and
maintain a custodial escrow account or accounts to pay taxes, assessments,      
primary mortgage insurance premiums, standard hazard insurance premiums and     
other comparable items to the extent permitted by law and required by the       
related mortgage loan documents. Withdrawals from escrow accounts may be made to
effect timely payment of taxes, assessments, insurance premiums or comparable   
items, to reimburse the servicer for maintaining required insurance, to refund  
to borrowers                                                                    

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amounts determined to be overages, to pay interest to borrowers on balances in  
the escrow account as required, to repair or otherwise protect the mortgaged    
properties and to clear and terminate this account. The servicer, directly or   
through subservicers, may be responsible for the administration of escrow       
accounts and may make advances to this account when a deficiency exists.        

   The servicer (or subservicer) may be required to maintain certain
insurance policies in respect of mortgaged properties securing mortgage loans   
included in your trust. Those policies may include primary mortgage insurance,  
special hazard insurance, borrower bankruptcy insurance and pool insurance. In  
the event that any special hazard insurance policy, borrower bankruptcy         
insurance or pool insurance policy for your series is canceled or terminated for
any reason other than the exhaustion of total policy coverage, the master       
servicer or the trustee may be required to obtain from another insurer a        
comparable replacement policy.                                                  

Subservicers                                                                    

     A servicer may delegate its servicing obligations in respect of the
mortgage loans to one or more subservicers, but such servicer will remain       
obligated under the related pooling and servicing agreement. Each sub-servicing 
agreement between a servicer and a subservicer must be consistent with the terms
of the related pooling and servicing agreement or transfer and servicing        
agreement, as applicable, (to the extent that any subservicer is not a party to 
any such agreement), and must provide that, if for any reason the servicer for  
the related series of securities is no longer acting in such capacity, the      
trustee, master servicer or any successor master servicer may assume the        
servicer's rights and obligations under such agreement.                         

      Unless otherwise specified in the related prospectus supplement, the
servicer will be solely liable for all fees owed by it to any subservicer,      
irrespective of whether the servicer's compensation pursuant to the related     
servicing agreement is sufficient to pay such fees. However, a subservicer may  
be entitled to a retained interest in certain mortgage loans. Each servicer will
be reimbursed by the master servicer for certain expenditures which it makes,   
generally to the same extent the master servicer would be reimbursed under a    
pooling and servicing agreement. See "Description of the Agreements -- Retained 
Interest; Servicing Compensation and Payment of Expenses."                      

Realization Upon Defaulted Mortgage Loans                                       

   A servicer will (or will cause any subservicer to) foreclose upon
mortgaged properties securing trust assets that come into and continue in       
default and as to which no satisfactory arrangements can be made for collection 
of delinquent payments. In connection with a foreclosure, the servicer will     
follow the practices and procedures that it deems necessary or advisable and as 
are normal and usual in its servicing activities with respect to comparable     
assets serviced by it. However, the servicer will not be required to expend its 
own funds in connection with any foreclosure or towards the restoration of any  
mortgaged property unless it determines that (a) the restoration or foreclosure 
will increase the liquidation proceeds available to the holders after           
reimbursement to itself for its expenses and (b) its expenses will be           
recoverable either through liquidation proceeds or insurance proceeds. In the   
case of a trust for which a REMIC election has been made, the servicer will be  
required to liquidate any mortgaged                                             

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property acquired through foreclosure within 36 months (or a shorter period     
specified in the related pooling and servicing agreement) after the acquisition 
of the mortgaged property. While the holder of a mortgaged property acquired    
through foreclosure can often maximize its recovery by providing financing to a 
new purchaser, the issuer will have no ability to do so and neither the master  
servicer, the servicer, not the depositor will be required to do so.            

         The servicer may arrange with the borrower on a defaulted mortgage loan
a modification of such mortgage loan. Modifications may only be entered into if 
they meet the underwriting policies and procedures employed by the servicing in 
servicing receivables for its own account and meet the other conditions in the  
related agreement.                                                              

Evidence as to Compliance                                                       

         In accordance with the terms of the transfer and servicing agreement or
the pooling and servicing agreement, as applicable, a firm of independent       
accountants will furnish an annual statement to the master servicer to the      
effect that such firm has examined certain documents and records relating to the
servicing of mortgage loans similar to the mortgage loans by the servicer and   
that, on the basis of such examination, such firm is of the opinion that the    
servicing has been conducted in accordance with the terms of the related        
agreement, except for exceptions as the firm believes to be immaterial and any  
other exceptions set forth in such statement. The master servicer will be       
obliged to cause its independent accountants to furnish such statement in the   
event that it becomes the successor servicer.                                   

Mortgage-Related Assets                                                         

      Mortgage-related assets included in your trust will be registered in
the name of the trustee. All distributions on financial assets will be made     
directly to the trustee, who will deposit these distributions as they are       
received into a trust account for the benefit of securityholders.               

If the trustee does not receive any required distribution on a
financial asset, following a cure period the trustee or trust administrator will
request the issuer or guarantor of the financial asset to make the missing      
payment promptly. If the issuer or guarantor of the financial asset does not    
comply, the trustee may take legal action, if it is deemed appropriate under the
circumstances. Reasonable legal fees and expenses incurred by these actions will
be reimbursable out of the proceeds of the action prior to any proceeds being   
distributed to you. If the result of a legal action of this nature is           
insufficient to reimburse the trustee or trust administrator for legal fees and 
expenses, the trustee may withdraw an amount equal to unreimbursed legal fees   
and expenses from the trust account, which may result in a loss to              
securityholders.                                                                

 DESCRIPTION OF THE AGREEMENTS

The Agreements                                                                  

   The following discussion describes the material provisions of the
pooling and servicing agreement (with respect to a series of certificates) and  
the transfer and servicing agreement and indenture (with respect to a series of 
notes). When particular provisions or terms used in the agreement are referred  
to, the actual provisions are incorporated by reference as part of these        

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discussions. For purposes of this discussion, unless specifically provided      
otherwise, the "agreement" refers to either the transfer and servicing          
agreement, the pooling and servicing agreement, or the indenture, as the context
requires.                                                                       

Master Servicer or Trust Administrator                                          

   The pooling and servicing agreement or the transfer and servicing
agreement, as applicable, may designate a person to act as master servicer and, 
if applicable, trust administrator with respect to each series.                 

        The master servicer is responsible to perform or cause to be performed
the servicing obligations of the former servicer until a successor servicer is  
appointed.                                                                      

      The master servicer will be required to supervise and administer the
performance of one or more servicers. In addition, the master servicer may be   
obligated to make advances of delinquent payments of principal and interest on  
the mortgage loans or servicing advances to the extent that the related servicer
fails to make an advance as required pursuant to the related servicing          
agreement; provided that the master servicer will not be obligated to make any  
such advance if it determines that such an advance would constitute a           
non-recoverable advance. The master servicer's obligations to act as a servicer 
following the termination of a servicer will not, however, require the master   
servicer to purchase mortgage loans from the trust due to a breach by the       
servicer of a representation or warranty under the related agreement, or advance
payments of principal and interest on a delinquent mortgage loan or make        
servicing advances in respect of the mortgage loans in excess of the master     
servicer's independent advance obligation under the pooling and servicing       
agreement or the transfer and servicing agreement, as applicable.               

  The trust administrator, to the extent that the trustee does not
perform such duties, will be responsible for such bond administration,          
calculation agent and paying agent duties as may be described in the pooling and
servicing agreement, transfer and servicing agreement or indenture, as          
applicable.                                                                     

         The master servicer or trust administrator for a series may resign from
its obligations and duties under the pooling and servicing agreement, transfer  
and servicing agreement, or the indenture with respect to such series, but no   
such resignation will become effective until the trustee or a successor master  
servicer or trust administrator has assumed the master servicer's or trust      
administrator's obligations and duties. If specified in the prospectus          
supplement for a series, FMIC may appoint a stand-by master servicer, which will
assume the obligations of the master servicer upon a default by the master      
servicer.                                                                       

Trust Administration                                                            

         The trustee, master servicer, or its designee will be responsible under
the applicable agreement for providing general administrative services to a     
trust including, among other things:                                            

o   oversight of payment received on mortgage loans                   

o   monitoring the amounts on deposit in various trust accounts       

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   o   calculation of the amounts payable to securityholders on each payment
date                                                          

o   preparation of periodic reports to the trustee(s) or the          
securityholders with respect to the foregoing matters         

o   preparation of federal and state tax and information returns      

    o   preparation of reports, if any, required under the Securities Exchange
Act.                                                          

Retained Interest; Servicing Compensation and Payment of Expenses               

   The prospectus supplement for a series of securities will specify
whether there will be any retained interest in the trust asset, and, if so, the 
initial owner thereof. If so, the retained interest will be established on a    
loan-by-loan basis and will be specified on an exhibit to the related agreement.
A "retained interest" in a trust asset represents a specified portion of the    
interest payable thereon. The retained interest will be deducted from borrower  
payments as received and will not be part of the related trust.                 

      Unless otherwise specified in the related prospectus supplement, the
servicer's primary servicing compensation with respect to a series of securities
will come from the periodic payment to it of a portion of the interest payment  
on each trust property. Since any retained interest and a servicer's primary    
compensation are percentages of the principal balance of each trust asset, such 
amounts will decrease in accordance with the amortization of the trust asset.   
The prospectus supplement with respect to a series of securities evidencing     
interests in a trust that includes mortgage loans may provide that, as          
additional compensation, the servicer may retain all or a portion of assumption 
fees, modification fees, late payment charges or prepayments collected from     
borrowers and any interest or other income which may be earned on funds held in 
any account held by any servicer pursuant to the related agreement.             

    The servicer may, to the extent provided in the related prospectus
supplement, pay from its servicing compensation certain expenses incurred in    
connection with its servicing and managing of the trust asset, including,       
without limitation, payment of the fees and disbursements of the independent    
accountants, payment of expenses incurred in connection with distributions and  
reports to securityholders, and payment of any other expenses described in the  
related prospectus supplement. Certain other expenses, including certain        
expenses relating to defaults and liquidations on the mortgage loans and, to the
extent so provided in the related prospectus supplement, interest thereon at the
rate specified therein may be borne by the trust.                               

         If and to the extent provided in the related prospectus supplement, the
servicer will be required to apply a portion of the servicing compensation      
otherwise payable to it in respect of any Due Period to certain prepayment      
interest shortfalls resulting from the voluntary prepayment of any mortgage     
loans in the related trust during such period prior to their respective due     
dates therein.                                                                  

The Trustee                                                                     

     The trustee under each agreement be named in the related prospectus
supplement. The trustee must be a corporation or association organized under the
laws of a state or the United                                                   

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States of America and authorized under the laws of the jurisdiction in which it 
is organized to have corporate trust powers. It must also have combined capital 
and surplus of at least $100,000,000 and be subject to regulation and           
examination by state or federal regulatory authorities. Although the trustee may
not be an affiliate of FMIC or the owner trustee in the case that the issuer is 
an owner trust or the servicer, either of these parties may maintain normal     
banking relations with the trustee if the trustee is a depository institution.  

      The trustee may resign at any time by giving written notice to FMIC,
the issuer, each securityholder and the related rating agencies for your series 
of securities within ninety (90) days before the date specified in the notice of
the date such resignation is to take effect and acceptance by a successor       
trustee in accordance with the terms of the related agreement. If at any time   
the trustee shall cease to be eligible to continue as such under the related    
agreement, or if at any time the trustee shall become incapable of acting, or   
shall be adjudged bankrupt or insolvent, or a receiver of the trustee or of its 
property shall be appointed, or any public officer shall take charge or control 
of the trustee or of its property, or if the trustee fails to satisfy the       
eligibility criteria to act as trustee then the issuer or depositor, as the case
may be, may remove the trustee and appoint a successor trustee. Any resignation 
or removal of the trustee and appointment of a successor trustee will not become
effective until acceptance of the appointment by the successor trustee. If a    
successor trustee does not take office within 30 days after its predecessor     
trustee resigns or is removed, the predecessor trustee, the issuer or the       
holders of a majority in outstanding balance of the securities may petition any 
court of competent jurisdiction for the appointment of a successor trustee.     

       If the trustee fails to comply with the eligibility criteria to serve
as a trustee as described under the agreement, any securityholder may petition  
any court of competent jurisdiction for the removal of the trustee and the      
appointment of a successor trustee.                                             

       The trustee will be under no obligation to exercise any of the trusts
or powers vested in it by the indenture, pooling and servicing agreement or     
transfer and servicing agreement or to make any investigation of matters arising
thereunder or to institute, conduct or defend any litigation thereunder or in   
relation thereto at the request, order or direction of any of the holders of    
securities covered by such agreement, unless such securityholders have offered  
to the trustee reasonable security or indemnity against the costs, expenses and 
liabilities which may be incurred therein or thereby.                           

The Owner Trustee                                                               

       The owner trustee under an owner trust agreement will be named in the
related prospectus supplement.                                                  

Duties of the Trustee                                                           

     The trustee will not make any representations as to the validity or
sufficiency of the agreements, the securities or of any assets or documents. If 
no event of default as defined in the agreement has occurred, the trustee is    
required to perform only those duties specifically required of it under the     
agreement. Upon receipt of the various certificates, statements, reports or     
other instruments furnished to it, the trustee is required to examine them to   
determine whether they are                                                      

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in the form required by the agreements. However, the trustee will not be        
responsible for the accuracy or content of any of the documents furnished to it 
by the holders or any of the parties under the agreements.                      

       The trustee may be held liable for its negligent action or failure to
act, or for its misconduct. The trustee will not be liable, however, with       
respect to any action taken, suffered or omitted to be taken by it in good faith
in accordance with the direction of the holders in an event of default. The     
trustee is not required to expend its own funds or incur any financial liability
in the performance of its duties, or in the exercise of any of its rights or    
powers, if repayment of those funds or adequate indemnity against risk is not   
reasonably assured it.                                                          

Amendment of the Agreements                                                     

       Each agreement may be amended by the parties thereto with the consent
of the holders of outstanding securities holding at least 66 2/3% (or such other
percentage as defined in the prospectus supplement) of the voting rights of a   
series. Voting rights with respect to any series may be allocated to specific   
classes of securities without regard to such classes' outstanding principal     
amount. For example, Strip Classes or Residual Certificates may be allocated a  
certain percentage of the voting rights of a series even though such classes may
not have any, or any significant amount of, principal amount outstanding. No    
amendment however may                                                           

  o   reduce in any manner the amount of, or delay the timing of, payments
that are required to be made in respect of any securities, or 

o   reduce the percentage of securityholders required to authorize an 
amendment to the agreement                                    

unless each holder of a security affected by such amendment consents; provided, 
however, with respect to any series as to which a REMIC election has been made, 
no amendment may be made unless the trustee and other parties specified in the  
pooling and servicing agreement receives an opinion of counsel addressed to such
parties that such amendment will not adversely affect the REMIC or result in the
imposition of tax upon any such REMIC status of the related trust at any time   
that the related certificates are outstanding. The agreements may also be       
amended by the parties thereto without the consent of securityholders, for the  
purpose of, among other things,                                                 

o   curing any ambiguity or mistake                                   

  o   correcting any defective provision or supplementing any inconsistent
provisions                                                    

o   modifying, eliminating or adding to any of its provisions to such 
extent as shall be necessary or appropriate to comply with any
       requirements imposed by the Code, ERISA and their related regulations

o   adding any other provisions with respect to matters or questions  
       arising under the agreements, provided that any such action shall not
adversely affect in any material respect the interests of any 
securityholder.                                               

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   Any such amendment or supplement shall be deemed not to adversely
affect in any material respect any securityholder if there is delivered to the  
trustee written notification from each rating agency that rated the applicable  
securities to the effect that such amendment or supplement will not cause that  
rating agency to reduce the then current rating assigned to such securities.    

Servicer Events of Default and Master Servicer Events of Default                

Servicer Events of Default                                    

         Unless otherwise specified in the related prospectus supplement, events
of default on the part of the servicer or the subservicer, as applicable (each  
referred to as a "servicer event of default"), under the pooling and servicing  
agreement or the transfer and servicing agreement, as applicable, indenture in  
respect of a series will include, among other things,                           

     o   any default in the performance or breach of any covenant or warranty of
         the servicer or subservicer, as applicable, under the related agreement
        with respect to such series which continues unremedied for a specified
  period after the giving of written notice of such failure to the
       servicer or subservicer, as applicable, by the master servicer or the
servicer                                                      

     o   any failure by the servicer or subservicer to make any payment required
     to be made under the related agreement (including any advances with
       respect to delinquent mortgage loans in a trust or servicing advances
    in respect of any mortgage loan) for a period of two business days
        after the date upon which written notice of such failure requiring the
sale to be remedied                                           

o   certain events of insolvency, readjustment of debt, marshaling of 
         assets and liabilities or similar proceedings regarding the servicer or
    subservicer and certain actions by or on behalf of the servicer or
       subservicer, as applicable, indicating its insolvency or inability to
pay its obligations                                           

  o   the servicer or the subservicer ceases to meet the qualifications of
Fannie Mae or Freddie Mac lender/servicer                     

o   the failure by the servicer or the subservicer, as applicable, to 
    maintain required licensures to do business or service residential
       mortgage loans in any jurisdiction where the mortgaged properties are
         located except if such failure to maintain such licensure does not have
  a material adverse effect on the servicer's or the subservicer's
ability to service the mortgage loans                         

o   the servicer or subservicer, as applicable, attempts to assign its
         servicing or rights to receive servicing compensation under the related
agreement in a manner than is not permitted                   

  o   if any of the rating agencies withdraws the rating of the securities
under circumstances specified in the related agreement        

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o   if the net worth of the servicer or the subservicer falls below   
specified limits.                                             

       Material variations to the foregoing events of default (other than to
shorten cure periods or eliminate notice requirements) will be specified in the 
related prospectus supplement.                                                  

Master Servicer Events of Default                             

         Unless otherwise specified in the related prospectus supplement, events
of default on the part of the master servicer (each referred to as a "master    
servicer event of default") under the pooling and servicing agreement or the    
transfer and servicing agreement, as applicable, in respect of a series will    
include, among other things,                                                    

o   any failure by the master servicer to furnish data to the trust   
     administrator sufficient for the trust administrator to prepare the
    reports required to be delivered under the related agreement which
         continues unremedied for a specified period after the giving of written
    notice by the trustee or the trust administrator or to such master
     servicer and the trustee by the holders of not less than 25% of the
aggregate voting rights with respect to your series           

     o   any default in the performance or breach of any covenant or warranty of
      the master servicer under the related agreement with respect to such
    series which continues unremedied for a specified period after the
        giving of written notice of such failure to the master servicer by the
       interest trustee or the trust administrator or to the master servicer
and the trustee by the majority securityholders               

o   certain events of insolvency, readjustment of debt, marshaling of 
    assets and liabilities or similar proceedings regarding the master
     servicer and certain actions by or on behalf of the master servicer
indicating its insolvency or inability to pay its obligations 

    o   any failure by the master servicer to remit to the trust administrator
any advance required to be made to the trust administrator in 
   accordance with the terms of the related agreement, which failure
continues unremedied for a specified period                   

  o   any sale or pledge of any of the rights of the master servicer under
the related agreement in a manner that is not permitted.      

Rights Upon Servicer and Master Servicer Events of Default                      

      So long as a servicer event of default or a master servicer event of
default, with respect to the related agreement, remains unremedied, the master  
servicer (in the case of a defaulting servicer or subservicer), the servicer (in
the case of a defaulting subservicer) and the trustee may, and at the direction 
of the holders of a series entitled to a certain percentage of the voting       
rights, as specified in the pooling and servicing agreement, terminate all of   
the rights and obligations of the master servicer under the applicable          
agreement. Upon termination of the subservicer, the servicer will succeed to all
the responsibilities, duties and liabilities of the subservicer under the       
related agreement, provided that the rating agencies have provided written      
confirmation that any such appointment will not result in a qualification,      
withdrawal or downgrade of the then-current                                     

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ratings for the securities of your series. Upon the termination of the servicer,
the master servicer will (a) within 90 days of the servicer's notice of         
termination succeed and assume all of the servicer's responsibilities, rights,  
duties and obligations under the related agreement or (b) appoint a successor   
that satisfies the eligibility criteria for servicers as provided in the related
agreement. Any successor to the servicer will be subject to the approval of the 
master servicer, the trustee and the trust administrator. Upon termination of   
the master servicer, the trustee or the trust administrator, as applicable, will
succeed to all the responsibilities, duties and liabilities of the master       
servicer under such agreement (except that if the trustee or the trust          
administrator, as applicable, is to so succeed the master servicer but is       
prohibited by law from obligating itself to make advances regarding delinquent  
mortgage loans, then the trustee will not be so obligated) and will be entitled 
to similar compensation arrangements. In the event that the trustee or the trust
administrator, as applicable, would be obligated to succeed the master servicer 
but is unwilling or unable so to act, it may appoint or, if the holders of      
securities representing a certain percentage of the voting rights, as specified 
in the pooling and servicing agreement, so request in writing, it shall appoint,
or petition a court of competent jurisdiction for the appointment of, a mortgage
loan servicing or other housing and home finance institution with a net worth of
at least $15,000,000 to act as successor to the master servicer under the       
applicable agreement or may provide cash, a letter of credit, a standby master  
servicing agreement or another arrangement that will not result in any downgrade
of the then-current rating of the securities of the related series. The trustee 
or the trust administrator, as applicable, and such successor may agree upon the
servicing compensation to be paid, which in no event may be greater than the    
compensation to the master servicer under the applicable agreement.             

    Unless otherwise described in the related prospectus supplement, a
specified percentage of the holders of securities affected by any event of      
default may be entitled to waive such event of default. Upon any such waiver of 
an event of default, such event of default shall cease to exist and shall be    
deemed to have been remedied for every purpose under the agreement.             

Reports to Securityholders                                                      

       The trust administrator will furnish the securityholders with monthly
statements containing information with respect to principal and interest        
payments, realized losses and the assets of the trust. Any financial information
contained in such reports will not have been examined or reported upon by an    
independent public accountant. Copies of such monthly statements and any annual 
reports prepared by the master servicer or any servicer with respect to         
compliance with the provisions of any of the agreements, will be furnished to   
securityholders upon request addressed to FMIC at 11000 Broken Land Parkway,    
Columbia Maryland 21044 (telephone (866) 365-FMIC (3642)).                      

Termination                                                                     

The pooling and servicing agreement or the indenture, and the 
respective obligations and responsibilities created thereby, shall terminate    
upon the distribution to securityholders of all amounts required to be paid     
pursuant to such agreement following                                            

o   the purchase of all the trust assets and the related mortgaged    
   properties acquired in respect thereof, if the related prospectus
supplement so provides, or                                    

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   o   the later of the final payment or other liquidation of the last trust
  asset remaining in the trust or the disposition of all mortgaged
properties acquired in respect thereof.                       

        In no event, however, will the trust created by any agreement continue
beyond the date specified in the related prospectus supplement. In the case of  
any series as to which a REMIC election has been made, any termination of the   
related trust must be carried out in such a manner that the termination of each 
REMIC included therein shall qualify as a "qualified liquidation" under Section 
860F of the Code and the related regulations, and, in some cases as specified in
the pooling and servicing agreement, an opinion of counsel must be delivered    
that any such termination will not adversely affect the REMIC status of any     
related REMICs or result in the imposition of any tax on such REMIC when any    
certificates are outstanding. Written notice of termination of the pooling and  
servicing agreement or indenture will be given to each securityholder, and the  
final distribution will be made only upon surrender and cancellation of the     
securities at the corporate trust office of the trustee or its agent as set     
forth in the prospectus supplement. If so specified in the related prospectus   
supplement, a series of securities may be subject to optional early termination 
through the repurchase of the assets in the related trust by the party specified
therein, under the circumstances and in the manner set forth therein. If so     
provided in the related prospectus supplement, upon the reduction of the        
security balance of a specified class or classes of securities by a specified   
percentage or amount, the party specified therein will solicit bids for the     
purchase of all assets of the trust, or of a sufficient portion of such assets  
to retire such class or classes or purchase such class or classes at a price set
forth in the related prospectus supplement, in each case, under the             
circumstances and in the manner set forth therein.                              

Certain Terms of the Indenture                                                  

        With respect to any series of notes, the indenture trustee, issuer and
the trust administrator will enter into an indenture governing the right, title 
and obligations of securityholders and payment priorities with respect to the   
notes. The following summary supplements the general discussion above regarding 
certain provisions of the indenture.                                            

Indenture Defaults. Unless otherwise specified in the related 
prospectus supplement, events of default under the indenture (each, an          
"indenture default") for each series of notes include:                          

    o   a default for thirty (30) days (or such other number of days specified
        in such prospectus supplement) or more in the payment of any principal
of or interest on any note of such series                     

 o   a default in the payment of the entire principal amount of any note
     when the same becomes due and payable under the indenture or on the
applicable maturity date                                      

  o   failure to perform any other covenant of the issuer in the indenture
        which continues for a period of thirty (30) days (or such other number
       of days specified in such prospectus supplement) after notice thereof
     is given in accordance with the procedures described in the related
prospectus supplement                                         

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   o   any representation or warranty made by the issuer in the indenture or
      in any certificate or other writing delivered pursuant thereto or in
      connection therewith with respect to or affecting such series having
    been incorrect in a material respect as of the time made, and such
      breach is not cured within thirty (30) days (or such other number of
       days specified in such prospectus supplement) after notice thereof is
  given in accordance with the procedures described in the related
prospectus supplement                                         

   o   certain events of bankruptcy, insolvency, receivership or liquidation
of the depositor or the trust or                              

o   any other indenture default provided with respect to notes of that
series.                                                       

        If an indenture default with respect to the notes of any series at the
time outstanding occurs and is continuing, either the trustee or the holders of 
a majority of the then aggregate outstanding amount of specified classes of     
notes of such series may declare the principal amount (or, if the notes of that 
series are accrual securities, such portion of the principal amount as may be   
specified in the terms of that series, as provided in the related prospectus    
supplement) of all the notes of such series to be due and payable immediately.  
Such declaration may, under certain circumstances, be rescinded and annulled by 
the holders of a majority in aggregate outstanding amount of specified classes  
of notes of such series.                                                        

    If the notes are declared immediately due and payable following an
indenture default, the trustee may institute proceedings to collect amounts due 
or foreclose on collateral pledged to secure the notes, exercise remedies as a  
secured party, sell the assets of the trust pledged to secure the notes, or     
elect to maintain possession of such assets and continue to apply collections on
such assets as if there had been no declaration of acceleration. However, the   
trustee is prohibited from selling the trust assets following an Indenture      
Default, other than a default in the payment of any principal of or a default   
for three months or more in the payment of any interest on specified classes of 
notes unless (a) the holders of all outstanding notes consent to such sale, (b) 
the proceeds of the sale are sufficient to pay in full the principal of and the 
accrued interest on such outstanding notes at the date of such sale or (c) the  
trustee determines that the proceeds of the trust and the other property of the 
issuer would not be sufficient on an ongoing basis to make all payments on the  
notes as such payments would have become due if such obligations had not been   
declared due and payable, and the trustee obtains the consent of the holders of 
66-2/3% of the aggregate outstanding principal amount of the notes.             

     If the collateral securing the notes is sold following an indenture
default, proceeds of such sale, after deduction of the expenses of such sale,   
will be applied in the order of priority provided in the Indenture.             

       If an indenture default occurs and is continuing, the trustee will be
under no obligation to exercise any of the rights or powers under the Indenture 
at the request or direction of any of the holders of the notes, if the trustee  
reasonably believes it will not be adequately indemnified against the costs,    
expenses and liabilities that might be incurred by it in complying with such    
request. Subject to the provisions for indemnification and certain limitations  
contained in the Indenture, the holders of a majority in principal amount of the
outstanding notes will have the right to direct the time, method and place of   
conducting any proceeding or any remedy available                               

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to the trustee, and the holders of a majority in principal amount of the notes  
then outstanding may, in certain cases, waive any default with respect thereto, 
except a default in the payment of principal or interest or a default in respect
of a covenant or provision of the Indenture that cannot be modified without the 
waiver or consent of all the holders of the outstanding notes.                  

   Except as described above in the case of an indenture default, no
securityholder will have the right to institute any proceeding with respect to  
the Indenture, unless (a) such holder previously has given to the trustee       
written notice of a continuing indenture default, (b) the holders of not less   
than 25% in principal amount of the outstanding notes have made written request 
to the trustee to institute such proceeding in its own name as the trustee, (c) 
such holder or holders have offered the trustee reasonable indemnity, (d) the   
trustee has, for 60 days after receipt of such notice, request and offer of     
indemnity, failed to institute such proceeding and (e) no direction inconsistent
with such written request has been given to the trustee during such 60-day      
period by the holders of a majority in principal amount of such outstanding     
notes.                                                                          

        In addition, the trustee and the holders, by accepting the notes, will
covenant that they will not at any time institute against the issuer any        
bankruptcy, reorganization or other proceeding under any federal or state       
bankruptcy or similar law.                                                      

       Neither the trustee, the trust administrator nor the owner trustee in
their respective individual capacities, nor the holder of the equity interest in
the issuer, nor any of their respective owners, beneficiaries, agents, officers,
directors, employees, affiliates, successors or assigns will, except as         
expressly set forth in the transaction documents, be personally liable for the  
payment of the principal of or interest on the notes or for the agreements of   
the issuer contained in the Indenture.                                          

Redemption                                                                      

       On any Payment Date following the month in which the aggregate unpaid
principal balance of the trust assets is less than a specified percentage of the
original unpaid principal balance of the trust assets, and any amounts on       
deposit in the pre-funding account, if any, the party specified in the          
prospectus supplement will have the option to purchase the mortgage loans, the  
mortgage-related assets, any REO Property and any other property remaining in   
the trust for a price equal to the purchase price. The master servicer, the     
servicer and the subservicer will be reimbursed from the purchase price for any 
outstanding advances, servicing advances and unpaid master servicing fees or    
servicing fees, as applicable, and other amounts not previously reimbursed      
pursuant to the provisions of the Transfer and Servicing Agreement, as          
applicable, and the trust administrator, the owner trustee and the trustee will 
be reimbursed for any previously unreimbursed amounts for which they are        
entitled to be reimbursed pursuant to the related agreements. If such option is 
exercised, the trust will be terminated resulting in a mandatory redemption of  
the notes.                                                                      

Discharge of the Indenture                                                      

    The indenture will be discharged with respect to a series of notes
(except with respect to certain continuing rights specified in the indenture)   
upon the delivery to the trustee for                                            

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cancellation of all the notes of such series or, with certain limitations, upon 
deposit with the trustee of funds sufficient for the payment in full of all of  
the notes of such series.                                                       

       In addition to such discharge with certain limitations, the indenture
will provide that, if so specified with respect to the notes of any series, the 
related trust will be discharged from any and all obligations in respect of the 
notes of such series (except for certain obligations relating to temporary notes
and exchange of notes, to register the transfer of or exchange notes of such    
series, to replace stolen, lost or mutilated notes of such series, to maintain  
paying agencies and to hold monies for payment in trust) upon the deposit with  
the trustee, in trust, of money and/or direct obligations of or obligations     
guaranteed by the United States of America which through the payment of interest
and principal in respect thereof in accordance with their terms will provide    
money in an amount sufficient to pay the principal of and each installment of   
interest on the notes of such series on the maturity date for such notes and any
installment of interest on such notes in accordance with the terms of the       
indenture and the notes of such series. In the event of any such defeasance and 
discharge of notes of such series, holders of notes of such series would be able
to look only to such money and/or direct obligations for payment of principal   
and interest, if any, on their notes until maturity.                            

 CERTAIN LEGAL ASPECTS OF MORTGAGE LOANS

General                                                                         

         The following discussion of material legal aspects of mortgage loans is
general in nature. Because many legal aspects are governed by state law, which  
laws may differ substantially, these summaries do not purport to be complete nor
to reflect the laws of any particular state, nor to encompass the laws of all   
states in which the mortgaged properties securing the mortgage loans are        
situated. These summaries are qualified in their entirety by reference to the   
applicable federal and state laws governing the mortgage loans. In particular,  
the following discussion does not reflect federal regulations with respect to   
FHA loans or VA loans.                                                          

Mortgage Loans                                                                  

        Some of the mortgage loans may be secured by either first mortgages or
deeds of trust, depending upon the prevailing practice in the state in which the
underlying property is located. A mortgage creates a lien upon the real property
encumbered by the mortgage. It is not prior to the lien for real estate taxes   
and assessments. Priority between mortgages depends on their terms and,         
generally, on the order of filing with a state or county office. There are two  
parties to a mortgage: the borrower, who is the borrower and owner of the       
property; and the mortgagee, who is the lender. Under the mortgage instrument,  
the borrower delivers to the mortgagee a note or bond evidencing the loan and   
the mortgage. Although a deed of trust is similar to a mortgage, a deed of trust
formally has three parties: the borrower-property owner called the trustor      
(similar to a borrower); a lender called the beneficiary (similar to a          
mortgagee); and a third-party grantee called the trustee. Under a deed of trust,
the borrower grants the property, irrevocably until the debt is paid, in trust, 
generally with a power of sale, to the trustee to secure payment of the loan.   
The trustee's authority under a deed of trust and the mortgagee's authority     
under a mortgage are governed by the express provisions of the deed of trust or 
mortgage, the law of the state in which the real property is located, certain   
federal laws (including, without limitation, the                                

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Servicemembers Civil Relief Act), and, in some cases, with respect to the deed  
of trust, the directions of the beneficiary.                                    

Interest In Real Property                                                       

       The real property covered by a mortgage, deed of trust, security deed
or deed to secure debt is most often the fee estate in land and improvements.   
However, such an instrument may encumber other interests in real property such  
as a tenant's interest in a lease of land or improvements, or both, and the     
leasehold estate created by such lease. An instrument covering an interest in   
real property other than the fee estate requires special provisions in the      
instrument creating such interest or in the mortgage, deed of trust, security   
deed or deed to secure debt, to protect the mortgagee against termination of    
such interest before the mortgage, deed of trust, security deed or deed to      
secure debt is paid. Unless otherwise specified in the prospectus supplement,   
the seller will make certain representations and warranties in the pooling and  
servicing agreement or the transfer and servicing agreement, as applicable, with
respect to any mortgage loans that are secured by an interest in a leasehold    
estate. Such representation and warranties, if applicable, will be set forth in 
the prospectus supplement.                                                      

Foreclosure                                                                     

General                                                       

       Foreclosure is a legal procedure that allows the mortgagee to recover
its mortgage debt by enforcing its rights and available legal remedies under the
mortgage. If the borrower defaults in payment or performance of its obligations 
under the note or mortgage, the mortgagee has the right to institute foreclosure
proceedings to sell the mortgaged property at public auction to satisfy the     
indebtedness.                                                                   

      Foreclosure procedures with respect to the enforcement of a mortgage
vary from state to state. Two primary methods of foreclosing a mortgage are     
judicial foreclosure and non-judicial foreclosure pursuant to a power of sale   
granted in the mortgage instrument. There are several other foreclosure         
procedures available in some states that are either infrequently used or        
available only in certain limited circumstances, such as strict foreclosure.    

     If one or more REMIC elections are made with respect to your trust,
under the rules currently in effect, property acquired by foreclosure generally 
must not be held for more than three calendar years following the year that the 
trust acquired the property. The pooling and servicing agreement governing any  
such REMIC will permit foreclosed property to be held for more than the three   
years discussed above if the Internal Revenue Service grants an extension of    
time within which to sell such property or independent counsel renders an       
opinion of counsel to the effect that holding such property beyond the three    
year period is permissible under the REMIC provisions then in effect.           

Judicial Foreclosure                                          

         Foreclosure of a mortgage is generally accomplished by judicial action.
Generally, the action is initiated by the service of legal pleadings upon the   
borrower and any party having a subordinate interest in the real estate         
including any holder of a junior encumbrance on the real                        

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estate. Delays in completion of the foreclosure occasionally may result from    
difficulties in locating necessary parties defendant. Judicial foreclosure      
proceedings are often not contested by any of the parties defendant. However,   
when the mortgagee's right to foreclosure is contested, the legal proceedings   
necessary to resolve the issue can be time-consuming. After the completion of a 
judicial foreclosure proceeding, the court may issue a judgment of foreclosure  
and appoint a receiver or other officer to conduct the sale of the mortgaged    
property. In some states, mortgages may also be foreclosed by advertisement,    
pursuant to a power of sale provided in the mortgage. Foreclosure of a mortgage 
by advertisement is essentially similar to foreclosure of a deed of trust by    
non-judicial power of sale.                                                     

Non-Judicial Foreclosure/Power of Sale                        

Foreclosure of a deed of trust is generally accomplished by a 
non-judicial trustee's sale under a specific provision in the deed of trust that
authorizes the trustee to sell the mortgaged property to a third party upon any 
default by the borrower under the terms of the note or deed of trust. In certain
states, such foreclosure also may be accomplished by judicial action in the     
manner provided for foreclosure of mortgages. In some states, the trustee must  
record a notice of default and send a copy to the borrower and to any person who
has recorded a request for a copy of a notice of default and notice of sale. In 
addition, the trustee must provide notice in some states to any other party     
having a subordinate interest in the real estate, including any holder of a     
junior encumbrance on the real estate. If the deed of trust is not reinstated   
within any applicable cure period, a notice of sale must be posted in a public  
place and, in most states, published for a specified period of time in one or   
more newspapers. In addition, some state laws require that a copy of the notice 
of sale be posted on the property and sent to all parties having an interest of 
record in the property. When the beneficiary's right to foreclosure is          
contested, the legal proceedings necessary to resolve the issue can be          
time-consuming. Foreclosure of a deed to secure debt is also generally          
accomplished by a non-judicial sale similar to that required by a deed of trust,
except that the lender or its agent, rather than a trustee, is typically        
empowered to perform the sale in accordance with the terms of the deed to secure
debt and applicable law.                                                        

Public Sale                                                   

        In case of foreclosure under either a mortgage or a deed of trust, the
sale by the receiver or other designated officer, or by the trustee, is a public
sale. However, because of the difficulty a potential buyer at the sale would    
have in determining the exact status of title and because the physical condition
of the mortgaged property may have deteriorated during the foreclosure          
proceedings, it is uncommon for a third party to purchase the mortgaged property
at the foreclosure sale. Rather, it is common for the lender to purchase the    
mortgaged property from the trustee or receiver for an amount which may be as   
great as the unpaid principal balance of the mortgage note, accrued and unpaid  
interest and the expenses of foreclosure. Thereafter, subject to the right of   
the borrower in some states to remain in possession during the redemption       
period, the lender will assume the burdens of ownership, including obtaining    
hazard insurance and making such repairs at its own expense as are necessary to 
render the mortgaged property suitable for sale. The lender commonly will obtain
the services of a real estate broker and pay the broker a commission in         
connection with the sale of the mortgaged property. Depending upon market       
conditions, the ultimate proceeds of the sale of the mortgaged property may not 
equal the lender's investment therein. Any loss may be reduced by the receipt of
insurance proceeds. See                                                         

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"The Trusts -- Mortgage Insurance on the Mortgage Loans" and "The Trusts --     
Hazard Insurance Policies" in this prospectus.                                  

   A junior mortgagee may not foreclose on the property securing the
junior mortgage unless it forecloses subject to senior mortgages and any other  
prior liens, in which case it may be obliged to make payments on the senior     
mortgages to avoid their foreclosure. In addition, in the event that the        
foreclosure of a junior mortgage triggers the enforcement of a "due-on-sale"    
clause contained in a senior mortgage, the junior mortgagee may be required to  
pay the full amount of the senior mortgage to avoid its foreclosure.            
Accordingly, with respect to those mortgage loans, if any, that are junior      
mortgage loans, if the lender purchases the property the lender's title will be 
subject to all senior mortgages, prior liens and certain governmental liens.    

Junior Mortgages                                                                

        Some of the mortgage loans may be secured by junior mortgages or deeds
of trust, which are junior to senior mortgages or deeds of trust which are not  
part of your trust. Your rights as the holder of a junior deed of trust or a    
junior mortgage are subordinate in lien priority and in payment priority to     
those of the holder of the senior mortgage or deed of trust, including the prior
rights of the senior mortgagee or beneficiary to receive and apply hazard       
insurance and condemnation proceeds and, upon default of the mortgagor, to cause
a foreclosure on the property. Upon completion of the foreclosure proceedings by
the holder of the senior mortgage or the sale pursuant to the deed of trust, the
junior mortgagee's or junior beneficiary's lien will be extinguished unless the 
junior lienholder satisfies the defaulted senior loan or asserts its subordinate
interest in a property in foreclosure proceedings.                              

    Furthermore, the terms of the junior mortgage or deed of trust are
subordinate to the terms of the senior mortgage or deed of trust. In the event  
of a conflict between the terms of the senior mortgage or deed of trust and the 
junior mortgage or deed of trust, the terms of the senior mortgage or deed of   
trust will govern generally. Upon a failure of the mortgagor or trustor to      
perform any of its obligations, the senior mortgagee or beneficiary, subject to 
the terms of the senior mortgage or deed of trust, may have the right to perform
the obligation itself. Generally, all sums so expended by the mortgagee or      
beneficiary become part of the indebtedness secured by the mortgage or deed of  
trust. To the extent a senior mortgagee expends these sums, these sums generally
will have priority over all sums due under the junior mortgage.                 

Rights of Reinstatement and Redemption                                          

   In some states, the borrower, or any other person having a junior
encumbrance on the real estate, may, during a reinstatement or redemption       
period, cure the default by paying the entire amount in arrears plus certain of 
the costs and expenses incurred in enforcing the obligation. Certain state laws 
control the amount of foreclosure expenses and costs, including attorneys' fees,
which may be recovered by a lender. In some states, the borrower has the right  
to reinstate the loan at any time following default until shortly before the    
foreclosure sale.                                                               

       In some states, after sale pursuant to a deed of trust or foreclosure
of a mortgage, the borrower and certain foreclosed junior encumbrancers are     
given a statutory period in which to redeem the mortgaged property from the     
foreclosure sale. Depending upon state law, the right of                        

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redemption may apply to sale following judicial foreclosure, or to sale         
pursuant to a non-judicial power of sale. Where the right of redemption is      
available, in some states statutory redemption may occur only upon payment of   
the foreclosure purchase price, accrued interest and taxes and certain of the   
costs and expenses incurred in enforcing the obligation. In other states,       
redemption may be authorized if the former borrower pays only a portion of the  
sums due. In some states, the right to redeem is a statutory right and in       
others it is a contractual right. The effect of a right of redemption is to     
diminish the ability of the lender to sell the foreclosed mortgaged property,   
while such right of redemption is outstanding. The exercise of a right of       
redemption would defeat the title of any purchaser at a foreclosure sale, or of 
any purchaser from the lender subsequent to judicial foreclosure or sale under  
a deed of trust. Consequently, the practical effect of the redemption right is  
to force the lender to maintain the property and pay the expenses of ownership  
until the redemption period has run.                                            

Consumer Protection Laws with respect to Mortgage Loans                         

   Numerous federal, state and local consumer protection laws impose
substantial requirements upon creditors involved in consumer finance. These laws
include the Federal Truth-in-Lending Act, Regulation Z, the Equal Credit        
Opportunity Act, Regulation B, the Fair Credit Reporting Act, the Real Estate   
Settlement Procedures Act, Regulation X, the Fair Housing Act and related       
statutes (including federal, state and local enacted predatory lending          
legislation). These laws can impose specific statutory liabilities upon lenders 
who fail to comply with their provisions. In some cases, this liability may     
affect an assignee's ability to enforce a contract. In particular, the          
originators' failure to comply with certain requirements of the Federal         
Truth-in-Lending Act, as implemented by Regulation Z, could subject both        
originators and assignees of such obligations to monetary penalties and could   
result in borrowers' rescinding the contracts against either the originators or 
assignees.                                                                      

   Under federal and state-enacted predatory lending laws, there are
stringent limitations on interest rates and fees or points assessed in          
connection with the origination of mortgage loans. The failure of a lender to   
comply with the predatory lending legislation may result in the affected        
mortgage loan being determined to be unenforceable. An affected mortgage loan   
would have a significantly increased risk of default or prepayment.             

        Mortgage loans often contain provisions obligating the borrower to pay
late charges if payments are not timely made. In certain cases, federal and     
state law may specifically limit the amount of late charges that may be         
collected. Late charges will be retained by the servicer as additional servicing
compensation, and any inability to collect these amounts will not affect        
payments to you.                                                                

        Courts have imposed general equitable principles upon repossession and
litigation involving deficiency balances. These equitable principles are        
generally designed to relieve a consumer from the legal consequences of a       
default.                                                                        

Anti-Deficiency Legislation and Other Limitations on Lenders                    

   Certain states have imposed statutory restrictions that limit the
remedies of a beneficiary under a deed of trust or a mortgagee under a mortgage.
In some states, statutes limit the right of                                     

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the beneficiary or mortgagee to obtain a deficiency judgment against the        
borrower following foreclosure or sale under a deed of trust. A deficiency      
judgment is a personal judgment against the former borrower equal in most cases 
to the difference between the amount due to the lender and greater of the net   
amount realized upon the foreclosure sale and the market value of the mortgaged 
property.                                                                       

    Statutory provisions may limit any deficiency judgment against the
former borrower following a foreclosure sale to the excess of the outstanding   
debt over the fair market value of the mortgaged property at the time of the    
sale. The purpose of these statutes is to prevent a beneficiary or a mortgagee  
from obtaining a large deficiency judgment against the former borrower as a     
result of low or no bids at the foreclosure sale.                               

         Some state statutes may require the beneficiary or mortgagee to exhaust
the security afforded under a deed of trust or mortgage by foreclosure in an    
attempt to satisfy the full debt before bringing a personal action against the  
borrower. In other states, the lender has the option of bringing a personal     
action against the borrower on the debt without first exhausting such security; 
however, in some of these states, the lender, following judgment on such        
personal action, may be deemed to have elected a remedy and may be precluded    
from exercising remedies with respect to the security. Consequently, the        
practical effect of the election requirement, when applicable, is that lenders  
will usually proceed first against the security rather than bringing a personal 
action against the borrower.                                                    

         In some states, exceptions to the anti-deficiency statutes are provided
for in certain instances where the value of the lender's security has been      
impaired by acts or omissions of the borrower, for example, in the event of     
waste of the mortgaged property.                                                

  In addition to anti-deficiency and related legislation, numerous
federal and state statutory provisions, including the federal bankruptcy laws,  
the federal Servicemembers Civil Relief Act and state laws affording relief to  
debtors, may interfere with or affect the ability of a secured mortgage lender  
to realize upon its security and enforce a deficiency judgment. For example,    
with respect to federal bankruptcy law, the filing of a petition acts as a stay 
against the enforcement of remedies for collection of a debt.                   

        In a Chapter 13 proceeding under the United States Bankruptcy Code, as
amended, as set forth in Title 11 of the United States Code (the "Bankruptcy    
Code"), when a court determines that the value of a home is less than the       
principal balance of the loan, the court may prevent a lender from foreclosing  
on the home, and, as part of the rehabilitation plan, reduce the amount of the  
secured indebtedness to the value of the home as it exists at the time of the   
proceeding, leaving the lender as a general unsecured creditor for the          
difference between that value and the amount of outstanding indebtedness. A     
bankruptcy court may grant the debtor a reasonable time to cure a payment       
default, and in the case of a mortgage loan not secured by the debtor's         
principal residence, also may reduce the periodic payments due under the        
mortgage loan, change the rate of interest and alter the mortgage loan repayment
schedule. Court decisions have applied this relief to claims secured by the     
debtor's principal residence. If a court relieves a borrower's obligation to    
repay amounts otherwise due on a mortgage loan, the servicer will not be        
required to advance these amounts, and any loss may reduce the amounts available
to be paid to you.                                                              

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         In a Chapter 11 case under the Bankruptcy Code, the lender is precluded
from foreclosing without authorization from the bankruptcy court. The lender's  
lien may be transferred to other collateral and be limited in amount to the     
value of the lender's interest in the collateral as of the date of the          
bankruptcy. The loan term may be extended, the interest rate may be adjusted to 
market rates and the priority of the loan may be subordinated to bankruptcy     
court-approved financing. The bankruptcy court can, in effect, invalidate       
due-on-sale clauses through confirmed Chapter 11 plans of reorganization.       

      The Code provides priority to certain tax liens over the lien of the
mortgage or deed of trust. Other federal and state laws provide priority to     
certain tax and other liens over the lien of the mortgage or deed of trust.     
Numerous federal and some state consumer protection laws impose substantive     
requirements upon mortgage lenders in connection with the origination, servicing
and the enforcement of mortgage loans. These laws include the federal Truth in  
Lending Act, Real Estate Settlement Procedures Act, Equal Credit Opportunity    
Act, Fair Credit Billing Act, Fair Credit Reporting Act, and related statutes   
and regulations. These federal laws and state laws impose specific statutory    
liabilities upon lenders who originate or service mortgage loans and who fail to
comply with the provisions of the law. In some cases, this liability may affect 
assignees of the mortgage loans.                                                

Servicemembers Civil Relief Act and Similar State-Enacted Legislation           

       Under the Servicemembers Civil Relief Act, members of all branches of
the military on active duty, including draftees and reservists in military      
service,                                                                        

    o   are entitled to have interest rates reduced and capped at 6% per annum
     on obligations -- including mortgage loans -- incurred prior to the
       commencement of military service for the duration of military service

    o   may be entitled to a stay of proceedings on any kind of foreclosure or
  repossession action in the case of defaults on these obligations
entered into prior to military service                        

   o   may have the maturity of these obligations incurred prior to military
 service extended, the payments lowered and the payment schedule
  readjusted for a period of time after the completion of military
service.                                                      

         Various states have enacted similar legislation which mandates interest
rate deduction for members of all branches of the military. However, these      
benefits are subject to challenge by creditors and if, in the opinion of the    
court, the ability of a person to comply with these obligations is not          
materially impaired by military service, the court may apply equitable          
principles accordingly. If a borrower's obligation to repay amounts otherwise   
due on a mortgage loan included in your trust is relieved pursuant to the       
Servicemembers Civil Relief Act and similar state laws, neither the servicer nor
the trustee will be required to advance these amounts, and any loss may reduce  
the amounts available to you. Any shortfalls in interest collections on mortgage
loans included in your trust resulting from application of the Servicemembers   
Civil Relief Act and similar state laws generally will be allocated to each     
class that is entitled to receive interest in proportion to the interest that   
each class would have otherwise been entitled to receive in respect of these    
mortgage loans had this interest shortfall not occurred.                        

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Environmental Considerations                                                    

   The federal Comprehensive Environmental Response Compensation and
Liability Act, as amended, ("CERCLA") imposes strict liability on present and   
past "owners" and "operators" of contaminated real property for the costs of    
clean-up. A secured lender may be liable as an "owner" or "operator" of a       
contaminated mortgaged property if agents or employees of the lender have become
sufficiently involved in the management of such mortgaged property or the       
operations of the borrower. This liability may exist even if the lender did not 
cause or contribute to the contamination and regardless of whether the lender   
has actually taken possession of a mortgaged property through foreclosure, deed 
in lieu of foreclosure or otherwise. The magnitude of the CERCLA liability at   
any given contaminated site is a function of the actions required to address    
adequately the risks to human health and the environment posed by the particular
conditions at the site. As a result, such liability is not constrained by the   
value of the property or the amount of the original or unamortized principal    
balance of any loans secured by the property. Moreover, under certain           
circumstances, liability under CERCLA may be joint and several (i.e., any liable
party may be obligated to pay the entire cleanup costs regardless of its        
relative contribution to the contamination). If a lender is found to be liable, 
it is entitled to bring an action for contribution against other liable parties,
such as the present or past owners and operators of the property. The lender    
nonetheless may have to bear a disproportionate share of the liability if such  
other parties are defunct or without substantial assets.                        

       The Asset Conservation, Lender Liability and Deposit Insurance Act of
1996 (the "1996 Lender Liability Act") amended, among other things, the         
provisions of CERCLA with respect to lender liability and the secured creditor  
exemption. The 1996 Lender Liability Act offers protection to lenders by        
defining certain activities in which a lender can engage and still have the     
benefit of the secured creditor exemption. A lender will be deemed to have      
participated in the management of a mortgaged property, and will lose the       
secured creditor exemption, if it actually participates in the operational      
affairs of the property of the borrower. The 1996 Lender Liability Act provides 
that "merely having the capacity to influence, or unexercised right to control" 
operations does not constitute participation in management. A lender will lose  
the protection of the secured creditor exemption if it exercises decision-making
control over the borrower's environmental compliance and hazardous substance    
handling and disposal practices, or assumes day-to-day management of all        
operational functions of the mortgaged property. The 1996 Lender Liability Act  
also provides that a lender may continue to have the benefit of the secured     
creditor exemption even if it forecloses on a mortgaged property, purchases it  
at a foreclosure sale or accepts a deed-in-lieu of foreclosure provided that the
lender seeks to sell the mortgaged property at the earliest practicable         
commercially reasonable time on commercially reasonable terms.                  

         Many states have environmental clean-up statutes similar to CERCLA, and
not all those statutes provide for a secured creditor exemption. In addition,   
underground storage tanks are commonly found on a wide variety of commercial and
industrial properties. Federal and state laws impose liability on the owners and
operators of underground storage tanks for any cleanup that may be required as a
result of releases from such tanks. These laws also impose certain compliance   
obligations on the tank owners and operators, such as regular monitoring for    
leaks and upgrading of older tanks. A lender may become a tank owner or         
operator, and subject to compliance obligations and potential cleanup           
liabilities, either as a result of becoming involved                            

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in the management of a site at which a tank is located or, more commonly, by    
taking title to such a property. Federal and state laws also obligate property  
owners and operators to maintain and, under some circumstances, to remove       
asbestos-containing building materials and lead based paint. As a result, the   
presence of these materials can increase the cost of operating a property and   
thus diminish its value. In a few states, transfers of some types of properties 
are conditioned upon cleanup of contamination prior to transfer. In these       
cases, a lender that becomes the owner of a property through foreclosure, deed  
in lieu of foreclosures or otherwise may be required to clean up the            
contamination before selling or otherwise transferring the property.            

      Beyond statute-based environmental liability, there exist common law
causes of action (for example, actions based on nuisance or on toxic tort       
resulting in death, personal injury or damage to property) related to hazardous 
environmental conditions on a property. While it may be more difficult to hold a
lender liable in these cases, unanticipated or uninsured liabilities of the     
borrower may jeopardize the borrower's ability to meet its loan obligations.    

     Under the laws of many states, contamination of a property may give
rise to a lien on the property for clean-up costs. In several states, such a    
lien has priority over all existing liens, including those of existing security 
instruments. In these states, the lien of a security instrument may lose its    
priority to such a "superlien."                                                 

        At the time the mortgage loans were originated, it is possible that no
environmental assessment or a very limited environmental assessment of the      
mortgaged property was conducted. No representations or warranties are made by  
the seller or FMIC as to the absence or effect of hazardous wastes or hazardous 
substances on any of the mortgaged property. Each of the servicers will make    
representations or warranties with respect to the absence or effect of hazardous
wastes or hazardous substances on any mortgaged property or any casualty        
resulting from the presence or effect of hazardous wastes or hazardous          
substances and any loss or liability resulting from the presence or effect of   
such hazardous wastes or hazardous substances will reduce the amounts otherwise 
available to pay to you.                                                        

Generally, the servicers are not permitted to foreclose on any
mortgaged property without the approval of the trustee or its designee. The     
trustee is not permitted to approve foreclosure on any property which it knows  
or has reason to know is contaminated with or affected by hazardous wastes or   
hazardous substances. The trustee, or its designee, is required to inquire of   
any servicer requesting approval of foreclosure whether the property proposed to
be foreclosed upon is so contaminated. If a servicer does not foreclose on      
mortgaged property, the amounts otherwise available to pay to you may be        
reduced. A servicer will not be liable to the holders of the securities if it   
fails to foreclose on mortgaged property that it reasonably believes may be so  
contaminated or affected, even if such mortgaged property are, in fact, not so  
contaminated or affected. Similarly, a servicer will not be liable to the       
holders of the securities if based on its reasonable belief that no such        
contamination or effect exists, the servicer forecloses on mortgaged property   
and takes title to the mortgaged property, and then the mortgaged properties are
determined to be contaminated or affected.                                      

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"Due-on Sale" Clauses                                                           

    The forms of mortgage note, mortgage and deed of trust relating to
conventional mortgage loans may contain a "due-on-sale" clause permitting       
acceleration of the maturity of a loan if the borrower transfers its interest in
the mortgaged property. In recent years, court decisions and legislative actions
placed substantial restrictions on the right of lenders to enforce such clauses 
in many states. However, effective October 15, 1982, Congress enacted the       
Garn-St Germain Depository Institutions Act of 1982 (the "Act"), which, after a 
three-year grace period, preempted state laws which prohibit the enforcement of 
due-on-sale clauses by providing, among other matters, that "due-on-sale"       
clauses in certain loans (including the conventional mortgage loans) made after 
the effective date of the Act are enforceable within limitations identified in  
the Act and its regulations.                                                    

         By virtue of the Act, the mortgage lender generally may be permitted to
accelerate any conventional mortgage loan which contains a "due-on-sale" clause 
upon transfer of an interest in the mortgaged property. With respect to any     
mortgage loan secured by a residence occupied or to be occupied by the borrower,
this ability to accelerate will not apply to certain types of transfers,        
including the following:                                                        

     o   the granting of a leasehold interest which has a term of three years or
less and which does not contain an option to purchase         

   o   a transfer to a relative resulting from the death of a borrower, or a
 transfer where the spouse or child(ren) becomes an owner of the
         mortgaged property in each case where the transferee(s) will occupy the
mortgaged property                                            

  o   a transfer resulting from a decree of dissolution of marriage, legal
separation agreement or from an incidental property settlement
 agreement by which the spouse becomes an owner of the mortgaged
property                                                      

     o   the creation of a lien or other encumbrance subordinate to the lender's
      security instrument which does not relate to a transfer of rights of
occupancy in the mortgaged property, provided that the lien or
encumbrance is not created pursuant to a contract for deed    

 o   a transfer by devise, descent or operation of law on the death of a
joint tenant or tenant by the entirety                        

o   other transfers set forth in the Act and its regulations.         

As a result, a lesser number of mortgage loans which contain  
"due-on-sale" clauses may extend to full maturity than earlier experience would 
indicate with respect to single-family mortgage loans. The extent of the effect 
of the Act on the average lives and delinquency rates of the mortgage loans,    
however, cannot be predicted. FHA and VA loans do not contain due-on-sale       
clauses. See "Description of the Securities -- Maturity and Prepayment          
Considerations" in this prospectus.                                             

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Enforceability of Prepayment and Late Payment Fees                              

        The standard form of mortgage note, mortgage and deed of trust used by
lenders may contain provisions obligating the borrower to pay a late charge if  
payments are not timely made and in some circumstances may provide for          
prepayment fees or penalties if the obligation is paid prior to maturity. In    
certain states, there are or may be specific limitations upon late charges which
a lender may collect from a borrower for delinquent payments. Certain states    
also limit the amounts that a lender may collect from a borrower as an          
additional charge if the loan is prepaid. The enforceability, under the laws of 
a number of states of provisions providing for prepayment fees or penalties upon
an involuntary prepayment is unclear, and no assurance can be given that, at the
time a prepayment fee or penalty is required to be made on a mortgage loan in   
connection with an involuntary prepayment, the obligation to make the payment   
will be enforceable under applicable state law. The absence of a restraint on   
prepayment, particularly with respect to mortgage loans having higher mortgage  
rates, may increase the likelihood of refinancing or other early retirements of 
the mortgage loans. Generally, late charges and prepayment fees may be retained 
by the servicers as additional servicing compensation to the extent permitted by
law and not waived by the servicers.                                            

Equitable Limitations on Remedies                                               

    Courts have imposed general equitable principles upon foreclosure.
These equitable principles are generally designed to relieve the borrower from  
the legal effect of defaults under the loan documents. Examples of judicial     
remedies that may be fashioned include judicial requirements that the lender    
undertake affirmative and expensive actions to determine the causes for the     
borrower's default and the likelihood that the borrower will be able to         
reinstate the loan. In some cases, courts have substituted their judgment for   
the lender's judgment and have required lenders to reinstate loans or recast    
payment schedules to accommodate borrowers who are suffering from temporary     
financial disability. In other cases, courts have limited the right of lenders  
to foreclose if the default under the security instrument is not monetary, like 
the borrower failing to adequately maintain the mortgaged property or the       
borrower executing a second mortgage or deed of trust affecting the mortgaged   
property. Finally, some courts have been faced with the issue whether federal or
state constitutional provisions reflecting due process concerns for adequate    
notice require that borrowers under the deeds of trust receive notices in       
addition to the statutorily-prescribed minimum requirements. For the most part, 
these cases have upheld the notice provisions as being reasonable or have found 
that the sale by a trustee under a deed of trust or under a mortgage having a   
power of sale does not involve sufficient state action to afford constitutional 
protections to the borrower.                                                    

  The mortgage loans may include a debt-acceleration clause, which
permits the lender to accelerate the debt upon a monetary default of the        
borrower, after the applicable cure period. The courts of all states will       
enforce clauses providing for acceleration in the event of a material payment   
default. However, courts of any state, exercising equity jurisdiction, may      
refuse to allow a lender to foreclose a mortgage or deed of trust when an       
acceleration of the indebtedness would be inequitable or unjust and the         
circumstances would render the acceleration unconscionable.                     

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Secondary Financing; Due-on-Encumbrance Provisions                              

  Some of the mortgage loans may not restrict secondary financing,
permitting the borrower to use the mortgaged property as security for one or    
more additional loans. Other of the mortgage loans may preclude secondary       
financing -- by permitting the first lender to accelerate the maturity of its   
loan if the borrower further encumbers the mortgaged property or in some other  
fashion -- or may require the consent of the senior lender to any junior or     
substitute financing. However, these provisions may be unenforceable in some    
jurisdictions under certain circumstances.                                      

      Where the borrower encumbers the mortgaged property with one or more
junior liens, the senior lender is subjected to additional risk. For example,   
the borrower may have difficulty servicing and repaying multiple loans or acts  
of the senior lender which prejudice the junior lender or impair the junior     
lender's security may create a superior equity in favor of the junior lender.   
For example, if the borrower and the senior lender agree to an increase in the  
principal amount of or the interest rate payable on the senior loan, the senior 
lender may lose its priority to the extent any existing junior lender is harmed 
or the borrower is additionally burdened. In addition, if the borrower defaults 
on the senior loan and/or any junior loan or loans, the existence of junior     
loans and actions taken by junior lenders can impair the security available to  
the senior lender and can interfere with, delay and in certain circumstances    
even prevent the taking of action by the senior lender. In addition, the        
bankruptcy of a junior lender may operate to stay foreclosure or similar        
proceedings by the senior lender.                                               

Alternative Mortgage Instruments                                                

      Alternative mortgage instruments, including adjustable rate mortgage
loans and early ownership mortgage loans, originated by non-federally chartered 
lenders have historically been subject to a variety of restrictions. Such       
restrictions differed from state to state, resulting in difficulties in         
determining whether a particular alternative mortgage instrument originated by a
state-chartered lender was in compliance with applicable law. These difficulties
were alleviated substantially as a result of the enactment of Title VIII of the 
Act ("Title VIII"). Title VIII provides that, notwithstanding any state law to  
the contrary, state-chartered banks may originate alternative mortgage          
instruments in accordance with regulations promulgated by the office of the     
Comptroller of the Currency with respect to origination of alternative mortgage 
instruments by national banks; state-chartered credit unions may originate      
alternative mortgage instruments in accordance with regulations promulgated by  
the National Credit Union Administration ("NCUA") with respect to origination of
alternative mortgage instruments by federal credit unions; and all other        
non-federally chartered housing creditors, including state-chartered savings and
loan associations, state-chartered savings banks and mutual savings banks and   
mortgage banking companies, may originate alternative mortgage instruments in   
accordance with the regulations promulgated by the Federal Home Loan Bank Board,
predecessor to the Office of Thrift Supervision ("OTS"), with respect to        
origination of alternative mortgage instruments by federal savings and loan     
associations. Title VIII provides that any state may reject applicability of the
provisions of Title VIII by adopting, prior to October 15, 1985, a law or       
constitutional provision expressly rejecting the applicability of such          
provisions. Certain states have taken such action.                              

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Forfeitures in Drug and RICO Proceedings                                        

  Federal law provides that property owned by persons convicted of
drug-related crimes or of criminal violations of the Racketeer Influenced and   
Corrupt Organizations ("RICO") statute can be seized by the government if the   
property was used in, or purchased with the proceeds of, such crimes. Under     
procedures contained in the Comprehensive Crime Control Act of 1984 (the "Crime 
Control Act"), the government may seize the property even before conviction. The
government must publish notice of the forfeiture proceeding and may give notice 
to all parties "known to have an alleged interest in the property," including   
the holders of mortgage loans.                                                  

     A lender may avoid forfeiture of its interest in the property if it
establishes that: (i) its mortgage was executed and recorded before commission  
of the crime upon which the forfeiture is based, or (ii) the lender was, at the 
time of execution of the mortgage, "reasonably without cause to believe" that   
the property was used in, or purchased with the proceeds of, illegal drug or    
RICO activities. However, there is no assurance that such a defense will be     
successful.                                                                     

Certain Legal Aspects of the Mortgage-Related Assets                            

Mortgage-related assets held by your trust will have legal    
characteristics different from mortgage loans. Mortgage-related assets will     
represent interests in, or will be secured by, mortgage loans or other mortgage 
loans held by another trust. Each mortgage-related asset held by your trust will
be registered in the name of your trustee, or your trustee will be the          
beneficial owner of the mortgage-related asset, if book-entry. Your interests in
the underlying mortgage-related assets may only be exercised through your       
trustee. The particular entitlements represented by the mortgage-related assets 
in your trust, and the underlying mortgage loans in each, will be detailed in   
your prospectus supplement.                                                     

 USE OF PROCEEDS

       Substantially all of the net proceeds from the sale of each series of
securities will be applied by FMIC to the purchase price of the trust assets and
to fund the re-payment of the related financing.                                

 FEDERAL INCOME TAX CONSEQUENCES

      The following discussion represents the opinion of Hunton & Williams
LLP regarding the material federal income tax consequences of the purchase,     
ownership, and disposition of the securities. This discussion is based upon     
laws, regulations, rulings, and decisions now in effect, all of which are       
subject to change. Because REMIC status may be elected with respect to certain  
series, this discussion includes a summary of the federal income tax            
consequences to holders of REMIC securities.                                    

      This discussion does not purport to deal with the federal income tax
consequences that may affect particular investors in light of their individual  
circumstances, or with certain categories of investors that are given special   
treatment under the federal income tax laws, such as banks, insurance companies,
thrift institutions, tax-exempt organizations, foreign investors, certain       
regulated entities, real estate investment trusts ("REITs"), investment         
companies, dealers in securities or currencies, mutual funds, S corporations,   
estates and trusts, securityholders that                                        

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hold the securities as part of a hedge, straddle or an integrated or conversion 
transaction, or securityholders whose functional currency is not the United     
States dollar, and certain other investors and entities that face special       
rules. This discussion focuses primarily on investors who will hold the         
securities as capital assets -- generally, property held for investment --      
within the meaning of Section 1221 of the Code, although much of this           
discussion is applicable to other investors as well. You should note that,      
although final regulations under the REMIC provisions of the Code (the "REMIC   
Regulations") have been issued by the Treasury Department (the "Treasury"), no  
currently effective regulations or other administrative guidance has been       
issued concerning certain provisions of the Code that are or may be applicable  
to you, particularly the provisions dealing with market discount and stripped   
debt securities. Although the Treasury has issued final regulations dealing     
with original issue discount and premium, those regulations do not address      
directly the treatment of REMIC regular certificates and certain other types of 
securities. Furthermore, the REMIC regulations do not address many of the       
issues that arise in connection with the formation and operation of a REMIC.    
Hence, definitive guidance cannot be provided with respect to many aspects of   
the tax treatment of securityholders, particularly holders of Residual          
Certificates. Moreover, this discussion and the opinion referred to below are   
based on current law, and there can be no assurance that the Internal Revenue   
Service (the "IRS") will not take positions that would be materially adverse to 
investors. Finally, this discussion does not purport to address the anticipated 
state, local, foreign or any other income tax consequences to investors of      
owning and disposing of the securities. Consequently, you should consult your   
own tax advisor in determining the federal, state, local, foreign, and any      
other tax consequences to you of the purchase, ownership, and disposition of    
the securities.                                                                 

General                                                                         

         Many aspects of the federal income tax treatment of the securities will
depend upon whether an election is made to treat your trust, or one or more     
segregated pools of trust assets, as one or more REMICs. The related prospectus 
supplement will indicate whether a REMIC election or elections will be made with
respect to your trust. For each series in which one or more REMIC elections are 
to be made, Hunton & Williams LLP, counsel to FMIC, will deliver a separate     
opinion generally to the effect that, assuming timely filing of a REMIC election
or elections and compliance with the pooling and servicing agreement and certain
other documents specified in the opinion, the trust -- or one or more segregated
pools of trust assets -- will qualify as one or more REMICs (each, a "Series    
REMIC"). For each series with respect to which a REMIC election is not to be    
made, Hunton & Williams LLP will deliver a separate opinion generally to the    
effect that the trust will be treated as (a) a grantor trust under subpart E,   
Part I of subchapter J of the Code that will issue securities (the "Grantor     
Trust Securities"), (b) a trust treated as a partnership for federal income tax 
purposes that will issue securities (the "Partnership Securities"), or (c) a    
trust treated either as a partnership, a disregarded entity or a qualified REIT 
subsidiary for federal income tax purposes that will issue notes (the "Debt     
Securities"). Those opinions will be based on existing law, but there can be no 
assurance that the law will not change or that contrary positions will not be   
taken by the IRS.                                                               

REMIC Certificates                                                              

     Each REMIC certificate will be classified as either a REMIC regular
certificate, which generally is treated as debt for federal income tax purposes,
or a Residual Certificate, which                                                

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generally is not treated as debt for such purposes, but rather as representing  
rights and responsibilities with respect to the taxable income or loss of the   
related REMIC. The related prospectus supplement for each series of REMIC       
certificates will indicate which of the certificates of the series will be      
classified as REMIC regular certificates and which will be classified as        
Residual Certificates. REMIC certificates held by a thrift institution taxed as 
a "domestic building and loan association" generally will constitute a "regular 
or residual interest in a REMIC," as the case may be, within the meaning of     
Section 7701(a)(19)(C)(xi) of the Code; REMIC certificates held by a REIT       
generally will constitute "real estate assets" within the meaning of Section    
856(c)(4)(A) of the Code. If the assets of a REMIC include Buydown Loans, it is 
possible that the percentage of such assets constituting "loans...secured by an 
interest in real property which is ...residential real property" for purposes   
of Code Section 7701(a)(19)(C) may be required to be reduced by the amount of   
the related funds paid thereon. Interest on these certificates generally will   
be considered "interest on obligations secured by mortgages on real property"   
within the meaning of Section 856(c)(3)(B) to the extent that such certificates 
are considered "real estate assets" within the meaning of Section 856(c)(4)(A)  
of the Code, all in the same proportion that the related REMIC's assets would   
so qualify. If 95% or more of the assets of a given Series REMIC constitute     
qualifying assets for thrift institutions and REITs, the REMIC certificates and 
income on them generally will be treated entirely as qualifying assets and      
income for these purposes. The REMIC regular certificates generally will be     
"qualified mortgages" within the meaning of Section 860G(a)(3) of the Code with 
respect to other REMICs. In the case of a series for which two or more Series   
REMICs will be created, all Series REMICs will be treated as a single REMIC for 
purposes of determining the extent to which the certificates and the income on  
them will be treated as qualifying assets and income for such purposes.         
However, REMIC certificates will not qualify as government securities for REITs 
and regulated investment companies ("RICs") in any case.                        

Tax Treatment of REMIC Regular Certificates                   

      Payments received by holders of REMIC regular certificates generally
should be accorded the same tax treatment under the Code as payments received on
other taxable corporate debt instruments. Except as described below for REMIC   
regular certificates issued with original issue discount or acquired with market
discount or premium, interest paid or accrued on REMIC regular certificates will
be treated as ordinary income to you and a principal payment on these           
certificates will be treated as a return of capital to the extent that your     
basis in the certificate is allocable to that payment. Holders of REMIC regular 
certificates or Residual Certificates must report income from their certificates
under an accrual method of accounting, even if they otherwise would have used   
the cash receipts and disbursements method. The trustee or its designee will    
report annually to the IRS and to holders of record with respect to interest    
paid or accrued and original issue discount, if any, accrued on the             
certificates. The trustee, the master servicer or its designee will be the party
responsible for computing the amount of original issue discount to be reported  
to the REMIC regular certificate holders each taxable year (the "Tax            
Administrator").                                                                

Under temporary Treasury regulations, holders of REMIC regular
certificates issued by "single-class REMICs" who are individuals, trusts,       
estates, or pass-through entities in which such investors hold interests may be 
required to recognize certain amounts of income in addition to interest and     
discount income. A single-class REMIC, in general, is a REMIC that (a) would    

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be classified as an investment trust in the absence of a REMIC election or (b)  
is substantially similar to an investment trust. Under the temporary Treasury   
regulations, each holder of a regular or residual interest in a single-class    
REMIC is allocated (a) a share of the REMIC's "allocable investment expenses" --
i.e., expenses normally allowable under Section 212 of the Code, which may      
include servicing and administrative fees and insurance premiums -- and (b) a   
corresponding amount of additional income. Section 67 of the Code permits an    
individual, trust or estate to deduct miscellaneous itemized expenses --        
including Section 212 expenses -- only to the extent that such expenses, in the 
aggregate, exceed 2% of its adjusted gross income. Consequently, an individual, 
trust or estate that holds a regular interest in a single-class REMIC -- either 
directly or through a pass-through entity -- will recognize additional income   
with respect to such regular interest to the extent that its share of allocable 
investment expenses, when combined with its other miscellaneous itemized        
deductions for the taxable year, fails to exceed 2% of its adjusted gross       
income. Any such additional income will be treated as interest income. In       
addition, Code Section 68 provides that the amount of itemized deductions       
otherwise allowable for the taxable year for an individual whose adjusted gross 
income exceeds a specified amount (the "Applicable Amount") will be reduced by  
the lesser of (a) 3% of the excess of adjusted gross income over such Applicable
Amount, and (b) 80% of the amount of itemized deductions otherwise allowable for
the taxable year these limitations will be phased out and eliminated by 2010.   
The amount of such additional taxable income recognized by holders who are      
subject to the limitations of either Section 67 or Section 68 may be substantial
and may reduce or eliminate the after-tax yield to such holders of an investment
in the certificates of an affected series. Where appropriate, the prospectus    
supplement for a particular REMIC series will indicate that the holders of      
certificates of this series may be required to recognize additional income as a 
result of the application of the limitations of either Section 67 or Section 68 
of the Code. Non-corporate holders of REMIC regular certificates evidencing an  
interest in a single-class REMIC also should be aware that miscellaneous        
itemized deductions, including allocable investment expenses attributable to    
such REMIC, are not deductible for purposes of the alternative minimum tax      
("AMT").                                                                        

Original Issue Discount                                       

  Certain classes of REMIC regular certificates may be issued with
"original issue discount" within the meaning of Section 1273(a) of the Code. In 
general, such original issue discount, if any, will equal the excess, if any, of
the "stated redemption price at maturity" of the REMIC regular certificate --   
generally, its principal amount -- over its "issue price." Holders of REMIC     
regular certificates as to which there is original issue discount should be     
aware that they generally must include original issue discount in income for    
federal income tax purposes on an annual basis under a constant yield accrual   
method that reflects compounding. In general, original issue discount is treated
as ordinary income and must be included in income in advance of the receipt of  
the cash to which it relates.                                                   

    The amount of original issue discount required to be included in a
REMIC regular certificateholder's income in any taxable year will be computed in
accordance with Section 1272(a)(6) of the Code, which provides rules for the    
accrual of original issue discount under a constant yield method for certain    
debt instruments, such as the REMIC regular certificates, that are subject to   
prepayment by reason of prepayments of underlying obligations. Under Section    
1272(a)(6), the amount and rate of accrual of original issue discount on a REMIC
regular                                                                         

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certificate generally is calculated based on (a) a single constant yield        
to maturity and (b) the prepayment rate for the related mortgage collateral and 
the reinvestment rate on amounts held pending distribution that were assumed in 
pricing the REMIC regular certificate (the "Pricing Prepayment Assumptions"). No
regulatory guidance currently exists under Code Section 1272(a)(6). Accordingly,
until the Treasury issues guidance to the contrary, the Tax Administrator will, 
except as otherwise provided, base its computations on Code Section 1272(a)(6), 
existing final regulations that govern the accrual of original issue discount on
debt instruments, but that do not address directly the treatment of instruments 
that are subject to Code Section 1272(a)(6) (the "OID Regulations"), and certain
other guidance, all as described below. However, there can be no assurance that 
the methodology described below represents the correct manner of calculating    
original issue discount on the REMIC regular certificates. The Tax Administrator
will account for income on certain REMIC regular certificates that provide for  
one or more contingent payments as described in "Federal Income Tax Consequences
-- REMIC Certificates -- Interest Weighted Certificates and Non-VRDI            
Certificates" in this prospectus. Prospective purchasers should be aware that   
neither FMIC, the trustee nor any servicer will make any representation that the
mortgage loans underlying a series will in fact prepay at a rate conforming to  
the related Pricing Prepayment Assumptions or at any other rate.                

         The amount of original issue discount on a REMIC regular certificate is
an amount equal to the excess, if any, of the certificate's "stated redemption  
price at maturity" over its "issue price." Under the OID Regulations, a debt    
instrument's stated redemption price at maturity is the sum of all payments     
provided by the instrument other than "qualified stated interest" (the "Deemed  
Principal Payments"). Qualified stated interest, in general, is stated interest 
that is unconditionally payable in cash or property -- other than debt          
instruments of the issuer -- at least annually at (a) a single fixed rate or (b)
a variable rate that meets certain requirements set out in the OID Regulations. 
See "Federal Income Tax Consequences -- REMIC Certificates -- Variable Rate     
Certificates" in this prospectus. Thus, in the case of any REMIC regular        
certificate, the stated redemption price at maturity will equal the total amount
of all Deemed Principal Payments due on that certificate.                       

       Since a certificate that is part of an Accretion Class generally will
not require unconditional payments of interest at least annually, the stated    
redemption price at maturity of this certificate will equal the aggregate of all
payments due, whether designated as principal, accrued interest, or current     
interest. The issue price of a REMIC regular certificate generally will equal   
the initial price at which a substantial amount of certificates of the same     
class is sold to the public.                                                    

   The OID Regulations contain an aggregation rule (the "Aggregation
Rule") under which two or more debt instruments issued in connection with the   
same transaction or related transactions -- determined based on all the facts   
and circumstances -- generally are treated as a single debt instrument for      
federal income tax accounting purposes if issued by a single issuer to a single 
holder. The Aggregation Rule, however, does not apply if the debt instrument is 
part of an issue (a) a substantial portion of which is traded on an established 
market or (b) a substantial portion of which is issued for cash -- or property  
traded on an established market -- to parties who are not related to the issuer 
or holder and who do not purchase other debt instruments of the same issuer in  
connection with the same transaction or related transactions. In most cases, the
Aggregation Rule will not apply to REMIC regular certificates of different      
classes because one                                                             

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or both of the exceptions to the Aggregation Rule will have been met. Although  
the Tax Administrator currently intends to apply the Aggregation Rule to all    
REMIC regular interests in a Series REMIC that are held by a related Series     
REMIC, it generally will not apply the Aggregation Rule to REMIC regular        
certificates for purposes of reporting to securityholders.                      

         Under a de minimis rule, a REMIC regular certificate will be considered
to have no original issue discount if the amount of original issue discount is  
less than 0.25% of the certificate's stated redemption price at maturity        
multiplied by the weighted average maturity ("WAM") of all Deemed Principal     
Payments. For that purpose, the WAM of a REMIC regular certificate is the sum of
the amounts obtained by multiplying the amount of each Deemed Principal Payment 
by a fraction, the numerator of which is the number of complete years from the  
certificate's issue date until the payment is made, and the denominator of which
is the certificate's stated redemption price at maturity. Although no Treasury  
regulations have been issued under the relevant provisions of the 1986 Act, it  
is expected that the WAM of a REMIC regular certificate will be computed using  
the Pricing Prepayment Assumptions. A REMIC regular certificateholder will      
include de minimis original issue discount in income on a pro rata basis as     
stated principal payments on the certificate are received or, if earlier, upon  
disposition of the certificate, unless the certificateholder makes an election  
to include in gross income all stated interest, acquisition discount, original  
issue discount, de minimis original issue discount, market discount, and de     
minimis market discount accruing on the REMIC regular certificate, reduced by   
any amortizable premium or acquisition premium accruing on the REMIC regular    
certificate, under the constant yield method used to account for original issue 
discount (an "All OID Election").                                               

       REMIC regular certificates may bear interest under terms that provide
for a teaser rate period, interest holiday, or other period during which the    
rate of interest payable on the certificates is lower than the rate payable     
during the remainder of the life of the certificates ("Teaser Certificates").   
Under certain circumstances, a Teaser Certificate may be considered to have a de
minimis amount of original issue discount even though the amount of original    
issue discount on the certificate would be more than de minimis as determined as
described above if the stated interest on a Teaser Certificate would be         
qualified stated interest but for the fact that during one or more accrual      
periods its interest rate is below the rate applicable for the remainder of its 
term, the amount of original issue discount on such certificate that is measured
against the de minimis amount of original issue discount allowable on the       
certificate is the greater of (a) the excess of the stated principal amount of  
the certificate over its issue price ("True Discount") and (b) the amount of    
interest that would be necessary to be payable on the certificate in order for  
all stated interest to be qualified stated interest.                            

     The holder of a REMIC regular certificate generally must include in
gross income the sum, for all days during his taxable year on which he holds the
REMIC regular certificate, of the "daily portions" of the original issue        
discount on such certificate. In the case of an original holder of a REMIC      
regular certificate, the daily portions of original issue discount with respect 
to such certificate generally will be determined by allocating to each day in   
any accrual period the certificate's ratable portion of the excess, if any, of  
(a) the sum of (i) the present value of all payments under the certificate yet  
to be received as of the close of such period plus (ii) the amount of any Deemed
Principal Payments received on the certificate during such period over (b) the  
certificate's "adjusted issue price" at the beginning of such period. The       
present value of                                                                

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payments yet to be received on a REMIC regular certificate is computed using the
Pricing Prepayment Assumptions and the certificate's original yield to maturity 
-- adjusted to take into account the length of the particular accrual period,   
and taking into account Deemed Principal Payments actually received on the      
certificate prior to the close of the accrual period. The adjusted issue price  
of a REMIC regular certificate at the beginning of the first period is its issue
price. The adjusted issue price at the beginning of each subsequent period is   
the adjusted issue price of the certificate at the beginning of the preceding   
period increased by the amount of original issue discount allocable to that     
period and reduced by the amount of any Deemed Principal Payments received on   
the certificate during that period. Thus, an increased or decreased rate of     
prepayments received with respect to a REMIC regular certificate will be        
accompanied by a correspondingly increased or decreased rate of recognition of  
original issue discount by the holder of such certificate.                      

    The yield to maturity of a REMIC regular certificate is calculated
based on (a) the Pricing Prepayment Assumptions and (b) any contingencies not   
already taken into account under the Pricing Prepayment Assumptions that,       
considering all of the facts and circumstances as of the issue date, are more   
likely than not to occur. Contingencies, such as the exercise of "mandatory     
redemptions," that are taken into account by the parties in pricing the REMIC   
regular certificate typically will be subsumed in the Pricing Prepayment        
Assumptions and thus will be reflected in the certificate's yield to maturity.  
The Tax Administrator's determination of whether a contingency relating to a    
class of REMIC regular certificates is more likely than not to occur is binding 
on each holder of a REMIC regular certificate of this class unless the holder   
explicitly discloses on its federal income tax return that its determination of 
the yield and maturity of the certificate is different from that of the Tax     
Administrator.                                                                  

       In many cases, REMIC regular certificates will be subject to optional
redemption before their stated maturity dates. Under the OID Regulations, FMIC  
will be presumed to exercise its option to redeem for purposes of computing the 
accrual of original issue discount if, and only if, by using the optional       
redemption date as the maturity date and the optional redemption price as the   
stated redemption price at maturity, the yield to maturity of the certificate is
lower than it would be if the certificate were not redeemed early. If FMIC is   
presumed to exercise its option to redeem the certificates, original issue      
discount on such certificates will be calculated as if the redemption date were 
the maturity date and the optional redemption price were the stated redemption  
price at maturity. In cases in which all of the certificates of a particular    
series are issued at par or at a discount, FMIC will not be presumed to exercise
its option to redeem the certificates because a redemption by FMIC would not    
lower the yield to maturity of the certificates. If, however, some certificates 
of a particular series are issued at a premium, FMIC may be able to lower the   
yield to maturity of the certificates by exercising its redemption option. In   
determining whether FMIC will be presumed to exercise its option to redeem      
certificates when one or more classes of the certificates is issued at a        
premium, the Tax Administrator will take into account all classes of            
certificates that are subject to the optional redemption to the extent that they
are expected to remain outstanding as of the optional redemption date, based on 
the Pricing Prepayment Assumptions. If, determined on a combined weighted       
average basis, the certificates of such classes were issued at a premium, the   
Tax Administrator will presume that FMIC will exercise its option. However, the 
OID Regulations are unclear as to how the redemption presumption rules should   
apply to instruments such as the certificates, and there can be no assurance    
that the IRS will agree with the Tax Administrator's position.                  

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   A REMIC regular certificate having original issue discount may be
acquired subsequent to its issuance for more than its adjusted issue price. If  
the subsequent holder's adjusted basis in such a certificate, immediately after 
its acquisition, exceeds the sum of all Deemed Principal Payments to be received
on the certificate after the acquisition date, the certificate will no longer   
have original issue discount, and the holder may be entitled to reduce the      
amount of interest income recognized on the certificate by the amount of        
amortizable premium. See "Federal Income Tax Consequences -- REMIC Certificates 
-- Amortizable Premium" in this prospectus. If the subsequent holder's adjusted 
basis in the certificate, immediately after the acquisition, exceeds the        
adjusted issue price of the certificate, but is less than or equal to the sum of
the Deemed Principal Payments to be received on the certificate after the       
acquisition date, the amount of original issue discount on the certificate will 
be reduced by a fraction, the numerator of which is the excess of the           
certificate's adjusted basis immediately after its acquisition over the adjusted
issue price of the certificate and the denominator of which is the excess of the
sum of all Deemed Principal Payments to be received on the certificate after the
acquisition date over the adjusted issue price of the certificate. For that     
purpose, the adjusted basis of a REMIC regular certificate generally is reduced 
by the amount of any qualified stated interest that is accrued but unpaid as of 
the acquisition date. Alternatively, the subsequent holder of a REMIC regular   
certificate having original issue discount may make an All OID Election with    
respect to the certificate.                                                     

         The OID Regulations provide that a certificateholder generally may make
an All OID Election to include in gross income all stated interest, acquisition 
discount, original issue discount, de minimis original issue discount, market   
discount, and de minimis market discount that accrues on a REMIC regular        
certificate under the constant yield method used to account for original issue  
discount. The accrued amount is adjusted to reflect any amortizable premium or  
acquisition premium accruing on the REMIC regular certificate. To make the All  
OID Election, the holder of the certificate must attach a statement to its      
timely filed federal income tax return for the taxable year in which the holder 
acquired the certificate. The statement must identify the instruments to which  
the election applies. An All OID Election is irrevocable unless the holder      
obtains the consent of the IRS. If an All OID Election is made for a debt       
instrument with market discount, the holder is deemed to have made an election  
to include in income currently the market discount on all of the holder's other 
debt instruments with market discount, as described in "Federal Income Tax      
Consequences -- REMIC Certificates -- Market Discount" in this prospectus. In   
addition, if an All OID Election is made for a debt instrument with amortizable 
bond premium, the holder is deemed to have made an election to amortize the     
premium on all of the holder's other debt instruments with amortizable premium  
under the constant yield method. See "Federal Income Tax Consequences -- REMIC  
Certificates -- Amortizable Premium" in this prospectus. You should be aware    
that the law is unclear as to whether an All OID Election is effective for a    
certificate that is subject to the contingent payment rules. See "Federal Income
Tax Consequences -- REMIC Certificates -- Interest Weighted Certificates and    
Non-VRDI Certificates" in this prospectus.                                      

If the interval between the issue date of a current interest  
certificate and the first Payment Date (the "First Distribution Period")        
contains more days than the number of days of stated interest that are payable  
on the first Payment Date, the effective interest rate received by you during   
the First Distribution Period will be less than your certificate's stated       
interest rate, making your certificate a Teaser Certificate. If the amount of   
original issue discount on the certificate                                      

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measured under the expanded de minimis test exceeds the de minimis amount of    
original issue discount allowable on the certificate, the amount by which the   
stated interest on the Teaser Certificate exceeds the interest that would be    
payable on the certificate at the effective rate of interest for the First      
Distribution Period would be treated as part of the certificate's stated        
redemption price at maturity. Accordingly, the holder of a Teaser Certificate   
may be required to recognize ordinary income arising from original issue        
discount in the First Distribution Period in addition to any qualified stated   
interest that accrues in that period.                                           

 Similarly, if the First Distribution Period is shorter than the
interval between subsequent Payment Dates, the effective rate of interest       
payable on a certificate during the First Distribution Period will be higher    
than the stated rate of interest if a certificateholder receives interest on the
first Payment Date based on a full accrual period. Unless the Pre-Issuance      
Accrued Interest Rule described below applies, the certificate (a "Rate Bubble  
Certificate") would be issued with original issue discount unless the amount of 
original issue discount is de minimis. The amount of original issue discount on 
a Rate Bubble Certificate attributable to the First Distribution Period would be
the amount by which the interest payment due on the first Payment Date exceeds  
the amount that would have been payable had the effective rate for that Period  
been equal to the stated interest rate. However, under the "Pre-Issuance Accrued
Interest Rule," if, (a) a portion of the initial purchase price of a Rate Bubble
Certificate is allocable to interest that has accrued under the terms of the    
certificate prior to its issue date ("Pre-Issuance Accrued Interest") and (b)   
the certificate provides for a payment of stated interest on the First Payment  
Date within one year of the issue date that equals or exceeds the amount of the 
Pre-Issuance Accrued Interest, the certificate's issue price may be computed by 
subtracting from the issue price the amount of Pre-Issuance Accrued Interest. If
the certificateholder opts to apply the Pre-Issuance Accrued Interest Rule, the 
portion of the interest received on the first Payment Date equal to the         
Pre-Issuance Accrued Interest would be treated as a return of such interest and 
would not be treated as a payment on the certificate. Thus, where the           
Pre-Issuance Accrued Interest Rule applies, a Rate Bubble Certificate will not  
have original issue discount attributable to the First Distribution Period,     
provided that the increased effective interest rate for that period is          
attributable solely to Pre-Issuance Accrued Interest, as typically will be the  
case. The Tax Administrator intends to apply the Pre-Issuance Accrued Interest  
Rule to each Rate Bubble Certificate for which it is available if the           
certificate's stated interest otherwise would be qualified stated interest. If, 
however, the First Distribution Period of a Rate Bubble Certificate is longer   
than subsequent payment periods, the application of the Pre-Issuance Accrued    
Interest Rule typically will not prevent disqualification of the certificate's  
stated interest because its effective interest rate during the First            
Distribution Period will be less than its stated interest rate. Thus, a REMIC   
regular certificate with a long First Distribution Period typically will be a   
Teaser Certificate, as discussed above. The Pre-Issuance Accrued Interest Rule  
will not apply to any amount paid at issuance for such a Teaser Certificate that
is nominally allocable to interest accrued under the terms of such certificate  
before its issue date. All amounts paid for such a Teaser Certificate at        
issuance, regardless of how designated, will be included in the issue price of  
such certificate for federal income tax accounting purposes.                    

         It is not entirely clear how income should be accrued with respect to a
REMIC regular certificate, the payments on which consist entirely or primarily  
of a specified nonvarying portion of the interest payable on one or more of the 
qualified mortgages held by the REMIC (an "Interest Weighted Certificate").     
Unless and until the IRS provides contrary administrative                       

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guidance on the income tax treatment of an Interest Weighted Certificate, the   
Tax Administrator will take the position that an Interest Weighted Certificate  
does not bear qualified stated interest, and will account for the income thereon
as described in "Federal Income Tax Consequences -- REMIC Certificates --       
Interest Weighted Certificates and Non-VRDI Certificates," in this prospectus.  
Some Interest Weighted Certificates may provide for a relatively small amount of
principal and for interest that can be expressed as qualified stated interest   
at a very high fixed rate with respect to that principal ("Superpremium         
Certificates"). Superpremium Certificates technically are issued with           
amortizable premium. However, because of their close similarity to other        
Interest Weighted Certificates it appears more appropriate to account for       
Superpremium Certificates in the same manner as for other Interest Weighted     
Certificates. Consequently, in the absence of further administrative guidance,  
the Tax Administrator intends to account for Superpremium Certificates in the   
same manner as other Interest Weighted Certificates. However, there can be no   
assurance that the IRS will not assert a position contrary to that taken by the 
Tax Administrator, and, therefore, holders of Superpremium Certificates should  
consider making a protective election to amortize premium on such certificates. 

        In view of the complexities and current uncertainties as to the manner
of inclusion in income of original issue discount on the REMIC regular          
certificates, you should consult your tax advisor to determine the appropriate  
amount and method of inclusion in income of original issue discount on your     
certificates for federal income tax purposes.                                   

Variable Rate Certificates                                    

    A REMIC regular certificate may pay interest at a variable rate (a
"Variable Rate Certificate"). A Variable Rate Certificate that qualifies as a   
"variable rate debt instrument" as that term is defined in the OID Regulations  
(a "VRDI") will be governed by the rules applicable to VRDIs in the OID         
Regulations, which are described below. A Variable Rate Certificate qualifies as
a VRDI under the OID Regulations if (a) the certificate is not issued at a      
premium to its noncontingent principal amount in excess of the lesser of (i)    
..015 multiplied by the product of such noncontingent principal amount and the  
WAM of the certificate or (ii) 15% of such noncontingent principal amount (an   
"Excess Premium"); (b) stated interest on the certificate compounds or is       
payable unconditionally at least annually at (i) one or more "qualified floating
rates," (ii) a single fixed rate and one or more qualified floating rates, (iii)
a single "objective rate," or (iv) a single fixed rate and a single objective   
rate that is a "qualified inverse floating rate"; (c) the qualified floating    
rate or the objective rate in effect during an accrual period is set at a       
current value of that rate -- i.e., the value of the rate on any day occurring  
during the interval that begins three months prior to the first day on which    
that value is in effect under the certificate and ends one year following that  
day; and (d) the certificate does not provide for contingent principal payments.

  Under the OID Regulations a rate is a qualified floating rate if
variations in the rate reasonably can be expected to measure contemporaneous    
variations in the cost of newly borrowed funds in the currency in which the debt
instrument is denominated. A qualified floating rate may measure contemporaneous
variations in borrowing costs for the issuer of the debt instrument or for      
issuers in general. A multiple of a qualified floating rate is considered a     
qualified floating rate only if the rate is equal to either (a) the product of a
qualified floating rate and a fixed multiple that is greater than .65 but not   
more than 1.35 or (b) the product of a                                          

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qualified floating rate and a fixed multiple that is greater than .65 but not   
more than 1.35, increased or decreased by a fixed rate. If a REMIC regular      
certificate provides for two or more qualified floating rates that reasonably   
can be expected to have approximately the same values throughout the term of the
certificate, the qualified floating rates together will constitute a single     
qualified floating rate. Two or more qualified floating rates conclusively will 
be presumed to have approximately the same values throughout the term of a      
certificate if the values of all rates on the issue date of the certificate are 
within 25 basis points of each other.                                           

       A variable rate will be considered a qualified floating rate if it is
subject to a restriction or restrictions on the maximum stated interest rate (a 
"Cap"), a restriction or restrictions on the minimum stated interest rate (a    
"Floor"), a restriction or restrictions on the amount of increase or decrease in
the stated interest rate (a "Governor"), or other similar restriction only if:  
(a) the Cap, Floor, Governor, or similar restriction is fixed throughout the    
term of the related certificate or (b) the Cap, Floor, Governor, or similar     
restriction is not reasonably expected, as of the issue date, to cause the yield
on the certificate to be significantly less or significantly more than the      
expected yield on the certificate determined without such Cap, Floor, Governor, 
or similar restriction, as the case may be. Although the OID Regulations are    
unclear, it appears that a VRDI, the principal rate on which is subject to a    
Cap, Floor, or Governor that itself is a qualified floating rate, bears interest
at an objective rate.                                                           

        An objective rate is a rate -- other than a qualified floating rate --
that (a) is determined using a single fixed formula, (b) is based on objective  
financial or economic information, and (c) is not based on information that     
either is within the control of the issuer -- or a related party -- or is unique
to the circumstances of the issuer or related party, such as dividends, profits,
or the value of the issuer's or related party's stock. That definition would    
include, in addition to a rate that is based on one or more qualified floating  
rates or on the yield of actively traded personal property, a rate that is based
on changes in a general inflation index. In addition, a rate would not fail to  
be an objective rate merely because it is based on the credit quality of the    
issuer. An objective rate is a qualified inverse floating rate if (a) the rate  
is equal to a fixed rate minus a qualified floating rate and (b) the variations 
in the rate can reasonably be expected to inversely reflect contemporaneous     
variations in the qualified floating rate (disregarding certain Caps, Floors,   
and Governors).                                                                 

      If interest on a Variable Rate Certificate is stated at a fixed rate
for an initial period of less than one year followed by a variable rate that is 
either a qualified floating rate or an objective rate for a subsequent period,  
and the value of the variable rate on the issue date is intended to approximate 
the fixed rate, the fixed rate and the variable rate together constitute a      
single qualified floating rate or objective rate. A variable rate conclusively  
will be presumed to approximate an initial fixed rate if the value of the       
variable rate on the issue date does not differ from the value of the fixed rate
by more than 25 basis points.                                                   

         All interest payable on a Variable Rate Certificate that qualifies as a
VRDI and provides for stated interest unconditionally payable in cash or        
property at least annually at a single qualified floating rate or a single      
objective rate (a "Single Rate VRDI Certificate") is treated as qualified stated
interest. The amount and accrual of original issue discount on a Single Rate    
VRDI Certificate is determined, in general, by converting such certificate into 
a hypothetical fixed rate certificate and applying the rules applicable to fixed
rate certificates described under                                               

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"Federal Income Tax Consequences -- REMIC Certificates -- Original Issue        
Discount" in this prospectus to such hypothetical fixed rate certificate.       
Qualified stated interest or original issue discount allocable to an accrual    
period with respect to a Single Rate VRDI Certificate also must be increased or 
decreased if the interest actually accrued or paid during such accrual period   
exceeds or is less than the interest assumed to be accrued or paid during such  
accrual period under the related hypothetical fixed rate certificate.           

    Except as provided below, the amount and accrual of original issue
discount on a Variable Rate Certificate that qualifies as a VRDI but is not a   
Single Rate VRDI Certificate (a "Multiple Rate VRDI Certificate") is determined 
by converting such certificate into a hypothetical equivalent fixed rate        
certificate that has terms that are identical to those provided under the       
Multiple Rate VRDI Certificate, except that such hypothetical equivalent fixed  
rate certificate will provide for fixed rate substitutes in lieu of the         
qualified floating rates or objective rate provided for under the Multiple Rate 
VRDI Certificate. A Multiple Rate VRDI Certificate that provides for a qualified
floating rate or rates or a qualified inverse floating rate is converted to a   
hypothetical equivalent fixed rate certificate by assuming that each qualified  
floating rate or the qualified inverse floating rate will remain at its value as
of the issue date. A Multiple Rate VRDI Certificate that provides for an        
objective rate or rates is converted to a hypothetical equivalent fixed rate    
certificate by assuming that each objective rate will equal a fixed rate that   
reflects the yield that reasonably is expected for the Multiple Rate VRDI       
Certificate. Qualified stated interest or original issue discount allocable to  
an accrual period with respect to a Multiple Rate VRDI Certificate must be      
increased or decreased if the interest actually accrued or paid during such     
accrual period exceeds or is less than the interest assumed to be accrued or    
paid during such accrual period under the hypothetical equivalent fixed rate    
certificate.                                                                    

      The amount and accrual of original issue discount on a Multiple Rate
VRDI Certificate that provides for stated interest at either one or more        
qualified floating rates or at a qualified inverse floating rate and in addition
provides for stated interest at a single fixed rate -- other than an initial    
fixed rate that is intended to approximate the subsequent variable rate -- is   
determined using the method described above for all other Multiple Rate VRDI    
Certificates except that prior to its conversion to a hypothetical equivalent   
fixed rate certificate, such Multiple Rate VRDI Certificate is treated as if it 
provided for a qualified floating rate -- or a qualified inverse floating rate, 
rather than the fixed rate. The qualified floating rate or qualified inverse    
floating rate replacing the fixed rate must be such that the fair market value  
of the Multiple Rate VRDI Certificate as of its issue date would be             
approximately the same as the fair market value of an otherwise identical debt  
instrument that provides for the qualified floating rate or qualified inverse   
floating rate, rather than the fixed rate.                                      

       REMIC regular certificates of certain series may provide for interest
based on a weighted average of the interest rates on some or all of the mortgage
loans or regular interests in a second REMIC held subject to the related pooling
and servicing agreement ("Weighted Average Certificates"). Although the         
treatment of such certificates is not entirely clear under the OID Regulations, 
it appears that Weighted Average Certificates bear interest at an "objective    
rate" and can be considered to have qualified stated interest, provided that the
average value of the rate during the first half of the certificate's term is not
reasonably expected to be either significantly less than or significantly       
greater than the average value of the rate during the final half of the         
certificate's term (i.e., the rate will not result in a significant frontloading
or backloading of                                                               

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interest). Until the IRS provides contrary administrative guidance on the income
tax treatment of Weighted Average Certificates, or unless otherwise specified in
the related prospectus supplement, the Tax Administrator intends to account for 
such certificates as described above for VRDI Certificates.                     

  REMIC regular certificates of certain series may provide for the
payment of interest at a rate determined as the difference between two interest 
rate parameters, one of which is a variable rate and the other of which is a    
fixed rate or a different variable rate ("Inverse Floater Certificates"). Under 
the OID Regulations, Inverse Floater Certificates generally bear interest at    
objective rates, because their rates either constitute "qualified inverse       
floating rates" under those Regulations or, although not qualified floating     
rates themselves, are based on one or more qualified floating rates.            
Consequently, if such certificates are not issued at an Excess Premium and their
interest rates otherwise meet the test for qualified stated interest, the income
on such certificates will be accounted for under the rules applicable to VRDIs  
described above. However, an Inverse Floater Certificate may have an interest   
rate parameter equal to the weighted average of the interest rates on some or   
all of the mortgage loans -- or other interest bearing assets -- held by the    
related REMIC in a case where one or more of those rates is a fixed rate or     
otherwise may not qualify as a VRDI. Unless and until the IRS provides contrary 
administrative guidance on the income tax treatment of such Inverse Floater     
Certificates, the Tax Administrator intends to treat such certificates as debt  
obligations that provide for one or more contingent payments, and will account  
for the income thereon as described in "Federal Income Tax Consequences -- REMIC
Certificates -- Interest Weighted Certificates and Non-VRDI Certificates" in    
this prospectus.                                                                

Interest Weighted Certificates and Non-VRDI Certificates      

   The treatment of a Variable Rate Certificate that is issued at an
Excess Premium, any other Variable Rate Certificate that does not qualify as a  
VRDI (each a "Non-VRDI Certificate") or an Interest Weighted Certificate is     
unclear under current law. The OID Regulations contain provisions (the          
"Contingent Payment Regulations") that address the federal income tax treatment 
of debt obligations that provide for one or more contingent payments            
("Contingent Payment Obligations"). Under the Contingent Payment Regulations,   
any variable rate debt instrument that is not a VRDI is classified as a         
Contingent Payment Obligation. However, the Contingent Payment Regulations, by  
their terms, do not apply to REMIC regular interests and other instruments that 
are subject to Section 1272(a)(6) of the Code. In the absence of further        
guidance, the Tax Administrator will account for Non-VRDI Certificates, Interest
Weighted Certificates, and other REMIC regular certificates that are Contingent 
Payment Obligations in accordance with Code Section 1272(a)(6) and the          
accounting methodology described in this paragraph. Income will be accrued on   
such certificates based on a constant yield that is derived from a projected    
payment schedule as of the closing date. The projected payment schedule will    
take into account the related Pricing Prepayment Assumptions and the interest   
payments that are expected to be made on such certificates based on the value of
any relevant indices on the issue date. To the extent that actual payments      
differ from projected payments for a particular taxable year, appropriate       
adjustments to interest income and expense accruals will be made for that year. 
In the case of a Weighted Average Certificate, the projected payments schedule  
will be derived based on the assumption that the principal balances of the      
mortgage loans that collateralize the certificate pay down pro rata.            

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    The method described in the foregoing paragraph for accounting for
Interest Weighted Certificates, Non-VRDI Certificates and any other REMIC       
regular certificates that are Contingent Payment Obligations is consistent with 
Code Section 1272(a)(6) and its legislative history. Because of the uncertainty 
with respect to the treatment of such certificates under the OID Regulations,   
however, there can be no assurance that the IRS will not assert successfully    
that a method less favorable to securityholders will apply. In view of the      
complexities and the current uncertainties as to income inclusions with respect 
to Non-VRDI Certificates, Interest Weighted Certificates, particularly with     
respect to the method that should be used to account for the income on such     
certificates, and any other REMIC regular certificates that are Contingent      
Payment Obligations you should consult your tax advisor to determine the        
appropriate amount and method of income inclusion on such certificates for      
federal income tax purposes.                                                    

Anti-Abuse Rule                                               

    Because of concerns that taxpayers might be able to structure debt
instruments or transactions, or to apply the bright-line or mechanical rules of 
the OID Regulations, in a way that produce unreasonable tax results, the OID    
Regulations contain an anti-abuse rule. The anti-abuse rule provides that if a  
principal purpose in structuring a debt instrument, engaging in a transaction,  
or applying the OID Regulations is to achieve a result that is unreasonable in  
light of the purposes of the applicable statutes, the IRS can apply or depart   
from the OID Regulations as necessary or appropriate to achieve a reasonable    
result. A result is not considered unreasonable under the regulations, however, 
in the absence of a substantial effect on the present value of a taxpayer's tax 
liability.                                                                      

Market Discount                                               

     A subsequent purchaser of a REMIC regular certificate at a discount
from its outstanding principal amount -- or, in the case of a REMIC regular     
certificate having original issue discount, its adjusted issue price -- will    
acquire such certificate with "market discount." The purchaser generally will be
required to recognize the market discount -- in addition to any original issue  
discount remaining with respect to the certificate -- as ordinary income. A     
person who purchases a REMIC regular certificate at a price lower than the      
remaining outstanding Deemed Principal Payments but higher than its adjusted    
issue price does not acquire the certificate with market discount, but will be  
required to report original issue discount, appropriately adjusted to reflect   
the excess of the price paid over the adjusted issue price. See "Federal Income 
Tax Consequences -- REMIC Certificates -- Original Issue Discount" in this      
prospectus. A REMIC regular certificate will not be considered to have market   
discount if the amount of such market discount is de minimis, i.e., less than   
the product of (a) 0.25% of the remaining principal amount of the certificate --
or in the case of a REMIC regular certificate having original issue discount,   
the adjusted issue price of such certificate -- multiplied by (b) the WAM of the
certificate determined as for original issue discount remaining after the date  
of purchase. Regardless of whether the subsequent purchaser of a REMIC regular  
certificate with more than a de minimis amount of market discount is a          
cash-basis or accrual-basis taxpayer, market discount generally will be taken   
into income as principal payments, including, in the case of a REMIC regular    
certificate having original issue discount, any Deemed Principal Payments, are  
received, in an amount equal to the lesser of (a) the amount of the principal   
payment received or (b) the amount of market discount that has "accrued," but   
that has not yet been included in income. The                                   

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purchaser may make a special election, which generally applies to all market    
discount instruments held or acquired by the purchaser in the taxable year of   
election or thereafter, to recognize market discount currently on an uncapped   
accrual basis (the "Current Recognition Election"). In addition, a purchaser may
make an All OID Election with respect to a REMIC regular certificate purchased  
with market discount. See "Federal Income Tax Consequences -- REMIC Certificates
-- Original Issue Discount" in this prospectus.                                 

         Until the Treasury promulgates applicable regulations, the purchaser of
a REMIC regular certificate with market discount generally may elect to accrue  
the market discount either: (a) on the basis of a constant interest rate; (b) in
the case of a REMIC regular certificate not issued with original issue discount,
in the ratio of stated interest payable in the relevant period to the total     
stated interest remaining to be paid from the beginning of such period; or (c)  
in the case of a REMIC regular certificate issued with original issue discount, 
in the ratio of original issue discount accrued for the relevant period to the  
total remaining original issue discount at the beginning of such period.        
Regardless of which computation method is elected, the Pricing Prepayment       
Assumptions must be used to calculate the accrual of market discount.           

         A certificateholder who has acquired any REMIC regular certificate with
market discount generally will be required to treat a portion of any gain on a  
sale or exchange of the certificate as ordinary income to the extent of the     
market discount accrued to the date of disposition under one of the foregoing   
methods, less any accrued market discount previously reported as ordinary income
as partial principal payments were received. Moreover, such certificateholder   
generally must defer interest deductions attributable to any indebtedness       
incurred or continued to purchase or carry the certificate to the extent they   
exceed income on the certificate. Any such deferred interest expense, in        
general, is allowed as a deduction not later than the year in which the related 
market discount income is recognized. If a REMIC regular certificateholder makes
a Current Recognition Election or an All OID Election, the interest deferral    
rule will not apply. Under the Contingent Payment Regulations, a secondary      
market purchaser of a Non-VRDI Certificate or an Interest Weighted Certificate  
at a discount generally would continue to accrue interest and determine         
adjustments on such certificate based on the original projected payment schedule
devised by the issuer of such certificate. See "Federal Income Tax Consequences 
-- REMIC Certificates -- Interest Weighted Certificates and Non-VRDI            
Certificates" in this prospectus. The holder of such a certificate would be     
required, however, to allocate the difference between the adjusted issue price  
of the certificate and its basis in the certificate as positive adjustments to  
the accruals or projected payments on the certificate over the remaining term of
the certificate in a manner that is reasonable -- e.g., based on a constant     
yield to maturity.                                                              

      Treasury regulations implementing the market discount rules have not
yet been issued, and uncertainty exists with respect to many aspects of those   
rules. For example, the treatment of a REMIC regular certificate subject to     
optional redemption by FMIC that is acquired at a market discount is unclear. It
appears likely, however, that the market discount rules applicable in such a    
case would be similar to the rules pertaining to original issue discount. Due to
the substantial lack of regulatory guidance with respect to the market discount 
rules, it is unclear how those rules will affect any secondary market that      
develops for a given class of REMIC regular certificates. Prospective investors 
in REMIC regular certificates should consult their own tax advisors as to the   
application of the market discount rules to those certificates.                 

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Amortizable Premium                                           

A purchaser of a REMIC regular certificate who purchases the  
certificate at a premium over the total of its Deemed Principal Payments may    
elect to amortize such premium under a constant yield method that reflects      
compounding based on the interval between payments on the certificates. The     
legislative history of the 1986 Act indicates that premium is to be accrued in  
the same manner as market discount. Accordingly, it appears that the accrual of 
premium on a REMIC regular certificate will be calculated using the Pricing     
Prepayment Assumptions. Under Treasury regulations, amortized premium generally 
would be treated as an offset to interest income on a REMIC regular certificate 
and not as a separate deduction item. If a holder makes an election to amortize 
premium on a REMIC regular certificate, such election will apply to all taxable 
debt instruments, including all REMIC regular interests, held by the holder at  
the beginning of the taxable year in which the election is made, and to all     
taxable debt instruments acquired thereafter by such holder, and will be        
irrevocable without the consent of the IRS. Purchasers who pay a premium for the
REMIC regular certificates should consult their tax advisors regarding the      
election to amortize premium and the method to be employed.                     

       Amortizable premium on a REMIC regular certificate that is subject to
redemption at the option of the trust generally must be amortized as if the     
optional redemption price and date were the certificate's principal amount and  
maturity date if doing so would result in a smaller amount of premium           
amortization during the period ending with the optional redemption date. Thus, a
certificateholder would not be able to amortize any premium on a REMIC regular  
certificate that is subject to optional redemption at a price equal to or       
greater than the certificateholder's acquisition price unless and until the     
redemption option expires. In cases where premium must be amortized on the basis
of the price and date of an optional redemption, the certificate will be treated
as having matured on the redemption date for the redemption price and then      
having been reissued on that date for that price. Any premium remaining on the  
certificate at the time of the deemed reissuance will be amortized on the basis 
of (a) the original principal amount and maturity date or (b) the price and date
of any succeeding optional redemption, under the principles described above.    

        Under the Contingent Payment Regulations, a secondary market purchaser
of a Non-VRDI Certificate or an Interest Weighted Certificate at a premium      
generally would continue to accrue interest and determine adjustments on such   
certificate based on the original projected payment schedule devised by the     
issuer of such certificate. See "Federal Income Tax Consequences -- REMIC       
Certificates -- Interest Weighted Certificates and Non-VRDI Certificates" in    
this prospectus. The holder of such a certificate would allocate the difference 
between its basis in the certificate and the adjusted issue price of the        
certificate as negative adjustments to the accruals or projected payments on the
certificate over the remaining term of the certificate in a manner that is      
reasonable -- e.g., based on a constant yield to maturity.                      

Consequences of Realized Losses                               

        Under Section 166 of the Code, both corporate holders of REMIC regular
certificates and noncorporate holders that acquire REMIC regular certificates in
connection with a trade or business should be allowed to deduct, as ordinary    
losses, any losses sustained during a taxable year in which their REMIC regular 
certificates become wholly or partially worthless as the result                 

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of one or more Realized Losses on the underlying assets. However, a noncorporate
holder that does not acquire a REMIC regular certificate in connection with its 
trade or business will not be entitled to deduct a loss under Code Section 166  
until its REMIC regular certificate becomes wholly worthless -- i.e., until its 
outstanding principal balance has been reduced to zero, and the loss will be    
characterized as short-term capital loss.                                       

       Each holder of a REMIC regular certificate will be required to accrue
original issue discount income with respect to such certificate without giving  
effect to any reduction in distributions attributable to a default or           
delinquency on the underlying assets until a Realized Loss is allocated to such 
certificate or until such earlier time as it can be established that any such   
reduction ultimately will not be recoverable. As a result, the amount of        
original issue discount reported in any period by the holder of a REMIC regular 
certificate could exceed significantly the amount of economic income actually   
realized by the holder in such period. Although the holder of a REMIC regular   
certificate eventually will recognize a loss or a reduction in income           
attributable to previously included original issue discount that, as a result of
a Realized Loss, ultimately will not be realized, the law is unclear with       
respect to the timing and character of such loss or reduction in income.        
Accordingly, you should consult with your tax advisor with respect to the       
federal income tax consequences of Realized Losses on original issue discount.  

 The Tax Administrator will adjust the accrual of original issue
discount on REMIC regular certificates in a manner that it believes to be       
appropriate to reflect Realized Losses. However, there can be no assurance that 
the IRS will not contend successfully that a different method of accounting for 
the effect of realized losses is correct and that such method will not have an  
adverse effect upon the holders of REMIC regular certificates.                  

Gain or Loss on Disposition                                   

    If a REMIC regular certificate is sold, the certificateholder will
recognize gain or loss equal to the difference between the amount realized on   
the sale and his adjusted basis in the certificate. The adjusted basis of a     
REMIC regular certificate generally will equal the cost of the certificate to   
the certificateholder, increased by any original issue discount or market       
discount previously includable in the certificateholder's gross income with     
respect to the certificate, and reduced by the portion of the basis of the      
certificate allocable to payments on the certificate, other than qualified      
stated interest, previously received by the certificateholder and by any        
amortized premium. Similarly, a certificateholder who receives a scheduled or   
prepaid principal payment with respect to a REMIC regular certificate will      
recognize gain or loss equal to the difference between the amount of the payment
and the allocable portion of his adjusted basis in the certificate. Except to   
the extent that the market discount rules apply and except as provided below,   
any gain or loss on the sale or other disposition of a REMIC regular certificate
generally will be capital gain or loss. Such gain or loss will be long-term gain
or loss if the certificate is held as a capital asset for more than 12 months.  

    If the holder of a REMIC regular certificate is a bank, thrift, or
similar institution described in Section 582 of the Code, any gain or loss on   
the sale or exchange of the REMIC regular certificate will be treated as        
ordinary income or loss. In the case of other types of holders, gain from the   
disposition of a REMIC regular certificate that otherwise would be capital      

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gain will be treated as ordinary income to the extent that the amount actually  
includable in income with respect to the certificate by the certificateholder   
during his holding period is less than the amount that would have been          
includable in income if the yield on that certificate during the holding period 
had been 110% of a specified United States Treasury borrowing rate as of the    
date that the certificateholder acquired the certificate. Although the          
legislative history to the 1986 Act indicates that the portion of the gain from 
disposition of a REMIC regular certificate that will be recharacterized as      
ordinary income is limited to the amount of original issue discount, if any, on 
the certificate that was not previously includable in income, the applicable    
Code provision contains no such limitation.                                     

         A portion of any gain from the sale of a REMIC regular certificate that
might otherwise be capital gain may be treated as ordinary income to the extent 
that such certificate is held as part of a "conversion transaction" within the  
meaning of Section 1258 of the Code. A conversion transaction generally is one  
in which the taxpayer has taken two or more positions in certificates or similar
property that reduce or eliminate market risk, if substantially all of the      
taxpayer's return is attributable to the time value of the taxpayer's net       
investment in such transaction. The amount of gain realized in a conversion     
transaction that is recharacterized as ordinary income generally will not exceed
the amount of interest that would have accrued on the taxpayer's net investment 
at 120% of the appropriate "applicable federal rate," which rate is computed and
published monthly by the IRS, at the time the taxpayer entered into the         
conversion transaction, subject to appropriate reduction for prior inclusion of 
interest and other ordinary income from the transaction.                        

       Holders of REMIC regular certificates that recognize a loss on a sale
or exchange of a regular security for federal income tax purposes in excess of  
certain threshold amounts should consult their tax advisors as to the need to   
file IRS Form 8886 (disclosing certain potential tax shelters) on their federal 
income tax returns.                                                             

Tax Treatment of Residual Certificates                        

       Overview. Residual Certificates will be considered residual interests
in the Series REMIC to which they relate. A REMIC is an entity for federal      
income tax purposes consisting of a fixed pool of mortgages or other            
mortgage-backed assets in which investors hold multiple classes of interests. To
be treated as a REMIC, the trust or one or more segregated pools of trust assets
underlying a series must meet certain continuing qualification requirements, and
a REMIC election must be in effect. See "Federal Income Tax Consequences --     
REMIC Certificates REMIC Qualification" in this prospectus. A Series REMIC      
generally will be treated as a pass-through entity for federal income tax       
purposes -- i.e., not subject to entity-level tax. All interests in a Series    
REMIC other than the Residual Certificates must be regular interests -- i.e.,   
REMIC regular certificates. As described in "Federal Income Tax Consequences -- 
REMIC Certificates -- Tax Treatment of REMIC Regular Certificates," a regular   
interest generally is an interest whose terms are analogous to those of a debt  
instrument and it generally is treated as such an instrument for federal income 
tax purposes. REMIC regular certificates will generate interest and original    
issue discount deductions for the REMIC. Each trust for which there is a REMIC  
election must have one, and only one class of residual interests. As a residual 
interest, a Residual Certificate represents the right to (a) stated principal   
and interest on such certificate, if any, and (b) its pro rata share of the     
income generated by the REMIC assets in excess of the                           

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amount necessary to service the regular interests and pay the REMIC's expenses. 
In a manner similar to that employed in the taxation of partnerships, REMIC     
taxable income or loss will be determined at the REMIC level, but passed through
to the Residual Certificateholders. Thus, REMIC taxable income or loss will be  
allocated pro rata to the Residual Certificateholders, and each Residual        
Certificateholder will report his share of REMIC taxable income or loss on his  
own federal income tax return. Prospective investors in Residual Certificates   
should be aware that the obligation to account for the REMIC's income or loss   
will continue until all of the REMIC regular certificates have been retired,    
which may not occur until well beyond the date on which the last payments on    
Residual Certificates are made. In addition, because of the way in which REMIC  
taxable income is calculated, a Residual Certificateholder may recognize        
"phantom" income -- i.e., income recognized for tax purposes in excess of income
as determined under financial accounting or economic principles -- which will be
matched in later years by a corresponding tax loss or reduction in taxable      
income, but which could lower the yield to Residual Certificateholders due to   
the lower present value of such loss or reduction.                              

   A portion of the income of Residual Certificateholders in certain
Series REMICs will be treated unfavorably in three contexts: (a) it may not be  
offset by current or net operating loss deductions; (b) it will be considered   
unrelated business taxable income ("UBTI") to tax-exempt entities; and (c) it is
ineligible for any statutory or treaty reduction in the 30 % withholding tax    
that may otherwise available to a foreign Residual Certificateholder.           

       Taxation of Residual Certificateholders. A Residual Certificateholder
will recognize his share of the related REMIC's taxable income or loss for each 
day during his taxable year on which he holds the Residual Certificate. The     
amount so recognized will be characterized as ordinary income or loss and       
generally will not be taxed separately to the REMIC. If a Residual Certificate  
is transferred during a calendar quarter, REMIC taxable income or loss for that 
quarter will be prorated between the transferor and the transferee on a daily   
basis.                                                                          

     A REMIC generally determines its taxable income or loss in a manner
similar to that of an individual using a calendar year and the accrual method of
accounting. REMIC taxable income or loss will be characterized as ordinary      
income or loss and will consist of the REMIC's gross income, including interest,
original issue discount, and market discount income, if any, on the REMIC's     
assets, including temporary cash flow investments, premium amortization on the  
REMIC regular certificates, income from foreclosure property, and any           
cancellation of indebtedness income due to the allocation of realized losses to 
REMIC regular certificates, reduced by the REMIC's deductions, including        
deductions for interest and original issue discount expense on the REMIC regular
certificates, premium amortization and servicing fees on such assets, the       
administration expenses of the REMIC and the REMIC regular certificates, any tax
imposed on the REMIC's income from foreclosure property, and any bad debt       
deductions with respect to the mortgage loans. However, the REMIC may not take  
into account any items allocable to a "prohibited transaction." See "Federal    
Income Tax Consequences -- REMIC Certificates -- REMIC-Level Taxes" in this     
prospectus. The deduction of REMIC expenses by Residual Certificateholders who  
are individuals is subject to certain limitations as described in "Federal      
Income Tax Consequences -- REMIC Certificates -- Special Considerations for     
Certain Types of Investors -- Individuals and Pass-Through Entities" in this    
prospectus.                                                                     

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       The amount of the REMIC's net loss with respect to a calendar quarter
that may be deducted by a Residual Certificateholder is limited to such         
certificateholder's adjusted basis in the Residual Certificate as of the end of 
that quarter -- or time of disposition of the Residual Certificate, if earlier, 
determined without taking into account the net loss for that quarter. A Residual
Certificateholder's basis in its Residual Certificate initially is equal to the 
price paid for such Certificate. This basis is increased by the amount of       
taxable income recognized with respect to the Residual Certificate and          
decreased, but not below zero, by the amount of distributions made and the      
amount of net losses recognized with respect to that certificate. The amount of 
the REMIC's net loss allocable to a Residual Certificateholder that is          
disallowed under the basis limitation may be carried forward indefinitely, but  
may be used only to offset income with respect to the related Residual          
Certificate. The ability of Residual Certificateholders to deduct net losses    
with respect to a Residual Certificate may be subject to additional limitations 
under the Code, as to which securityholders should consult their tax advisors. A
distribution with respect to a Residual Certificate is treated as a non-taxable 
return of capital up to the amount of the Residual Certificateholder's adjusted 
basis in his Residual Certificate. If a distribution exceeds the adjusted basis 
of the Residual Certificate, the excess is treated as gain from the sale of such
Residual Certificate.                                                           

Although the law is unclear in certain respects, a Residual   
Certificateholder effectively should be able to recover some or all of the basis
in his Residual Certificate as the REMIC recovers the basis of its assets       
through either the amortization of premium on such assets or the allocation of  
basis to principal payments received on such assets. The REMIC's initial        
aggregate basis in its assets will equal the sum of the issue prices of all     
Residual Certificates and REMIC regular certificates. In general, the issue     
price of a REMIC regular certificate of a particular class is the initial price 
at which a substantial amount of the certificates of such class is sold to the  
public. In the case of a REMIC regular certificate of a class not offered to the
public, the issue price is either the price paid by the first purchaser of such 
certificate or the fair market value of the property received in exchange for   
such certificate, as appropriate. The REMIC's aggregate basis will be allocated 
among its assets in proportion to their respective fair market values.          

      The assets of certain Series REMICs may have bases that exceed their
principal amounts. Except as indicated in "Federal Income Tax Consequences --   
REMIC Certificates -- Treatment by the REMIC of Original Issue Discount, Market 
Discount, and Amortizable Premium," the premium on such assets will be          
amortizable under the constant yield method and the same prepayment assumptions 
used in pricing the certificates. The amortized premium will reduce the REMIC's 
taxable income or increase its tax loss for each year which will offset a       
corresponding amount of the stated interest or other residual cash flow, if any,
allocable to the Residual Certificateholders. It should be noted, however, that 
the law concerning the amortization of premium on trust assets is unclear in    
certain respects. If the IRS were to contend successfully that part or all of   
the premium on the REMIC's assets underlying certain Series REMICs is not       
amortizable, the Residual Certificateholders would recover the basis            
attributable to the unamortizable premium only as principal payments are        
received on such assets or upon the disposition or worthlessness of their       
Residual Certificates. The inability to amortize part or all of the premium     
could give rise to timing differences between the REMIC's income and deductions,
creating phantom income. Because phantom income arises from timing differences, 
it will be matched by a corresponding loss or reduction in taxable income in    
later years, during which                                                       

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economic or financial income will exceed REMIC taxable income. Any              
acceleration of taxable income, however, could lower the yield to a Residual    
Certificateholder, since the present value of the tax paid on that income will  
exceed the present value of the corresponding tax reduction in the later years. 
The amount and timing of any phantom income are dependent upon (a) the structure
of the particular Series REMIC and (b) the rate of prepayment on the mortgage   
loans comprising or underlying the REMIC's assets and, therefore, cannot be     
predicted without reference to a particular Series REMIC.                       

       The assets of certain Series REMICs may have bases that are less than
their principal amounts. In such a case, a Residual Certificateholder will      
recover the basis in his Residual Certificate as the REMIC recovers the portion 
of its basis in the assets that is attributable to the residual interest. The   
REMIC's basis in the assets is recovered as it is allocated to principal        
payments received by the REMIC.                                                 

     A Residual Certificate may have a negative value if the net present
value of anticipated tax liabilities exceeds the present value of anticipated   
cash flows. The REMIC Regulations appear to treat the issue price of such a     
residual interest as zero rather than such negative amount for purposes of      
determining the REMIC basis in its assets. Treasury regulations have been       
proposed addressing the federal income tax treatment of "inducement fees"       
received by transferees of noneconomic residual interests. The proposed         
regulations would require inducement fees to be included in income over a period
reasonably related to the period in which a Residual Certificate is expected to 
generate taxable income or net loss to its holder. Under two proposed safe      
harbor methods, inducement fees would be permitted to be included in income:    
(a) in the same amounts and over the same period that the holder uses for       
financial reporting purposes, provided that such period is not shorter than the 
period the related REMIC is expected to generate taxable income or (b) ratably  
over the remaining anticipated weighted average life of all the regular and     
residual interests issued by the related REMIC, determined based on actual      
distributions projected as remaining to be made on such interests under the     
applicable prepayment assumption. If a Residual Holder sells or otherwise       
disposes of the residual interest any unrecognized portion of the inducement fee
would be required to be taken into account at the time of the sale or           
disposition.                                                                    

   A portion of the REMIC's taxable income may be subject to special
treatment. That portion ("excess inclusion income") generally is any taxable    
income beyond that which the Residual Certificateholder would have recognized   
had the Residual Certificate been a conventional debt instrument bearing        
interest at 120 % of the applicable long-term federal rate, based on quarterly  
compounding, as of the date on which the Residual Certificate was issued. Excess
inclusion income generally is intended to approximate phantom income and may    
result in unfavorable tax consequences for certain investors. See "Federal      
Income Tax Consequences -- REMIC Certificates -- Taxation of Residual           
Certificateholders -- Limitations on Offset or Exemption of REMIC Income" and   
"Federal Income Tax Consequences -- REMIC Certificates -- Special Considerations
for Certain Types of Investors" in this prospectus.                             

  Limitations on Offset or Exemption of REMIC Income. Generally, a
Residual Certificateholder's taxable income for any taxable year may not be less
than such Certificateholder's excess inclusion income for that taxable year.    
Excess inclusion income is equal to the excess of REMIC taxable income for the  
quarterly period for the Residual                                               

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Certificates over the product of (a) 120% of the long-term applicable federal   
rate that would have applied to the Residual Certificates if they were debt     
instruments for federal income tax purposes on the closing date and (b) the     
adjusted issue price of such Residual Certificates at the beginning of such     
quarterly period. For this purpose, the adjusted issue price of a Residual      
Certificate at the beginning of a quarter is the issue price of the Residual    
Certificate, increased by the amount of the daily accruals of REMIC income for  
all prior quarters, decreased by any distributions made with respect to such    
Residual Certificate prior to the beginning of such quarterly period. If the    
Residual Certificateholder is an organization subject to the tax on UBTI imposed
by Code Section 511, the Residual Certificateholder's excess inclusion income   
will be treated as UBTI. In the case of a Residual Certificate held by a "real  
estate investment trust" (a "REIT"), the aggregate excess inclusions with       
respect to the Residual Certificate, as reduced, but not below zero, by the     
REIT's taxable income, will be allocated among the shareholders of the trust in 
proportion to the dividends received by the shareholders from the trust, and any
amount so allocated will be treated as an excess inclusion with respect to a    
Residual Certificate as if held directly by the shareholder. A REIT's taxable   
income is defined by Section 857(b)(2) of the Code, and as used in the prior    
sentence, does not include any net capital gain. Treasury regulations yet to be 
issued could apply a similar rule to regulated investment companies, common     
trust funds and cooperatives. The REMIC Regulations currently do not address    
this subject. Finally, Residual Certificateholders that are foreign persons will
not be entitled to any exemption from the 30% withholding tax or a reduced      
treaty rate with respect to their excess inclusion income from the REMIC. See   
"Federal Income Tax Consequences -- REMIC Certificates -- Taxation of Certain   
Foreign Holders of REMIC Certificates -- Residual Certificates" in this         
prospectus.                                                                     

       Non-Recognition of Certain Transfers for Federal Income Tax Purposes.
The transfer of a "noneconomic residual interest" to a United States person will
be disregarded for tax purposes if a significant purpose of the transfer was to 
impede the assessment or collection of tax. A Residual Certificate will         
constitute a noneconomic residual interest unless, at the time the interest is  
transferred, (a) the present value of the expected future distributions         
(determined using the "applicable federal rate" as of the date of transfer for a
term ending with the last calendar quarter in which excess inclusions are       
expected to accrue) with respect to the Residual Certificate equals or exceeds  
the product of the present value of the anticipated excess inclusion income and 
the highest corporate tax rate for the year in which the transfer occurs, and   
(b) the transferor reasonably expects that the transferee will receive          
distributions from the REMIC in amounts sufficient to satisfy the taxes on      
excess inclusion income as they accrue. If a transfer of a residual interest is 
disregarded, the transferor would continue to be treated as the owner of the    
Residual Certificate and thus would continue to be subject to tax on its        
allocable portion of the net income of the related REMIC. A significant purpose 
to impede the assessment or collection of tax exists if the transferor, at the  
time of the transfer, either knew or should have known that the transferee would
be unwilling or unable to pay taxes due on its share of the taxable income of   
the REMIC, -- i.e., the transferor has "improper knowledge." A transferor is    
presumed not to have such improper knowledge if (a) the transferor conducted, at
the time of the transfer, a reasonable investigation of the financial condition 
of the transferee and, as a result of the investigation, the transferor found   
that the transferee had historically paid its debts as they came due and found  
no significant evidence to indicate that the transferee would not continue to   
pay its debts as they come due and (b) the transferee represents to the         
transferor that it understands that, as the holder of a noneconomic residual    
interest, it may incur tax liabilities in excess of any cash                    

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flows generated by the interest and that it intends to pay the taxes associated 
with holding the residual interest as they become due.                          

       Treasury regulations provide for a safe harbor for transfers of REMIC
Residual Certificates and if the safe harbor is satisfied, the transfer is      
presumed to be a valid transfer that will be respected for federal income tax   
purposes. To qualify under the safe harbor set out in the regulations, (a) the  
transferor must perform a reasonable investigation of the financial status of   
the transferee and determine that the transferee has historically paid its debts
as they come due and find no evidence to indicate that the transferee will not  
continue to pay its debts as they come due, (b) the transferor must obtain a    
representation from the transferee to the effect that the transferee understands
that as the holder of the REMIC residual certificate the transferee will        
recognize taxable income in excess of cash flow and that the transferee intends 
to pay taxes on the income as those taxes become due, (c) the transferee        
represents that it will not cause income from the noneconomic residual interest 
to be attributable to a foreign permanent establishment or fixed base (within   
the meaning of an applicable income tax treaty) of the transferee or another    
U.S. taxpayer, and (d) the transferee satisfies either the formula test or the  
asset test described below.                                                     

         Under the formula test, a transferor of a noneconomic residual interest
will be presumed not to have improper knowledge if, in addition to meeting      
conditions (a), (b) and (c) above, the present value of the anticipated tax     
liabilities associated with holding the residual interest does not exceed the   
sum of the present values of (a) any consideration given to the transferee to   
acquire the interest, (b) the expected future payments of interest, and (c) any 
anticipated tax savings associated with holding the interest as the REMIC       
generates losses. For purposes of this calculation, the present values generally
are calculated using a discount rate equal to the federal short-term rate for   
the month of the transfer and the transferer is assumed to pay tax at the       
highest corporate rate or, in certain circumstances, the alternative minimum tax
rate.                                                                           

       Under the asset test, a transferor of a noneconomic residual interest
generally will be presumed not to have improper knowledge if, in addition to    
(a), (b) and (c) above, (i) the transferee's gross assets exceed $100 million   
and its net assets exceed $10 million, (ii) the transferee is an "eligible      
corporation" as defined in Treasury regulations section 1.860E-1(c)(6)(i) other 
than a foreign permanent establishment or a fixed base (within the meaning of an
applicable income tax treaty) of a domestic corporation, (iii) the transferee   
agrees in writing that any subsequent transfer of the residual interest will not
comply with the asset test, (iv) the transferor does not know or have reason to 
know that the transferee will not honor the restrictions on subsequent transfers
of the residual interest, and (v) a reasonable person would not conclude, based 
on the facts and circumstances known to the transferor, that the taxes          
associated with the residual interest will not be paid. Holders should consult  
with their own tax advisors regarding the transfer of a Residual Certificate.   

  A similar limitation exists with respect to transfers of certain
residual interests to foreign investors. See "Federal Income Tax Consequences --
REMIC Certificates -- Taxation of Certain Foreign Holders of REMIC Certificates 
-- Residual Certificates" in this prospectus.                                   

       Ownership of Residual Certificates by Disqualified Organizations. The
Code contains three sanctions that are designed to prevent or discourage the    
direct or indirect ownership of a                                               

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REMIC residual interest, such as a Residual Certificate, by the United States,  
any state or political subdivision, any foreign government, any international   
organization, any agency or instrumentality of any of the foregoing, any        
tax-exempt organization -- other than a farmers' cooperative described in       
Section 521 of the Code -- that is not subject to the tax on UBTI, or any rural 
electrical or telephone cooperative (each a "Disqualified Organization"). A     
corporation is not treated as an instrumentality of the United States or any    
state or political subdivision thereof if all of its activities are subject to  
tax and, with the exception of Freddie Mac, a majority of its board of directors
is not selected by such governmental unit.                                      

  First, REMIC status is dependent upon the presence of reasonable
arrangements designed to prevent a Disqualified Organization from acquiring     
record ownership of a residual interest. Residual interests in Series REMICs are
not offered for sale to Disqualified Organizations. Furthermore, (a) residual   
interests in Series REMICs will be registered as to both principal and any      
stated interest with the trustee (or its agent) and transfer of a residual      
interest may be effected only (i) by surrender of the old residual interest     
instrument and reissuance by the trustee of a new residual interest instrument  
to the new holder or (ii) through a book entry system maintained by the trustee,
(b) the applicable pooling and servicing agreement will prohibit the ownership  
of residual interests by Disqualified Organizations, and (c) each residual      
interest instrument will contain a legend providing notice of that prohibition. 
Consequently, each Series REMIC should be considered to have made reasonable    
arrangements designed to prevent the ownership of residual interests by         
Disqualified Organizations.                                                     

         Second, the Code imposes a one-time tax on the transferor of a residual
interest, including a Residual Certificate or interest in a Residual            
Certificate, to a Disqualified Organization. The one-time tax equals the product
of (a) the present value of the total anticipated excess inclusions with respect
to the transferred residual interest for periods after the transfer and (b) the 
highest marginal federal income tax rate applicable to corporations. The        
anticipated excess inclusions with respect to a transferred residual interest   
must be based on (a) both actual prior prepayment experience and the prepayment 
assumptions used in pricing the related REMIC's interests and (b) any required  
or permitted clean up calls or required qualified liquidation provided for in   
the REMIC's organizational documents. The present value of anticipated excess   
inclusions is determined using a discount rate equal to the applicable federal  
rate that would apply to a debt instrument that was issued on the date the      
Disqualified Organization acquired the residual interest and whose term ends on 
the close of the last quarter in which excess inclusions are expected to accrue 
with respect to the residual interest. Where a transferee is acting as an agent 
for a Disqualified Organization, the transferee is subject to the one-time tax. 
For that purpose, the term "agent" includes a broker, nominee, or other         
middleman. Upon the request of such transferee or the transferor, the REMIC must
furnish to the requesting party and to the IRS information sufficient to permit 
the computation of the present value of the anticipated excess inclusions. The  
transferor of a residual interest will not be liable for the one-time tax if the
transferee furnishes to the transferor an affidavit that states, under penalties
of perjury, that the transferee is not a Disqualified Organization, and, as of  
the time of the transfer, the transferor does not have actual knowledge that    
such affidavit is false. The one-time tax must be paid by April 15th of the year
following the calendar year in which the residual interest is transferred to a  
Disqualified Organization. The one-time tax may be waived by the Secretary of   
the Treasury if, upon discovery that a transfer is subject to the one-time tax, 

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the Disqualified Organization promptly disposes of the residual interest and the
transferor pays such amounts as the Secretary may require.                      

     Third, the Code imposes an annual tax on any pass-through entity --
i.e., RIC, REIT, common trust, partnership, trust, estate or cooperative        
described in Code Section 1381 -- that owns a direct or indirect interest in a  
residual interest, if record ownership of an interest in the pass-through entity
is held by one or more Disqualified Organizations. The tax imposed equals the   
highest corporate income tax rate multiplied by the share of any excess         
inclusion income of the pass-through entity for the taxable year that is        
allocable to the interests in the pass-through entity held by Disqualified      
Organizations. The same tax applies to a nominee who acquires an interest in a  
residual interest on behalf of a Disqualified Organization. For example, a      
broker that holds an interest in a Residual Certificate in "street name" for a  
Disqualified Organization is subject to the tax. The tax due must be paid by the
fifteenth day of the fourth month following the close of the taxable year of the
pass-through entity in which the Disqualified Organization is a record holder.  
Any such tax imposed on a pass-through entity would be deductible against that  
entity's ordinary income in determining the amount of its required              
distributions. In addition, dividends paid by a RIC or a REIT are not considered
preferential dividends within the meaning of Section 562(c) of the Code solely  
because the RIC or REIT allocates such tax expense only to the shares held by   
Disqualified Organizations. A pass-through entity will not be liable for the    
annual tax if the record holder of the interest in the pass-through entity      
furnishes to the pass-through entity an affidavit that states, under penalties  
of perjury, that the record holder is not a Disqualified Organization, and the  
pass-through entity does not have actual knowledge that such affidavit is false.

      If an "electing large partnership" holds a Residual Certificate, all
interests in the electing large partnership are treated as held by Disqualified 
Organizations for purposes of the tax imposed upon a pass-through entity by     
Section 860E(c) of the Code. The exception to this tax, otherwise available to a
pass-through entity that is furnished certain affidavits as described above, is 
not available to an electing large partnership.                                 

    The pooling and servicing agreement will provide that no record or
beneficial ownership interest in a Residual Certificate may be purchased,       
transferred or sold, directly or indirectly, without the express written consent
of the trustee. The trustee will grant such consent to a proposed transfer only 
if it receives the following: (a) an affidavit from the proposed transferee to  
the effect that it is not a Disqualified Organization and is not acquiring the  
Residual Certificate as a nominee or agent for a disqualified organization and  
(b) a covenant by the proposed transferee to the effect that the proposed       
transferee agrees to be bound by and to abide by the transfer restrictions      
applicable to the Residual Certificate.                                         

 The Code and the REMIC Regulations also require that reasonable
arrangements be made with respect to each REMIC to enable the REMIC to provide  
the Treasury and the transferor with information necessary for the application  
of the one-time tax described above. Consequently, the applicable pooling and   
servicing agreement will provide for an affiliate to perform such information   
services as may be required for the application of the one-time tax. If a       
Residual Certificateholder transfers an interest in a Residual Certificate in   
violation of the relevant transfer restrictions and triggers the information    
requirement, the affiliate may charge such Residual Certificateholder a         
reasonable fee for providing the information.                                   

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Special Considerations for Certain Types of Investors         

        Dealers in Securities. Residual Certificateholders that are dealers in
securities should be aware that under Treasury regulations (the "Mark-to-Market 
Regulations") relating to the requirement under Section 475 of the Code that    
dealers in securities use mark-to-market accounting for federal income tax      
purposes, dealers in securities are not permitted to mark to market any Residual
Certificates. Prospective purchasers of Residual Certificates should consult    
with their tax advisors regarding the possible application of the Mark-to-Market
Regulations.                                                                    

    Tax-Exempt Entities. Any excess inclusion income with respect to a
Residual Certificate held by a tax-exempt entity, including a qualified         
profit-sharing, pension, or other employee benefit plan, will be treated as     
UBTI. Although the legislative history and statutory provisions imply otherwise,
the Treasury conceivably could take the position that, under pre-existing Code  
provisions, substantially all income on a Residual Certificate, including       
non-excess inclusion income, is to be treated as UBTI. See "Federal Income Tax  
Consequences -- REMIC Certificates -- Taxation of Residual Certificateholders"  
in this prospectus.                                                             

         Individuals and Pass-Through Entities. A Residual Certificateholder who
is an individual, trust, or estate will be able to deduct its allocable share of
the fees or expenses relating to servicing the assets assigned to a trust or    
administering the Series REMIC under Section 212 of the Code only to the extent 
that the amount of such fees or expenses, when combined with the                
certificateholder's other miscellaneous itemized deductions for the taxable     
year, exceeds 2% of the holder's adjusted gross income. That same limitation    
will apply to individuals, trusts, or estates that hold Residual Certificates   
indirectly through a grantor trust, a partnership, an S corporation, a common   
trust, or a nonpublicly offered RIC. A nonpublicly offered RIC is a RIC other   
than one whose shares are (a) continuously offered pursuant to a public         
offering, (b) regularly traded on an established securities market, or (c) held 
by no fewer than 500 persons at all times during the taxable year. In addition, 
that limitation will apply to individuals, trusts, or estates that hold Residual
Certificates through any other person (a) that is not generally subject to      
federal income tax and (b) the character of whose income may affect the         
character of the income generated by that person for its owners or              
beneficiaries. In addition, Code Section 68 provides that the amount of itemized
deductions otherwise allowable for the taxable year for an individual whose     
adjusted gross income exceeds the Applicable Amount will be reduced by the      
lesser of (a) 3% of the excess of adjusted gross income over the Applicable     
Amount, or (b) 80% of the amount of itemized deductions otherwise allowable for 
the taxable year. These limitations will be phased out and eliminated by 2010.  
In some cases, the amount of additional income that would be recognized as a    
result of the foregoing limitations by a Residual Certificateholder who is an   
individual, trust, or estate could be substantial. Non-corporate holders of     
REMIC Residual Certificates also should be aware that miscellaneous itemized    
deductions, including allocable investment expenses attributable to the related 
REMIC, are not deductible for purposes of the AMT. Finally, persons holding an  
interest in a Residual Certificate indirectly through an interest in a RIC,     
common trust or one of certain corporations doing business as a cooperative     
generally will recognize a share of any excess inclusion allocable to that      
Residual Certificate.                                                           

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 Employee Benefit Plans. See "Federal Income Tax Consequences --
Residual Certificates -- Special Considerations for Certain Types of Investors  
-- Tax-exempt Entities" and "ERISA Considerations" in this prospectus.          

     REITs and RICs. If the Residual Certificateholder is a REIT and the
related REMIC generates excess inclusion income, a portion of REIT dividends    
will be treated as excess inclusion income for the REIT's shareholders. Thus,   
shareholders in a REIT that invests in Residual Certificates could face         
unfavorable treatment of a portion of their REIT dividend income for purposes of
(a) using current deductions or net operating loss carryovers or carrybacks, (b)
UBTI in the case of tax-exempt shareholders, and (c) withholding tax in the case
of foreign shareholders. Moreover, because Residual Certificateholders may      
recognize phantom income, a REIT contemplating an investment in Residual        
Certificates should consider carefully the effect of any phantom income upon its
ability to meet its income distribution requirements under the Code. The same   
rules regarding excess inclusion will apply to a Residual Certificateholder that
is a RIC, common trust, or one of certain corporations doing business as a      
cooperative. See "Federal Income Tax Consequences -- Residual Certificates --   
Special Considerations for Certain Types of Investors -- Foreign Residual       
Certificateholders" and "Federal Income Tax Consequences -- REMIC Certificates  
-- Taxation of Residual Certificateholders" in this prospectus.                 

        A Residual Certificate held by a REIT will be treated as a real estate
asset for purposes of the REIT qualification requirements in the same proportion
that the REMIC's assets would be treated as real estate assets if held directly 
by the REIT, and interest income derived from such Residual Certificate will be 
treated as qualifying interest income for REIT purposes ("Qualifying REIT       
Interest") to the same extent. If 95% or more of a REMIC's assets qualify as    
real estate assets for REIT purposes, 100% of that REMIC's regular and residual 
interests will be treated as real estate assets for REIT purposes, and all of   
the income derived from such interests will be treated as Qualifying REIT       
Interest. The REMIC Regulations provide that payments of principal and interest 
on mortgage loans that are reinvested pending distribution to the holders of the
REMIC certificates constitute real estate assets for REIT purposes. Two REMICs  
that are part of a tiered structure will be treated as one REMIC for purposes of
determining the percentage of assets of each REMIC that constitutes real estate 
assets. It is expected that at least 95% of the assets of a Series REMIC will be
real estate assets throughout the REMIC's life. The amount treated as a real    
estate asset in the case of a Residual Certificate apparently is limited to the 
REIT's adjusted basis in the certificate. REITs should be aware that 100% of the
interest income derived by a REIT from a residual interest in such REMIC may not
be treated as Qualifying REIT Interest if the REMIC holds mortgage loans that   
provide for interest that is contingent on borrower profits or property         
appreciation.                                                                   

   Significant uncertainty exists with respect to the treatment of a
Residual Certificate for purposes of the various asset composition requirements 
applicable to RICs. A Residual Certificate should be treated as a "security,"   
but will not be considered a "government security" for purposes of Section      
851(b)(4) of the Code. Moreover, it is unclear whether a Residual Certificate   
will be treated as a "voting security" under that Code section. Finally, because
the REMIC will be treated as the "issuer" of the Residual Certificate for       
purposes of that Section, a RIC would be unable to invest more than 25% of the  
value of its total assets in Residual Certificates of the same REMIC.           

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        Partnerships. Partners in a partnership (other than an "electing large
partnership") that acquire a Residual Certificate generally must take into      
account their allocable share of any income, including excess inclusion income, 
that is produced by the Residual Certificate. The partnership itself is not     
subject to tax on income from the Residual Certificate other than excess        
inclusion income that is allocable to partnership interests owned by            
Disqualified Organizations. For the treatment of an "electing large             
partnership," see "Federal Income Tax Consequences -- REMIC Certificates -- Tax 
Treatment of Residual Certificates -- Ownership of Residual Certificates by     
Disqualified Organizations" in this prospectus.                                 

       Foreign Residual Certificateholders. Certain adverse tax consequences
may be associated with the holding of certain Residual Certificates by a foreign
person or with the transfer of such Certificates to or from a foreign person.   
See "Federal Income Tax Consequences -- REMIC Certificates -- Taxation of       
Certain Foreign Holders of REMIC Certificates -- Residual Certificates" in this 
prospectus.                                                                     

       Thrift Institutions, banks, and certain other financial institutions.
Residual Certificates will be treated as qualifying assets for thrift           
institutions in the same proportion that the assets of the REMIC would be so    
treated. However, if 95% or more of the assets of a given Series REMIC are      
qualifying assets for thrift institutions, 100% of that REMIC's regular and     
residual interests would be treated as qualifying assets. In addition, the REMIC
Regulations provide that payments of principal and interest on mortgage loans   
that are reinvested pending their distribution to the holders of the REMIC      
Certificates will be treated as qualifying assets for thrift institutions.      
Moreover, two REMICs that are part of a tiered structure will be treated as one 
REMIC for purposes of determining the percentage of assets of each REMIC that   
constitutes qualifying assets for thrift institution purposes. It is expected   
that at least 95% of the assets of any Series REMIC will be qualifying assets   
for thrift institutions throughout the REMIC's life. The amount of a Residual   
Certificate treated as a qualifying asset for thrift institutions, however,     
cannot exceed the holder's adjusted basis in that Residual Certificate.         

       Generally, gain or loss arising from the sale or exchange of Residual
Certificates held by certain financial institutions will give rise to ordinary  
income or loss, regardless of the length of the holding period for the Residual 
Certificates. Those financial institutions include banks, mutual savings banks, 
cooperative banks, domestic building and loan institutions, savings and loan    
institutions, and similar institutions. See "Federal Income Tax Consequences -- 
REMIC Certificates -- Disposition of Residual Certificates" in this prospectus. 

Disposition of Residual Certificates                          

 A Residual Certificateholder will recognize gain or loss on the
disposition of his Residual Certificate equal to the difference between the     
amount realized -- or the fair market value of any property -- received and his 
adjusted basis in the Residual Certificate. If the holder has held the Residual 
Certificate for more than 12 months, such gain or loss generally will be        
characterized as long-term capital gain or loss. In the case of banks, thrifts, 
and certain other financial institutions, however, gain or loss on the          
disposition of a Residual Certificate will be treated as ordinary gain or loss, 
regardless of the length of the holding period. See "Federal Income Tax         
Consequences -- REMIC Certificates -- Special Considerations for Certain Types  
of Investors" in this prospectus.                                               

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        A special version of the wash sale rules will apply to dispositions of
Residual Certificates. Under that version, losses on dispositions of Residual   
Certificates generally will be disallowed where, within six months before or    
after the disposition, the seller of such a certificate acquires any residual   
interest in a REMIC or any interest in a taxable mortgage pool that is          
economically comparable to a Residual Certificate. Regulations providing for    
appropriate exceptions to the application of the wash sale rules have been      
authorized, but have not yet been promulgated.                                  

       A holder of a Residual Certificate that recognizes a loss on the sale
or exchange of such certificate that for federal income purposes is in excess of
certain thresholds should consult a tax advisors as to the need to file IRS Form
8886 (disclosing certain potential tax shelters) on its federal income tax      
return.                                                                         

Liquidation of the REMIC                                      

       A REMIC may liquidate without the imposition of entity-level tax only
in a qualified liquidation. A liquidation is considered "qualified liquidation" 
under Section 860F of the Code if the REMIC (a) adopts a plan of complete       
liquidation, (b) sells all of its non-cash assets within 90 days of the date on 
which it adopts the plan, and (c) distributes in liquidation all sale proceeds  
plus its cash (other than amounts retained to meet claims against it) to        
securityholders within the 90-day period. Furthermore, a REMIC will be required 
to attach its adopted plan of complete liquidation to its final federal tax     
return.                                                                         

     Treatment by the REMIC of Original Issue Discount, Market Discount,
and Amortizable Premium                                       

         Original Issue Discount. Generally, the REMIC's deductions for original
issue discount expense on its REMIC regular certificates will be determined in  
the same manner as for determining the original issue discount income of the    
holders of such certificates, as described in "Federal Income Tax Consequences  
-- REMIC Certificates -- Original Issue Discount" in this prospectus, without   
regard to the de minimis rule described therein.                                

         Market Discount. In general, the REMIC will have market discount income
with respect to its qualified mortgages if the basis of the REMIC in such       
mortgages is less than the adjusted issue prices of such mortgages. The REMIC's 
aggregate initial basis in its qualified mortgages, and any other assets        
transferred to the REMIC on the startup day, equals the aggregate of the issue  
prices of the regular and residual interests in the REMIC. That basis is        
allocated among the REMIC's qualified mortgages based on their relative fair    
market values. Any market discount that accrues on the REMIC's qualified        
mortgages will be recognized currently as an item of REMIC ordinary income. The 
amount of market discount income to be recognized in any period is determined in
a manner generally similar to that used in the determination of original issue  
discount, as if the qualified mortgages had been issued (a) on the date they    
were acquired by the REMIC and (b) for a price equal to the REMIC's initial     
basis in the qualified mortgages. The Pricing Prepayment Assumptions are used to
compute the yield to maturity of the REMIC's qualified mortgages.               

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Premium. Generally, if the basis of the REMIC in its qualified
mortgages exceeds the unpaid principal balances of those mortgages the REMIC    
will be considered to have acquired such mortgages at a premium equal to the    
amount of such excess. As stated above, the REMIC's initial basis in its        
qualified mortgages equals the aggregate of the issue prices of the regular and 
residual interests in the REMIC. As described under "Federal Income Tax         
Consequences -- REMIC Certificates-Amortizable Premium," a REMIC that holds a   
qualified mortgage as a capital asset generally may elect under Code Section 171
to amortize premium on such mortgage under a constant interest method, to the   
extent such mortgages were originated, or treated as originated, after September
27, 1985. The legislative history to the 1986 Act indicates that, while the     
deduction for amortization of premium will not be subject to the limitations on 
miscellaneous itemized deductions of individuals, it will be treated as interest
expense for purposes of other provisions in the 1986 Act limiting the           
deductibility of interest for non-corporate taxpayers. Because substantially all
of the borrowers on the mortgage loans that comprise or underlie the qualified  
mortgages are expected to be individuals, Section 171 will not be available for 
the amortization of premium on such mortgage loans to the extent they were      
originated on or prior to September 27, 1985. Such premium may be amortizable   
under more general provisions and principles of federal income tax law in       
accordance with a reasonable method regularly employed by the holder of such    
mortgage loans. The allocation of such premium pro rata among principal payments
should be considered a reasonable method; however, the IRS may argue that such  
premium should be allocated in a different manner, such as allocating such      
premium entirely to the final payment of principal.                             

REMIC-Level Taxes                                             

  Income from certain transactions by the REMIC, called prohibited
transactions, will not be part of the calculation of the REMIC's income or      
loss that is includable in the federal income tax returns of Residual           
Certificateholders, but rather will be taxed directly to the REMIC at a 100%    
rate. In addition, net income from one prohibited transaction may not be offset 
by losses from other prohibited transactions. Prohibited transactions generally 
include: (a) the disposition of qualified mortgages other than pursuant to      
(i) the repurchase of a defective mortgage, (ii) the substitution for a         
defective mortgage within two years of the closing date, (iii) a substitution   
for any qualified mortgage within three months of the closing date, (iv) the    
foreclosure, default, or imminent default of a qualified mortgage, (v) the      
bankruptcy or insolvency of the REMIC, (vi) the sale of an adjustable rate      
mortgage loan the interest rate on which is convertible to a fixed rate of      
interest upon such conversion for an amount equal to the mortgage loan's current
principal balance plus accrued but unpaid interest (and provided that certain   
other requirements are met) or (vii) a qualified liquidation of the REMIC;      
(b) the receipt of income from assets that are not the type of mortgages or     
investments that the REMIC is permitted to hold; (c) the receipt of compensation
for services by the REMIC; and (d) the receipt of gain from disposition of      
cash-flow investments other than pursuant to a qualified liquidation of the     
REMIC. A disposition of a qualified mortgage or cash flow investment will not   
give rise to a prohibited transaction, however, if the disposition was          
(a) required to prevent default on a regular interest resulting from a default  
on one or more of the REMIC's qualified mortgages or (b) made to facilitate a   
clean-up call. The REMIC Regulations define a clean-up call as the redemption of
a class of regular interests when, by reason of prior payments with respect to  
those interests, the administrative costs associated with servicing the class   
outweigh the benefits of maintaining the class. Under those regulations, the    
redemption of a class of regular interests with an outstanding principal        

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balance of no more than 10% of the original principal balance qualifies as a    
clean-up call. The REMIC Regulations also provide that the modification of a    
mortgage loan generally will not be treated as a disposition of that loan if it 
is occasioned by a default or a reasonably foreseeable default, an assumption of
the mortgage loan, the waiver of a due-on-sale or encumbrance clause, or the    
conversion of an interest rate by a borrower pursuant to the terms of a         
convertible adjustable rate mortgage loan.                                      

    In addition, a REMIC generally will be taxed at a 100% rate on any
contribution to the REMIC after the closing date unless such contribution is a  
cash contribution that (a) takes place within the three-month period beginning  
on the closing date, (b) is made to facilitate a clean-up call or a qualified   
liquidation, (c) is a payment in the nature of a guarantee, (d) constitutes a   
contribution by the holder of the Residual Certificates in the REMIC to a       
qualified reserve fund, or (e) is otherwise permitted by Treasury regulations   
yet to be issued. The structure and operation of each Series REMIC generally    
will be designed to avoid the imposition of both the 100% tax on contributions  
and the 100% tax on prohibited transactions.                                    

 To the extent that a REMIC derives certain types of income from
foreclosure property -- generally, income relating to dealer activities of the  
REMIC, it will be taxed on such income at the highest corporate income tax rate.
It is not anticipated that any Series REMIC will receive significant amounts of 
such income, although the relevant law is unclear.                              

       The organizational documents governing the REMIC regular certificates
and Residual Certificates will be designed to prevent the imposition of the     
foregoing taxes on the related Series REMIC in any material amounts. If any of  
the foregoing taxes is imposed on a Series REMIC, the trustee will seek to place
the burden thereof on the person whose action or inaction gave rise to such     
taxes. To the extent that the trustee is unsuccessful in doing so, the burden of
such taxes will be borne by any outstanding subordinated class of certificates  
before it is borne by a more senior class of certificates.                      

REMIC Qualification                                           

   The trust underlying a series, or one or more designated pools of
assets held by the trust, will qualify under the Code as a REMIC in which the   
REMIC regular certificates and Residual Certificates will constitute the        
"regular interests" and "residual interests," respectively, if a REMIC election 
is in effect and certain tests concerning (a) the composition of the REMIC's    
assets and (b) the nature of the securityholders' interests in the REMIC are met
on a continuing basis.                                                          

Asset Composition                                             

         In order for a trust, or one or more designated pools of assets held by
a trust, to be eligible for REMIC status, substantially all of the assets of the
trust must consist of "qualified mortgages" and "permitted investments" as of   
the close of the third month beginning after the closing date and at all times  
thereafter (the "Asset Qualification Test"). A REMIC will be deemed to satisfy  
the Asset Qualification Test if no more than a de minimis amount of its assets  
(i.e., assets with an aggregate adjusted basis that is less than 1% of the      
aggregate adjusted basis of all the REMIC's assets) are assets other than       
qualified mortgages and permitted investments.                                  

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A qualified mortgage is any obligation that is principally secured by an        
interest in real property, including a regular interest in another REMIC, that  
(i) is transferred to the REMIC on the closing date, (ii) purchased by the      
REMIC pursuant to a fixed price contract within a three-month period or         
(iii) represents an increase in the principal amount of the obligation under the
terms of such obligation described in (i) or (ii) above if such increase is     
attributable to an advance made to the obligor pursuant to the original terms of
the obligation, occurs after the closing date of the REMIC and is purchased by  
the REMIC pursuant to a fixed price contract in effect on the closing date.     
Under the REMIC regulations, a qualified mortgage includes any obligation       
secured by manufactured housing that qualifies as a single family residence     
under Section 25(e)(10) of the Code, which requires that the housing (a) be used
as a single family residence, (b) have a minimum of 400 square feet of living   
space and a minimum width in excess of 102 inches, and (c) be customarily used  
at a fixed location. A qualified mortgage also includes a qualified replacement 
mortgage, which is any property that would have been treated as a qualified     
mortgage if it were transferred to the REMIC on the closing date and that is    
received either in exchange for a defective mortgage within a two-year period   
beginning on the closing date or in exchange for any qualified mortgage within a
three-month period beginning on the closing date. The trust assets of each      
Series REMIC will be treated as qualified mortgages.                            

        Permitted investments include cash flow investments, qualified reserve
assets, and foreclosure property. Cash flow investments are investments of      
amounts received with respect to qualified mortgages for a temporary period not 
to exceed thirteen months before distribution to holders of regular or residual 
interests in the REMIC. Qualified reserve assets are intangible investment      
assets other than REMIC residual interests that are part of a reasonably        
required reserve (a "Qualified Reserve Fund") maintained by the REMIC (i) to    
provide for full payment of expenses of the REMIC or amounts due on the regular 
interests in the event of defaults or delinquencies on qualified mortgages,     
lower than expected returns on cash-flow investments, interest shortfalls on    
qualified mortgages caused by prepayments of those mortgages or unanticipated   
losses or expenses incurred by the REMIC or (ii) to provide a source of funding 
for the purchase of additional mortgage loans pursuant to a qualifying fixed    
price or additional draws made by mortgagors under the terms of loans held by   
the related REMIC. The aggregate fair market of any such reserve cannot exceed  
50% of the aggregate fair market value of all assets of the REMIC on the closing
date. A Qualified Reserve Fund will be disqualified if more than 30% of the     
gross income from the assets in such fund for the year is derived from the sale 
of property held for less than three months, unless such sale was required to   
prevent a default on the regular interests caused by a default on one or more   
qualified mortgages. To the extent that the amount in a Qualified Reserve Fund  
exceeds a reasonably required amount, it must be reduced "promptly and          
appropriately." Foreclosure property generally is property acquired by the REMIC
in connection with the default or imminent default of a qualified mortgage.     
Property so acquired by the REMIC, however, will not be qualifying foreclosure  
property if the foreclosure was anticipated at the time that the related        
qualified mortgage was transferred to the REMIC. Furthermore, foreclosure       
property may not be held beyond the end of the third taxable year beginning     
after foreclosure occurs, unless it is established to the satisfaction of the   
Secretary of the Treasury that an extension of the three-year period is         
necessary for the orderly liquidation of the foreclosure property. The Secretary
of the Treasury may grant one or more extensions, but any such extension shall  
not extend the grace period beyond the end of the sixth taxable year beginning  
after the date such foreclosure property is acquired.                           

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Investors' Interests                                          

      In addition to the requirements of the Asset Qualification Test, the
various interests in a REMIC also must meet certain requirements. All of the    
interests in a REMIC must be issued on the closing date, or within a specified  
10-day period and belong to either of the following: (a) one or more classes of 
regular interests or (b) a single class of residual interests on which          
distributions are made pro rata. For each series REMIC with respect to which    
REMIC certificates are issued, the REMIC regular certificates will constitute   
one or more classes of regular interests in that REMIC, and the Residual        
Certificates will constitute the single class of residual interests in that     
REMIC.                                                                          

If the interest payable on any REMIC regular interest is      
disproportionately high relative to the specified principal amount of the       
interest, that interest may be treated, in whole or in part, as a second        
residual interest, which could result in the disqualification of the REMIC.     
Under the REMIC Regulations, interest payments, or similar amounts, are         
considered disproportionately high if the issue price of the REMIC regular      
interest exceeds 125% of its specified principal amount. Under the REMIC        
Regulations, however, interest payable at a disproportionately high rate will   
not cause a REMIC regular certificate to be recharacterized as a residual       
interest if interest payments on the certificate consist of a specified portion 
of the interest payments on qualified mortgages and such portion does not vary  
during the period that the certificate is outstanding. None of the REMIC regular
certificates will have an issue price that exceeds 125% of their respective     
specified principal amounts unless interest payments on those certificates      
consist of a specified nonvarying portion of the interest payments on one or    
more of the REMIC's qualified mortgages.                                        

         A REMIC interest qualifies as a regular interest if (a) it is issued on
the startup day with fixed terms, (b) it is designated as a regular interest,   
(c) it entitles its holder to a specified principal amount, and (d) if it pays  
interest, such interest either (i) constitutes a specified nonvarying portion of
the interest payable on one or more of the REMIC's qualified mortgages, (ii) is 
payable at a fixed rate with respect to the principal amount of the regular     
interest, or (iii) to the extent permitted under the REMIC Regulations, is      
payable at a variable rate with respect to such principal amount. Pursuant to   
the REMIC Regulations, the following rates are permissible variable rates for   
REMIC regular interests: (A) a qualified floating rate set at a current value as
described in "Federal Income Tax Consequences -- REMIC Certificates -- Variable 
Rate Certificates" in this prospectus, without regard to the rules in the OID   
Regulations limiting the use of Caps, Floors, and Governors with respect to such
a rate, (B) a rate equal to the highest, lowest, or average of two or more      
qualified floating rates -- e.g., a rate based on the average cost of funds of  
one or more financial institutions, or (C) a rate equal to the weighted average 
of the interest rates on some or all of the qualified mortgages held by the     
REMIC; provided, however, that the qualified mortgages taken into account in    
determining the weighted average rate bear interest at a fixed rate or a rate   
that would be a permissible variable rate for a REMIC regular interest as       
described in this sentence. Under the REMIC Regulations, the presence of a      
ceiling or Floor on the interest payable on a variable rate interest will not   
prevent such interest from qualifying as a regular interest. In addition, a     
qualifying variable rate may be expressed as a multiple of, or a constant number
of basis points more or less than, one of the permissible types of variable     
rates described above. Finally, a limitation on the amount of interest to be    
paid on a variable rate regular interest based on the total amount available for
distribution is permissible,                                                    

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provided that it is not designed to avoid the restrictions on qualifying        
variable rates. The REMIC Regulations also provide that the specified principal 
amount of a REMIC regular interest may be zero if the interest associated with  
such regular interest constitutes a specified nonvarying portion of the interest
on one or more of the REMIC's qualified mortgages.                              

         The Code requires that certain arrangements be made with respect to all
REMICs. Those arrangements, which are intended to prevent acquisitions of REMIC 
residual interests by certain organizations that are not subject to federal     
income tax, are described in "Federal Income Tax Consequences -- REMIC          
Certificates -- Taxation of Residual Certificateholders -- Ownership of Residual
Interests by Disqualified Organizations" in this prospectus. Series REMICs will 
be structured to provide for such arrangements.                                 

Consequences of Disqualification                              

  If a Series REMIC fails to comply with one or more of the Code's
ongoing requirements for REMIC status during any taxable year, the Code provides
that its REMIC status may be lost for that year and thereafter. If REMIC status 
is lost, the treatment of the former REMIC and the interests therein for federal
income tax purposes is uncertain. The former REMIC might be entitled to         
treatment as a grantor trust under Subpart E, Part 1 of Subchapter J of the     
Code, in which case no entity-level tax would be imposed on the former REMIC.   
Alternatively, the REMIC regular certificates may continue to be treated as debt
instruments for federal income tax purposes, but the arrangement could be       
treated as a Taxable Mortgage Pool, as described in "Federal Income Tax         
Consequences -- REMIC Certificates -- Taxable Mortgage Pools" in this           
prospectus. If a Series REMIC were treated as a Taxable Mortgage Pool, any      
residual income of the REMIC -- i.e., interest and discount income from the     
mortgage loans less interest and original issue discount expense allocable to   
the REMIC regular certificates and any administrative expenses of the REMIC --  
would be subject to corporate income tax at the Taxable Mortgage Pool level. On 
the other hand, the arrangement could be treated under Treasury regulations as a
separate association taxable as a corporation and the REMIC regular certificates
would be treated as stock interests therein, rather than debt instruments. In   
that case, none of the payments made with respect to the REMIC regular          
certificates would be deductible by the former REMIC. In the latter two cases,  
the Residual Certificates also would be treated as stock interests in such      
Taxable Mortgage Pool or association, respectively. The Code authorizes the     
Treasury to issue regulations that address situations where a failure to meet   
the requirements for REMIC status occurs inadvertently and in good faith. Such  
regulations have not yet been issued. The conference report related the 1986 Act
indicates that disqualification relief may be accompanied by sanctions, such as 
the imposition of a corporate tax on all or a portion of the REMIC's income for 
the period of time in which the requirements for REMIC status are not satisfied.

Taxable Mortgage Pools                                        

  Corporate income tax can be imposed on the net income of certain
entities issuing non-REMIC debt obligations secured by real estate mortgages    
("Taxable Mortgage Pools"). Any entity other than a REMIC or a REIT will be     
considered to be a Taxable Mortgage Pool if (a) substantially all of the assets 
of the entity consist of debt obligations and more than 50% of such obligations 
consist of real estate mortgages, (b) such entity is the borrower under debt    

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obligations with two or more maturities, and (c) under the terms of the debt    
obligations on which the entity is the borrower, payments on such obligations   
bear a relationship to payment on the obligations held by the entity.           
Furthermore, a group of assets held by an entity can be treated as a separate   
Taxable Mortgage Pool if the assets are expected to produce significant cash    
flow that will support one or more of the entity's issues of debt obligations.  
FMIC generally will structure offerings of Debt Securities to avoid the         
application of the Taxable Mortgage Pool rules unless otherwise disclosed in the
related prospectus supplement.                                                  

Taxation of Certain Foreign Holders of REMIC Certificates     

REMIC Regular Certificates. Interest, including original issue
discount, paid on a REMIC regular certificate to a nonresident alien individual,
foreign corporation, or other non-United States person (a "foreign person")     
generally will be treated as "portfolio interest." and, therefore, will not be  
subject to any United States withholding tax, provided that (a) such interest is
not effectively connected with a trade or business in the United States of the  
certificateholder, (b) the trustee or other person who would otherwise be       
required to withhold tax is provided with appropriate certification on Form     
W-8BEN that the beneficial owner of the certificate is a foreign person         
("foreign person certification"), (c) the foreign person is not a 10%           
shareholder within the meaning of Section 871(h)(3)(B) of the Code or a         
controlled foreign corporation as described under Section 881(c)(3)(C) of the   
Code, and (d) the foreign person is not a bank receiving interest on a loan made
in the ordinary course of business. If the certificateholder fails to meet the  
conditions listed above, interest, including original issue discount, paid on   
the holder's certificates may be subject to either a 30% withholding tax or     
backup withholding. The 30% withholding tax may be subject to a reduction or    
elimination under an applicable tax treaty if you certify you are the           
beneficiary of such a tax treaty on Form W-8BEN. Further, the withholding tax   
may not apply if your interest, including original issue discount, is           
effectively connected with your conduct of a trade or business in the United    
States and if you certify this on Form W-8ECI. See "Federal Income Tax          
Consequences -- REMIC Certificates -- Backup Withholding" in this prospectus.   

        Residual Certificates. Amounts paid to Residual Certificateholders who
are foreign persons are treated as interest for purposes of the 30%, or lower   
treaty rate, United States withholding tax. Under Treasury regulations,         
non-excess inclusion income received by Residual Certificateholders who are     
foreign persons generally qualifies as "portfolio interest" exempt from the 30% 
withholding tax only to the extent that (a) the assets of the Series REMIC are  
mortgage certificates that are issued in registered form, (b) the mortgage loans
underlying the mortgage certificates were originated after July 18, 1984 and (c)
the certificateholder meets the requirements listed under "Federal Income Tax   
Consequences -- REMIC Certificates -- Taxation of Certain Foreign Holders of    
REMIC Certificates -- REMIC Regular Certificates" in this prospectus. Because   
mortgage loans are not issued in registered form, amounts received by Residual  
Certificateholders who are foreign persons will not be exempt from the 30%      
withholding tax to the extent such amounts relate to mortgage loans held        
directly, rather than indirectly through mortgage certificates, by the related  
REMIC. If the portfolio interest exemption is unavailable, such amounts         
generally will be subject to United States withholding tax when paid or         
otherwise distributed, or when the Residual Certificate is disposed of, under   
rules similar to those for withholding on debt instruments that have original   
issue discount. However, the Code grants the Treasury authority to issue        
regulations requiring that those                                                

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amounts be taken into account earlier than otherwise provided where necessary to
prevent avoidance of tax -- i.e., where the Residual Certificates, as a class,  
do not have significant value. Further, a Residual Certificateholder will not be
entitled to any exemption from the 30% withholding tax or a reduced treaty rate 
on excess inclusion income.                                                     

        Under the REMIC Regulations, a transfer of a Residual Certificate that
has "tax avoidance potential" will be disregarded for federal income tax        
purposes if the transferee is a foreign person. A Residual Certificate is deemed
to have tax avoidance potential unless, at the time of the transfer, the        
transferor reasonably expects that, for each accrual of excess inclusion, the   
REMIC will distribute to the transferee an amount that will equal at least 30%  
of the excess inclusion, and that each such amount will be distributed no later 
than the close of the calendar year following the calendar year of accrual (the 
"30% Test"). A transferor of a Residual Certificate to a foreign person will be 
presumed to have had a reasonable expectation that the Residual Certificate     
satisfies the 30% Test if that test would be satisfied for all mortgage loan    
prepayment rates between 50% and 200% of the Pricing Prepayment Assumption. See 
"Federal Income Tax Consequences -- REMIC Certificates -- Original Issue        
Discount," in this prospectus. If a foreign person transfers a Residual         
Certificate to a United States person and the transfer, if respected, would     
permit avoidance of withholding tax on accrued excess inclusion income, the     
transfer will be disregarded for federal income tax purposes and distributions  
with respect to the Residual Certificate will continue to be subject to 30%     
withholding as though the foreign person still owned the Residual Certificate.  
Investors who are foreign persons should consult their own tax advisors         
regarding the specific tax consequences to them of owning and disposing of a    
Residual Certificate. Any foreign investor that invokes the protection of an    
income tax treaty with respect to United States withholding tax generally will  
be required to obtain a taxpayer identification number from the IRS in advance  
and provide verification that such investor is entitled to the protection of the
relevant income tax treaty. Foreign tax-exempt investors generally will be      
required to provide verification of their tax-exempt status. Foreign investors  
are urged to consult with their tax advisors with respect to these new          
withholding rules.                                                              

Backup Withholding                                            

     Under federal income tax law, a certificateholder may be subject to
"backup withholding" under certain circumstances. Backup withholding may apply  
to a certificateholder who is a United States person if the certificateholder,  
among other things, (a) fails to furnish his social certificate number or other 
taxpayer identification number ("TIN") to the trustee, (b) furnishes the        
trustee an incorrect TIN, (c) fails to report properly interest and dividends,  
or (d) under certain circumstances, fails to provide the trustee or the         
certificateholder's certificates broker with a certified statement, signed under
penalties of perjury, that the TIN provided to the trustee is correct and that  
the certificateholder is not subject to backup withholding. Backup withholding  
may apply, under certain circumstances, to a certificateholder who is a foreign 
person if the certificateholder fails to provide the trustee or the             
certificateholder's certificates broker with a foreign person certification.    
Backup withholding applies to "reportable payments," which include interest     
payments and principal payments to the extent of accrued original issue         
discount, as well as distributions of proceeds from the sale of REMIC regular   
certificates or REMIC Residual Certificates. Backup withholding, however, does  
not apply to payments on a certificate made to certain exempt recipients, such  
as tax-exempt organizations, and to certain foreign persons. You should consult 
your tax advisors for additional information concerning the                     

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potential application of backup withholding to payments received by you with    
respect to a certificate.                                                       

Reporting and Tax Administration                              

       REMIC Regular Certificates. Reports will be made at least annually to
holders of record of REMIC regular certificates, other than those with respect  
to whom reporting is not required, and to the IRS as may be required by statute,
regulation, or administrative ruling with respect to (a) interest paid or       
accrued on the certificates, (b) original issue discount, if any, accrued on the
certificates, and (c) information necessary to compute the accrual of any market
discount or the amortization of any premium on the certificates.                

         Residual Certificates. For purposes of federal income tax reporting and
administration, a Series REMIC generally will be treated as a partnership, and  
the related Residual Certificateholders as its partners. A Series REMIC will    
file an annual return on Form 1066 and will be responsible for providing        
information to Residual Certificateholders sufficient to enable them to report  
properly their shares of the REMIC's taxable income or loss, although it is     
anticipated that such information actually will be supplied by the trustee. The 
REMIC Regulations require reports to be made by a REMIC to its Residual         
Certificateholders each calendar quarter in order to permit such securityholders
to compute their taxable income accurately. A person that holds a Residual      
Certificate as a nominee for another person is required to furnish those        
quarterly reports to the person for whom it is a nominee within 30 days of      
receiving such reports. A REMIC is required to file all such quarterly reports  
for a taxable year with the IRS as an attachment to the REMIC's income tax      
return for that year. As required by the Code, a Series REMIC's taxable year    
will be the calendar year.                                                      

         Residual Certificateholders should be aware that their responsibilities
as holders of the residual interest in a REMIC, including the duty to account   
for their shares of the REMIC's income or loss on their returns, continue for   
the life of the REMIC, even after the principal and interest on their Residual  
Certificates have been paid in full.                                            

    A Residual Certificateholder will be designated as the REMIC's tax
matters person ("TMP"). The TMP generally has responsibility for overseeing and 
providing notice to the other Residual Certificateholders of certain            
administrative and judicial proceedings regarding the REMIC's tax affairs,      
although other holders of the Residual Certificates of the same series would be 
able to participate in such proceedings in appropriate circumstances. FMIC, or  
its affiliate will acquire a portion of the residual interest in each Series    
REMIC in order to permit it to be designated as TMP for the REMIC or will obtain
from the Residual Certificateholders an irrevocable appointment to perform the  
functions of the REMIC's TMP and will prepare and file the REMIC's federal and  
state income tax and information returns.                                       

         Treasury regulations provide that a holder of a Residual Certificate is
not required to treat items on its return consistently with their treatment on  
the REMIC's return if a holder owns 100% of the Residual Certificates for the   
entire calendar year. Otherwise, each holder of a Residual Certificate is       
required to treat items on its returns consistently with their treatment on the 
REMIC's return, unless the holder of a Residual Certificate either files a      
statement identifying the inconsistency or establishes that the inconsistency   
resulted from incorrect                                                         

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information received from the REMIC. The IRS may assess a deficiency resulting  
from a failure to comply with the consistency requirement without instituting an
administrative proceeding at the REMIC level. A Series REMIC typically will not 
register as a tax shelter pursuant to Code Section 6111 because it generally    
will not have a net loss for any of the first five taxable years of its         
existence. Any person that holds a Residual Certificate as a nominee for another
person may be required to furnish the REMIC, in a manner to be provided in      
Treasury regulations, with the name and address of such person and other        
specified information.                                                          

Grantor Trusts                                                                  

Treatment of the Trust for Federal Income Tax Purposes        

   With respect to each series of Grantor Trust Securities, assuming
compliance with all applicable provisions of the Code, the related Grantor Trust
(the "Grantor Trust") will be classified as a grantor trust under Subpart E,    
Part I of subchapter J of the Code and not as an association taxable as a       
corporation. For federal income tax purposes, the owner of a Grantor Trust      
Security will be treated as the beneficial owner of an appropriate portion of   
the principal and interest payments, according to the characteristics of the    
security in question, to be received on the trust assets assigned to your trust 
for federal income tax purposes.                                                

Tax Treatment of the Grantor Trust Security                   

        The types of Grantor Trust Securities offered in a series may include:

 o   Grantor Trust Securities evidencing ownership interests only in the
  interest payments on the trust assets, net of certain fees, ("IO
Securities")                                                  

o   Grantor Trust Securities evidencing ownership interests in the    
    principal, but not the interest, payments on the trust assets ("PO
Securities")                                                  

  o   Grantor Trust Securities evidencing ownership interests in differing
         percentages of both the interest payments and the principal payments on
the trust assets ("Ratio Securities")                         

   o   Grantor Trust Securities evidencing ownership in equal percentages of
        the principal and interest payments on the trust assets ("Pass-Through
Securities").                                                 

         The federal income tax treatment of Grantor Trust Securities other than
Pass-Through Securities ("Strip Securities") will be determined in part by      
Section 1286 of the Code. Moreover, where there is a retained interest with     
respect to the trust assets underlying a Series of Grantor Trust Securities or  
where the servicing fees are in excess of reasonable servicing compensation, the
transaction will be subject to the application of the "stripped bond" and       
"stripped coupon" rules of the Code, as described below.                        

        Little administrative guidance has been issued under that Section and,
thus, many aspects of its operation are unclear, particularly the interaction   
between that Section and the rules pertaining to discount and premium. Hence,   
significant uncertainty exists with respect to the federal income tax treatment 
of the Strip Securities, and potential investors should consult their own tax   
advisors concerning such treatment.                                             

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         Several Code Sections provide beneficial treatment to certain taxpayers
that invest in certain types of mortgage loans. For purposes of those Code      
Sections, Pass-Through Securities will be characterized with reference to the   
trust assets, but it is not clear whether the Strip Securities will be so       
characterized. The IRS could take the position that the character of the trust  
assets is not attributable to the Strip Securities for purposes of those        
Sections. However, because the Strip Securities represent sole ownership rights 
in the principal and interest payments on the trust assets, the Strip           
Securities, like the Pass-Through Securities, should be considered to represent 
"real estate assets" within the meaning of Section 856(c)(4)(A) of the Code, and
"loans secured by an interest in real property" within the meaning of Section   
7701(a)(19)(C)(v) of the Code, and interest income attributable to the          
securities should be considered to represent "interest on obligations secured by
mortgages on real property" within the meaning of Section 856(c)(3)(B) of the   
Code, to the extent that the trust assets would qualify for such treatment.     

    The assets constituting certain Grantor Trusts may include Buydown
Loans. The characterization of an investment in Buydown Loans will depend upon  
the precise terms of the related buydown agreement, but to the extent that the  
Buydown Loans are secured by a bank account or other personal property, they may
not be treated in their entirety as assets described in the preceding paragraph.
No directly applicable precedents exist with respect to the federal income tax  
treatment or the characterization of investments in Buydown Loans. Accordingly, 
holders of Grantor Trust Securities should consult their own tax advisors with  
respect to the characterization of investments in Grantor Trust Securities      
representing an interest in a Grantor Trust that includes Buydown Loans.        

        One or more classes of Grantor Trust Securities may be subordinated to
one or more other classes of Grantor Trust Securities of the same series. In    
general, such subordination should not affect the federal income tax treatment  
of either the subordinated or senior Grantor Trust Securities. However, holders 
of the subordinated Grantor Trust Securities will be allocated losses that      
otherwise would have been borne by the holders of the more senior Grantor Trust 
Securities. Holders of the subordinated Grantor Trust Securities should be able 
to recognize any such losses no later than the taxable year in which they become
Realized Losses. Employee benefit plans subject to ERISA or similar law should  
consult their own tax advisors before purchasing any Grantor Trust Security. See
"ERISA Considerations" in this prospectus and in the related prospectus         
supplement.                                                                     

Treatment of Pass-Through Securities                          

       The holder of a Pass-Through Security ("Pass-Through Securityholder")
generally will be treated as owning a pro rata undivided interest in each of the
trust assets. Accordingly, each Pass-Through Securityholder will be required to 
include in income its pro rata share of the entire income from the trust assets,
including interest and discount income, if any. Such securityholder generally   
will be able to deduct from its income its pro rata share of the administrative 
fees and expenses incurred with respect to the trust assets, provided that these
fees and expenses represent reasonable compensation for the services rendered.  
An individual, trust, or estate that holds a Pass-Through Security directly or  
through a pass-through entity will be entitled to deduct such fees and expenses 
under Section 212 of the Code only to the extent that the amount of the fees and
expenses, when combined with its other miscellaneous itemized deductions for the
taxable year in question, exceeds 2% of its adjusted gross income. In addition, 
Code Section 68 provides                                                        

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that the amount of itemized deductions otherwise allowable for the taxable year 
for an individual whose adjusted gross income exceeds the Applicable Amount will
be reduced by the lesser of (i) 3% of the excess, if any, of adjusted gross     
income over the Applicable Amount or (ii) 80% of the amount of itemized         
deductions otherwise allowable for such year. These limitations will be phased  
out and eliminated by 2010.                                                     

       Non-corporate holders of Pass-Through Securities also should be aware
that miscellaneous itemized deductions are not deductible for purposes of the   
AMT. Each Pass-Through Securityholder generally will determine its net income or
loss with respect to the Grantor Trust in accordance with its own method of     
accounting, although income arising from original issue discount must be taken  
into account under the accrual method even though the securityholder otherwise  
would use the cash receipts and disbursements method.                           

The Code provisions concerning original issue discount, market
discount, and amortizable premium will apply to the trust assets. The rules     
regarding discount and premium that are applicable to Grantor Trust Securities  
generally are the same as those that apply to REMIC regular certificates. See   
"Federal Income Tax Consequences -- REMIC Certificates -- Original Issue        
Discount," "-- Variable Rate Certificates," "-- Market Discount" and "--        
Amortizable Premium" in this prospectus.                                        

       For instruments to which it applies, Code Section 1272(a)(6) requires
the use of an income tax accounting methodology that utilizes                   

o   a single constant yield to maturity, and                          

o   the Pricing Prepayment Assumptions.                               

       As in the case of REMIC regular certificates, Code Section 1272(a)(6)
applies to Grantor Trust Securities, but no regulations have been issued        
describing the application of that Section to such securities. Nonetheless,     
unless and until administrative guidance to the contrary is released, the Tax   
Administrator intends to account for a class of Grantor Trust Securities in the 
same manner as it would account for a class of REMIC regular certificates with  
the same terms. There can be no assurance, however, that the IRS ultimately will
sanction the Tax Administrator's position.                                      

      It is anticipated that most or all of the trust assets securing your
series will be subject to the original issue discount, market discount, and     
amortizable premium rules. Although most mortgage loans nominally are issued at 
their original principal amounts, original issue discount could arise from the  
payment of points or certain other origination charges by the borrower if the   
discount attributable to such payments exceeds the de minimis amount. If the    
Grantor Trust contains trust assets purchased for a price below their           
outstanding principal amount, Pass-Through securityholders generally will be    
required to take into account original issue discount not previously accrued to 
the prior holder of such trust assets. Moreover, if trust assets were purchased 
for less than their adjusted issue prices, Pass-Through Securityholders         
generally will be required to take into account market discount, unless the     
amount of such market discount is de minimis under the market discount rules.   
Finally, Pass-Through Securityholders generally may elect to amortize any       
premium paid for trust assets over their adjusted issue prices. See "Federal    

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Income Tax Consequences -- REMIC Certificates -- Original Issue Discount,"      
"--Market Discount" and "-- Amortizable Premium" in this prospectus.            

Treatment of Strip Securities                                 

Many aspects of the federal income tax treatment of the Strip 
Securities are uncertain. The discussion below describes the treatment that     
Hunton & Williams believes is appropriate, but there can be no assurance that   
the IRS will not take a contrary position. You should consult your tax advisor  
with respect to the federal income tax treatment of the Strip Securities.       

    Under Section 1286 of the Code, the separation of ownership of the
right to receive some or all of the interest payments on an obligation from     
ownership of the right to receive some or all of the principal payments on such 
obligation results in the creation of "stripped coupons" with respect to the    
separated rights to interest payments and "stripped bonds" with respect to the  
principal and any unseparated interest payments associated with that principal. 
The issuance of IO Securities or PO Securities effects a separation of the      
ownership of the interest and principal payments on some or all of the trust    
assets. Grantor Trust Securities that represent a retained interest or other    
ownership interest in a portion of the payments on the trust assets or that     
represent an ownership interest in the trust assets to the extent a party is    
paid (or retains) servicing compensation in an amount greater than reasonable   
consideration for servicing the trust assets also falls within this category. In
addition, the issuance of Ratio Securities effectively separates and reallocates
the proportionate ownership of the interest and principal payments on the trust 
assets. Therefore, Strip Securities will be subject to Section 1286. For federal
income tax accounting purposes, Section 1286 of the Code treats a stripped bond 
or a stripped coupon as a new debt instrument issued on the date that the       
stripped interest is purchased, and at a price equal to its purchase price or,  
if more than one stripped interest is purchased, the share of the purchase price
allocable to such stripped interest.                                            

 Each stripped bond or coupon generally will have original issue
discount equal to the excess of its stated redemption price at maturity -- or,  
in the case of a stripped coupon, the amount payable on the due date of such    
coupon -- over its issue price. Treasury regulations under Section 1286 of the  
Code (the "Stripping Regulations"), however, provide that the original issue    
discount on a stripped bond or stripped coupon is zero if the amount of the     
original issue discount would be de minimis under rules generally applicable to 
debt instruments. For purposes of determining whether such amount would be de   
minimis,                                                                        

    o   the number of complete years to maturity is measured from the date the
stripped bond or stripped coupon is purchased,                

     o   an aggregation approach similar to the Aggregation Rule may be applied,
and                                                           

  o   unstripped coupons may be treated as stated interest with respect to
the related bonds and, therefore, may be excluded from stated 
redemption price at maturity in appropriate circumstances.    

 In addition, the Stripping Regulations provide that, in certain
circumstances, the excess of a stripped bond's stated redemption price at       
maturity over its issue price is treated as market                              

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discount, rather than as original issue discount. See "Federal Income Tax       
Consequences -- Grantor Trusts -- Determination of Income With Respect to Strip 
Securities" in this prospectus.                                                 

        The application of Section 1286 of the Code to the Strip Securities is
not entirely clear under current law. That Section could be interpreted as      
causing any or all of the following:                                            

   o   in the case of an IO Security, each interest payment due on the trust
assets to be treated as a separate debt instrument,           

   o   in the case of a Ratio Security entitled to a disproportionately high
       share of principal, each excess principal amount -- i.e., the portion
     of each principal payment on such assets that exceeds the amount to
        which the Ratio Securityholder would have been entitled if he had held
 an undivided interest in the trust assets -- to be treated as a
separate debt instrument, and                                 

   o   in the case of a Ratio Security entitled to a disproportionately high
   share of interest, each excess interest amount to be treated as a
separate debt instrument.                                     

        In addition, Section 1286 of the Code requires the purchase price of a
Strip Security to be allocated among each of the rights to payment on the trust 
assets to which the securityholder is entitled that are treated as separate debt
instruments. Despite the foregoing, it may be appropriate to treat stripped     
coupons and stripped bonds issued to the same holder in connection with the     
same transaction as a single debt instrument, depending on the facts and        
circumstances surrounding the issuance. Facts and circumstances considered      
relevant for this purpose should include the likelihood of the debt instruments 
trading as a unit and the difficulty of allocating the purchase price of the    
unit among the individual payments. Strip Securities are designed to trade as   
whole investment units and, to the extent that the underwriter develops a       
secondary market for the Strip Securities, it anticipates that the Strip        
Securities would trade in such market as whole units. In addition, because no   
market exists for individual payments on trust assets, the proper allocation of 
the security's purchase price to each separate payment on the trust assets      
would be difficult and burdensome to determine. Based on those facts and        
circumstances, it appears that all payments of principal and interest to which  
the holder of a Strip Security is entitled should be treated as a single        
installment obligation. Although the OID Regulations do not refer directly to   
debt instruments that are governed by Section 1286 of the Code, the application 
of the OID Regulations to such instruments is consistent with the overall       
statutory and regulatory scheme. Therefore, the Tax Administrator intends to    
treat each Strip Security as a single debt instrument for federal income tax    
accounting purposes.                                                            

Determination of Income with Respect to Strip Securities      

      For purposes of determining the amount of income on a Strip Security
that accrues in any period, the rules described in this prospectus under        
"Federal Income Tax Consequences -- REMIC Certificates -- Original Issue        
Discount," "-- Variable Rate Certificates," "-- Interest Weighted Certificates  
and Non-VRDI Securities," "-- Anti-Abuse Rule," "-- Market Discount" and        
"-- Amortizable Premium" in this prospectus will apply. PO Securities, and      
certain classes of Ratio Securities, will be issued at a price that is less than
their stated principal amount and thus generally will be issued with original   
issue discount. A Strip Security that would meet the                            

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definition of an Interest Weighted Certificate or a Weighted Average Certificate
if it were a REMIC regular certificate is subject to the same tax accounting    
considerations applicable to the REMIC regular certificate to which it          
corresponds. As described in "Federal Income Tax Consequences -- REMIC          
Certificates -- Interest Weighted Certificates and Non-VRDI Certificates" in    
this prospectus, certain aspects of the tax accounting treatment of such a Strip
Security are unclear. Unless and until the IRS provides administrative guidance 
to the contrary, the Tax Administrator will account for such a Strip Security in
the manner described for the corresponding REMIC regular certificate. See       
"Federal Income Tax Consequences -- REMIC Certificates -- Interest Weighted     
Certificates and Non-VRDI Certificates" in this prospectus.                     

If a PO Security or a Ratio Security that is not considered a 
Contingent Payment Obligation (an "Ordinary Ratio Security") subsequently is    
sold, the purchaser apparently would be required to treat the difference between
the purchase price and the stated redemption price at maturity as original issue
discount. The holders of such securities generally will be required to include  
such original issue discount in income as described in "Federal Income Tax      
Consequences -- REMIC Certificates -- Original Issue Discount" in this          
prospectus. PO Securities and Ordinary Ratio Securities issued at a price less  
than their stated principal amount will be treated as issued with market        
discount rather than with original issue discount if, after the most recent     
disposition of the related Grantor Trust Security, either (a) the amount of     
original issue discount on the Grantor Trust Security is considered to be de    
minimis under the Stripping Regulations or (b) the annual stated rate of        
interest payable on the Grantor Trust Security is no more than 1% lower than the
annual stated rate of interest payable on the trust assets from which the       
Grantor Trust Security was stripped. The holders of such Grantor Trust          
Securities generally would be required to include market discount in income in  
the manner described in "Federal Income Tax Consequences -- REMIC Certificates  
-- Market Discount" in this prospectus. Some classes of Ordinary Ratio          
Securities may be issued at prices that exceed their stated principal amounts.  
Subject to the discussion of Superpremium Securities in "Federal Income Tax     
Consequences -- REMIC Certificates -- Original Issue Discount," holders of      
Ordinary Ratio Securities generally will be able to amortize that premium as    
described in "Federal Income Tax Consequences -- REMIC Securities -- Amortizable
Premium" in this prospectus.                                                    

Purchase of Complementary Classes of Strip Securities         

        Strip Securities of certain classes of the same series ("Complementary
Securities"), when held in combination, may provide an aggregate economic effect
equivalent to that of a Pass-Through Security based upon the same trust assets. 
When an investor purchases Complementary Securities, it appears that, for       
federal income tax purposes, each security should be treated separately and     
should be subject to the rules described above. The IRS could assert, however,  
that Complementary Securities held in combination should be treated as a single 
pass-through type instrument, with the result that the rules governing stripped 
bonds and stripped coupons under Section 1286 of the Code would not be applied. 
Consequently, investors who acquire Complementary Securities should consult     
their own tax advisors as to the proper treatment of such securities.           

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Possible Alternative Characterizations                        

        The IRS could assert that the Strip Securities should be characterized
for tax purposes in a manner different from that described above. For example,  
the IRS could contend that each Ratio Security whose interest rate is higher    
than the net interest rate distributed from the trust taking into account all of
the securities of that series (the "Net Series Rate") is to be treated as being 
composed of two securities: (a) a Pass-Through Security of the same principal   
amount as the Ratio Security but generating interest at the Net Series Rate; and
(b) an IO Security representing the excess of the rate on the Ratio Security    
over the Net Series Rate. Similarly, a Ratio Security whose interest rate is    
lower than the Net Series Rate could be treated as composed of a Pass-Through   
Security with an interest rate equal to the Net Series Rate and a PO Security.  
Alternatively, the IRS could interpret Section 1286 of the Code to require that 
each individual interest payment with respect to an IO Security or a Ratio      
Security be treated as a separate debt instrument for original issue discount   
purposes. The IRS also might challenge the manner in which original issue       
discount is calculated, contending that                                         

  o   the stated maturity should be used to calculate yield on the Grantor
Trust Securities,                                             

o   the Contingent Payment Regulations should not apply to the IO     
Securities, or                                                

   o   the Contingent Payment Regulations should apply to the Ordinary Ratio
Securities.                                                   

  Given the variety of alternative treatments of the Grantor Trust
Securities and the different federal income tax consequences that could result  
from each alternative, you are urged to consult your tax advisor regarding the  
proper treatment of the Grantor Trust Securities for federal income tax         
purposes.                                                                       

Limitations on Deductions With Respect to Strip Securities    

         The holder of a Strip Security will be treated as owning an interest in
each of the trust assets and will recognize an appropriate share of the income  
and expenses associated with those trust assets. Accordingly, an individual,    
trust, or estate that holds a Strip Security directly or through a pass-through 
entity will be subject to the same limitations on deductions with respect to    
such security as are applicable to holders of Pass-Through Securities. See      
"Federal Income Tax Consequences -- Grantor Trusts -- Treatment of Pass-Through 
Securities" in this prospectus.                                                 

Sale of a Grantor Trust Security                              

         A sale of a Grantor Trust Security prior to its maturity will result in
gain or loss equal to the difference, if any, between the amount received and   
the holder's adjusted basis in such security. The rules for computing the       
adjusted basis of a Grantor Trust Security are the same as in the case of a     
REMIC regular certificate. See "Federal Income Tax Consequences -- REMIC        
Certificates -- Gain or Loss on Disposition" in this prospectus. Gain or loss   
from the sale or other disposition of a Grantor Trust Security generally will be
capital gain or loss to a securityholder if the security is held as a "capital  
asset" within the meaning of Section 1221 of the Code, and will be long-term or 
short-term depending on whether the security has been held                      

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for more than one year. Ordinary income treatment, however, will apply to the   
extent mandated by the original issue discount and market discount rules or if  
the Securityholder is a financial institution described in Section 582 of the   
Code. See "Federal Income Tax Consequences -- REMIC Certificates -- Gain or Loss
on Disposition" in this prospectus.                                             

 Taxation of Certain Foreign Holders of Grantor Trust Securities

      Interest, including original issue discount, paid on a Grantor Trust
Security to a foreign person generally is treated as "portfolio interest" and,  
therefore, is not subject to any United States tax, provided that               

    o   such interest is not effectively connected with a trade or business in
the United States of the securityholder,                      

     o   the trustee or other person who would otherwise be required to withhold
tax is provided with foreign person certification,            

    o   the foreign person is not a 10% shareholder within the meaning of Code
       Section 871(h)(3)(B) or a controlled foreign corporation as described
under Code Section 881(c)(3)(C), and                          

o   the foreign person is not a bank receiving interest on a loan made
during the ordinary course of business.                       

         If the foregoing conditions are not met, interest -- including original
issue discount -- paid on a Grantor Trust Security may be subject to either a   
30% withholding tax or backup withholding.                                      

         In the case of certain series, portfolio interest treatment will not be
available for interest paid with respect to certain classes of Grantor Trust    
Securities. Interest on debt instruments issued on or before July 18, 1984 does 
not qualify as "portfolio interest" and, therefore, is subject to United States 
withholding tax at a 30% rate -- or lower treaty rate, if applicable. IO        
Securities and PO Securities generally are treated, and Ratio Securities        
generally should be treated, as having been issued when they are sold to an     
investor. In the case of Pass-Through Securities, however, the issuance date of 
the security is determined by the issuance date of the mortgage loans underlying
the trust. Thus, to the extent that the interest received by a holder of a      
Pass-Through Security is attributable to mortgage loans issued on or before July
18, 1984, such interest will be subject to the 30% withholding tax. Moreover, to
the extent that a Ratio Security is characterized as a pass-through type        
security and the underlying mortgage loans were issued on or before July 18,    
1984, interest generated by the security may be subject to the withholding tax. 
See "Federal Income Tax Consequences -- Grantor Trusts -- Possible Alternative  
Characterizations" in this prospectus. Although Code Sections 871(h)(4) and     
881(c)(4) deny portfolio interest treatment to certain types of contingent      
interest, those provisions generally apply only to interest based on the income,
profits, or property values of the debtor. Accordingly, it is not anticipated   
that those provisions will apply to deny portfolio interest to Securityholders  
who are foreign persons. However, because the scope of those provisions is not  

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entirely clear, investors who are foreign persons should consult their own tax  
advisors regarding the potential application of those provisions before         
purchasing a security.                                                          

Backup Withholding                                            

   The application of backup withholding to Grantor Trust Securities
generally is the same as in the case of REMIC regular certificates. See "Federal
Income Tax Consequences -- REMIC Certificates -- Backup Withholding" in this    
prospectus.                                                                     

Reporting and Tax Administration                              

  For purposes of reporting and tax administration, the holders of
Grantor Trust Securities will be treated in the same fashion as the holders of  
REMIC regular certificates. See "Federal Income Tax Consequences -- REMIC       
Certificates -- Reporting and Tax Administration" in this prospectus.           

Debt Securities and Partnership Trusts                                          

Classification of Debt Securities and Partnership Trusts      

With respect to each series of Partnership Securities and Debt
Securities, Hunton & Williams LLP will deliver its opinion that any Partnership 
Trust (the "Partnership Trust") will not be a taxable mortgage pool or an       
association (or publicly traded partnership) taxable as a corporation for       
federal income tax purposes. With respect to the Debt Securities, Hunton &      
Williams LLP will deliver its opinion that for federal income tax purposes the  
Debt Securities will be classified as debt. Each Debt Securityholder, by        
acceptance of a Debt Security, will agree to treat the Debt Securities as       
indebtedness for federal income tax purposes. The opinions will be based on     
various assumptions, as stated in the related prospectus supplement, including  
that the terms of the related documents will be complied with.                  

Characterization of Investments in Partnership Securities and 
Debt Securities                                               

      For federal income tax purposes, (a) Partnership Securities and Debt
Securities held by a thrift institution taxed as a domestic building and loan   
association will not constitute "loans...secured by an interest in real property
which is...residential real property" within the meaning of Code Section        
7701(a)(19)(C)(v) and (b) interest on Debt Securities held by a real estate     
investment trust will not be treated as "interest on obligations secured by     
mortgages on real property or on interests in real property" within the meaning 
of Code Section 856(c)(3)(B), and (c) Debt Securities held by a real estate     
investment trust will not constitute "real estate assets" within the meaning of 
Code Section 856(c)(4)(A), but Partnership Securities held by a real estate     
investment trust will represent a proportionate interest in the assets of the   
Partnership Trust based on the real estate investment trust's capital interest  
in the Partnership Trust.                                                       

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Taxation of Debt Securityholders                                                

Treatment of the Debt Securities as Indebtedness              

       The depositor will agree, and the securityholders will agree by their
purchase of Debt Securities, to treat the Debt Securities as debt for federal   
income tax purposes. No regulations, published rulings, or judicial decisions   
exist that discuss the characterization for federal income tax purposes of      
securities with terms substantially the same as the Debt Securities. However,   
with respect to each series of Debt Securities, Hunton & Williams LLP will      
deliver its opinion that the Debt Securities will be classified as indebtedness 
for federal income tax purposes. The discussion below assumes this              
characterization of the Debt Securities is correct.                             

       If, contrary to the opinion of counsel, the IRS successfully asserted
that the Debt Securities were not debt for federal income tax purposes, the Debt
Securities might be treated as equity interests, and the timing and amount of   
income allocable to holders of such Debt Securities may be different than as    
described in the following paragraph.                                           

         Debt Securities generally will be subject to the same rules of taxation
as REMIC regular certificates issued by a REMIC except that (a) stated interest 
reportable on Debt Securities generally is not required to be reported under the
accrual method unless the holder otherwise uses the accrual method and (b) the  
special rule treating a portion of the gain on the sale or exchange of a REMIC  
regular certificate as ordinary income is inapplicable to Debt Securities. See  
"Federal Income Tax Consequences -- REMIC Certificates -- Tax Treatment of REMIC
Regular Certificates" and "-- Gain or Loss on Disposition of Partnership        
Securities."                                                                    

Taxation of Owners of Partnership Securities                                    

Treatment of the Partnership Trust as a Partnership           

        If so specified in the applicable prospectus supplement, the depositor
will agree, and the securityholders will agree by their purchase of Partnership 
Securities, to treat the Partnership Trust as a partnership for purposes of     
federal and state income tax, franchise tax and any other tax measured in whole 
or in part by income, with the assets of the partnership being the assets       
held by the Partnership Trust, the partners of the partnership being the        
securityholders (including the depositor), and the Debt Securities (if any)     
being debt of the partnership. However, the proper characterization of the      
arrangement involving the Partnership Trust, the Partnership Securities, the    
Debt Securities, and the depositor is not entirely clear, because there is not  
authority on transactions closely comparable to that contemplated herein.       

       A variety of alternative characterizations are possible. For example,
because one or more of the classes of Partnership Securities have certain       
features characteristic of debt, the Partnership Securities might be considered 
debt of the depositor or the Partnership Trust. The following discussion assumes
that the Partnership Securities represent equity interests in a partnership.    

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Partnership Taxation                                          

        As a partnership, the Partnership Trust will not be subject to federal
income tax. Rather, each securityholder will be required to separately take into
account such holder's allocated share of income, gains, losses, deductions and  
credits of the Partnership Trust. It is anticipated that the Partnership Trust's
income will consist primarily of interest earned on the mortgage loans          
(including appropriate adjustments for market discount, original issue discount 
and bond premium) as described above under "Federal Income Tax Consequences --  
REMIC Certificates -- Original Issue Discount," "-- Market Discount" and        
"-- Amortizable Premium" in this prospectus, and any gain upon collection or    
disposition of mortgage loans. The Partnership Trust's deductions will consist  
primarily of interest expense accruing with respect to the Debt Securities,     
servicing and other fees, and losses or deductions upon collection or           
disposition of Debt Securities.                                                 

 The tax items of a partnership are allocable to the partners in
accordance with the Code, Treasury regulations and the partnership agreement.   
The partnership agreement will provide, in general, that the securityholders    
will be allocated taxable income of the Partnership Trust for each Due Period   
equal to the sum of (a) the interest that accrues on the Partnership Securities 
in accordance with their terms for such Due Period, including interest accruing 
at the applicable pass-through rate for such Due Period and interest on amounts 
previously due on the Partnership Securities but not yet distributed; (b) any   
Partnership Trust income attributable to discount on the mortgage loans that    
corresponds to any excess of the principal amount of the Partnership Securities 
over their initial issue price; and (c) any other amounts of income payable to a
securityholder for such Due Period. Such allocation will be reduced by any      
amortization by the Partnership Trust of premium on mortgage loans that         
corresponds to any excess of the issue price of Partnership Securities over     
their principal amount. All remaining taxable income of the Partnership Trust   
will be allocated to the depositor. Based on the economic arrangement of the    
parties, this approach for allocating Partnership Trust income should be        
permissible under applicable Treasury regulations, although no assurance can be 
given that the IRS would not require a greater amount of income to be allocated 
to securityholders. Moreover, even under the foregoing method of allocation,    
securityholders may be allocated interest income at the applicable pass-through 
rate plus the other income items described above, even though the Partnership   
Trust may not have sufficient cash to make current cash distributions of such   
amounts. Thus, cash basis holders will in effect be required to report income   
from the Partnership Securities on the accrual basis and securityholders may    
become liable for taxes on Partnership Trust income even if they have not       
received cash from the Partnership Trust to pay such taxes.                     

         Part or all of the taxable income allocated to a securityholder that is
a pension, profit sharing or employee benefit plan or other tax-exempt entity   
(including an individual retirement account) may constitute UBTI generally      
taxable to such a holder under the Code.                                        

     A share of expenses of the Partnership Trust (including fees of the
servicer but not interest expense) allocable to an individual, estate or trust  
securityholder would be miscellaneous itemized deductions subject to the        
limitations described above under "Federal Income Tax Consequences -- REMIC     
Certificates -- Tax Treatment of REMIC Regular Certificates" in this prospectus.
Accordingly, such deductions might be disallowed to the individual, estate or   
trust                                                                           

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in whole or in part and might result in such holder being taxed on an amount of 
income that exceeds the amount of cash actually distributed to such holder over 
the life of the Partnership Trust.                                              

       Discount income or premium amortization with respect to each mortgage
loan would be calculated in a manner similar to the description under "Federal  
Income Tax Consequences -- REMIC Certificates -- Original Issue Discount,"      
"-- Market Discount" and "-- Amortizable Premium" in this prospectus.           
Notwithstanding such description, it is intended that the Partnership Trust will
make all tax calculations relating to income and allocations to securityholders 
on an aggregate basis with respect to all mortgage loans held by the Partnership
Trust rather than on a mortgage loan-by-mortgage loan basis. If the IRS were to 
require that such calculations be made separately for each mortgage loan, the   
Partnership Trust might be required to incur additional expense, but it is      
believed that there would be no material adverse effect on securityholders.     

Discount and Premium                                          

        Unless indicated otherwise in the applicable prospectus supplement, it
is not anticipated that the mortgage loans will have been issued with original  
issue discount and, therefore, the Partnership Trust should not have original   
issue discount income. However, the purchase price paid by the Partnership Trust
for the mortgage loans may be greater or less than the remaining principal      
balance of the mortgage loans at the time of purchase. If so, the mortgage loans
will have been acquired at a premium or discount, as the case may be. See       
"Federal Income Tax Consequences -- REMIC Certificates -- Original Issue        
Discount," "-- Market Discount" and "-- Amortizable Premium" in this prospectus.
(As indicated above, the Partnership Trust will make this calculation on an     
aggregate basis, but might be required to recompute it on a mortgage            
loan-by-mortgage loan basis).                                                   

  If the Partnership Trust acquires the mortgage loans at a market
discount or premium, the Partnership Trust will elect to include any such       
discount in income currently as it accrues over the life of the mortgage loans  
or to offset any such premium against interest income on the mortgage loans. As 
indicated above, a portion of such market discount income or premium deduction  
may be allocated to securityholders.                                            

Section 708 Termination                                       

        Under Section 708 of the Code, the Partnership Trust will be deemed to
terminate for federal income tax purposes if 50% or more of the capital and     
profits interests in the Partnership Trust are sold or exchanged within a twelve
month period. If such termination occurs, it would cause a deemed contribution  
of the assets of a Partnership Trust (the "old partnership") to a new           
Partnership Trust (the "new partnership") in exchange for interests in the new  
partnership. Such interests would be deemed distributed to the partners of the  
old partnership in liquidation thereof, which would not constitute a sale or    
exchange. The Partnership Trust will not comply with certain technical          
requirements that might apply when such a constructive termination occurs. As a 
result, the Partnership Trust may be subject to certain tax penalties and may   
incur additional expenses if it is required to comply with those requirements.  
Furthermore, the Partnership Trust might not be able to comply due to lack of   
data.                                                                           

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Gain or Loss on Disposition of Partnership Securities         

 Generally, capital gain or loss will be recognized on a sale of
Partnership Securities in an amount equal to the difference between the amount  
realized and your tax basis in the Partnership Securities sold. A               
securityholder's tax basis in a Partnership Security will generally equal the   
holder's cost increased by the holder's share of Partnership Trust income       
(includible in income) and decreased by any distributions received with respect 
to such Partnership Security. In addition, both the tax basis in the Partnership
Securities and the amount realized on a sale of a Partnership Security would    
include the holder's share of the Debt Securities and other liabilities of the  
Partnership Trust. A holder acquiring Partnership Securities at different prices
will be required to maintain a single aggregate adjusted tax basis in such      
Partnership Securities, and, upon sale or other disposition of some of the      
Partnership Securities, allocate a portion of such aggregate tax basis to the   
Partnership Securities sold (rather than maintaining a separate tax basis in    
each Partnership Security for purposes of computing gain or loss on a sale of   
that Partnership Security).                                                     

    Any gain on the sale of a Partnership Security attributable to the
holder's share of unrecognized accrued market discount on the mortgage loans    
would generally be treated as ordinary income to the holder and would give rise 
to special tax reporting requirements. The Partnership Trust does not expect to 
have any other assets that would give rise to such special reporting            
considerations. Thus, to avoid those special reporting requirements, the        
Partnership Trust will elect to include market discount in income as it accrues.

     If a securityholder is required to recognize an aggregate amount of
income (not including income attributable to disallowed itemized deductions     
described above) over the life of the Partnership Securities that exceeds the   
aggregate cash distributions with respect thereto, such excess will generally   
give rise to a capital loss upon the retirement of the Partnership Securities.  

Allocations Between Transferors and Transferees               

       In general, the Partnership Trust's taxable income and losses will be
determined each Due Period and the tax items for a particular Due Period will be
apportioned among the securityholders in proportion to the principal amount of  
Partnership Securities owned by them as of the close of the last day of such Due
Period. As a result, a holder purchasing Partnership Securities may be allocated
tax items (which will affect its tax liability and tax basis) attributable to   
periods before the actual transaction.                                          

 The use of such a Due Period convention may not be permitted by
existing regulations. If a Due Period convention is not allowed (or only applies
to transfers of less than all of the partner's interest), taxable income or     
losses of the Partnership Trust might be reallocated among the securityholders. 
The depositor will be authorized to revise the Partnership Trust's method of    
allocation between transferors and transferees to conform to a method permitted 
by future regulations.                                                          

Section 731 Distributions                                     

      In the case of any distribution to a securityholder, no gain will be
recognized to that securityholder except to the extent that the amount of any   
money distributed with respect to such                                          

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security does not exceed the adjusted basis of such securityholder's interest in
the security. To the extent that the amount of money distributed exceeds such   
securityholder's adjusted basis, gain will be currently recognized. In the case 
of any distribution to a securityholder, no loss will be recognized except upon 
a distribution in liquidation of a securityholder's interest. Any gain or loss  
recognized by a securityholder will be capital gain or loss.                    

Section 754 Election                                          

        In the event that a securityholder sells its Partnership Securities at
a profit (loss), the purchasing securityholder will have a higher (lower) basis 
in the Partnership Securities than the selling securityholder had. The tax basis
of the Partnership Trust's assets would not be adjusted to reflect the higher   
(or lower) basis unless the Partnership Trust were to file an election under    
Section 754 of the Code. In order to avoid the administrative complexities that 
would be involved in keeping accurate accounting records, as well as potentially
onerous information reporting requirements, the Partnership Trust will not make 
such an election. As a result, a securityholder might be allocated a greater or 
lesser amount of Partnership Trust income than would be appropriate based on its
own purchase price for Partnership Securities.                                  

Administrative Matters                                        

    The trustee is required to keep or have kept complete and accurate
books of the Partnership Trust. Such books will be maintained for financial     
reporting and tax purposes on an accrual basis and the fiscal year of the       
Partnership Trust will be the calendar year. The trustee will file a partnership
information return (IRS Form 1065) with the IRS for each taxable year of the    
Partnership Trust and will report each securityholder's allocable share of the  
items of Partnership Trust income and expense to holders and the IRS on Schedule
K-1. The trustee will provide the Schedule K-1 information to nominees that fail
to provide the Partnership Trust with the information statement described below 
and such nominees will be required to forward such information to the beneficial
owners of the Partnership Securities. Generally, holders must file tax returns  
that are consistent with the information return filed by the Partnership Trust  
or be subject to penalties unless the holder notifies the IRS of all such       
consistencies.                                                                  

   Under Section 6031 of the Code, any person that holds Partnership
Securities as a nominee at any time during a calendar year is required to       
furnish the Partnership Trust with a statement containing certain information on
the nominee, the beneficial owners and the Partnership Securities so held. Such 
information includes the (i) name, address and taxpayer identification number of
the nominee and (ii) as to each beneficial owner (x) the name, address and      
taxpayer identification number of such person, (y) whether such person is a     
United States Person, a tax-exempt entity or a foreign government, an           
international organization, or any wholly-owned agency or instrumentality of    
either of the foregoing, and (z) certain information on Partnership Securities  
that were held, bought or sold on behalf of such persons throughout the year. In
addition, brokers and financial institutions that hold Partnership Securities   
through a nominee are required to furnish directly to the trustee information as
to themselves and their ownership of Partnership Securities. A clearing agency  
registered under Section 17A of the Securities Exchange Act of 1934, as amended 
is not required to furnish any such information statement to the Partnership    
Trust. The information referred to above for any calendar year must be furnished
to the Partnership Trust on or before the following January 31. Nominees,       
brokers                                                                         

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and financial institutions that fail to provide the Partnership Trust with the  
information described above may be subject to penalties.                        

The depositor will be designated as the TMP in the pooling and
servicing agreement and as such, will be responsible for representing the       
securityholders in any dispute with the IRS. The Code provides for              
administrative examination of a partnership as if the partnership were a        
separate and distinct taxpayer. Generally, the statute of limitations for a     
partnership item does not expire until three years after the date on which the  
partnership information return is filed. Any adverse determination following    
an audit of the return of the Partnership Trust by the appropriate taxing       
authorities could result in an adjustment of the returns of the securityholders,
and, under certain circumstances, a securityholder may be precluded from        
separately litigating a proposed adjustment to the items of the Partnership     
Trust. An adjustment could also result in an audit of a securityholder's returns
and adjustments of items not related to the income and losses of the Partnership
Trust.                                                                          

Tax Consequences to Foreign Securityholders                   

         It is not clear whether the Partnership Trust would be considered to be
engaged in a trade or business in the United States for purposes of federal     
withholding taxes with respect to foreign persons because there is no clear     
authority dealing with that issue under facts substantially similar to those    
applicable here. Although it is not expected that the Partnership Trust would be
engaged in a trade or business in the United States for such purposes, if so    
specified in the applicable prospectus supplement, the Partnership Trust may    
withhold as if it were so engaged in order to protect the Partnership Trust from
possible adverse consequences of a failure to withhold. The Partnership Trust   
may withhold on the portion of its taxable income that is allocable to          
securityholders that are foreign persons pursuant to Section 1446 of the Code,  
as if such income were effectively connected to a United States trade or        
business. Amounts withheld will be deemed to be distributed to the foreign      
securityholder. Subsequent adoption of Treasury regulations or the issuance of  
other administrative pronouncements may require the Partnership Trust to change 
its withholding procedures. In determining a holder's withholding status, the   
Partnership Trust may rely on IRS Form W-8BEN, IRS Form W-9 or the holder's     
certification of non-foreign status signed under penalties of perjury.          

  To the extent specified in the applicable prospectus supplement,
(a) each foreign securityholder might be required to file an individual or      
corporate United States income tax return (including in the case of a           
corporation, the branch profits tax) on its share of the Partnership Trust's    
income, (b) each foreign securityholder must obtain a taxpayer identification   
number from the IRS and submit that number to the Partnership Trust on Form     
W-8BEN in order to ensure appropriate crediting of the taxes withheld, and      
(c) a foreign securityholder generally would be entitled to file with the IRS a 
claim for refund with respect to taxes withheld by the Partnership Trust, taking
the position that no taxes were due because the Partnership Trust was not       
engaged in a United States trade or business. Notwithstanding the foregoing,    
interest payments made (or accrued) to a foreign securityholder may be          
considered guaranteed payments to the extent such payments are determined       
without regard to the income of the Partnership Trust. If these interest        
payments are properly characterized as guaranteed payments, then the            
interest may not be considered "portfolio interest." As a result, a foreign     
securityholder may be subject to United States federal income tax and           
withholding at a rate of 30%, unless reduced or                                 

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eliminated pursuant to an applicable treaty. In such case, a foreign            
securityholder would be entitled to claim a refund for that portion of the      
taxes in excess of the taxes that should be paid with respect to the guaranteed 
payments. Please consult your tax advisor concerning the withholding            
requirements for partners and their partnerships regulations.                   

Backup Withholding                                            

        Distributions made on the Partnership Securities and proceeds from the
sale of the Partnership Securities will be subject to a "backup" withholding tax
if, in general, the securityholder fails to comply with certain identification  
and certification procedures, unless the holder is an exempt recipient under    
applicable provisions of the Code.                                              

STATE AND OTHER TAX CONSIDERATIONS

 In addition to the federal income tax consequences described in
"Federal Income Tax Consequences," you should consider the state and other      
income tax consequences of the acquisition, ownership, and disposition of the   
securities. State income tax laws, for example, may differ substantially from   
the corresponding federal law, and this discussion does not purport to describe 
any aspect of the income tax laws of any state or locality. Therefore, you      
should consult your tax advisor with respect to the various state tax           
consequences of an investment in the securities.                                

ERISA CONSIDERATIONS

General                                                                         

       ERISA and the Code impose certain requirements in connection with the
investment of plan assets on employee benefit plans and on certain other        
retirement plans and arrangements, including individual retirement accounts and 
annuities, Keogh plans and collective investment funds and separate accounts in 
which these plans, accounts or arrangements are invested, that are subject to   
Title I of ERISA or to Section 4975 of the Code ("Plans") and on persons who are
fiduciaries for those Plans and on person who are deemed to hold the assets of  
such plans.                                                                     

        Some employee benefit plans, such as governmental plans (as defined in
ERISA Section 3(32)) and, if no election has been made under Section 410(d) of  
the Code, church plans (as defined in Section 3(33) of ERISA), are not subject  
to the fiduciary responsibility and prohibited transaction provisions of ERISA  
or the Code. However, such plans may be subject to the provisions of federal,   
state and local law that are substantially similar to the provisions of ERISA   
and the Code. Any of these plans that is qualified and exempt from taxation     
under Sections 401(a) and 501(a) of the Code, however, is subject to the        
prohibited transaction rules set forth in Section 503 of the Code.              

       ERISA generally imposes on Plan fiduciaries certain general fiduciary
requirements, including those of investment prudence and diversification and the
requirement that a Plan's investments be made in accordance with the documents  
governing the Plan. In addition, ERISA and the Code prohibit a broad range of   
transactions involving assets of a Plan and persons, referred to as parties in  
interest" who have certain specified relationships to the Plan unless a         
statutory, regulatory or administrative exemption is available. Certain parties 
in interest that                                                                

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participate in a prohibited transaction may be subject to an excise tax imposed 
pursuant to Section 4975 of the Code, unless a statutory, regulatory or         
administrative exemption is available.                                          

       These prohibited transactions generally are set forth in Sections 406
and 407 of ERISA and Section 4975 of the Code.                                  

Plan Assets                                                                     

        A Plan's investment in certificates may cause the assets included in a
related trust fund to be deemed Plan assets. Section 2510.3-101 of the          
regulations of the United States Department of Labor ("DOL") (the "Plan Asset   
Regulations") provides that when a Plan acquires an equity interest in an       
entity, the Plan's assets include both the equity interest and an undivided     
interest in each of the underlying assets of the entity, unless certain         
exceptions not applicable here apply, or unless the equity participation in the 
entity by "benefit plan investors" (i.e., Plans, employee benefit plans not     
subject to ERISA, and entities whose underlying assets include plan assets by   
reason of a Plan's investment in the entity) is not "significant," both as      
defined below. This treatment could cause certain transactions concerning the   
trust assets to be deemed prohibited transactions under ERISA and, in addition, 
could result in a finding of an improper delegation by the plan fiduciary of its
duty to manage plan assets.                                                     

Under the Plan Asset Regulations, a trust's assets will not be
considered plan assets of a Plan if the securities are considered debt. For this
purpose, the securities will be debt only if they are treated as indebtedness   
under applicable local law and do not have any substantial equity features.     
The term substantial equity features has no definition under the Plan Asset     
Regulations. In the absence of such a definition, we cannot assure you that the 
securities, either when they are issued or at any later date, will have no      
substantial equity features. The prospectus supplement for a particular offering
of securities may tell you whether we believe the securities are debt for ERISA 
purposes. To the extent that the securities do not constitute debt for purposes 
of ERISA, they will constitute equity investments. The Plan Asset Regulations   
will not apply if (i) the security is registered under the Securities Exchange  
Act of 1934, is freely transferable and is part of a class of securities that is
held by more than 100 unrelated investors (the "publicly offered exception"),   
or (ii) immediately after the most recent acquisition of an equity interest,    
benefit plan investors do not own 25% or more of the value of any class of      
equity interests in the trust (the "insignificant participation exception"). If 
the securities may be treated as an equity investment under the plan asset      
regulations, the prospectus supplement may tell you whether we either of the    
following exceptions to the Plan Assets Regulations will apply.                 

     However, without regard to whether the securities are treated as an
"equity interest" or as debt, the acquisition or holding of securities, even    
those treated as debt, by or on behalf of a Plan could be considered to give    
rise to a prohibited transaction if the trust or any of its affiliates is or    
becomes a party in interest or disqualified person with respect to such Plan, or
in the event that a security is purchased in the secondary market and such      
purchase constitutes a sale or exchange between a Plan and a party in interest  
or disqualified person with respect to such Plan. There can be no assurance that
the trust or any of its affiliates will not be or become a party in interest or 
a disqualified person with respect to a Plan that acquires securities.          

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      Any person who has discretionary authority or control respecting the
management or disposition of assets of a Plan, and any person who provides      
investment advice for those assets for a fee, is a fiduciary of the Plan. If the
assets included in a trust fund constitute plan assets of an investing Plan,    
then any party exercising management or discretionary control regarding those   
assets, such as the servicer or master servicer, may be deemed to be a          
"fiduciary" of the Plan and thus subject to the fiduciary responsibility        
provisions and prohibited transaction provisions of ERISA and the Code with     
respect to the investing Plan. In addition, if the assets included in a trust   
fund constitute plan assets, the purchase of certificates by a party in interest
of the Plan, as well as the operation of the trust fund, may constitute or      
involve a prohibited transaction under ERISA and the Code.                      

Possible Exemptive Relief                                                       

      The DOL has issued several exemptions from certain of the prohibited
transaction rules of ERISA and the related excise tax provisions of Section 4975
of the Code. Those exemptions include, but are not limited to:                  

o   Prohibited Transaction Class Exemption ("PTCE") 95-60, regarding  
investments by insurance company general accounts;            

    o   PTCE 96-23, regarding investment decisions by in-house asset managers;

    o   PTCE 91-38, regarding investments by bank collective investment funds;

   o   PTCE 90-1, regarding investments by insurance company pooled separate
accounts;                                                     

 o   PTCE 84-14, regarding investment decisions made by a qualified plan
asset manager;                                                

 o   PTCE 83-1, regarding acquisitions by Plans of interests in mortgage
pools; and                                                    

o   various underwriter exemptions.                                   

Underwriters' Exemption                                                         

     The DOL has issued individual exemptions to various underwriters as
indicated in the related prospectus supplement (the "Exemption") that generally 
exempt from the application of the prohibited transaction provisions of Sections
406(a) and 407(a) of ERISA, and the excise taxes imposed on those prohibited    
transactions pursuant to Section 4975(a) and (b) of the Code, certain           
transactions relating to the servicing and operation of trusts issuing          
asset-backed and mortgage-backed securities and the purchase, sale and holding  
of such securities are underwritten by an "underwriter") and where the trust and
the offered securities meet certain specified conditions, several of which are  
set forth below. This is called the Exemption. Amendments to the Underwriters'  
Exemption may be found at 62 Fed. Reg. 39021 (July 21, 1997) and 65 Fed. Reg.   
67765 (November 13, 2000) and 67 Fed. Reg. 54487 (August 22, 2002). The         
Exemption, as amended, provides a partial exemption for transactions involving  
certificates representing a beneficial interest in a trust and entitling the    
holder to pass-through payments of principal, interest and/or other payments    
with respect to the trust's assets or a debt instrument                         

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issued by the trust. When applicable, the Exemption applies to the initial      
purchase, holding and subsequent resale of securities, and certain transactions 
incidental to the servicing and operation of the assets of such a trust.        

For purposes of this Section "ERISA Considerations," the term 
"underwriter" will include (a) the underwriter specified in the related         
prospectus supplement, (b) any person directly or indirectly, through one or    
more intermediaries, controlling, controlled by or under common control with    
that underwriter, and (c) any member of the underwriting syndicate or selling   
group of which a person described in (a) or (b) is a manager or co-manager for a
class of securities.                                                            

  The Exemption sets forth several general conditions that must be
satisfied for a transaction involving the purchase, sale and holding of         
securities backed by the types of mortgage loans or obligations described in    
this prospectus to be eligible for exemptive relief:                            

   o   The acquisition of certificates by a Plan must be on terms (including
       the price for the certificates) that are at least as favorable to the
        Plan as they would be in an arm's-length transaction with an unrelated
party;                                                        

  o   If the investment pool contains only fully secured mortgage loans or
       obligations, the Exemption will apply to securities evidencing rights
  and interests which are subordinated to the rights and interests
evidenced by the other certificates of the trust fund;        

    o   The certificates at the time of acquisition by the Plan must generally
         be rated in one of the four highest generic rating categories (three if
         the transaction is not a "designated transaction") by Standard & Poor's
         Rating Services, a division of The McGraw-Hill Companies, Inc. ("S&P"),
        Moody's Investors Service, Inc. ("Moody's") or Fitch Ratings ("Fitch")
(each, a "Rating Agency");                                    

o   One-to-four family residential and home equity loans may have     
     loan-to-value ratios in excess of 100% (but not in excess of 125%),
        provided the certificates are not subordinated and are rated in one of
the two highest generic rating categories by a Rating Agency; 

o   The trustee may not be an affiliate of any other member of the    
 Restricted Group, as defined below, other than any underwriter;

     o   The sum of all payments made to and retained by the underwriter(s) must
      represent not more than reasonable compensation for underwriting the
   certificates; the sum of all payments made to and retained by the
       depositor pursuant to the assignment of the assets to the issuer must
         represent not more than the fair market value of those obligations; and
         the sum of all payments made to and retained by the master servicer and
         any other servicer must represent not more than reasonable compensation
for that person's services under the related agreement and    
  reimbursement of that person's reasonable expenses in connection
therewith;                                                    

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   o   The Plan investing in the certificates must be an accredited investor
      as defined in Rule 501(a)(1) of Regulation D of the Commission under
the Securities Act of 1933, as amended;                       

     o   For certain types of issuers, the documents establishing the issuer and
       governing the transaction must contain provisions intended to protect
the assets of the issuer from creditors of the seller.        

In addition, the Exemption provides relief for transactions in
connection with the servicing, operation and management of a trust only if the  
transactions are carried out in accordance with the terms of a binding pooling  
and servicing agreement and such agreement was provided to, or was fully        
described in the prospectus provided to, investing Plans before they purchase   
securities issued by the trust.                                                 

Moreover, the Exemption provides relief from certain          
self-dealing/conflict of interest prohibited transactions that may arise under  
Sections 406(b)(1) and 406(b)(2) of ERISA (as well as from the excise taxes     
imposed by Sections 4975(a) and 4975(b) of the Code, by reason of Section       
4975(c)(1)(E) of the Code) when a fiduciary causes a Plan to invest in an issuer
that holds obligations on which the fiduciary (or its affiliate) is an obligor  
only if, among other requirements: (a) the fiduciary (or its affiliate) is an   
obligor with respect to no more than 5% of the fair market value of the         
obligations contained in the trust fund; (b) the Plan's investment in each class
of certificates does not exceed 25% of all of the certificates of that class    
outstanding at the time of the acquisition and (c) immediately after the        
acquisition, no more than 25% of the assets of any Plan for which the fiduciary 
serves as a fiduciary are invested in securities representing an interest in one
or more trusts containing assets sold or serviced by the same entity; (d) in the
case of an acquisition of certificates in connection with their initial         
issuance, at least 50% of each class of certificates in which Plans have        
invested and at least 50% of the aggregate interest in the issuer is acquired by
persons independent of the Restricted Group; and (e) the Plan is not an Excluded
Plan. An "Excluded Plan" is one that is sponsored by a member of the Restricted 
Group, which consists of the trustee, each underwriter, any insurer of the      
issuer, the sponsor, each servicer, any obligor with respect to obligations     
included in the issuer constituting more than 5% of the aggregate unamortized   
principal balance of the assets of the issuer on the date of the initial        
issuance of certificates, each counterparty in any eligible swap transactions   
and any affiliate of any such persons.                                          

        A fiduciary of a Plan contemplating purchasing a certificate must make
its own determination that the general conditions of the Exemption set forth    
above will be satisfied for that certificate.                                   

        The rating of a certificate may change. If the rating of a certificate
declines below the lowest permitted rating, the certificate will no longer be   
eligible for relief under the Exemption (although a Plan that had purchased the 
certificate when the certificate had a permitted rating would not be required by
the Exemption to dispose of it). If a certificate underwritten by an underwriter
fails to meet the requirements of Exemption solely because of the rating and/or 
the subordination conditions, either at the closing date or at some later time, 
such certificate may still be purchased by Plan investors which are insurance   
company general accounts pursuant to Sections I and III of PTCE 95-60.          

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    If certain specific conditions of the Exemption are satisfied, the
Exemption may provide an exemption from the restrictions imposed by Sections    
406(a), 406(b) and 407(a) of ERISA, and the taxes imposed by Sections 4975(a)   
and (b) of the Code by reason of Section 4975(c) of the Code for transactions in
connection with the servicing, management and operation of the trust fund. The  
depositor expects that the specific conditions of the Exemption required for    
this purpose will be satisfied for the certificates so that the Exemption would 
provide an exemption from the restrictions imposed by Sections 406(a), 406(b)   
and 407(a) of ERISA (as well as the excise taxes imposed by Sections 4975(a) and
(b) of the Code by reason of Section 4975(c) of the Code) for transactions in   
connection with the servicing, management and operation of the mortgage pools,  
provided that the general conditions of the Exemption are satisfied.            

   The Exemption also may provide an exemption from the restrictions
imposed by Sections 406(a) and 407(a) of ERISA, and the taxes imposed by Section
4975(a) and (b) of the Code by reason of Sections 4975(c)(1)(A) through (D) of  
the Code if those restrictions are deemed to otherwise apply merely because a   
person is deemed to be a "party in interest" (within the meaning of Section     
3(14) of ERISA) or a "disqualified person" (within the meaning of Section       
4975(e)(2) of the Code) with respect to an investing Plan by virtue of providing
services to the Plan (or by virtue of having certain specified relationships to 
that person) solely as a result of the Plan's ownership of certificates.        

       The Exemption extends exemptive relief to certain mortgage-backed and
asset-backed securities transactions that use pre-funding accounts and that     
otherwise meet the requirements of the exemption. Obligations in an investment  
pool supporting payments to securityholders, and having a value equal to no more
than 25% of the total initial principal balance of the related certificates, may
be transferred to the trust fund within the pre-funding period, instead of being
required to be either identified or transferred on or before the closing date.  
The relief is available if the following conditions are met:                    

o   The ratio of the amount allocated to the pre-funding account to   
        purchase mortgage loans that have not yet been identified to the total
      principal amount of the certificates being offered (the "Pre-Funding
Limit") must not exceed 25%;                                  

     o   All assets transferred after the closing date (the "Subsequent Assets")
         must meet the same terms and conditions for eligibility as the original
        assets used to create the issuer, which terms and conditions have been
approved by at least one rating agency;                       

o   The transfer of the Subsequent Assets to the issuer during the    
       pre-funding period must not result in the certificates that are to be
        covered by the Exemption receiving a lower credit rating from a rating
        agency upon termination of the pre-funding period than the rating that
         was obtained at the time of the initial issuance of the certificates by
the issuer;                                                   

 o   The weighted average annual percentage interest rate for all of the
       assets in the issuer at the end of the pre-funding period must not be
         more than 100 basis points lower than the average interest rate for the
assets transferred to the issuer on the closing date;         

  o   In order to ensure that the characteristics of the Subsequent Assets
        are substantially similar to the original assets that were transferred
to the issuer: (a) the characteristics of                     

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       the Subsequent Assets must be monitored by an insurer or other credit
  support provider that is independent of the depositor; or (b) an
   independent accountant retained by the depositor must provide the
     depositor with a letter (with copies provided to each rating agency
   rating the certificates, the underwriter and the trustee) stating
        whether or not the characteristics of the Subsequent Assets conform to
    the characteristics described in the related prospectus supplement
         and/or the related agreement. In preparing this letter, the independent
       accountant must use the same type of procedures as were applicable to
the assets transferred to the issuer as of the closing date.  

     o   The pre-funding period must end no later than the later of three months
  or 90 days after the closing date (or earlier if the pre-funding
account falls below the minimum level specified in the related
agreement or an event of default occurs).                     

   o   Amounts transferred to the pre-funding account and/or the capitalized
 interest account used in connection with the pre-funding may be
invested only in certain permitted investments.               

o   The prospectus or prospectus supplement must describe: (a) the    
 pre-funding account and/or capitalized interest account used in
 connection with the prefunding account; (b) the duration of the
    pre-funding period; (c) the percentage and/or dollar amount of the
         pre-funding limit for the issuer; and (d) that the amounts remaining in
      the pre-funding account at the end of the pre-funding period will be
remitted to securityholders as repayments of principal.       

   o   The related agreement must describe the permitted investments for the
     pre-funding account and/or capitalized interest account and, if not
      disclosed in the prospectus supplement, the terms and conditions for
eligibility of Subsequent Assets.                             

    The Exemption permits "eligible yield supplement agreements" to be
assets of the trust fund subject to certain conditions. An eligible yield       
supplement agreement is any yield supplement agreement or similar arrangement   
(or if purchased by or on behalf of the trust) an interest rate cap contract to 
supplement the interest rates otherwise payable on obligations held by the trust
fund ("Cap Agreement"). If the Cap Agreement has a notional principal amount    
and/or is written on an International Swaps and Derivatives Association, Inc.   
("ISDA") form, the Cap Agreement may only be held as an asset of the trust fund 
with respect to certificates purchased by Plans if it meets the following       
conditions:                                                                     

o   The Cap Agreement is denominated in U.S. dollars.                 

o   The trust fund pays or receives, on or immediately prior to the   
        respective payment or distribution date for the class of securities to
         which the Cap Agreement relates, a fixed rate of interest or a floating
      rate of interest based on a publicly available index (e.g., LIBOR or
    the U.S. Federal Reserve's Cost of Funds Index ("COFI")), with the
      trust fund receiving such payments on at least a quarterly basis and
 obligated to make separate payments no more frequently than the
counterparty, with all simultaneous payments being netted.    

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 o   Payments are based on the applicable notional amount, the day count
 fractions, the fixed or floating rates permitted above, and the
     difference between the products thereof, calculated on a one-to-one
ratio and not on a multiplier of such difference.             

o   The Cap Agreement does not allow any of these three preceding     
    requirements to be unilaterally altered without the consent of the
trustee.                                                      

  o   The Cap Agreement is entered into between the trust and an "eligible
 counterparty." An "eligible counterparty" means a bank or other
         financial institution which has a rating at the date of issuance of the
   securities, which is in one of the three highest long term credit
      rating categories or one of the two highest short term credit rating
        categories, utilized by at least one of the Rating Agencies rating the
      securities; provided that, if a counterparty is relying on its short
        term rating to establish eligibility hereunder, such counterparty must
      either have a long term rating in one of the three highest long term
      rating categories or not have a long term rating from the applicable
Rating Agency.                                                

o   The notional amount that does not exceed either: (a) the principal
 balance of the class of certificates to which the Cap Agreement
    relates, or (b) the portion of the principal balance of such class
represented by obligations.                                   

      The Exemption may cover Notes as well as Certificates. The exemptive
relief provided under the Exemption for any prohibited transactions which could 
be caused as a result of the operation, management or servicing of the trust and
its assets would not be necessary with respect to Notes with no substantial     
equity features which are issued as obligations of the trust. However, the      
Exemption would provide prohibited transaction exemptive relief for the         
acquisition, holding or transfer of Notes between a Plan and a party in         
interest, provided that the same conditions of the Exemption described above    
with respect to the Notes. The same limitations of such exemptive relief        
relating to acquisitions of securities generally by fiduciaries with respect to 
Excluded Plans would also be applicable to the Notes as described herein.       

        In the event that the Exemption is not applicable to the Notes, one or
more other PTCEs discussed above may be available to Plans purchasing or        
transferring the Notes depending in part upon the type of Plan fiduciary making 
the decision to acquire the Notes and the circumstances under which such        
decision is made. These exemptions include, as listed above, but are not limited
to, PTCE 90-1, PTCE 91-38, PTCE 84-14, PTCE 95-60 and PTCE 96-23. However, even 
if the conditions specified in these PTCEs are met, the scope of the relief     
provided under such Exemptions might or might not cover all acts which might be 
construed as prohibited transactions.                                           

Consultation with Counsel                                     

Any Plan fiduciary that proposes to cause a Plan to purchase  
certificates should consult with its counsel with respect to the potential      
applicability of ERISA and the Code to that investment, the application of the  
Plan Asset Regulations, the availability of the exemptive relief provided in the
Exemption and the potential applicability of any other prohibited transaction   
exemption in connection therewith. The prospectus supplement for a series of    
securities may contain additional information regarding the application of the  
Exemption, or any other                                                         

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exemption, with respect to the securities offered thereby. In addition, any     
Plan fiduciary that proposes to cause a Plan to purchase certain types of       
certificates should consider the federal income tax consequences of that        
investment.                                                                     

         The sale of certificates to a Plan is in no respect a representation by
the depositor or the underwriter that the investment meets all relevant legal   
requirements for investments by Plans generally or any particular Plan, or that 
the investment is appropriate for Plans generally or any particular Plan.       

A purchaser of securities should be aware that certain of the 
exemptions do not apply to the purchase, sale, and holding of subordinated      
securities. In addition, PTCE 83-1 will not apply to securities issued by       
certain trusts. There can be no assurance that any DOL exemption will apply with
respect to any particular Plan that acquires the securities or, even if all the 
conditions specified therein were satisfied, that any such exemption would apply
to transactions involving the trust or that the scope of the relief provided by 
an exemption might not cover all acts that might be construed as prohibited     
transactions. For example, the Exemption does not provide relief for the        
purchase of securities from, or the sale of securities to, a party in interest  
or disqualified person where the party in interest or disqualified person       
is a fiduciary of the purchaser or seller in which the fiduciary receives       
consideration for its personal account from any party other than the purchaser  
or the seller. Prospective Plan investors should consult with their legal       
counsel concerning the impact of ERISA and the Code and the potential           
consequences to their specific circumstances prior to making an investment in   
the securities. Neither the Depositor, the Trustee, the Servicer nor any of     
their respective affiliates will make any representation to the effect that the 
securities satisfy all legal requirements with respect to the investment therein
by Plans generally or any particular Plan or to the effect that the securities  
are an appropriate investment for Plans generally or any particular Plan.       

     Insurance companies contemplating the investment of general account
assets in the securities should consult with their legal advisors with respect  
to the applicability of Section 401(c) of ERISA. The DOL issued final           
regulations under Section 401(c) which became applicable on July 5, 2001.       

       Government plans are generally not subject to the fiduciary standards
of ERISA or the prohibited transaction rules of ERISA or the Code. However, many
states have enacted laws which established standards of fiduciary conduct, legal
investment rules, or other requirements for investment transactions involving   
the assets of government plans. If you are considering investing in securities  
on behalf of a government plan, you should consult with your advisors regarding 
the requirements of applicable state law.                                       

Certain Required Representations                              

   Because the exemptive relief afforded by Exemption or any similar
exemption that might be available to the securities will not apply to the       
purchase, sale or holding of certain securities, including but not limited to   
Residual Certificates and any securities which are not rated in the applicable  
generic rating category by the Rating Agencies, transfers of these securities to
a Plan or other person acting on behalf of any Plan or to any other person      
investing plan assets to effect the acquisition will not be registered by the   
trustee unless the transferee provides the Trustee                              

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with a "Benefit Plan Opinion." A Benefit Plan Opinion is an opinion of counsel  
satisfactory to the Trustee (and upon which FMIC and the trustee and their      
respective counsel are authorized to rely) that the ownership of a security of  
such class:                                                                     

    o   will not be treated as a prohibited transaction under Sections 406 and
407 of ERISA or Section 4975 of the Code; and                 

o   either                                                            

  o   will not cause any of the assets in the trust -- or in the case of a
         REMIC, the REMIC's assets -- to be regarded as plan assets for purposes
        of the Plan Asset Regulation; or o will not give rise to any fiduciary
      duty under ERISA on the part of FMIC, the trustee or the servicer in
addition to any obligation undertaken in the agreement.       

 A Benefit Plan Opinion will not be required with respect to the
purchase of DTC registered securities. Any purchaser of a DTC registered        
security will be deemed to have represented by the purchase that either (a) the 
purchaser is not a Plan and is not purchasing the securities on behalf of, or   
with plan assets of, any Plan or (b) the purchase of the security by or on      
behalf of, or with plan assets meets the conditions stated in the Benefit Plan  
Opinion.                                                                        

    This discussion is a general discussion of some of the rules which
apply to Plans and similar entities. Prior to making an investment in           
securities, prospective plan investors should consult with their legal and other
advisors concerning the impact of ERISA and the Code and, particularly in the   
case of government plans and related investment vehicles, any additional state  
law considerations, and the potential consequences in their specific            
circumstances.                                                                  

 LEGAL INVESTMENT CONSIDERATIONS

         The related prospectus supplement describes whether the securities will
constitute "mortgage-related securities" for purposes of the Secondary Mortgage 
Market Enhancement Act of 1984 ("SMMEA"). To the extent that any securities     
constitute mortgage-related securities, these securities will be legal          
investments for persons, trusts, corporations, partnerships, associations,      
business trusts and business entities (including depository institutions, life  
insurance companies and pension funds) created pursuant to or existing under the
laws of the United States or of any state whose authorized investments are      
subject to state regulation to the same extent that, under applicable law,      
obligations issued by or guaranteed as to principal and interest by the United  
States or any of its agencies or instrumentalities constitute legal investments 
for any of these entities. Pursuant to SMMEA, a number of states enacted        
legislation, on or before the October 3, 1991 cutoff for such enactments,       
limiting to varying extents the ability of certain entities to invest in        
"mortgage-related securities," in most cases by requiring the affected investors
to rely solely upon existing state law, and not SMMEA. Accordingly, the         
investors affected by such legislation will be authorized to invest in the      
securities only to the extent provided in such legislation.                     

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SMMEA also amended the legal investment authority of federally
chartered depository institutions as follows: federal savings and loan          
associations and federal savings banks may invest in, sell or otherwise deal    
in the securities without limitation as to the percentage of their assets       
represented thereby; federal credit unions may invest in the securities; and    
national banks may purchase the securities for their own account without regard 
to the limitations generally applicable to investment securities set forth in 12
U.S.C. Section 24 (Seventh), subject in each case to such regulations as the    
applicable federal regulatory authority may prescribe.                          

       Securities that do not constitute "mortgage-related securities" under
SMMEA will require registration, qualification or an exemption under applicable 
state securities laws and may not be "legal investments" to the same extent as  
"mortgage-related securities."                                                  

Institutions whose investment activities are subject to legal 
investment laws or regulations or review by certain regulatory authorities may  
be subject to restrictions on investment in certain classes of offered          
securities. Any financial institution which is subject to the jurisdiction of   
the office of the Comptroller of the Currency, the Board of Governors of the    
Federal Reserve System, the FDIC, the OTS, the NCUA or other federal or state   
agencies with similar authority should review any applicable rules, guidelines  
and regulations prior to purchasing any offered security. The Federal Financial 
Institutions Examination Council, for example, has issued a Supervisory Policy  
Statement on Securities Activities effective February 10, 1992 setting forth    
guidelines for and significant restrictions on investments in "high-risk        
mortgage securities." The policy statement has been adopted by the Comptroller  
of the Currency, the Federal Reserve Board, the FDIC, the OTS and the NCUA (with
certain modifications), with respect to the depository institutions that they   
regulate. The policy statement generally indicates that a mortgage derivative   
product will be deemed to be high risk if it exhibits greater price volatility  
than a standard fixed rate thirty-year mortgage security. According to the      
policy statement, prior to purchase, a depository institution will be required  
to determine whether a mortgage derivative product that it is considering       
acquiring is high-risk, and if so that the proposed acquisition would reduce the
institution's overall interest rate risk. Reliance on analysis and documentation
obtained from a securities dealer or other outside party without internal       
analysis by the institution would be unacceptable. There can be no assurance    
that any classes of offered securities will not be treated as high-risk under   
the policy statement.                                                           

   The predecessor to the OTS issued a bulletin, entitled, "Mortgage
Derivative Products and Mortgage Swaps", which is applicable to thrift          
institutions regulated by the OTS. The bulletin established guidelines for the  
investment by savings institutions in certain "high-risk" mortgage derivative   
securities and limitations on the use of such securities by insolvent,          
undercapitalized or otherwise "troubled" institutions. According to the         
bulletin, such "high-risk" mortgage derivative securities include securities    
having certain specified characteristics, which may include certain classes of  
securities. In accordance with Section 402 of the Financial Institutions Reform,
Recovery and Enhancement Act of 1989, the foregoing bulletin will remain in     
effect unless and until modified, terminated, set aside or superseded by the    
FDIC. Similar other policy statements have been issued by regulators having     
jurisdiction over the types of depository institutions.                         

       In September 1993 the National Association of Insurance Commissioners
released a draft model investment law (the "Model Law") which sets forth model  
investment guidelines for the                                                   

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insurance industry. Institutions subject to insurance regulatory authorities may
be subject to restrictions on investment similar to those set forth in the Model
Law and other restrictions.                                                     

     If specified in the related prospectus supplement, other classes of
offered securities offered pursuant to this Prospectus will not constitute      
"mortgage-related securities" under SMMEA. The appropriate characterization of  
this offered security under various legal investment restrictions, and thus the 
ability of investors subject to these restrictions to purchase such offered     
securities, may be subject to significant interpretive uncertainties.           

The depositor will make no representations as to the proper   
characterization of the offered securities for legal investment or financial    
institution regulatory purposes, or as to the ability of particular investors to
purchase any offered securities under applicable legal investment restrictions. 
The uncertainties described above (and any unfavorable future determinations    
concerning legal investment or financial institution regulatory characteristics 
of the offered securities) may adversely affect the liquidity of the offered    
securities.                                                                     

     The foregoing does not take into consideration the applicability of
statutes, rules, regulations, orders, guidelines or agreements generally        
governing investments made by a particular investor, including, but not limited 
to, "prudent investor" provisions, percentage-of-assets limits and provisions   
which may restrict or prohibit investment in securities which are not "interest 
bearing" or "income paying."                                                    

      There may be other restrictions on the ability of certain investors,
including depository institutions, either to purchase offered securities or to  
purchase offered securities representing more than a specified percentage of    
the investor's assets. Accordingly, all investors whose investment activities   
are subject to legal investment laws and regulations, regulatory capital        
requirements or review by regulatory authorities should consult with their own  
legal advisors in determining whether and to what extent the offered securities 
of any class constitute legal investments or are subject to investment, capital 
or other restrictions.                                                          

 LEGAL MATTERS

      Legal matters relating to the securities and material federal income
tax consequences concerning the securities will be passed upon for the sponsor  
and the depositor by Hunton & Williams LLP.                                     

PLAN OF DISTRIBUTION

         FMIC may sell the securities offered by this prospectus and the related
prospectus supplement either directly or through one or more underwriters or    
underwriting syndicates. The related prospectus supplement sets forth the terms 
of the offering of your securities, including the name or names of the          
underwriters, the proceeds to and their use by FMIC, and either the initial     
public offering price, the discounts and commissions to the underwriters and any
discounts or concessions allowed or reallowed to dealers, or the method by which
the price at which the underwriters will sell the securities will be determined.

       Your securities may be acquired by underwriters for their own account
and may be resold from time to time in one or more transactions, including      
negotiated transactions, at a fixed public                                      

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offering price or at varying prices determined at the time of sale. The         
obligations of any underwriters will be subject to certain conditions precedent,
and the underwriters will be severally obligated to purchase all the securities 
of a series described in the related prospectus supplement, if any are          
purchased. If securities of a series are offered other than through             
underwriters, the related prospectus supplement will contain information        
regarding the nature of the offering and any agreements to be entered into      
between FMIC and purchasers of these securities.                                

         This Prospectus may be used, to the extent required, by any Underwriter
in connection with offers and sales related to market making transactions.      

        The place and time of delivery for your securities is set forth in the
related prospectus supplement.                                                  

        FMIC or certain of its affiliates may retain certain of the securities
but may offer such securities for sale from time to time in the future.         

  Securities issued under the registration statement of which this
prospectus is a part may be reregistered and reissued under the registration    
statement when they are reacquired by FMIC and deposited by FMIC to be part of  
the estate of a new trust. In addition, other securities issued by affiliates of
FMIC or persons unaffiliated with FMIC may be acquired by FMIC and deposited to 
new trusts to be part of the trust estate for securities issued pursuant to this
prospectus and a related prospectus supplement.                                 

 RATINGS

        It is a condition to the issuance of any class of securities that they
shall have been rated not lower than investment grade, that is, in one of the   
four highest rating categories, by at least one rating agency.                  

        Any ratings on the securities address the likelihood of receipt by you
of all collections on the underlying trust assets to which you are entitled.    
These ratings address the structural, legal and issuer-related aspects          
associated with your securities, the nature of the underlying trust assets and  
the credit quality of the guarantor, if any. Ratings do not represent any       
assessment of the likelihood of principal prepayments by borrowers or of the    
degree by which prepayments might differ from those originally anticipated. As a
result, you might suffer a lower than anticipated yield, and, in addition,      
holders of Strip Securities in extreme cases might fail to recoup their initial 
investments.                                                                    

ADDITIONAL INFORMATION

     FMIC is subject to the informational requirements of the Securities
Exchange Act of 1934 and, in accordance therewith, files reports and other      
information with the SEC. Reports and other information filed by FMIC with the  
SEC can be inspected and copied at the public reference facilities maintained by
the SEC at 100 F Street, N.E., Washington, D.C. 20549, and at the Regional      
Offices of the SEC at 7 World Trade Center, Suite 1300, New York, New York      
10048; and Northwestern Atrium Center, 500 West Madison Street, Suite 1400,     
Chicago, Illinois 60661-2511. Copies of these materials can be obtained from the
Public Reference Section of the                                                 

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SEC, 450 Fifth Street, N.W., Washington, D.C. 20549, at prescribed rates. In    
addition, the SEC maintains a public access site on the internet through the    
"world wide web" at which any electronic filings, reports, information          
statements and other information regarding FMIC may be viewed. The internet     
address of the SEC's site is http://www.sec.gov.                                

       This prospectus does not contain all the information set forth in the
registration statements of which this prospectus is a part, such as the exhibits
FMIC has filed with the SEC. Copies of the information and the exhibits are on  
file at the offices of the SEC may be obtained, upon payment of the fee         
prescribed by the SEC, or may be examined without charge at the offices of the  
SEC. Copies of the agreements for your series will be provided to each person to
whom a prospectus and prospectus supplement is delivered upon written or oral   
request, provided that such request is made to Fieldstone Mortgage Investment   
Corporation c/o General Counsel, 11000 Broken Land Parkway, Columbia, Maryland  
21044 (telephone (866) 365-FMIC (3642)).                                        

Financial Information                                                           

      A new trust will be formed with respect to each series of securities
and no trust will engage in a any business activity or have any assets or       
obligations prior to the issuance of the related series of securities.          
Accordingly, no financial statements with respect to any trust will be included 
in this prospectus or in the related prospectus supplement.                     

 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

     The SEC allows us to "incorporate by reference" information that we
file with them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is  
an important part of this prospectus, and the information that we file later    
with the SEC will automatically update and supersede this information.          

      All documents filed by us with respect to a trust referred to in the
related prospectus supplement and the related series of securities after the    
date of this prospectus and before the end of the related offering pursuant to  
Section 13(a), 13(c), 14 or 15(d) of the Securities Exchange Act of 1934, as    
amended, are incorporated by reference in this prospectus and are a part of this
prospectus from the date of their filing. Any statement contained in a document 
incorporated by reference in this prospectus is modified or superseded for all  
purposes of this prospectus to the extent that a statement contained in this    
prospectus (or in the related prospectus supplement) or in any other            
subsequently filed document that also is incorporated by reference differs from 
that statement. Any statement so modified or superseded shall not, except as so 
modified or superseded, constitute a part of this prospectus. If so specified in
any such document, such document shall also be deemed to be incorporated by     
reference in the registration statement of which this prospectus forms a part.  

       We will provide, without charge to each person to whom a copy of this
prospectus and any related prospectus supplement is delivered, a copy of any    
documents incorporated by reference herein. You may request a copy by writing or
telephoning us at our principal executive offices at the following address:     

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Fieldstone Mortgage Investment Corporation                    
11000 Broken Land Parkway                                     
Suite 600                                                     
Columbia, Maryland  21044                                     
Attention:  General Counsel                                   
Telephone:  (866) 365-FMIC (3642)                             

      You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. We are not making an     
offer of these securities in any state where the offer is not permitted. Do not 
assume that the information in this prospectus or any prospectus supplement is  
accurate as of any date other than the date on the front of these documents.    

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Index of Significant Terms                      

1996 Lender Liability Act..........................88                           
30% Test..........................................128                           
Accretion Class....................................24                           
Act................................................90                           
Additional Collateral Mortgage Loans...............63                           
adjusted issue price...............................98                           
Advances............................................4                           
agent.............................................116                           
Aggregation Rule...................................97                           
agreement...........................................1                           
agreements..........................................1                           
All OID Election...................................98                           
AMT................................................96                           
Applicable Amount..................................96                           
applicable federal rate...........................110                           
Asset Qualification Test..........................123                           
backup............................................145                           
banking organization...............................27                           
Bankruptcy Code....................................86                           
benefit plan investors............................146                           
Benefit Plan Opinion..............................154                           
Book-Entry Securities...............................5                           
Cap...............................................103                           
Cap Agreement.....................................151                           
Cede...............................................25                           
CERCLA.............................................88                           
certificates........................................1                           
clearing agency....................................27                           
clearing corporation...............................27                           
CLTV...............................................62                           
Code...............................................24                           
COFI..............................................151                           
Collection Account.................................49                           
combined loan-to-value ratio.......................62                           
compensating interest payment......................66                           
Complementary Securities..........................135                           
Contingent Payment Obligations....................105                           
Contingent Payment Regulations....................105                           
conversion transaction............................110                           
covered trust......................................50                           
CPR................................................34                           
Credit Enhancement..................................2                           
Crime Control Act..................................93                           
Current Recognition Election......................107                           
Custodial Account..................................48                           
daily portions.....................................98                           
Debt Securities....................................94                           
Deemed Principal Payments..........................97                           
Depositor...........................................1                           
Determination Date..................................3                           
Disqualified Organization.........................116                           
disqualified person...............................150                           
distribution date..................................24                           
distributions......................................24                           
DOL...............................................146                           
DTC................................................25                           
Due Period..........................................3                           
due-on-sale........................................90                           
electing large partnership........................117                           
eligible counterparty.............................152                           
eligible investments...............................46                           
eligible yield supplement agreements..............151                           
equity interest...................................146                           
ERISA...............................................7                           
Euroclear Operator.................................28                           
excess inclusion income...........................113                           
Excess Premium....................................102                           
Excluded Plan.....................................149                           
Exemption.........................................147                           
Fannie Mae Certificates............................39                           
FIC................................................56                           
Fieldstone.........................................23                           
Fieldstone Underwriting Guidelines.................57                           
Financial Asset Custodial Account..................49                           
First Distribution Period.........................100                           
Fitch.............................................148                           
Floor.............................................103                           
FMC................................................56                           
FMIC................................................1                           
foreign person....................................127                           
foreign person certification......................127                           
Freddie Mac Certificates...........................39                           
FSC................................................57                           
Ginnie Mae.........................................40                           
Ginnie Mae Certificates............................39                           
government security...............................119                           
Governor..........................................103                           
Grantor Trust.....................................130                           
Grantor Trust Securities...........................94                           
high-risk mortgage securities.....................155                           

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HUD................................................40                           
improper knowledge................................114                           
indenture default..................................78                           
Indenture Trustee...................................2                           
inducement fees...................................113                           
insignificant participation exception.............146                           
Interest Accrual Period.............................3                           
Interest Only Class................................24                           
interest rate......................................23                           
Interest Weighted Certificate.....................101                           
Inverse Floater Certificates......................105                           
IO Class...........................................24                           
IO Securities.....................................130                           
IRS................................................94                           
ISDA..............................................151                           
issue price........................................96                           
Issuer..............................................1                           
L/C Bank...........................................51                           
loan-to-value ratio................................62                           
LTV................................................62                           
mandatory redemptions..............................99                           
market discount...................................106                           
Mark-to-Market Regulations........................118                           
Master Servicer.....................................1                           
master servicer event of default...................76                           
MERS...............................................37                           
MERS System........................................37                           
Model Law.........................................155                           
Moody's...........................................148                           
mortgage insurance policies........................52                           
Mortgage-Related Assets.............................2                           
mortgage-related securities.........................8                           
Multiple Rate VRDI Certificate....................104                           
NCUA...............................................92                           
Net Series Rate...................................136                           
new partnership...................................141                           
noneconomic residual interest.....................114                           
Non-VRDI Certificate..............................105                           
notes...............................................1                           
objective rate....................................102                           
OID Regulations....................................97                           
old partnership...................................141                           
Ordinary Ratio Security...........................135                           
original issue discount............................96                           
OTS................................................92                           
owner trust agreement..............................23                           
Owner Trustee.......................................2                           
PAC Classes........................................24                           
Parity Price.......................................35                           
Partnership Securities.............................94                           
Partnership Trust.................................138                           
party in interest.................................150                           
pass-through rate..................................24                           
Pass-Through Securities...........................130                           
Pass-Through Securityholder.......................131                           
payment date.......................................23                           
Payment Date........................................3                           
payments...........................................23                           
permitted investments.............................123                           
Plan Asset Regulations............................146                           
Plans.............................................145                           
PMBS pooling and servicing agreement...............42                           
PMBS servicer......................................42                           
PMBS trustee.......................................42                           
PMI................................................52                           
PO Class...........................................24                           
PO Securities.....................................130                           
pooling and servicing agreement....................23                           
portfolio interest................................127                           
Pre-Funded Amount..................................46                           
Pre-Funding Account.................................2                           
Pre-Funding Limit.................................150                           
Pre-Funding Period.................................46                           
Pre-Issuance Accrued Interest.....................101                           
Pre-Issuance Accrued Interest Rule................101                           
prepayment.........................................34                           
Prepayment Interest Shortfall......................31                           
Prepayment Period...................................3                           
Pricing Prepayment Assumptions.....................97                           
Principal Only Class...............................24                           
PTCE..............................................147                           
publicly offered exception........................146                           
qualified floating rates..........................102                           
qualified inverse floating rate...................102                           
qualified liquidation..............................33                           
qualified mortgages................................95                           
Qualified Reserve Fund............................124                           
qualified stated interest..........................97                           
Qualifying REIT Interest..........................119                           
Rate Bubble Certificate...........................101                           
Rating Agency.....................................148                           
Ratio Securities..................................130                           

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real estate assets.................................95                           
Realized Loss......................................31                           
Record Date.........................................3                           
regular interests.............................25, 123                           
REIT..............................................114                           
REITs..............................................93                           
REMIC..............................................24                           
REMIC regular certificates.........................25                           
REMIC Regulations..................................94                           
Residual Certificates..............................25                           
residual interests................................123                           
retained interest..................................72                           
RICO...............................................93                           
RICs...............................................95                           
S&P...............................................148                           
securities..........................................1                           
securitization servicing agreement.................23                           
Seller..............................................1                           
Series REMIC.......................................94                           
Servicemembers Shortfall...........................31                           
Servicer............................................1                           
servicer event of default..........................75                           
Servicer Remittance Date............................3                           
Single Rate VRDI Certificate......................103                           
single-class REMICs................................95                           
SMMEA...............................................8                           
SPA................................................34                           
stated redemption price at maturity................96                           
Strip Class........................................24                           
Strip Securities..................................130                           
stripped bond.....................................130                           
stripped bonds....................................133                           
stripped coupon...................................130                           
stripped coupons..................................133                           
Stripping Regulations.............................133                           
Subsequent Assets.................................150                           
Subservicer.........................................2                           
superlien..........................................89                           
Superpremium Certificates.........................102                           
Tax Administrator..................................95                           
Taxable Mortgage Pools............................126                           
Teaser Certificates................................98                           
TIN...............................................128                           
Title VIII.........................................92                           
TMP...............................................129                           
Treasury...........................................94                           
True Discount......................................98                           
Trust Administrator.................................2                           
trust assets.......................................36                           
Trustee.............................................2                           
UBTI..............................................111                           
underwriter.......................................148                           
Variable Rate Certificate.........................102                           
VRDI..............................................102                           
WAM................................................98                           
Weighted Average Certificates.....................104                           

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