MILA Mortgage Acceptance, Inc. – ‘S-3’ on 6/27/05

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Registration Statement for Securities Offered Pursuant to a Transaction   —   Form S-3
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: S-3         Mila Mortgage Acceptance, Inc.                       292±  1.22M 
 2: EX-1.1      Form of Underwriting Agreement                        22±    97K 
 3: EX-3.1      Restated Certificate of Incorporation                  7±    31K 
 4: EX-3.2      By-Laws of the C0Mpany                                14±    56K 
 5: EX-4.1      Form of Pooling and Servicing Agreement              117±   459K 
 6: EX-4.2      Form of Servicing Agreement                           33±   156K 
 7: EX-4.3      Form of Trust Agreement                               47±   171K 
 8: EX-4.4      Form of Indenture                                     96±   459K 
 9: EX-5.1      Opinion of Thacher Proffitt & Wood LLP                 3±    17K 
10: EX-24.1     Power of Attorney                                      1      8K 

S-3   —   Mila Mortgage Acceptance, Inc.
Document Table of Contents

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                                                 REGISTRATION NO. 333-__________
================================================================================

 UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
 _____________

FORM S-3
REGISTRATION STATEMENT
 UNDER
THE SECURITIES ACT OF 1933
 _____________

MILA MORTGAGE ACCEPTANCE, INC.
(Exact name of registrant as specified in its charter)
Delaware
(State of Incorporation)

84-1682706
 (I.R.S. Employer Identification Number)

 6021 -244th Street SW
 Mountlake Terrace, WA 98043
(800) 332-6452

 (Address, including zip code, and telephone number,
including area code, of Registrant's
principal executive offices)

 Doug Schwed
MILA Mortgage Acceptance, Inc.
 6021 -244th Street SW
 Mountlake Terrace, WA 98043
(800) 332-6452

 (Name, address, including zip code, and telephone
 number, including area code, of agent for service
 with respect to the Registrant)

 _____________

Copies to:
Richard D. Simonds Jr., Esq.
 Thacher Proffitt & Wood LLP
Two World Financial Center
New York, New York 10281
(212) 912-7472
================================================================================

       Approximate date of commencement of proposed sale to the public: From
time to time on or after the effective date of this Registration Statement, as  
determined by market conditions and pursuant to Rule 415.                       

        If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following 
box. [ ]                                                                        

  If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the         
Securities Act of 1933, other than securities offered only in connection with   
dividend or interest reinvestment plans, please check the following box. [X]    

         If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier        
effective registration statement for the same offering. [ ]                     

   If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration         
statement for the same offering. [ ]                                            

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       If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [ ]                                        

                                                        [Enlarge/Download Table]


                                            CALCULATION OF REGISTRATION FEE                                         

--------------------------------------------------------------------------------------------------------------------
                                                      PROPOSED MAXIMUM       PROPOSED MAXIMUM         AMOUNT OF     
 PROPOSED TITLE OF SECURITIES      AMOUNT TO BE        OFFERING PRICE       AGGREGATE OFFERING       REGISTRATION   
       BEING REGISTERED             REGISTERED          PER UNIT (1)             PRICE (1)               FEE        
--------------------------------------------------------------------------------------------------------------------
                                                                                                                    
Mortgage Pass-Through               $1,000,000              100%                $1,000,000             $117.70      
Certificates and                                                                                                    
Mortgage-Backed Notes                                                                                               
(Issuable in Series)                                                                                                
--------------------------------------------------------------------------------------------------------------------

(1)      Estimated solely for the purpose of calculating the registration fee on
the basis of the proposed maximum offering price per unit.                      

 _______________________

       The registrant hereby amends this registration statement on such date
or dates as may be necessary to delay its effective date until the registrant   
shall file a further amendment which specifically states that this registration 
statement shall thereafter become effective in accordance with Section 8(a) of  
the Securities Act of 1933 or until the registration statement shall become     
effective on such date as the Commission acting pursuant to said Section 8(a),  
may determine.                                                                  

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EXPLANATORY NOTE

    This Registration Statement includes (i) a base prospectus (ii) an
illustrative form of prospectus supplement for use in an offering of Mortgage   
Pass-Through Certificates consisting of senior and subordinate certificate      
classes ("Version 1") and (iii) an illustrative form of prospectus supplement   
for use in an offering of Mortgage-Backed Notes ("Version 2").                  

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SUBJECT TO COMPLETION 
PRELIMINARY PROSPECTUS DATED JUNE 24, 2005  

MILA MORTGAGE ACCEPTANCE, INC.
 Company

MORTGAGE PASS-THROUGH CERTIFICATES
 MORTGAGE-BACKED NOTES

--------------------------------------------------------------------------------
The information contained in this Prospectus is not complete and may be changed.
We may not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This Prospectus is not an offer
to sell these securities and is not soliciting of an offer to buy these         
securities in any state where the offer or sale is not permitted.               
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
You should consider carefully the risk factors in the prospectus supplement.    
--------------------------------------------------------------------------------

THE OFFERED SECURITIES                                                          
The company proposes to establish one or more trusts to issue and sell from time
to time one or more classes of offered securities, which shall be mortgage      
pass-through certificates or mortgage-backed notes.                             

THE TRUST FUND                                                                  
Each series of securities will be secured by a trust fund consisting primarily  
of a segregated pool of mortgage loans, including:                              

o        mortgage loans secured by first and junior liens on the related        
mortgage property;                                            

o        home equity revolving lines of credit;                                 

o        mortgage loans where the borrower has little or no equity in the       
related mortgaged property;                                   

o        mortgage loans secured by one-to-four-family residential properties;   

o        mortgage loans secured by multifamily properties, commercial properties
    and mixed residential and commercial properties, provided that the
     concentration of these properties is less than 10% of the pool; and

o        manufactured housing conditional sales contracts and installment loan  
agreements or interests therein.                              

in each case acquired by the company from one or more affiliated or unaffiliated
institutions.                                                                   

CREDIT ENHANCEMENT                                                              
If so specified in the related prospectus supplement, the trust for a series of 
securities may include any one or any combination of a financial guaranty       
insurance policy, mortgage pool insurance policy, letter of credit, special     
hazard insurance policy or reserve fund, currency or interest rate exchange     
agreements or other type of credit enhancement, even if not specified herein. In
addition to or in lieu of the foregoing, credit enhancement may be provided by  
means of subordination of one or more classes of securities, by                 
cross-collateralization or by overcollateralization.                            

The offered securities may be offered to the public through different methods as
described in "Methods of Distribution" in this prospectus.                      

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

The date of this prospectus is [___________] __, 2005.

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 TABLE OF CONTENTS

CAPTION                                                                         

INTRODUCTION................................................................    
GENERAL.................................................................. 

THE MORTGAGE POOLS..........................................................    
GENERAL.................................................................. 
THE MORTGAGE LOANS....................................................... 
UNDERWRITING STANDARDS................................................... 
QUALIFICATIONS OF ORIGINATORS AND SELLERS................................ 
REPRESENTATIONS BY SELLERS............................................... 
OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS............................ 

SERVICING OF MORTGAGE LOANS.................................................    
GENERAL.................................................................. 
THE MASTER SERVICER...................................................... 
THE SERVICERS............................................................ 
COLLECTION AND OTHER SERVICING PROCEDURES;                                
 MORTGAGE LOAN MODIFICATIONS............................................
SPECIAL SERVICERS........................................................ 
REALIZATION UPON OR SALE OF DEFAULTED MORTGAGE LOANS..................... 
SERVICING AND OTHER COMPENSATION AND PAYMENT OF                           
 EXPENSES; RETAINED INTEREST............................................
EVIDENCE AS TO COMPLIANCE................................................ 

DESCRIPTION OF THE SECURITIES...............................................    
GENERAL.................................................................. 
FORM OF SECURITIES....................................................... 
GLOBAL SECURITIES........................................................ 
ASSIGNMENT OF TRUST FUND ASSETS.......................................... 
DISTRIBUTION ACCOUNT..................................................... 
DISTRIBUTIONS............................................................ 
DISTRIBUTIONS OF INTEREST AND PRINCIPAL ON THE SECURITIES................ 
PRE-FUNDING ACCOUNT...................................................... 
DISTRIBUTIONS ON THE SECURITIES IN RESPECT OF                             
 PREPAYMENT PREMIUMS....................................................
ALLOCATION OF LOSSES AND SHORTFALLS...................................... 
ADVANCES................................................................. 
REPORTS TO SECURITYHOLDERS............................................... 

DESCRIPTION OF CREDIT ENHANCEMENT...........................................    
GENERAL.................................................................. 
SUBORDINATE SECURITIES................................................... 
CROSS-COLLATERALIZATION.................................................. 
OVERCOLLATERALIZATION.................................................... 
FINANCIAL GUARANTY INSURANCE POLICY...................................... 
MORTGAGE POOL INSURANCE POLICIES......................................... 
LETTER OF CREDIT......................................................... 
SPECIAL HAZARD INSURANCE POLICIES........................................ 
RESERVE FUNDS............................................................ 
CASH FLOW AGREEMENTS..................................................... 
MAINTENANCE OF CREDIT ENHANCEMENT........................................ 
REDUCTION OR SUBSTITUTION OF CREDIT ENHANCEMENT.......................... 

OTHER FINANCIAL OBLIGATIONS RELATED TO THE SECURITIES.......................    
SWAPS AND YIELD SUPPLEMENT AGREEMENTS.................................... 

DESCRIPTION OF PRIMARY MORTGAGE INSURANCE, HAZARD                               
INSURANCE; CLAIMS THEREUNDER..............................................  
GENERAL.................................................................. 
PRIMARY MORTGAGE INSURANCE POLICIES...................................... 
HAZARD INSURANCE POLICIES................................................ 
FHA MORTGAGE INSURANCE................................................... 
VA MORTGAGE GUARANTY..................................................... 

THE COMPANY.................................................................    

THE AGREEMENTS..............................................................    
GENERAL.................................................................. 
CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE COMPANY............ 
EVENTS OF DEFAULT AND RIGHTS UPON EVENT OF DEFAULT....................... 
AMENDMENT................................................................ 
TERMINATION; RETIREMENT OF SECURITIES.................................... 
THE TRUSTEE.............................................................. 
DUTIES OF THE TRUSTEE.................................................... 
SOME MATTERS REGARDING THE TRUSTEE....................................... 
RESIGNATION AND REMOVAL OF THE TRUSTEE................................... 

YIELD CONSIDERATIONS........................................................    

MATURITY AND PREPAYMENT CONSIDERATIONS......................................    

LEGAL ASPECTS OF MORTGAGE LOANS.............................................    
MORTGAGES................................................................ 
COOPERATIVE MORTGAGE LOANS............................................... 
TAX ASPECTS OF COOPERATIVE OWNERSHIP..................................... 
LEASES AND RENTS......................................................... 
CONTRACTS................................................................ 
FORECLOSURE ON MORTGAGES AND SOME CONTRACTS.............................. 
FORECLOSURE ON SHARES OF COOPERATIVES.................................... 
REPOSSESSION WITH RESPECT TO CONTRACTS................................... 
RIGHTS OF REDEMPTION..................................................... 
ANTI-DEFICIENCY LEGISLATION AND OTHER LIMITATIONS ON LENDERS............. 
ENVIRONMENTAL LEGISLATION................................................ 
CONSUMER PROTECTION LAWS................................................. 
HOMEOWNERSHIP ACT AND SIMILAR STATE LAWS................................. 
ADDITIONAL CONSUMER PROTECTIONS LAWS WITH RESPECT TO CONTRACTS........... 
ENFORCEABILITY OF CERTAIN PROVISIONS..................................... 
SUBORDINATE FINANCING.................................................... 
INSTALLMENT CONTRACTS.................................................... 
APPLICABILITY OF USURY LAWS.............................................. 
ALTERNATIVE MORTGAGE INSTRUMENTS......................................... 
FORMALDEHYDE LITIGATION WITH RESPECT TO CONTRACTS........................ 
SOLDIERS' AND SAILORS' CIVIL RELIEF ACT OF 1940.......................... 
FORFEITURES IN DRUG AND RICO PROCEEDINGS................................. 
JUNIOR MORTGAGES......................................................... 
NEGATIVE AMORTIZATION LOANS.............................................. 

FEDERAL INCOME TAX CONSEQUENCES.............................................    
GENERAL.................................................................. 
REMICS................................................................... 
NOTES.................................................................... 
GRANTOR TRUST FUNDS...................................................... 

STATE AND OTHER TAX CONSEQUENCES............................................    

ERISA CONSIDERATIONS........................................................    
UNDERWRITER EXEMPTION.................................................... 
OTHER EXEMPTIONS......................................................... 
ERISA CONSIDERATIONS RELATING TO NOTES................................... 
TAX EXEMPT INVESTORS..................................................... 
CONSULTATION WITH COUNSEL................................................ 

LEGAL INVESTMENT MATTERS....................................................    

USE OF PROCEEDS.............................................................    

METHODS OF DISTRIBUTION.....................................................    

FINANCIAL INFORMATION.......................................................    

RATING......................................................................    

AVAILABLE INFORMATION.......................................................    

REPORTS TO SECURITYHOLDERS..................................................    

INCORPORATION OF INFORMATION BY REFERENCE...................................    

GLOSSARY....................................................................    

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ALL CAPITALIZED TERMS IN THIS PROSPECTUS ARE DEFINED IN THE GLOSSARY AT THE END.

GENERAL                                                                         

         The mortgage pass-through certificates or mortgage-backed notes offered
by this prospectus and the related prospectus supplement will be offered from   
time to time in series. The securities of each series will consist of the       
offered securities of the series, together with any other mortgage pass-through 
certificates or mortgage-backed notes of the series.                            

        Each series of certificates will represent in the aggregate the entire
beneficial ownership interest in, and each series of notes will represent       
indebtedness of, a trust fund to be established by the company. Each trust fund 
will consist primarily of a pool of mortgage loans or interests therein, which  
may include mortgage securities, acquired or purchased by the company from one  
or more affiliated or unaffiliated sellers. See "The Company" and "The Mortgage 
Pools." The mortgage loans will include sub-prime loans. The trust fund assets, 
may also include, if applicable, reinvestment income, reserve funds, cash       
accounts, swaps and other derivatives and various forms of credit enhancement as
described in this prospectus and will be held in trust for the benefit of the   
related securityholders pursuant to: (1) with respect to each series of         
certificates, a pooling and servicing agreement or other agreement, or (2) with 
respect to each series of notes, an indenture, in each case as more fully       
described in this prospectus and in the related prospectus supplement.          
Information regarding the offered securities of a series, and the general       
characteristics of the mortgage loans and other trust fund assets in the related
trust fund, will be set forth in the related prospectus supplement.             

        Each series of securities will include one or more classes. Each class
of securities of any series will represent the right, which right may be senior 
or subordinate to the rights of one or more of the other classes of the         
securities, to receive a specified portion of payments of principal or interest 
or both on the mortgage loans and the other trust fund assets in the related    
trust fund in the manner described in this prospectus under "Description of the 
Securities" and in the related prospectus supplement. A series may include one  
or more classes of securities entitled to principal distributions, with         
disproportionate, nominal or no interest distributions, or to interest          
distributions, with disproportionate, nominal or no principal distributions. A  
series may include two or more classes of securities which differ as to the     
timing, sequential order, priority of payment, pass-through rate or amount of   
distributions of principal or interest or both.                                 

       The company's only obligations with respect to a series of securities
will be pursuant to representations and warranties made by the company, except  
as provided in the related prospectus supplement. The master servicer and each  
principal servicer for any series of securities will be named in the related    
prospectus supplement. The principal obligations of the master servicer will be 
pursuant to its contractual servicing obligations, which include its limited    
obligation to make advances in the event of delinquencies in payments on the    
related mortgage loans if the servicer of a mortgage loan fails to make such    
advance. See "Description of the Securities."                                   

      If so specified in the related prospectus supplement, the trust fund
for a series of securities may include any one or any combination of a financial
guaranty insurance policy, mortgage pool insurance policy, letter of credit,    
special hazard insurance policy, reserve fund, currency or interest rate        
exchange agreements or any other type of credit enhancement specified in the    
related prospectus supplement, even if not specified herein. In addition to or  
in lieu of the foregoing, credit enhancement may be provided by means of        
subordination of one or more classes of securities, by cross-collateralization  
or by overcollateralization. See "Description of Credit Enhancement."           

       The rate of payment of principal of each class of securities entitled
to a portion of principal payments on the mortgage loans in the related mortgage
pool and the trust fund assets will depend on the priority of payment of the    
class and the rate and timing of principal payments on the mortgage loans and   
other trust fund assets, including by reason of prepayments, defaults,          
liquidations and repurchases of mortgage loans. A rate of principal payments    
lower or faster than that anticipated may affect the yield on a class of        
securities in the manner described in this prospectus and in the related        
prospectus supplement. See "Yield Considerations."                              

 With respect to each series of securities, one or more separate
elections may be made to treat the related trust fund or a designated portion   
thereof as a REMIC for federal income tax purposes. If applicable, the          
prospectus supplement for a series of securities will specify which class or    
classes of the securities will be considered to be regular interests in the     
related REMIC and which class of securities or other interests will be          
designated as the residual interest in the related REMIC. See "Federal Income   
Tax Consequences" in this prospectus.                                           

     The offered securities may be offered through one or more different
methods, including offerings through underwriters, as more fully described under
"Methods of Distribution" and in the related prospectus supplement.             

     There will be no secondary market for the offered securities of any
series prior to the offering thereof. There can be no assurance that a secondary
market for any of the offered securities will develop or, if it does develop,   
that it will continue. The offered securities will not be listed on any         
securities exchange, unless so specified in the related prospectus supplement.  

THE MORTGAGE POOLS

GENERAL                                                                         

        Each mortgage pool will consist primarily of mortgage loans, minus any
interest retained by the company or any affiliate of the company. The mortgage  
loans may consist of single family loans, multifamily loans, commercial loans,  
mixed-use loans and Contracts, each as described below.                         

         The single family loans will be evidenced by mortgage notes and secured
by mortgages that, in each case, create a first or junior lien on the related   
mortgagor's fee or leasehold interest in the related mortgaged property. The    
related mortgaged property for a single family loan may be owner-occupied or may
be a vacation, second or non-owner-occupied home.                               

        If specified in the related prospectus supplement relating to a series
of securities, the single family loans may include cooperative apartment loans  
evidenced by a mortgage note secured by security interests in the related       
mortgaged property including shares issued by cooperatives and in the related   
proprietary leases or occupancy agreements granting exclusive rights to occupy  
specific dwelling units in the related buildings.                               

       The multifamily loans will be evidenced by mortgage notes and secured
by mortgages that create a first or junior lien on residential properties       
consisting of five or more dwelling units in high-rise, mid- rise or garden     
apartment structures or projects.                                               

      The commercial loans will be evidenced by mortgage notes and secured
mortgages that create a first or junior lien on commercial properties including 
office building, retail building and a variety of other commercial properties as
may be described in the related prospectus supplement.                          

        The mixed-use loans will be evidenced by mortgage loans and secured by
mortgages that create a first or junior lien on properties consisting of mixed  
residential and commercial structures.                                          

The aggregate concentration by original principal balance of  
commercial, multifamily and mixed-use loans in any mortgage pool will be less   
than 10% of the original principal balance of the mortgage pool.                

      Mortgaged properties may be located in any one of the 50 states, the
District of Columbia or the Commonwealth of Puerto Rico.                        

        The mortgage loans will not be guaranteed or insured by the company or
any of its affiliates. However, if so specified in the related prospectus       
supplement, mortgage loans may be insured by the FHA or guaranteed by the VA.   
See "Description of Primary Insurance Policies--FHA Insurance" and "--VA        
Mortgage Guaranty."                                                             

      A mortgage pool may include mortgage loans that are delinquent as of
the date the related series of securities is issued. In that case, the related  
prospectus supplement will set forth, as to each mortgage loan, available       
information as to the period of delinquency and any other information relevant  
for a prospective investor to make an investment decision. No mortgage loan in a
mortgage pool shall be non-performing. Mortgage loans which are more than 30    
days delinquent included in any mortgage pool will have delinquency data        
relating to them included in the related prospectus supplement. No mortgage pool
will include a concentration of mortgage loans which is more than 30 days       
delinquent of 20% or more.                                                      

     A mortgage pool may contain more than one mortgage loan made to the
same borrower with respect to a single mortgaged property, and may contain      
multiple mortgage loans made to the same borrower on several mortgaged          
properties.                                                                     

         The mortgage loans will include "sub-prime" mortgage loans. "Sub-prime"
mortgage loans will be underwritten in accordance with underwriting standards   
which are less stringent than guidelines for "A" quality borrowers. Mortgagors  
may have a record of outstanding judgments, prior bankruptcies and other credit 
items that do not satisfy the guidelines for "A" quality borrowers. They may    
have had past debts written off by past lenders.                                

 A mortgage pool may include mortgage loans that do not meet the
purchase requirements of Fannie Mae and Freddie Mac. These mortgage loans are   
known as nonconforming loans. The mortgage loans may be nonconforming because   
they exceed the maximum principal balance of mortgage loans purchased by Fannie 
Mae and Freddie Mac, known as jumbo loans, because the mortgage loan may have   
been originated with limited or no documentation, because they are sub-prime    
loans, or because of some other failure to meet the purchase criteria of Fannie 
Mae and Freddie Mac for these programs. The related prospectus supplement will  
detail to what extent the mortgage loans are nonconforming mortgage loans.      

      Each mortgage loan will be selected by the company or its affiliates
for inclusion in a mortgage pool from among those purchased by the company,     
either directly or through its affiliates, from Unaffiliated Sellers or         
Affiliated Sellers. If a mortgage pool is composed of mortgage loans acquired by
the company directly from Unaffiliated Sellers, the related prospectus          
supplement will specify the extent of mortgage loans so acquired. The           
characteristics of the mortgage loans will be as described in the related       
prospectus supplement. Other mortgage loans available for purchase by the       
company may have characteristics which would make them eligible for inclusion in
a mortgage pool but were not selected for inclusion in the mortgage pool.       

     The mortgage loans may be delivered to the trust fund pursuant to a
Designated Seller Transaction, concurrently with the issuance of the related    
series of securities. These securities may be sold in whole or in part to the   
Seller in exchange for the related mortgage loans, or may be offered under any  
of the other methods described in this prospectus under "Methods of             
Distribution." The related prospectus supplement for a mortgage pool composed of
mortgage loans acquired by the company pursuant to a Designated Seller          
Transaction will generally include information, provided by the related Seller, 
about the Seller, the mortgage loans and the underwriting standards applicable  
to the mortgage loans.                                                          

         If specified in the related prospectus supplement, the trust fund for a
series of securities may include participations in mortgage loans or mortgage   
securities, as described in this prospectus. The mortgage securities may have   
been issued previously by the company or an affiliate thereof, a financial      
institution or other entity engaged generally in the business of mortgage       
lending or a limited purpose corporation organized for the purpose of, among    
other things, acquiring and depositing mortgage loans into trusts, and selling  
beneficial interests in trusts. The mortgage securities will be generally       
similar to securities offered under this prospectus. However, any mortgage      
securities included in a trust fund will (1) either have been (a) previously    
registered under the Securities Act, or (b) eligible for sale under Rule 144(k) 
under the Exchange Act; and (2) be acquired in bona fide secondary market       
transactions. As to any series of mortgage securities, the related prospectus   
supplement will include a description of (1) the mortgage securities and any    
related credit enhancement, and (2) the mortgage loans underlying the mortgage  
securities.                                                                     

THE MORTGAGE LOANS                                                              

         Each of the mortgage loans will be a type of mortgage loan described or
referred to below, with any variations described in the related prospectus      
supplement:                                                                     

         o        Fixed-rate, fully-amortizing mortgage loans (which may include
                mortgage loans converted from adjustable-rate mortgage loans
                  or otherwise modified) providing for level monthly payments of
      principal and interest and terms at origination or
         modification of not more than approximately 15 years;

         o        Fixed-rate, fully-amortizing mortgage loans (which may include
                mortgage loans converted from adjustable-rate mortgage loans
                  or otherwise modified) providing for level monthly payments of
      principal and interest and terms at origination or
         modification of more than 15 years, but not more than
approximately 40 years;                     

         o        Fully-amortizing ARM Loans having an original or modified term
              to maturity of not more than approximately 40 years with a
                  related mortgage rate which generally adjusts initially either
               three months, six months or one, two, three, five, seven or
                  ten years or other intervals subsequent to the initial payment
           date, and thereafter at either three- month, six-month,
                  one-year or other intervals (with corresponding adjustments in
                 the amount of monthly payments) over the term of the mortgage
                 loan to equal the sum of the related Note Margin and the Note
               Index. The related prospectus supplement will set forth the
               relevant Index and the highest, lowest and weighted average
            Note Margin with respect to the ARM Loans in the related
              mortgage pool. The related prospectus supplement will also
               indicate any periodic or lifetime limitations on changes in
                 any per annum mortgage rate at the time of any adjustment. If
               specified in the related prospectus supplement, an ARM Loan
                may include a provision that allows the mortgagor to convert
              the adjustable mortgage rate to a fixed rate at some point
                during the term of the ARM Loan generally not later than six
        to ten years subsequent to the initial payment date;

      o        Negatively-amortizing ARM Loans having original or modified
                  terms to maturity of not more than approximately 40 years with
                  mortgage rates which generally adjust initially on the payment
                 date referred to in the related prospectus supplement, and on
                 each of specified periodic payment dates thereafter, to equal
           the sum of the Note Margin and the Index. The scheduled
                 monthly payment will be adjusted as and when described in the
               related prospectus supplement to an amount that would fully
                 amortize the mortgage loan over its remaining term on a level
                debt service basis; provided that increases in the scheduled
                 monthly payment may be subject to limitations as specified in
                 the related prospectus supplement. Any Deferred Interest will
           be added to the principal balance of the mortgage loan;

       o        Fixed-rate, graduated payment mortgage loans having original
                or modified terms to maturity of not more than approximately
        15 years with monthly payments during the first year
                  calculated on the basis of an assumed interest rate which is a
                specified percentage below the mortgage rate on the mortgage
                  loan. Monthly payments on these mortgage loans increase at the
                 beginning of the second year by a specified percentage of the
           monthly payment during the preceding year and each year
               thereafter to the extent necessary to amortize the mortgage
              loan over the remainder of its approximately 15-year term.
             Deferred Interest, if any, will be added to the principal
balance of these mortgage loans;            

       o        Fixed-rate, graduated payment mortgage loans having original
                or modified terms to maturity of not more than approximately
        40 years with monthly payments during the first year
                  calculated on the basis of an assumed interest rate which is a
                specified percentage below the mortgage rate on the mortgage
                  loan. Monthly payments on these mortgage loans increase at the
                 beginning of the second year by a specified percentage of the
           monthly payment during the preceding year and each year
            thereafter to the extent necessary to fully amortize the
                 mortgage loan over the remainder of its approximately 30-year
         term. Deferred Interest, if any, will be added to the
principal balance of these mortgage loans;  

        o        Balloon loans having payment terms similar to those described
                  in one of the preceding paragraphs, calculated on the basis of
             an assumed amortization term, but providing for a balloon
                payment of all outstanding principal and interest to be made
           at the end of a specified term that is shorter than the
assumed amortization term.                  

       o        Mortgage loans that provide for a line of credit pursuant to
              which amounts may be advanced to the borrower from time to
time;                                       

        o        Mortgage loans that require that each monthly payment consist
                  of an installment of interest which is calculated according to
               the simple interest method. This method calculates interest
                using the outstanding principal balance of the mortgage loan
           multiplied by the loan rate and further multiplied by a
                 fraction, the numerator of which is the number of days in the
              period elapsed since the preceding payment of interest was
                  made and the denominator of which is the number of days in the
                  annual period for which interest accrues on the mortgage loan.
               As payments are received on simple interest mortgage loans,
               the amount received is applied first to interest accrued to
                the date of payment and the balance is applied to reduce the
  unpaid principal balance of the mortgage loan;

       o        Mortgage loans which provide for an interest only period and
                 do not provide for the payment of principal for the number of
            years specified in the related prospectus supplement; or

 o        Another type of mortgage loan described in the related
prospectus supplement.                      

       The mortgage pool may contain mortgage loans secured by junior liens.
The related senior lien, which may have been made at the same time as the first 
lien, may or may not be included in the mortgage pool as well. The primary risk 
to holders of mortgage loans secured by junior liens is the possibility that    
adequate funds will not be received in connection with a foreclosure of the     
related senior liens to satisfy fully both the senior liens and the mortgage    
loan secured by a junior lien. In the event that a holder of a senior lien      
forecloses on a mortgaged property, the proceeds of the foreclosure or similar  
sale will be applied first to the payment of court costs and fees in connection 
with the foreclosure, second to real estate taxes, third in satisfaction of all 
principal, interest, prepayment or acceleration penalties, if any, and any other
sums due and owing to the holder of the senior liens. The claims of the holders 
of the senior liens will be satisfied in full out of proceeds of the liquidation
of the related mortgaged property, if the proceeds are sufficient, before the   
trust fund as holder of the junior lien receives any payments in respect of the 
mortgage loan. If the master servicer or a servicer were to foreclose on a      
mortgage loan secured by a junior lien, it would do so subject to any related   
senior liens. In order for the debt related to the mortgage loan to be paid in  
full at the sale, a bidder at the foreclosure sale of the mortgage loan would   
have to bid an amount sufficient to pay off all sums due under the mortgage loan
and the senior liens or purchase the mortgaged property subject to the senior   
liens. In the event that the proceeds from a foreclosure or similar sale of the 
related mortgaged property are insufficient to satisfy all senior liens and the 
mortgage loan in the aggregate, the trust fund, as the holder of the junior     
lien, and, accordingly, holders of one or more classes of the securities of the 
related series bear (1) the risk of delay in distributions while a deficiency   
judgment against the borrower is sought and (2) the risk of loss if the         
deficiency judgment is not realized upon. Moreover, deficiency judgments may not
be available in some jurisdictions or the mortgage loan may be nonrecourse. In  
addition, a junior mortgagee may not foreclose on the property securing a junior
mortgage unless it forecloses subject to the senior mortgages.                  

        A mortgage loan may require payment of a prepayment charge or penalty,
the terms of which will be more fully described in the prospectus supplement.   
Prepayment penalties may apply if the borrower makes a substantial prepayment,  
or may apply only if the borrower refinances the mortgage loans. A multifamily, 
commercial or mixed-use loan may also contain a prohibition on prepayment or    
lock-out period.                                                                

     A multifamily, commercial or mixed-use loan may contain a provision
that entitles the lender to a share of profits realized from the operation or   
disposition of the related mortgaged property. If the holders of any class or   
classes of offered securities of a series will be entitled to all or a portion  
of this type of equity participation, the related prospectus supplement will    
describe the equity participation and the method or methods by which            
distributions in respect thereof will be made to such holders.                  

    The mortgage loans may be "equity refinance" mortgage loans, as to
which a portion of the proceeds are used to refinance an existing mortgage loan,
and the remaining proceeds may be retained by the mortgagor or used for purposes
unrelated to the mortgaged property. Alternatively, the mortgage loans may be   
"rate and term refinance" mortgage loans, as to which substantially all of the  
proceeds (net of related costs incurred by the mortgagor) are used to refinance 
an existing mortgage loan or loans (which may include a junior lien) primarily  
in order to change the interest rate or other terms thereof. The mortgage loans 
may be mortgage loans which have been consolidated and/or have had various terms
changed, mortgage loans which have been converted from adjustable rate mortgage 
loans to fixed rate mortgage loans, or construction loans which have been       
converted to permanent mortgage loans. In addition, a mortgaged property may be 
subject to secondary financing at the time of origination of the mortgage loan  
or thereafter. In addition, some or all of the single family loans secured by   
junior liens may be High LTV Loans.                                             

       If provided for in the related prospectus supplement, a mortgage pool
may contain convertible mortgage loans which allow the mortgagors to convert the
interest rates on these mortgage loans from a fixed rate to an adjustable rate, 
or an adjustable rate to a fixed rate, at some point during the life of these   
mortgage loans. In addition, if provided for in the related prospectus          
supplement, a mortgage pool may contain mortgage loans which may provide for    
modification to other fixed rate or adjustable rate programs offered by the     
Seller. If specified in the related prospectus supplement, upon any conversion  
or modification, the depositor, the related master servicer, the related        
servicer, the applicable Seller or a third party will repurchase the converted  
or modified mortgage loan as and to the extent set forth in the related         
prospectus supplement. Upon the failure of any party so obligated to repurchase 
any converted or modified mortgage loan, it will remain in the mortgage pool.   

    If provided for in the related prospectus supplement, the mortgage
loans may include buydown mortgage loans. Under the terms of a buydown mortgage 
loan, the monthly payments made by the mortgagor during the early years of the  
mortgage loan will be less than the scheduled monthly payments on the mortgage  
loan. The resulting difference will be made up from:                            

       o        funds contributed by the seller of the mortgaged property or
     another source and placed in a custodial account,

  o        if funds contributed by the seller are contributed on a
              present value basis, investment earnings on these funds or

o        additional funds to be contributed over time by the  
mortgagor's employer or another source.     

See "Description of the Securities--Payments on Mortgage Loans; Deposits to     
Distribution Account."                                                          

   Generally, the mortgagor under each buydown mortgage loan will be
qualified at the applicable lower monthly payment. Accordingly, the repayment of
a buydown mortgage loan is dependent on the ability of the mortgagor to make    
larger level monthly payments after the Buydown Funds have been depleted and,   
for some buydown mortgage loans, during the Buydown Period.                     

      The prospectus supplement for each series of securities will contain
information, to the extent known or reasonably ascertainable, as to the loss and
delinquency experience of the Seller and/or the master servicer (if the master  
servicer is directly servicing the mortgage loans) and/or one or more of the    
servicers, with respect to mortgage loans similar to those included in the trust
fund. Information generally will be provided when the Seller and/or master      
servicer (if the master servicer is directly servicing the mortgage loans)      
and/or a servicer (in the case of servicers directly servicing mortgage loans in
a trust fund in excess of 10% of the total) have a seasoned portfolio of        
mortgage loans similar to those included in the trust.                          

      The prospectus supplement for each series of securities will contain
information as to the type of mortgage loans that will be included in the       
related mortgage pool. Each prospectus supplement applicable to a series of     
securities will include information, generally as of the cut-off date and to the
extent then available to the company, on an approximate basis, as to the        
following:                                                                      

 o        the aggregate principal balance of the mortgage loans,

o        the type of property securing the mortgage loans,    

     o        the original or modified terms to maturity of the mortgage
loans,                                      

   o        the range of principal balances of the mortgage loans at
origination or modification,                

   o        the earliest origination or modification date and latest
maturity date of the mortgage loans,        

o        the Loan-to-Value Ratios of the mortgage loans,      

    o        the mortgage rate or range of mortgage rates borne by the
mortgage loans,                             

     o        if any of the mortgage loans are ARM Loans, the applicable
                  Index, the range of Note Margins and the weighted average Note
Margin,                                     

o        the geographical distribution of the mortgage loans, 

       o        the percentage of buydown mortgage loans, if applicable, and

       o        the percent of ARM Loans which are convertible to fixed-rate
mortgage loans, if applicable.              

A Current Report on Form 8-K will be available upon request to holders of the   
related series of securities and will be filed, together with the related       
pooling and servicing agreement, with respect to each series of certificates, or
the related servicing agreement, owner trust agreement and indenture, with      
respect to each series of notes, with the Commission within fifteen days after  
the initial issuance of the securities. In the event that mortgage loans are    
added to or deleted from the trust fund after the date of the related prospectus
supplement, the addition or deletion will be noted in the Current Report on Form
8-K. In no event, however, will more than 5% (by principal balance at the       
cut-off date) of the mortgage loans or mortgage securities deviate from the     
characteristics of the mortgage loans or mortgage securities set forth in the   
related prospectus supplement.                                                  

     The company will cause the mortgage loans included in each mortgage
pool, or mortgage securities evidencing interests therein, to be assigned,      
without recourse, to the trustee named in the related prospectus supplement, for
the benefit of the holders of the securities of a series. Except to the extent  
that servicing of any mortgage loan is to be transferred to a special servicer, 
the master servicer named in the related prospectus supplement will service the 
mortgage loans, directly or through servicers, pursuant to a pooling and        
servicing agreement, with respect to each series of certificates, or a servicing
agreement, with respect to each series of notes, and will receive a fee for     
these services. See "Servicing of Mortgage Loans," "Description of the          
Securities" and "The Agreements." The master servicer's obligations with respect
to the mortgage loans will consist principally of its contractual servicing     
obligations under the related pooling and servicing agreement or servicing      
agreement (including its obligation to supervise, monitor and oversee the       
obligations of the servicers to service and administer their respective mortgage
loans in accordance with the terms of the applicable servicing agreements), as  
more fully described in this prospectus under "Servicing of Mortgage            
Loans--Servicers," and, if and to the extent set forth in the related prospectus
supplement, its obligation to make cash advances in the event of delinquencies  
in payments on or with respect to the mortgage loans as described in this       
prospectus under "Description of the Securities--Advances") or pursuant to the  
terms of any mortgage securities. The obligations of a master servicer to make  
advances may be subject to limitations, to the extent this prospectus and the   
related prospectus supplement so provides.                                      

UNDERWRITING STANDARDS                                                          

       Mortgage loans to be included in a mortgage pool will be purchased on
the closing date by the company either directly or indirectly from Affiliated   
Sellers or Unaffiliated Sellers. The company will acquire mortgage loans        
utilizing re-underwriting criteria which it believes are appropriate, depending 
to some extent on the company's or its affiliates' prior experience with the    
Seller and the servicer, as well as the company's prior experience with a       
particular type of mortgage loan or with mortgage loans relating to mortgaged   
properties in a particular geographical region. A standard approach to          
re-underwriting is to compare loan file information and information that is     
represented to the company on a tape with respect to a percentage of the        
mortgage loans the company deems appropriate in the circumstances. The company  
will not undertake any independent investigations of the creditworthiness of    
particular obligors.                                                            

   The mortgage loans, as well as mortgage loans underlying mortgage
securities, unless otherwise disclosed in the related prospectus supplement,    
will have been originated in accordance with underwriting standards described   
below.                                                                          
         The underwriting standards to be used in originating the mortgage loans
are primarily intended to assess the creditworthiness of the mortgagor, the     
value of the mortgaged property and the adequacy of the property as collateral  
for the mortgage loan.                                                          

    The primary considerations in underwriting a mortgage loan are the
mortgagor's employment stability and whether the mortgagor has sufficient       
monthly income available (1) to meet the mortgagor's monthly obligations on the 
proposed mortgage loan (generally determined on the basis of the monthly        
payments due in the year of origination) and other expenses related to the home 
(including property taxes and hazard insurance) and (2) to meet monthly housing 
expenses and other financial obligations and monthly living expenses. However,  
the Loan-to-Value Ratio of the mortgage loan is another critical factor. In     
addition, a mortgagor's credit history and repayment ability, as well as the    
type and use of the mortgaged property, are also considerations.                

High LTV Loans are underwritten with an emphasis on the       
creditworthiness of the related mortgagor. High LTV Loans are underwritten with 
a limited expectation of recovering any amounts from the foreclosure of the     
related mortgaged property.                                                     

     In the case of the multifamily loans, commercial loans or mixed-use
loans, lenders typically look to the debt service coverage ratio of a loan as an
important measure of the risk of default on that loan. Unless otherwise defined 
in the related prospectus supplement, the debt service coverage ratio of a      
multifamily loan, commercial loan or mixed-use loan at any given time is the    
ratio of (1) the net operating income of the related mortgaged property for a   
twelve-month period to (2) the annualized scheduled payments on the mortgage    
loan and on any other loan that is secured by a lien on the mortgaged property  
prior to the lien of the related mortgage. The net operating income of a        
mortgaged property is the total operating revenues derived from a multifamily,  
commercial or mixed-use property, as applicable, during that period, minus the  
total operating expenses incurred in respect of that property during that period
other than (a) non-cash items such as depreciation and amortization, (b) capital
expenditures and (c) debt service on loans (including the related mortgage loan)
secured by liens on that property. The net operating income of a multifamily,   
commercial or mixed-use property, as applicable, will fluctuate over time and   
may or may not be sufficient to cover debt service on the related mortgage loan 
at any given time. As the primary source of the operating revenues of a         
multifamily, commercial or mixed-use property, as applicable, rental income (and
maintenance payments from tenant-stockholders of a cooperatively owned          
multifamily property) may be affected by the condition of the applicable real   
estate market and/or area economy. Increases in operating expenses due to the   
general economic climate or economic conditions in a locality or industry       
segment, such as increases in interest rates, real estate tax rates, energy     
costs, labor costs and other operating expenses, and/or to changes in           
governmental rules, regulations and fiscal policies, may also affect the risk of
default on a multifamily, commercial or mixed-use loan. Lenders also look to the
Loan-to-Value Ratio of a multifamily, commercial or mixed-use loan as a measure 
of risk of loss if a property must be liquidated following a default.           

    Each prospective mortgagor will generally complete a mortgage loan
application that includes information on the applicant's liabilities, income,   
credit history, employment history and personal information. One or more credit 
reports on each applicant from national credit reporting companies generally    
will be required. The report typically contains information relating to credit  
history with local and national merchants and lenders, installment debt payments
and any record of defaults, bankruptcies, repossessions, or judgments. In the   
case of a multifamily loan, commercial loan or mixed-use loan, the mortgagor    
will also be required to provide certain information regarding the related      
mortgaged property, including a current rent roll and operating income          
statements (which may be pro forma and unaudited). In addition, the originator  
will generally also consider the location of the mortgaged property, the        
availability of competitive lease space and rental income of comparable         
properties in the relevant market area, the overall economy and demographic     
features of the geographic area and the mortgagor's prior experience in owning  
and operating properties similar to the multifamily properties or commercial    
properties, as the case may be.                                                 

         Mortgaged properties generally will be appraised by licensed appraisers
or through an automated valuation system. A licensed appraiser will generally   
address neighborhood conditions, site and zoning status and condition and       
valuation of improvements. In the case of mortgaged properties secured by single
family loans, the appraisal report will generally include a reproduction cost   
analysis (when appropriate) based on the current cost of constructing a similar 
home and a market value analysis based on recent sales of comparable homes in   
the area. With respect to multifamily properties, commercial properties and     
mixed-use properties, the appraisal must specify whether an income analysis, a  
market analysis or a cost analysis was used. An appraisal employing the income  
approach to value analyzes a property's projected net cash flow, capitalization 
and other operational information in determining the property's value. The      
market approach to value analyzes the prices paid for the purchase of similar   
properties in the property's area, with adjustments made for variations between 
those other properties and the property being appraised. The cost approach to   
value requires the appraiser to make an estimate of land value and then         
determine the current cost of reproducing the improvements less any accrued     
depreciation. In any case, the value of the property being financed, as         
indicated by the appraisal, must support, and support in the future, the        
outstanding loan balance. All appraisals by licensed appraisers are required to 
be on forms acceptable to Fannie Mae or Freddie Mac. Automated valuation systems
generally rely on publicly available information regarding property values and  
will be described more fully in the related prospectus supplement. An appraisal 
for purposes of determining the Value of a mortgaged property may include an    
automated valuation.                                                            

Notwithstanding the foregoing, Loan-to-Value Ratios will not  
necessarily provide an accurate measure of the risk of liquidation loss in a    
pool of mortgage loans. For example, the value of a mortgaged property as of the
date of initial issuance of the related series of securities may be less than   
the Value determined at loan origination, and will likely continue to fluctuate 
from time to time based upon changes in economic conditions and the real estate 
market. Mortgage loans which are subject to negative amortization will have     
Loan-to-Value Ratios which will increase after origination as a result of       
negative amortization. Also, even when current, an appraisal is not necessarily 
a reliable estimate of value for a multifamily property or commercial property. 
As stated above, appraised values of multifamily, commercial and mixed-use      
properties are generally based on the market analysis, the cost analysis, the   
income analysis, or upon a selection from or interpolation of the values derived
from those approaches. Each of these appraisal methods can present analytical   
difficulties. It is often difficult to find truly comparable properties that    
have recently been sold; the replacement cost of a property may have little to  
do with its current market value; and income capitalization is inherently based 
on inexact projections of income and expenses and the selection of an           
appropriate capitalization rate. Where more than one of these appraisal methods 
are used and provide significantly different results, an accurate determination 
of value and, correspondingly, a reliable analysis of default and loss risks, is
even more difficult.                                                            

        If so specified in the related prospectus supplement, the underwriting
of a multifamily loan, commercial loan or mixed-use loan may also include       
environmental testing. Under the laws of some states, contamination of real     
property may give rise to a lien on the property to assure the costs of cleanup.
In several states, this type of lien has priority over an existing mortgage lien
on that property. In addition, under the laws of some states and under CERCLA, a
lender may be liable, as an "owner" or "operator", for costs of addressing      
releases or threatened releases of hazardous substances at a property, if agents
or employees of the lender have become sufficiently involved in the operations  
of the borrower, regardless of whether or not the environmental damage or threat
was caused by the borrower or a prior owner. A lender also risks such liability 
on foreclosure of the mortgage as described under "Legal Aspects of Mortgage    
Loans--Environmental Legislation" in this prospectus.                           

        With respect to any FHA loan or VA loans the mortgage loan Seller will
be required to represent that it has complied with the applicable underwriting  
policies of the FHA or VA, respectively. See "Description of Primary Insurance  
Policies--FHA Insurance" and "--VA Insurance" in this prospectus.               

QUALIFICATIONS OF ORIGINATORS AND SELLERS                                       

      Each mortgage loan generally will be originated, directly or through
mortgage brokers and correspondents, by a savings and loan association, savings 
bank, commercial bank, credit union, insurance company, or similar institution  
which is supervised and examined by a federal or state authority, or by a       
mortgagee approved by the Secretary of Housing and Urban Development pursuant to
sections 203 and 211 of the Housing Act, unless otherwise provided in the       
related prospectus supplement.                                                  

REPRESENTATIONS BY SELLERS                                                      

         Each Seller will have made representations and warranties in respect of
the mortgage loans and/or mortgage securities sold by the Seller and evidenced  
by a series of securities. In the case of mortgage loans, representations and   
warranties will generally include, among other things, that as to each mortgage 
loan:                                                                           

        o        with respect to each mortgage loan other than a Contract or a
                 cooperative mortgage loan, if required, (A) a title insurance
                policy, binder, or other assurance of title customary in the
               relevant jurisdiction insuring (subject only to permissible
               title insurance exceptions) the lien status of the mortgage
                 was effective at the origination of the mortgage loan and the
            policy remained in effect on the date of purchase of the
            mortgage loan from the Seller by the company, (B) if the
                  mortgaged property securing the mortgage loan is located in an
                area where these policies are generally not available, there
                is in the related mortgage file an attorney's certificate of
                 title indicating (subject to permissible exceptions set forth
                therein) the lien status of the mortgage or (C) with respect
                  to a mortgage oan which is a refinanced mortgage loan, a title
       search was done by the Seller or some other type of
"short-form" title insurance was obtained;  

 o        the Seller has good title to the mortgage loan and the
        mortgage loan was subject to no offsets, defenses or
                counterclaims except as may be provided under the Relief Act
                  and except to the extent that any buydown agreement exists for
a buydown mortgage loan;                    

     o        there are no mechanics' liens or claims for work, labor or
                material affecting the related mortgaged property which are,
             or may be a lien prior to, or equal with, the lien of the
                 related mortgage (subject only to permissible title insurance
exceptions);                                

o        the mortgage loan constituted a valid first or other 
             applicable lien on, or a perfected security interest with
       respect to, the mortgaged property (subject only to
              permissible title insurance exceptions, if applicable, and
                certain other exceptions described in the Agreement) and the
              related mortgaged property is free from damage and in good
repair;                                     

      o        there are no delinquent tax or assessment liens against the
related mortgaged property;                 

      o        the mortgage loan is not more than 90 days delinquent as to
           any scheduled payment of principal and/or interest; and

       o        to the best of the Seller's knowledge, each mortgage loan at
               the time it was made complied in all material respects with
                applicable federal, state and local laws, including, without
               limitation, usury, equal credit opportunity, disclosure and
               recording laws; and, to the best of the Seller's knowledge,
                 each mortgage loan has been serviced in all material respects
                in accordance with applicable federal, state and local laws,
      including, without limitation, usury, equal credit
               opportunity, disclosure and recording laws and the terms of
          the related mortgage note, the mortgage and other loan
documents.                                  

If the mortgage loans include cooperative mortgage loans, representations and   
warranties with respect to title insurance or hazard insurance may not be given.
Generally, the cooperative itself is responsible for the maintenance of hazard  
insurance for property owned by the cooperative, and the borrowers              
(tenant-stockholders) of the cooperative do not maintain hazard insurance on    
their individual dwelling units. In the case of mortgage securities,            
representations and warranties will generally include, among other things, that 
as to each mortgage security, the Seller has good title to the mortgage security
free of any liens. In the event of a breach of a Seller's representation or     
warranty that materially adversely affects the interests of the securityholders 
in a mortgage loan or mortgage security, the related Seller will be obligated to
cure the breach or repurchase or, if permitted, replace the mortgage loan or    
mortgage security as described below. However, there can be no assurance that a 
Seller will honor its obligation to repurchase or, if permitted, replace any    
mortgage loan or mortgage security as to which a breach of a representation or  
warranty arises.                                                                

       All of the representations and warranties of a Seller in respect of a
mortgage loan or mortgage security will have been made as of the date on which  
the mortgage loan or mortgage security was purchased from the Seller by or on   
behalf of the company, unless a specific representation or warranty relates to  
an earlier date, in which case such representation or warranty shall be made as 
of such earlier date. As a result, the date as of which the representations and 
warranties were made may be a date prior to the date of initial issuance of the 
related series of securities or, in the case of a Designated Seller Transaction,
will be the date of closing of the related sale by the applicable Seller. A     
substantial period of time may have elapsed between the date as of which the    
representations and warranties were made and the later date of initial issuance 
of the related series of securities. Accordingly, the Seller's repurchase       
obligation (or, if specified in the related prospectus supplement, limited      
replacement option) described below will not arise if, during the period        
commencing on the date of sale of a mortgage loan or mortgage security by the   
Seller, an event occurs that would have given rise to a repurchase obligation   
had the event occurred prior to sale of the affected mortgage loan or mortgage  
security, as the case may be. The only representations and warranties to be made
for the benefit of holders of securities in respect of any related mortgage loan
or mortgage security relating to the period commencing on the date of sale of   
the mortgage loan or mortgage security by the Seller to or on behalf of the     
company will be the limited corporate representations of the company and the    
master servicer described under "Description of the Securities--Assignment of   
Trust Fund Assets" below.                                                       

       The company will assign to the trustee for the benefit of the holders
of the related series of securities all of its right, title and interest in each
purchase agreement by which it purchased a mortgage loan or mortgage security   
from a Seller insofar as the purchase agreement relates to the representations  
and warranties made by the Seller in respect of the mortgage loan or mortgage   
security and any remedies provided for with respect to any breach of            
representations and warranties with respect to the mortgage loan or mortgage    
security. If a Seller cannot cure a breach of any representation or warranty    
made by it in respect of a mortgage loan or mortgage security which materially  
and adversely affects the interests of the securityholders therein within a     
specified period after having discovered or received notice of a breach, then,  
the Seller will be obligated to repurchase the mortgage loan or mortgage        
security at a purchase price set forth in the related pooling and servicing     
agreement or other agreement which purchase price generally will be equal to the
principal balance thereof as of the date of repurchase plus accrued and unpaid  
interest through or about the date of repurchase at the related mortgage rate or
pass-through rate, as applicable (net of any portion of this interest payable to
the Seller in respect of master servicing compensation, special servicing       
compensation or servicing compensation, as applicable, and any interest retained
by the company).                                                                

   As to any mortgage loan required to be repurchased by a Seller as
provided above, rather than repurchase the mortgage loan, the Seller, if so     
specified in the related prospectus supplement, will be entitled, at its sole   
option, to remove the Deleted Mortgage Loan from the trust fund and substitute  
in its place a Qualified Substitute Mortgage Loan; however, with respect to a   
series of certificates for which no REMIC election is to be made, the           
substitution must be effected within 120 days of the date of the initial        
issuance of the related series of certificates. With respect to a trust fund for
which a REMIC election is to be made, the substitution of a defective mortgage  
loan must be effected within two years of the date of the initial issuance of   
the related series of certificates, and may not be made if the substitution     
would cause the trust fund, or any portion thereof, to fail to qualify as a     
REMIC or result in a Prohibited Transaction Tax under the Code. Any Qualified   
Substitute Mortgage Loan generally will, on the date of substitution:           

        o        have an outstanding principal balance, after deduction of the
                principal portion of the monthly payment due in the month of
            substitution, not in excess of the outstanding principal
           balance of the Deleted Mortgage Loan (the amount of any
                shortfall to be deposited in the Distribution Account by the
         related Seller or the master servicer in the month of
          substitution for distribution to the securityholders),

     o        have a mortgage rate and a Net Mortgage Rate not less than
               (and not materially greater than) the mortgage rate and Net
                Mortgage Rate, respectively, of the Deleted Mortgage Loan as
of the date of substitution,                

    o        have a Loan-to-Value Ratio at the time of substitution no
                higher than that of the Deleted Mortgage Loan at the time of
substitution,                               

      o        have a remaining term to maturity not materially earlier or
                  later than (and not later than the latest maturity date of any
        mortgage loan) that of the Deleted Mortgage Loan and

        o        comply with all of the representations and warranties made by
the Seller as of the date of substitution.  

     The related mortgage loan purchase agreement may include additional
requirements relating to ARM Loans or other specific types of mortgage loans, or
additional provisions relating to meeting the foregoing requirements on an      
aggregate basis where a number of substitutions occur contemporaneously. A      
Seller will have an option to substitute for a mortgage security that it is     
obligated to repurchase in connection with a breach of a representation and     
warranty only if it satisfies the criteria set forth in the related prospectus  
supplement.                                                                     

The master servicer or the trustee will be required under the 
applicable pooling and servicing agreement or servicing agreement to use        
reasonable efforts to enforce this repurchase or substitution obligation for the
benefit of the trustee and the securityholders, following those practices it    
would employ in its good faith business judgment and which are normal and usual 
in its general mortgage servicing activities; provided, however, that this      
repurchase or substitution obligation will not become an obligation of the      
master servicer in the event the applicable Seller fails to honor the           
obligation. In instances where a Seller is unable, or disputes its obligation,  
to repurchase affected mortgage loans and/or mortgage securities, the master    
servicer or the trustee, employing the standards set forth in the preceding     
sentence, may negotiate and enter into one or more settlement agreements with   
the related Seller that could provide for the repurchase of only a portion of   
the affected mortgage loans and/or mortgage securities. Any settlement could    
lead to losses on the mortgage loans and/or mortgage securities which would be  
borne by the related securities. In accordance with the above described         
practices, the master servicer or trustee will not be required to enforce any   
repurchase obligation of a Seller arising from any misrepresentation by the     
Seller, if the master servicer determines in the reasonable exercise of its     
business judgment that the matters related to the misrepresentation did not     
directly cause or are not likely to directly cause a loss on the related        
mortgage loan or mortgage security. If the Seller fails to repurchase and no    
breach of any other party's representations has occurred, the Seller's          
repurchase obligation will not become an obligation of the company or any other 
party. In the case of a Designated Seller Transaction where the Seller fails to 
repurchase a mortgage loan or mortgage security and neither the company nor any 
other entity has assumed the representations and warranties, the repurchase     
obligation of the Seller will not become an obligation of the company or any    
other party. The foregoing obligations will constitute the sole remedies        
available to securityholders or the trustee for a breach of any representation  
by a Seller or for any other event giving rise to the obligations as described  
above.                                                                          

  Neither the company nor the master servicer will be obligated to
repurchase a mortgage loan or mortgage security if a Seller defaults on its     
obligation to do so, and no assurance can be given that the Sellers will        
carryout their repurchase obligations. A default by a Seller is not a default by
the company or by the master servicer. However, to the extent that a breach of  
the representations and warranties of a Seller also constitutes a breach of a   
representation made by the company or the master servicer, as described below   
under "Description of the Securities--Assignment of Trust Fund Assets," the     
company or the master servicer may have a repurchase or substitution obligation.
Any mortgage loan or mortgage security not so repurchased or substituted for    
shall remain in the related trust fund and any losses related thereto shall be  
allocated to the related credit enhancement, to the extent available, and       
otherwise to one or more classes of the related series of securities.           

If a person other than a Seller makes the representations and 
warranties referred to in the first paragraph of this "--Representations by     
Sellers" section, or a person other than a Seller is responsible for            
repurchasing or replacing any mortgage loan or mortgage security for a breach of
those representations and warranties, the identity of that person will be       
specified in the related prospectus supplement.                                 

OPTIONAL PURCHASE OF DEFAULTED MORTGAGE LOANS                                   

        If the related prospectus supplement so specifies, the master servicer
or another entity identified in such prospectus supplement may, at its option,  
purchase from the trust fund any mortgage loan which is delinquent in payment by
90 days or more or is an REO Mortgage Loan as the date of such purchase. Any    
such purchase shall be at the price described in the related prospectus         
supplement.                                                                     

 SERVICING OF MORTGAGE LOANS

GENERAL                                                                         

      The mortgage loans and mortgage securities included in each mortgage
pool will be serviced and administered pursuant to either a pooling and         
servicing agreement or a servicing agreement. A form of pooling and servicing   
agreement and a form of servicing agreement have each been filed as an exhibit  
to the registration statement of which this prospectus is a part. However, the  
provisions of each pooling and servicing agreement or servicing agreement will  
vary depending upon the nature of the related mortgage pool. The following      
summaries describe the material servicing-related provisions that may appear in 
a pooling and servicing agreement or servicing agreement for a mortgage pool    
that includes mortgage loans. The related prospectus supplement will describe   
any servicing-related provision of its related pooling and servicing agreement  
or servicing agreement that materially differs from the description thereof     
contained in this prospectus. If the related mortgage pool includes mortgage    
securities, the related prospectus supplement will summarize the material       
provisions of the related pooling and servicing agreement and identify the      
responsibilities of the parties to that pooling and servicing agreement.        

  With respect to any series of securities as to which the related
mortgage pool includes mortgage securities, the servicing and administration of 
the mortgage loans underlying any mortgage securities will be pursuant to the   
terms of those mortgage securities. Mortgage loans underlying mortgage          
securities in a mortgage pool will be serviced and administered generally in the
same manner as mortgage loans included in a mortgage pool, however, there can be
no assurance that this will be the case, particularly if the mortgage securities
are issued by an entity other than the company or any of its affiliates.        

THE MASTER SERVICER                                                             

       The master servicer, if any, for a series of securities will be named
in the related prospectus supplement and may be an affiliate of the company. The
master servicer is required to maintain a fidelity bond and errors and omissions
policy with respect to its officers and employees and other persons acting on   
behalf of the master servicer in connection with its activities under a pooling 
and servicing agreement or a servicing agreement.                               

         The master servicer shall supervise, monitor and oversee the obligation
of the servicers to service and administer their respective mortgage loans in   
accordance with the terms of the applicable servicing agreements and shall have 
full power and authority to do any and all things which it may deem necessary or
desirable in connection with such master servicing and administration. In       
addition, the Master Servicer shall oversee and consult with each servicer as   
necessary from time-to-time to carry out the master servicer's obligations under
the pooling and servicing agreement or servicing agreement, shall receive,      
review and evaluate all reports, information and other data provided to the     
master servicer by each servicer and shall cause each servicer to perform and   
observe the covenants, obligations and conditions to be performed or observed by
such servicer under its applicable servicing agreement. Each pooling and        
servicing agreement or servicing agreement, as applicable, for a series of      
securities, will provide that in the event a servicer fails to perform its      
obligations in accordance with its servicing agreement, the master servicer     
shall terminate such servicer and act as servicer of the related mortgage loans 
or cause the trustee to enter into a new servicing agreement with a successor   
servicer selected by the master servicer.                                       

THE SERVICERS                                                                   

         Each of the servicers, if any, for a series of securities will be named
in the related prospectus supplement and may be an affiliate of the company or  
the Seller of the mortgage loans for which it is acting as servicer. Each       
servicer will servicer the mortgage loans pursuant to a servicing agreement     
between the master servicer and the related servicer, which servicing agreement 
will not contain any terms which are inconsistent with the related agreement.   
Each servicer is required to maintain a fidelity bond and errors and omissions  
policy with respect to its officers and employees and other persons acting on   
behalf of the servicer in connection with its activities under a servicing      
agreement.                                                                      

COLLECTION AND OTHER SERVICING PROCEDURES; MORTGAGE LOAN MODIFICATIONS          

       The master servicer for any mortgage pool will be obligated under the
pooling and servicing agreement or servicing agreement to supervise, monitor and
oversee the obligations of the servicers to service and administer their        
respective mortgage loans in the mortgage pool for the benefit of the related   
securityholders, in accordance with applicable law, the terms of the pooling and
servicing agreement or servicing agreement, the mortgage loans and any          
instrument of credit enhancement included in the related trust fund, and, to the
extent consistent with the foregoing, the customs and standards of prudent      
institutional mortgage lenders servicing comparable mortgage loans for their own
account in the jurisdictions where the related mortgaged properties are located.
Subject to the foregoing, the master servicer will have full power and authority
to do any and all things in connection with servicing and administration that it
may deem necessary and desirable.                                               

       As part of its servicing duties, the master servicer will be required
to, and to cause each of the servicers to, make reasonable efforts to collect   
all payments called for under the terms and provisions of the mortgage loans    
that it services. The master servicer and each servicer will be obligated to    
follow the same collection procedures as it would follow for comparable mortgage
loans held for its own account, so long as these procedures are consistent with 
the servicing standard of and the terms of the related pooling and servicing    
agreement or servicing agreement and the servicing standard generally described 
in the preceding paragraph, and do not impair recovery under any instrument of  
credit enhancement included in the related trust fund. Consistent with the      
foregoing, the master servicer or any servicer will be permitted, in its        
discretion, to waive any prepayment premium, late payment charge or other charge
in connection with any mortgage loan.                                           

     Under a pooling and servicing agreement or a servicing agreement, a
master servicer and each servicer will be granted discretion to extend relief to
mortgagors whose payments become delinquent. In the case of single family loans 
and Contracts, a master servicer or servicer may, for example, grant a period of
temporary indulgence to a mortgagor or may enter into a liquidating plan        
providing for repayment of delinquent amounts within a specified period from the
date of execution of the plan. However, the master servicer or servicer must    
first determine that any waiver or extension will not impair the coverage of any
related insurance policy or materially adversely affect the security for the    
mortgage loan. In addition, unless otherwise specified in the related prospectus
supplement, if a material default occurs or a payment default is reasonably     
foreseeable with respect to a multifamily loan, commercial loan or mixed-use    
loan, the master servicer or servicer will be permitted, subject to any specific
limitations set forth in the related pooling and servicing agreement or         
servicing agreement and described in the related prospectus supplement, to      
modify, waive or amend any term of such mortgage loan, including deferring      
payments, extending the stated maturity date or otherwise adjusting the payment 
schedule, provided that the modification, waiver or amendment (1) is reasonably 
likely to produce a greater recovery with respect to that mortgage loan on a    
present value basis than would liquidation and (2) will not adversely affect the
coverage under any applicable instrument of credit enhancement.                 

         In the case of multifamily loans, commercial loans and mixed-use loans,
a mortgagor's failure to make required mortgage loan payments may mean that     
operating income is insufficient to service the mortgage debt, or may reflect   
the diversion of that income from the servicing of the mortgage debt. In        
addition, a mortgagor under a multifamily, commercial or mixed-use loan that is 
unable to make mortgage loan payments may also be unable to make timely payment 
of taxes and otherwise to maintain and insure the related mortgaged property.   
Generally, the related master servicer or servicer will be required to monitor  
any multifamily loan or commercial loan that is in default, evaluate whether the
causes of the default can be corrected over a reasonable period without         
significant impairment of the value of the related mortgaged property, initiate 
corrective action in cooperation with the mortgagor if cure is likely, inspect  
the related mortgaged property and take any other actions as are consistent with
the servicing standard described above and in the pooling and servicing         
agreement or servicing agreement. A significant period of time may elapse before
the master servicer or servicer is able to assess the success of any such       
corrective action or the need for additional initiatives. The time within which 
the master servicer or servicer can make the initial determination of           
appropriate action, evaluate the success of corrective action, develop          
additional initiatives, institute foreclosure proceedings and actually foreclose
(or accept a deed to a mortgaged property in lieu of foreclosure) on behalf of  
the securityholders of the related series may vary considerably depending on the
particular multifamily, commercial or mixed-use loan, the mortgaged property,   
the mortgagor, the presence of an acceptable party to assume that loan and the  
laws of the jurisdiction in which the mortgaged property is located. If a       
mortgagor files a bankruptcy petition, the master servicer or servicer may not  
be permitted to accelerate the maturity of the related multifamily, commercial  
or mixed-use loan or to foreclose on the mortgaged property for a considerable  
period of time. See "Legal Aspects of Mortgage Loans."                          

    Some or all of the mortgage loans in a mortgage pool may contain a
due-on-sale clause that entitles the lender to accelerate payment of the        
mortgage loan upon any sale or other transfer of the related mortgaged property 
made without the lender's consent. In any case in which a mortgaged property is 
being conveyed by the mortgagor, the master servicer will in general be         
obligated, to the extent it has knowledge of the conveyance, to exercise its    
rights, or cause the servicer of the mortgage loan to exercise its rights, to   
accelerate the maturity of the related mortgage loan under any due-on-sale      
clause applicable thereto, but only if the exercise of these rights is permitted
by applicable law and only to the extent it would not adversely affect or       
jeopardize coverage under any Primary Insurance Policy or applicable credit     
enhancement arrangements. If applicable law prevents the master servicer or     
servicer from enforcing a due-on-sale or due-on-encumbrance clause or if the    
master servicer or servicer determines that it is reasonably likely that the    
related mortgagor would institute a legal action to avoid enforcement of a      
due-on-sale or due-on-encumbrance clause, the master servicer or servicer may   
enter into (1) an assumption and modification agreement with the person to whom 
the property has been or is about to be conveyed, pursuant to which this person 
becomes liable under the mortgage note subject to specified conditions and the  
mortgagor, to the extent permitted by applicable law, remains liable thereon or 
(2) a substitution of liability agreement pursuant to which the original        
mortgagor is released from liability and the person to whom the property has    
been or is about to be conveyed is substituted for the original mortgagor and   
becomes liable under the mortgage note, subject to specified conditions. The    
original mortgagor may be released from liability on a single family loan if the
master servicer or servicer shall have determined in good faith that the release
will not adversely affect the collectability of the mortgage loan. The master   
servicer or servicer will determine whether to exercise any right the trustee   
may have under any due-on-sale or due-on-encumbrance provision in a multifamily 
loan, commercial loan or mixed-use loan in a manner consistent with the         
servicing standard. The master servicer or servicer generally will be entitled  
to retain as additional servicing compensation any fee collected in connection  
with the permitted transfer of a mortgaged property. See "Legal Aspects of      
Mortgage Loans--Enforceability of Certain Provisions." FHA loans do not contain 
due-on-sale or due-on-encumbrance clauses and may be assumed by the purchaser of
the mortgaged property.                                                         

    Mortgagors may, from time to time, request partial releases of the
mortgaged properties, easements, consents to alteration or demolition and other 
similar matters. The master servicer or the servicer may approve a request if it
has determined, exercising its good faith business judgment in the same manner  
as it would if it were the owner of the related mortgage loan, that approval    
will not adversely affect the security for, or the timely and full              
collectability of, the related mortgage loan. Any fee collected by the master   
servicer or servicer for processing these requests will be retained by the      
master servicer or servicer, as the case may be, as additional servicing        
compensation.                                                                   

      In the case of mortgage loans secured by junior liens on the related
mortgaged properties, the master servicer will be required to file, or cause the
servicer of the mortgage loans to file, of record a request for notice of any   
action by a superior lienholder under the senior lien for the protection of the 
related trustee's interest, where permitted by local law and whenever applicable
state law does not require that a junior lienholder be named as a party         
defendant in foreclosure proceedings in order to foreclose the junior           
lienholder's equity of redemption. The master servicer also will be required to 
notify, or cause the servicer of the mortgage loan to notify, any superior      
lienholder in writing of the existence of the mortgage loan and request         
notification of any action (as described below) to be taken against the         
mortgagor or the mortgaged property by the superior lienholder. If the master   
servicer or a servicer is notified that any superior lienholder has accelerated 
or intends to accelerate the obligations secured by the related senior lien, or 
has declared or intends to declare a default under the mortgage or the          
promissory note secured thereby, or has filed or intends to file an election to 
have the related mortgaged property sold or foreclosed, then, the master        
servicer will be required to take, or cause the servicer of the related         
mortgaged property to take, on behalf of the related trust fund, whatever       
actions are necessary to protect the interests of the related securityholders,  
and/or to preserve the security of the related mortgage loan, subject to the    
REMIC Provisions, if applicable. The master servicer will be required to        
advance, or cause the servicer of the mortgage loan to advance, the necessary   
funds to cure the default or reinstate the superior lien, if the advance is in  
the best interests of the related securityholders and the master servicer or the
servicer, as the case may be, determines the advances are recoverable out of    
payments on or proceeds of the related mortgage loan.                           

    The master servicer for any mortgage pool will also be required to
perform, or cause the servicers of the mortgage loans in the mortgage pool to   
perform, other customary functions of a servicer of comparable loans, including 
maintaining escrow or impound accounts for payment of taxes, insurance premiums 
and similar items, or otherwise monitoring the timely payment of those items;   
adjusting mortgage rates on ARM Loans; maintaining Buydown Accounts; supervising
foreclosures and similar proceedings; managing REO properties; and maintaining  
servicing records relating to the mortgage loans in the mortgage pool. The      
master servicer will be responsible for filing and settling claims in respect of
particular mortgage loans under any applicable instrument of credit enhancement.
See "Description of Credit Enhancement."                                        

SPECIAL SERVICERS                                                               

        If and to the extent specified in the related prospectus supplement, a
special servicer may be a party to the related pooling and servicing agreement  
or servicing agreement or may be appointed by the master servicer or another    
specified party to perform specified duties in respect of servicing the related 
mortgage loans that would otherwise be performed by the master servicer (for    
example, the workout and/or foreclosure of defaulted mortgage loans). The rights
and obligations of any special servicer will be specified in the related        
prospectus supplement, and the master servicer will be liable for the           
performance of a special servicer only if, and to the extent, set forth in that 
prospectus supplement.                                                          

REALIZATION UPON OR SALE OF DEFAULTED MORTGAGE LOANS                            

       Except as described below, the master servicer will be required, in a
manner consistent with the servicing standard, to, or to cause the servicers of 
the mortgage loans to, foreclose upon or otherwise comparably convert the       
ownership of properties securing any mortgage loans in the related mortgage pool
that come into and continue in default and as to which no satisfactory          
arrangements can be made for collection of delinquent payments. Generally, the  
foreclosure process will commence no later than 90 days after delinquency of the
related mortgage loan. The master servicer and each servicer will be authorized 
to institute foreclosure proceedings, exercise any power of sale contained in   
the related mortgage, obtain a deed in lieu of foreclosure, or otherwise acquire
title to the related mortgaged property, by operation of law or otherwise, if   
the action is consistent with the servicing standard. The master servicer's or  
applicable servicer's actions in this regard must be conducted, however, in a   
manner that will permit recovery under any instrument of credit enhancement     
included in the related trust fund. In addition, neither the master servicer nor
any other servicer will be required to expend its own funds in connection with  
any foreclosure or to restore any damaged property unless it shall determine    
that (1) the foreclosure and/or restoration will increase the proceeds of       
liquidation of the mortgage loan to the related securityholders after           
reimbursement to itself for these expenses and (2) these expenses will be       
recoverable to it from related Insurance Proceeds, Liquidation Proceeds or      
amounts drawn out of any fund or under any instrument constituting credit       
enhancement (respecting which it shall have priority for purposes of withdrawal 
from the Distribution Account in accordance with the pooling and servicing      
agreement or servicing agreement).                                              

However, unless otherwise specified in the related prospectus 
supplement, neither the master servicer nor any other servicer may acquire title
to any multifamily property or commercial property securing a mortgage loan or  
take any other action that would cause the related trustee, for the benefit of  
securityholders of the related series, or any other specified person to be      
considered to hold title to, to be a "mortgagee-in-possession" of, or to be an  
"owner" or an "operator" of such mortgaged property within the meaning of       
federal environmental laws, unless the master servicer or the servicer of the   
mortgage loan has previously determined, based on a report prepared by a person 
who regularly conducts environmental audits (which report will be an expense of 
the trust fund), that either:                                                   

         (1)      the mortgaged property is in compliance with
       applicable environmental laws and regulations or, if not, that taking
actions as are necessary to bring the mortgaged property into 
      compliance with these laws is reasonably likely to produce a greater
      recovery on a present value basis than not taking those actions; and

                (2)      there are no circumstances or conditions present at
    the mortgaged property that have resulted in any contamination for
    which investigation, testing, monitoring, containment, clean-up or
       remediation could be required under any applicable environmental laws
      and regulations or, if those circumstances or conditions are present
        for which any such action could be required, taking those actions with
     respect to the mortgaged property is reasonably likely to produce a
 greater recovery on a present value basis than not taking those
actions. See "Legal Aspects of Mortgage Loans--Environmental  
Legislation."                                                 

         Neither the master servicer nor any other servicer will be obligated to
foreclose upon or otherwise convert the ownership of any mortgaged property     
securing a single family loan if it has received notice or has actual knowledge 
that the property may be contaminated with or affected by hazardous wastes or   
hazardous substances; however, environmental testing will not be required. The  
master servicer or servicer, as applicable, will not be liable to the           
securityholders of the related series if, based on its belief that no such      
contamination or effect exists, the master servicer or such servicer forecloses 
on a mortgaged property and takes title to the mortgaged property, and          
thereafter the mortgaged property is determined to be so contaminated or        
affected.                                                                       

    With respect to a mortgage loan in default, the master servicer or
servicer of the mortgage loan may pursue foreclosure (or similar remedies)      
concurrently with pursuing any remedy for a breach of a representation and      
warranty. However, neither the master servicer nor the servicer of the mortgage 
loan is required to continue to pursue both remedies if it determines that one  
remedy is more likely than the other to result in a greater recovery. Upon the  
first to occur of final liquidation (by foreclosure or otherwise) or a          
repurchase or substitution pursuant to a breach of a representation and         
warranty, the mortgage loan will be removed from the related trust fund if it   
has not been removed previously. The master servicer or servicer may elect to   
treat a defaulted mortgage loan as having been finally liquidated if a          
substantial portion or all of the amounts expected to be received from that     
mortgage loan have been received. Any additional liquidation expenses relating  
to the mortgage loan thereafter incurred will be reimbursable to the master     
servicer or servicer, as applicable, from any amounts otherwise distributable to
holders of securities of the related series, or may be offset by any subsequent 
recovery related to the mortgage loan. Alternatively, for purposes of           
determining the amount of related Liquidation Proceeds to be distributed to     
securityholders, the amount of any Realized Loss or the amount required to be   
drawn under any applicable form of credit support, the master servicer and      
servicer may take into account minimal amounts of additional receipts expected  
to be received, as well as estimated additional liquidation expenses expected to
be incurred in connection with the defaulted mortgage loan.                     

       As provided above, the master servicer or a servicer may pass through
less than the full amount it expects to receive from the related mortgage loan; 
however, the master servicer or servicer may only do this if the master servicer
or servicer reasonably believes it will maximize the proceeds to the            
securityholders in the aggregate. To the extent the master servicer or servicer 
receives additional recoveries following liquidation, the amount of the Realized
Loss will be restated, and the additional recoveries will be passed through the 
trust as Liquidation Proceeds. In the event the amount of the Realized Loss is  
restated, the amount of overcollateralization or the principal balance of the   
most subordinate class of securities in the trust may be increased. However, the
holders of any securities whose principal balance is increased will not be      
reimbursed interest for the period during which the principal balance of their  
securities was lower.                                                           

       With respect to a series of securities, if so provided in the related
prospectus supplement, the applicable form of credit enhancement may provide, to
the extent of coverage, that a defaulted mortgage loan will be removed from the 
trust fund prior to the final liquidation thereof. In addition, a pooling and   
servicing agreement or servicing agreement may grant to the company, an         
affiliate of the company, the master servicer, a special servicer, a provider of
credit enhancement and/or the holder or holders of specified classes of         
securities of the related series a right of first refusal to purchase from the  
trust fund, at a predetermined purchase price, any mortgage loan as to which a  
specified number of scheduled payments are delinquent. If the purchase price is 
insufficient to fully fund the entitlements of securityholders to principal and 
interest, it will be specified in the related prospectus supplement.            
Furthermore, a pooling and servicing agreement or a servicing agreement may     
authorize the master servicer or servicer of the mortgage loan to sell any      
defaulted mortgage loan if and when the master servicer or servicer determines, 
consistent with the servicing standard, that the sale would produce a greater   
recovery to securityholders on a present value basis than would liquidation of  
the related mortgaged property.                                                 

  In the event that title to any mortgaged property is acquired by
foreclosure or by deed in lieu of foreclosure, the deed or certificate of sale  
will be issued to the trustee or to its nominee on behalf of securityholders of 
the related series. Notwithstanding any acquisition of title and cancellation of
the related mortgage loan, the REO Mortgage Loan will be considered for most    
purposes to be an outstanding mortgage loan held in the trust fund until the    
mortgaged property is sold and all recoverable Liquidation Proceeds and         
Insurance Proceeds have been received with respect to the defaulted mortgage    
loan. For purposes of calculations of amounts distributable to securityholders  
in respect of an REO Mortgage Loan, the amortization schedule in effect at the  
time of any acquisition of title (before any adjustment thereto by reason of any
bankruptcy or any similar proceeding or any moratorium or similar waiver or     
grace period) will be deemed to have continued in effect (and, in the case of an
ARM Loan, the amortization schedule will be deemed to have adjusted in          
accordance with any interest rate changes occurring on any adjustment date      
therefor) so long as the REO Mortgage Loan is considered to remain in the trust 
fund.                                                                           

      If title to any mortgaged property is acquired by a trust fund as to
which a REMIC election has been made, the master servicer, on behalf of the     
trust fund, will be required to sell, or cause the servicer of the mortgage loan
to sell, the mortgaged property within three years of acquisition, unless (1)   
the IRS grants an extension of time to sell the property or (2) the trustee     
receives an opinion of independent counsel to the effect that the holding of the
property by the trust fund for more than three years after its acquisition will 
not result in the imposition of a tax on the trust fund or cause the trust fund 
to fail to qualify as a REMIC under the Code at any time that any certificate is
outstanding. Subject to the foregoing and any other tax-related constraints, the
master servicer generally will be required to solicit bids, or to cause a       
servicer to solicit bids, for any mortgaged property so acquired in a manner as 
will be reasonably likely to realize a fair price for the property. If title to 
any mortgaged property is acquired by a trust fund as to which a REMIC election 
has been made, the master servicer will also be required to ensure that the     
mortgaged property is administered so that it constitutes "foreclosure property"
within the meaning of Section 860G(a)(8) of the Code at all times, that the sale
of the property does not result in the receipt by the trust fund of any income  
from non-permitted assets as described in Section 860F(a)(2)(B) of the Code, and
that the trust fund does not derive any "net income from foreclosure property"  
within the meaning of Section 860G(c)(2) of the Code with respect to the        
property.                                                                       

        If Liquidation Proceeds collected with respect to a defaulted mortgage
loan are less than the outstanding principal balance of the defaulted mortgage  
loan plus accrued interest plus the aggregate amount of reimbursable expenses   
incurred by the master servicer or the servicer, as applicable, with respect to 
the mortgage loan, and the shortfall is not covered under any applicable        
instrument or fund constituting credit enhancement, the trust fund will realize 
a loss in the amount of the difference. The master servicer or servicer, as     
applicable, will be entitled to reimburse itself from the Liquidation Proceeds  
recovered on any defaulted mortgage loan, prior to the distribution of          
Liquidation Proceeds to securityholders, amounts that represent unpaid servicing
compensation in respect of the mortgage loan, unreimbursed servicing expenses   
incurred with respect to the mortgage loan and any unreimbursed advances of     
delinquent payments made with respect to the mortgage loan. If so provided in   
the related prospectus supplement, the applicable form of credit enhancement may
provide for reinstatement subject to specified conditions in the event that,    
following the final liquidation of a mortgage loan and a draw under the credit  
enhancement, subsequent recoveries are received. In addition, if a gain results 
from the final liquidation of a defaulted mortgage loan or an REO Mortgage Loan 
which is not required by law to be remitted to the related mortgagor, the master
servicer or servicer, as applicable, will be entitled to retain the gain as     
additional servicing compensation unless the related prospectus supplement      
provides otherwise. For a description of the master servicer's (or other        
specified person's) obligations to maintain and make claims under applicable    
forms of credit enhancement and insurance relating to the mortgage loans, see   
"Description of Credit Enhancement" and "Description of Primary Mortgage        
Insurance, Hazard Insurance; Claims Thereunder."                                

SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES; RETAINED INTEREST     

        The principal servicing compensation to be paid to the master servicer
in respect of its master servicing activities for a series of securities will be
equal to the percentage or range of percentages per annum described in the      
related prospectus supplement of the outstanding principal balance of each      
mortgage loan, and this compensation will be retained by it on a monthly or     
other periodic basis from collections of interest on each mortgage loan in the  
related trust fund at the time the collections are deposited into the applicable
Distribution Account. This portion of the servicing fee will be calculated with 
respect to each mortgage loan by multiplying the fee by the principal balance of
the mortgage loan. In addition, to the extent not permitted to be retained by   
the servicer of the mortgage loan, the master servicer may retain all prepayment
premiums, assumption fees and late payment charges, to the extent collected from
mortgagors, and any benefit which may accrue as a result of the investment of   
funds in the applicable Distribution Account. Any additional servicing          
compensation will be described in the related prospectus supplement.            

     The principal servicing compensation to be paid to each servicer in
respect of its servicing activities for a series of securities will be equal to 
the percentage or range of percentages per annum described in the related       
prospectus supplement of the outstanding principal balance of each mortgage loan
serviced by such servicer, and this compensation will be retained by it on a    
monthly or other periodic basis from collections of interest on each mortgage   
loan in the related trust fund at the time the collections are deposited into   
such servicer's Protected Account. This portion of the servicing fee will be    
calculated with respect to each mortgage loan serviced by a servicer by         
multiplying the fee by the principal balance of the mortgage loan. In addition, 
each servicer may retain all prepayment premiums, assumption fees and late      
payment charges, to the extent collected from mortgagors, and any benefit which 
may accrue as a result of the investment of funds in its Protected Account. Any 
additional servicing compensation will be described in the related prospectus   
supplement.                                                                     

      The master servicer will pay or cause to be paid some of the ongoing
expenses associated with each trust fund and incurred by it in connection with  
its responsibilities under the pooling and servicing agreement or servicing     
agreement, including, if so specified in the related prospectus supplement,     
payment of any fee or other amount payable in respect of any alternative credit 
enhancement arrangements, payment of the fees and disbursements of the trustee, 
any custodian appointed by the trustee and the security registrar, and payment  
of expenses incurred in enforcing the obligations of the servicers and the      
Sellers. The master servicer will be entitled to reimbursement of expenses      
incurred in enforcing the obligations of the servicers and the Sellers under    
limited circumstances. In addition, the master servicer and each servicer will  
be entitled to reimbursements for some of its expenses incurred in connection   
with liquidated mortgage loans and in connection with the restoration of        
mortgaged properties, this right of reimbursement being prior to the rights of  
securityholders to receive any related Liquidation Proceeds or Insurance        
Proceeds. If and to the extent so provided in the related prospectus supplement,
the master servicer and each servicer will be entitled to receive interest on   
amounts advanced to cover reimbursable expenses for the period that the advances
are outstanding at the rate specified in the prospectus supplement, and the     
master servicer and each servicer will be entitled to payment of the interest   
periodically from general collections on the mortgage loans in the related trust
fund prior to any payment to securityholders or as otherwise provided in the    
related pooling and servicing agreement or servicing agreement and described in 
the prospectus supplement.                                                      

   The prospectus supplement for a series of securities will specify
whether there will be any interest in the mortgage loans retained by the        
company. Any retained interest will be a specified portion of the interest      
payable on each mortgage loan in a mortgage pool and will not be part of the    
related trust fund. Any retained interest will be established on a loan-by-loan 
basis and the amount thereof with respect to each mortgage loan in a mortgage   
pool will be specified on an exhibit to the related pooling and servicing       
agreement or servicing agreement. Any partial recovery of interest in respect of
a mortgage loan will be allocated between the owners of any retained interest   
and the holders of classes of securities entitled to payments of interest as    
provided in the related prospectus supplement and the applicable pooling and    
servicing agreement or servicing agreement.                                     

         If and to the extent provided in the related prospectus supplement, the
master servicer and the servicers may be required to apply a portion of the     
servicing compensation otherwise payable to it in respect of any period to any  
Prepayment Interest Shortfalls resulting from mortgagor prepayments during that 
period. See "Yield Considerations."                                             

EVIDENCE AS TO COMPLIANCE                                                       

   Each pooling and servicing agreement and servicing agreement will
provide that on or before a specified date in each year, beginning the first    
such date that is at least a specified number of months after the cut-off date, 
a firm of independent public accountants will furnish a statement to the company
and the trustee (and to the master servicer if such statement is being furnished
with respect to a servicer) to the effect that, on the basis of an examination  
by the firm conducted substantially in compliance with the Uniform Single       
Attestation Program for Mortgage Bankers or the Audit Program for mortgages     
serviced for Freddie Mac, the servicing of mortgage loans under agreements      
(including the related pooling and servicing agreement or servicing agreement)  
substantially similar to each other was conducted in compliance with the        
agreements except for significant exceptions or errors in records that, in the  
opinion of the firm, the Uniform Single Attestation Program for Mortgage Bankers
or the Audit Program for mortgages serviced for Freddie Mac requires it to      
report. In rendering its statement the firm may rely, as to the matters relating
to the direct servicing of mortgage loans by subservicers, upon comparable      
statements for examinations conducted substantially in compliance with the      
Uniform Single Attestation Program for Mortgage Bankers or the Audit Program for
mortgages serviced for Freddie Mac (rendered within one year of the statement)  
of firms of independent public accountants with respect to those subservicers   
which also have been the subject of this type of examination. If the master     
servicer has not, during the course of a fiscal year, directly serviced any of  
the mortgage loans, such accountants statement will only be provided with       
respect to the servicers of the mortgage loans and no such accountants statement
will be provided with respect to the master servicer.                           

        Each pooling and servicing agreement and servicing agreement will also
provide for delivery to the trustee, on or before a specified date in each year,
of an annual statement signed by one or more officers of the master servicer to 
the effect that, to the best knowledge of each officer, the master servicer has 
fulfilled in all material respects its obligations under the pooling and        
servicing agreement or servicing agreement throughout the preceding year or, if 
there has been a material default in the fulfillment of any obligation, the     
statement shall specify each known default and the nature and status thereof.   
This statement may be provided as a single form making the required statements  
as to more than one pooling and servicing agreement or servicing agreement. In  
addition, pursuant to its respective servicing agreement, one or more officers  
of each servicer will also be required to provide the foregoing annual statement
to the master servicer prior to the time that the master servicer is required to
deliver its annual statement to the trustee.                                    

         Copies of the annual accountants' statement and the annual statement of
officers of a master servicer may be obtained by securityholders without charge 
upon written request to the master servicer or trustee.                         

 DESCRIPTION OF THE SECURITIES

GENERAL                                                                         

      The securities will be issued in series. Each series of certificates
(or, in some instances, two or more series of certificates) will be issued      
pursuant to a pooling and servicing agreement, similar to one of the forms filed
as an exhibit to the registration statement of which this prospectus is a part. 
Each pooling and servicing agreement will be filed with the Commission as an    
exhibit to a Current Report on Form 8-K. Each series of notes (or, in some      
instances, two or more series of notes) will be issued pursuant to an indenture 
between the related Issuer and the trustee, similar to the form filed as an     
exhibit to the registration statement of which this prospectus is a part. The   
trust fund will be created pursuant to an owner trust agreement between the     
company and the owner trustee. Each indenture, along with the related servicing 
agreement and owner trust agreement, will be filed with the Commission as an    
exhibit to a Current Report on Form 8-K. Qualified counsel will render an       
opinion to the effect that the trust fund's assets will not be considered assets
of the Seller or the company in the event of the bankruptcy of the Seller or the
company. The following summaries (together with additional summaries under "The 
Agreements" below) describe the material provisions relating to the securities  
common to each Agreement.                                                       

 Certificates of each series covered by a particular pooling and
servicing agreement will evidence specified beneficial ownership interests in a 
separate trust fund created pursuant to the pooling and servicing agreement.    
Each series of notes covered by a particular indenture will evidence            
indebtedness of a separate trust fund created pursuant to the related owner     
trust agreement. A trust fund will consist of, to the extent provided in the    
pooling and servicing agreement or owner trust agreement:                       

     o        the mortgage loans (and the related mortgage documents) or
         interests therein (including any mortgage securities)
                underlying a particular series of securities as from time to
              time are subject to the pooling and servicing agreement or
                  servicing agreement, exclusive of, if specified in the related
                  prospectus supplement, any interest retained by the company or
             any of its affiliates with respect to each mortgage loan;

        o        all payments and collections in respect of the mortgage loans
                 or mortgage securities due after the related cut-off date, as
            from time to time are identified as deposited in respect
                  thereof in the related Protected Account, Distribution Account
                 or any other account established pursuant to the Agreement as
described below;                            

    o        any property acquired in respect of mortgage loans in the
                 trust fund, whether through foreclosure of a mortgage loan or
by deed in lieu of foreclosure;             

     o        hazard insurance policies, Primary Insurance Policies, FHA
               insurance policies and VA guarantees, if any, maintained in
                respect of mortgage loans in the trust fund and the proceeds
of these policies;                          

     o        the rights of the company under any mortgage loan purchase
              agreement, including in respect of any representations and
warranties therein; and                     

         o        any combination, as and to the extent specified in the related
            prospectus supplement, of a financial guaranty insurance
             policy, mortgage pool insurance policy, letter of credit,
                 special hazard insurance policy, or currency or interest rate
                 exchange agreements as described under "Description of Credit
                  Enhancement" or any other form of credit enhancement as may be
   described in the related prospectus supplement.

If provided in the related prospectus supplement, the original
principal amount of a series of securities may exceed the principal balance of  
the mortgage loans or mortgage securities initially being delivered to the      
trustee. Cash in an amount equal to this difference will be deposited into a    
pre-funding account maintained with the trustee. During the period set forth in 
the related prospectus supplement, amounts on deposit in the pre-funding account
may be used to purchase additional mortgage loans or mortgage securities for the
related trust fund. Any amounts remaining in the pre-funding account at the end 
of the period will be distributed as a principal prepayment to the holders of   
the related series of securities at the time and in the manner set forth in the 
related prospectus supplement.                                                  

      Each series of securities may consist of any one or a combination of
the following:                                                                  

o        a single class of securities;                        

    o        two or more classes of securities, one or more classes of
                 which may be senior in right of payment to one or more of the
             other classes, and as to which some classes of senior (or
             subordinate) securities may be senior to other classes of
           senior (or subordinate) securities, as described in the
respective prospectus supplement;           

    o        two or more classes of securities, one or more classes of
which will be Strip Securities;             

   o        two or more classes of securities which differ as to the
                  timing, sequential order, rate, pass-through rate or amount of
                  distributions of principal or interest or both, or as to which
                 distributions of principal or interest or both on a class may
                  be made upon the occurrence of specified events, in accordance
               with a schedule or formula (including "planned amortization
                  classes" and "targeted amortization classes"), or on the basis
                 of collections from designated portions of the mortgage pool,
                and which classes may include one or more classes of Accrual
Securities; or                              

    o        other types of classes of securities, as described in the
related prospectus supplement.              

With respect to any series of notes, the related Equity Certificates, insofar as
they represent the beneficial ownership interest in the Issuer, will be         
subordinate to the related notes. As to each series, the offered securities will
be rated in one of the four highest rating categories by one or more Rating     
Agencies. Credit support for the offered securities of each series may be       
provided by a financial guaranty insurance policy, mortgage pool insurance      
policy, letter of credit, reserve fund, currency or interest rate exchange      
agreement, overcollateralization, cross-collateralization or by the             
subordination of one or more other classes of securities, each, as described    
under "Description of Credit Enhancement," or by any combination of the         
foregoing.                                                                      

      If so specified in the prospectus supplement relating to a series of
certificates, one or more elections may be made to treat the related trust fund,
or a designated portion thereof, as a REMIC. If an election is made with respect
to a series of certificates, one of the classes of certificates in the series   
will be designated as evidencing the sole class of "residual interests" in each 
related REMIC, as defined in the Code; alternatively, a separate class of       
ownership interests will evidence the residual interests. All other classes of  
certificates in the series will constitute "regular interests" in the related   
REMIC, as defined in the Code. As to each series of certificates as to which a  
REMIC election is to be made, the master servicer, trustee or other specified   
person will be obligated to take specified actions required in order to comply  
with applicable laws and regulations.                                           

FORM OF SECURITIES                                                              

       Except as described below, the offered securities of each series will
be issued as physical certificates or notes in fully registered form only in the
denominations specified in the related prospectus supplement, and will be       
transferrable and exchangeable at the corporate trust office of the registrar   
named in the related prospectus supplement. No service charge will be made for  
any registration of exchange or transfer of offered securities, but the trustee 
may require payment of a sum sufficient to cover any tax or other governmental  
charge. A "securityholder" or "holder" is the entity whose name appears on the  
records of the registrar (consisting of or including the security register) as  
the registered holder of a security.                                            

         If so specified in the related prospectus supplement, specified classes
of a series of securities will be initially issued through the book-entry       
facilities of DTC. As to any class of DTC Registered Securities, the            
recordholder of the securities will be DTC's nominee. DTC is a limited-purpose  
trust company organized under the laws of the State of New York, which holds    
securities for its participants and facilitates the clearance and settlement of 
securities transactions between participants through electronic book-entry      
changes in the accounts of participants. Intermediaries have indirect access to 
DTC's clearance system.                                                         

      If securities are issued as DTC Registered Securities, no Beneficial
Owner will be entitled to receive a security representing its interest in       
registered, certificated form, unless either (1) DTC ceases to act as depository
in respect thereof and a successor depository is not obtained, or (2) the       
company elects in its sole discretion to discontinue the registration of the    
securities through DTC. Prior to one of these events, Beneficial Owners will not
be recognized by the trustee or the master servicer as holders of the related   
securities for purposes of the related pooling and servicing agreement or       
indenture, and Beneficial Owners will be able to exercise their rights as owners
of the securities only indirectly through DTC, participants and Intermediaries. 
Any Beneficial Owner that desires to purchase, sell or otherwise transfer any   
interest in DTC Registered Securities may do so only through DTC, either        
directly if the Beneficial Owner is a participant or indirectly through         
participants and, if applicable, Intermediaries. Pursuant to the procedures of  
DTC, transfers of the beneficial ownership of any DTC Registered Securities will
be required to be made in minimum denominations specified in the related        
prospectus supplement. The ability of a Beneficial Owner to pledge DTC          
Registered Securities to persons or entities that are not participants in the   
DTC system, or to otherwise act with respect to the securities, may be limited  
because of the lack of physical certificates or notes evidencing the securities 
and because DTC may act only on behalf of participants.                         

   Distributions in respect of the DTC Registered Securities will be
forwarded by the trustee or other specified person to DTC, and DTC will be      
responsible for forwarding the payments to participants, each of which will be  
responsible for disbursing the payments to the Beneficial Owners it represents  
or, if applicable, to Intermediaries. Accordingly, Beneficial Owners may        
experience delays in the receipt of payments in respect of their securities.    
Under DTC's procedures, DTC will take actions permitted to be taken by holders  
of any class of DTC Registered Securities under the pooling and servicing       
agreement or indenture only at the direction of one or more participants to     
whose account the DTC Registered Securities are credited and whose aggregate    
holdings represent no less than any minimum amount of Percentage Interests or   
voting rights required therefor. DTC may take conflicting actions with respect  
to any action of holders of securities of any class to the extent that          
participants authorize these actions. None of the master servicer, the company, 
the trustee or any of their respective affiliates will have any liability for   
any aspect of the records relating to or payments made on account of beneficial 
ownership interests in the DTC Registered Securities, or for maintaining,       
supervising or reviewing any records relating to the beneficial ownership       
interests.                                                                      

GLOBAL SECURITIES                                                               

         Some of the offered securities may be Global Securities. Except in some
limited circumstances, the Global Securities will be available only in          
book-entry form. Investors in the Global Securities may hold those Global       
Securities through any of DTC, Clearstream, or Euroclear System (in Europe). The
Global Securities will be traceable 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 through Clearstream and
Euroclear System will be conducted in the ordinary way in accordance with the   
normal rules and operating procedures of Clearstream and Euroclear System and in
accordance with conventional eurobond practice (i.e., seven calendar day        
settlement).                                                                    

Secondary market trading between investors through DTC will be
conducted according to DTC's rules and procedures applicable to U.S. corporate  
debt obligations.                                                               

        Secondary cross-market trading between Clearstream or Euroclear System
and DTC participants holding interests in Global Securities will be effected on 
a delivery-against-payment basis through the respective depositaries of         
Clearstream and Euroclear System (in that capacity) and as DTC participants.    

         Non-U.S. holders (as described below) of interests in Global Securities
will be subject to U.S. withholding taxes unless those holders meet various     
requirements and deliver appropriate U.S. tax documents to the securities       
clearing organizations or their participants.                                   

     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 and 
Euroclear System will hold positions on behalf of their participants through    
their relevant depositary which in turn will hold those positions in their      
accounts as DTC participants.                                                   

         Investors electing to hold their interests in Global Securities through
DTC will follow DTC settlement practices. Investor securities custody accounts  
will be credited with their holdings against payment in same-day funds on the   
settlement date.                                                                

         Investors electing to hold their interests in Global Securities through
Clearstream or Euroclear System 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.                                                      

       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.                                                                           

 Secondary market trading between DTC participants will occur in
accordance with DTC rules. Secondary market trading between Clearstream         
participants or Euroclear System participants will be settled using the         
procedures applicable to conventional eurobonds in same-day funds. When Global  
Securities are to be transferred from the account of a DTC participant to the   
account of a Clearstream participant or a Euroclear System participant, the     
purchaser will send instructions to Clearstream or Euroclear System through a   
Clearstream participant or Euroclear System participant at least one business   
day prior to settlement. Clearstream or Euroclear System will instruct the      
relevant depositary, as the case may be, to receive the Global Securities       
against payment. Payment will include interest accrued on the Global Securities 
from and including the last coupon payment date to and excluding the settlement 
date, on the basis of the actual number of days in that accrual period and a    
year assumed to consist of 360 days. 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 relevant depositary to 
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 participant's or Euroclear System          
participant's account. The securities credit will appear the next day (European 
time) and the cash debit 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 or Euroclear System 
cash debit will be valued instead as of the actual settlement date.             

         Clearstream participants and Euroclear System participants will need to
make available to the respective clearing systems the funds necessary to process
same-day funds settlement. The most direct means of doing so is to preposition  
funds for settlement, either from cash on hand or existing lines of credit, as  
they would for any settlement occurring within Clearstream or Euroclear System. 
Under this approach, they may take on credit exposure to Clearstream or         
Euroclear System until the Global Securities are credited to their account one  
day later. As an alternative, if Clearstream or Euroclear System has extended a 
line of credit to them, Clearstream participants or Euroclear System            
participants can elect not to preposition funds and allow that credit line to be
drawn upon to finance settlement. Under this procedure, Clearstream participants
or Euroclear System 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 those overdraft charges, although  
the result will depend on each Clearstream participant's or Euroclear System    
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 crediting Global Securities to the respective European depositary
for the benefit of Clearstream participants or Euroclear System 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.                          

       Due to time zone differences in their favor, Clearstream participants
and Euroclear System participants may employ their customary procedures for     
transactions in which Global Securities are to be transferred by the respective 
clearing system, through the respective depositary, to a DTC participant. The   
seller will send instructions to Clearstream or Euroclear System through a      
Clearstream participant or Euroclear System participant at least one business   
day prior to settlement. In these cases Clearstream or Euroclear System will    
instruct the respective depositary, as appropriate, to credit the Global        
Securities to the DTC participant's account against payment. Payment will       
include interest accrued on the Global Securities from and including the last   
coupon payment to and excluding the settlement date on the basis of the actual  
number of days in that accrual period and a year assumed to consist to 360 days.
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 Clearstream participant or     
Euroclear System participant the following day, and receipt of the cash proceeds
in the Clearstream participant's or Euroclear System participant's account would
be back-valued to the value date (which would be the preceding day, when        
settlement occurred in New York). Should the Clearstream participant or         
Euroclear System 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        
participant's or Euroclear System participant's account would instead be valued 
as of the actual settlement date.                                               

        Finally, day traders that use Clearstream or Euroclear System and that
purchase interests in Global Securities from DTC participants for delivery to   
Clearstream participants or Euroclear System participants should note that these
trades would automatically fail on the sale side unless affirmative action is   
taken. At least three techniques should be readily available to eliminate this  
potential problem:                                                              

        o        borrowing through Clearstream or Euroclear System for one day
               (until the purchase side of the trade is reflected in their
                Clearstream or Euroclear System accounts) in accordance with
the clearing system's customary procedures; 

 o        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 or Euroclear System account in
  order to settle the sale side of the trade; or

       o        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 participant or Euroclear System
participant.                                

         A beneficial owner of interests in Global Securities holding securities
through Clearstream or Euroclear System (or through DTC if the holder has an    
address outside the U.S.) 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 (as defined below), unless (i) 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 that beneficial owner and the U.S. entity required to    
withhold tax complies with applicable certification requirements and (ii) that  
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      
holders of interests in Global Securities that are Non-U.S. Persons (as defined 
below) 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). If the information shown on Form W-8BEN changes, a new 
Form W-8BEN must be filed within 30 days of that change.                        

        A Non-U.S. Person (as defined below), 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 (Exemption   
from Withholding of Tax on Income Effectively Connected with the Conduct of a   
Trade or Business in the United States).                                        

       Non-U.S. Persons residing in a country that has a tax treaty with the
United States can obtain an exemption or reduced tax rate (depending on the     
treaty terms) by filing Form W-8BEN (Holdership, Exemption or Reduced Rate      
Certificate). Form W-8BEN may be filed by Noteholders or their agent.           

       U.S. Persons can obtain a complete exemption from the withholding tax
by filing Form W-9 (Payer's Request for Taxpayer Identification Number and      
Certification).                                                                 

     The holder of an interest in a Global Security or, in the case of a
Form W-8BEN or a Form W-8ECI filer, his agent, files by submitting the          
appropriate form to the person through whom it holds the security (the clearing 
agency, in the case of persons holding directly on the books of the clearing    
agency). Form W-8BEN and Form W-8ECI are effective for three calendar years. The
term "U.S. Person" means a citizen or resident of the United States, a          
corporation, partnership or other entity created or organized in, or under the  
laws of, the United States or any political subdivision thereof (except, in the 
case of a partnership, to the extent provided in regulations), or an estate     
whose income is subject to United States federal income tax regardless of its   
source, or a trust if a court within the United States is able to exercise      
primary supervision over the administration of the trust and one or more United 
States Persons have the authority to control all substantial decisions of the   
trust. The term "Non-U.S. Person" means any person who is not a U.S. Person.    
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.                

ASSIGNMENT OF TRUST FUND ASSETS                                                 

     At the time of issuance of a series of securities, the company will
assign, or cause to be assigned, to the related trustee (or its nominee),without
recourse, the mortgage loans or mortgage securities being included in the       
related trust fund, together with, all principal and interest received on or    
with respect to the mortgage loans or mortgage securities after the cut-off     
date, other than principal and interest due on or before the cut-off date. If   
specified in the related prospectus supplement, the company or any of its       
affiliates may retain an interest in the trust fund assets, if any, for itself  
or transfer the same to others. The trustee will, concurrently with the         
assignment, deliver the securities of the series to or at the direction of the  
company in exchange for the mortgage loans and/or mortgage securities in the    
related trust fund. Each mortgage loan will be identified in a schedule         
appearing as an exhibit to the related pooling and servicing agreement or       
servicing agreement. The schedule will include, among other things, information 
as to the principal balance of each mortgage loan in the related trust fund as  
of the cut-off date, as well as information respecting the mortgage rate, the   
currently scheduled monthly payment of principal and interest, the maturity of  
the mortgage note and the Loan-to-Value Ratio at origination or modification    
(without regard to any secondary financing).                                    

         In addition, the company will, as to each mortgage loan, other than (1)
mortgage loans underlying any mortgage securities and (2) Contracts, deliver, or
cause to be delivered, to the related trustee (or to the custodian described    
below) the following documents:                                                 

        o        the mortgage note endorsed, without recourse, either in blank
    or to the order of the trustee (or its nominee),

   o        the mortgage with evidence of recording indicated on the
                  mortgage (except for any mortgage not returned from the public
               recording office) or, in the case of a cooperative mortgage
loan, on the related financing statement,   

       o        an assignment of the mortgage in blank or to the trustee (or
          its nominee) in recordable form (or, with respect to a
              cooperative mortgage loan, an assignment of the respective
                 security agreements, any applicable UCC financing statements,
                recognition agreements, relevant stock certificates, related
            blank stock powers and the related proprietary leases or
occupancy agreements),                      

       o        any intervening assignments of the mortgage with evidence of
              recording on the assignment (except for any assignment not
returned from the public recording office), 

     o        if applicable, any riders or modifications to the mortgage
note and mortgage,                          

    o        if the mortgage loan is secured by additional collateral,
             certain security and assignment documents relating to the
pledge of the additional collateral, and    

   o        any other documents set forth in the related pooling and
            servicing agreement, mortgage loan purchase agreement or
servicing agreement.                        

The assignments may be blanket assignments covering mortgages on mortgaged      
properties located in the same county, if permitted by law.                     

        Notwithstanding the foregoing, a trust fund may include mortgage loans
where the original mortgage note is not delivered to the trustee if the company 
delivers, or causes to be delivered, to the related trustee (or the custodian) a
copy or a duplicate original of the mortgage note, together with an affidavit   
certifying that the original thereof has been lost or destroyed. In addition, if
the company cannot deliver, with respect to any mortgage loan, the mortgage or  
any intervening assignment with evidence of recording on the assignment         
concurrently with the execution and delivery of the related pooling and         
servicing agreement or servicing agreement because of a delay caused by the     
public recording office, the company will deliver, or cause to be delivered, to 
the related trustee (or the custodian) a true and correct photocopy of the      
mortgage or assignment as submitted for recording within one year. The company  
will deliver, or cause to be delivered, to the related trustee (or the          
custodian) the mortgage or assignment with evidence of recording indicated on   
the assignment after receipt thereof from the public recording office. If the   
depositor cannot deliver, with respect to any mortgage loan, the mortgage or any
intervening assignment with evidence of recording on the mortgage or assignment 
concurrently with the execution and delivery of the related pooling and         
servicing agreement or servicing agreement because the mortgage or assignment   
has been lost, the depositor will deliver, or cause to be delivered, to the     
related trustee (or the custodian) a true and correct photocopy of the mortgage 
or assignment with evidence of recording on the mortgage or assignment. If the  
company cannot deliver, with respect to any mortgage loan, the mortgage or any  
intervening assignment with evidence of recording on the mortgage or assignment 
because the applicable jurisdiction retains the originals of such documents, the
depositor will deliver photocopies of such documents containing an original     
certification by the judicial or other governmental authority of the            
jurisdiction where such documents were recorded. Assignments of the mortgage    
loans to the trustee (or its nominee) will be recorded in the appropriate public
recording office, except (1) where recordation is not required by the Rating    
Agencies rating the applicable securities, (2) in states where, in the opinion  
of counsel acceptable to the trustee, recording is not required to protect the  
trustee's interests in the mortgage loan against the claim of any subsequent    
transferee or any successor to or creditor of the company or the originator of  
the mortgage loan or (3) where Mortgage Electronic Registration Systems, Inc. is
identified on the mortgage or a properly recorded assignment of mortgage as the 
mortgagee of record solely as nominee for a Seller and its successors and       
assigns. In addition, the depositor shall not be required to deliver intervening
assignments or mortgage note endorsements between the underlying sellers of the 
mortgage loans and the Seller, between the Seller and the company and between   
the company and the trustee.                                                    

As to each Contract, the company will deliver, or cause to be 
delivered, to the related trustee (or the custodian) the following documents:   

         o        the original Contract endorsed, without recourse, to the order
of the trustee,                             

      o        copies of documents and instruments related to the Contract
               and the security interest in the Manufactured Home securing
the Contract, and                           

      o        a blanket assignment to the trustee of all Contracts in the
                 related trust fund and the related documents and instruments.

In order to give notice of the right, title and interest of the securityholders 
to the Contracts, the company will cause to be executed and delivered to the    
trustee a UCC-1 financing statement identifying the trustee as the secured party
and identifying all Contracts as collateral.                                    

       The company will, as to each mortgage security included in a mortgage
pool, deliver, or cause to be delivered, to the related trustee (or the         
custodian), either (1) cause an electronic transfer of that security or (2)     
provide a physical certificate or note evidencing the mortgage security,        
registered in the name of the related trustee (or its nominee), or endorsed in  
blank or to the related trustee (or its nominee), or accompanied by transfer    
documents sufficient to effect a transfer to the trustee (or its nominee).      

         The trustee (or the custodian) will hold the documents in trust for the
benefit of the related securityholders, and generally will review the documents 
within 180 days after receipt thereof in the case of documents delivered        
concurrently with the execution and delivery of the related pooling and         
servicing agreement or indenture, and within the time period specified in the   
related pooling and servicing agreement or indenture in the case of all other   
documents delivered. If any document is found to be missing or defective in any 
material respect, the trustee (or the custodian) will be required to promptly so
notify the master servicer, the company, and the related Seller. If the related 
Seller does not cure the omission or defect within a specified period after     
notice is given thereto by the trustee, and the omission or defect materially   
and adversely affects the interests of securityholders in the affected mortgage 
loan or mortgage security, then, the related Seller will be obligated to        
repurchase the mortgage loan or mortgage security from the trustee at its       
purchase price (or, if and to the extent it would otherwise be permitted to do  
so for a breach of representation and warranty as described under "The Mortgage 
Pools--Representations of Sellers," to substitute for the mortgage loan or      
mortgage security). The trustee will be obligated to enforce this obligation of 
the Seller to the extent described above under "The Mortgage                    
Pools--Representations by Sellers," but there can be no assurance that the      
applicable Seller will fulfill its obligation to repurchase (or substitute for) 
the affected mortgage loan or mortgage security as described above. The company 
will not be obligated to repurchase or substitute for the mortgage loan or      
mortgage security if the Seller defaults on its obligation to do so. This       
repurchase or substitution obligation constitutes the sole remedy available to  
the related securityholders and the related trustee for omission of, or a       
material defect in, a constituent document. Any affected mortgage loan or       
mortgage security not so repurchased or substituted for shall remain in the     
related trust fund.                                                             

   The trustee will be authorized at any time to appoint one or more
custodians pursuant to a custodial agreement to hold title to the mortgage loans
and/or mortgage securities in any mortgage pool, and to maintain possession of  
and, if applicable, to review, the documents relating to the mortgage loans     
and/or mortgage securities, in any case as the agent of the trustee. The        
identity of any custodian to be appointed on the date of initial issuance of the
securities will be set forth in the related prospectus supplement. A custodian  
may be an affiliate of the company or the master servicer.                      

     Except as to mortgage loans underlying any mortgage securities, the
Seller will make representations and warranties as to the types and geographical
concentrations of the mortgage loans and as to the accuracy of some of the      
information furnished to the related trustee in respect of each mortgage loan   
(for example, the original Loan-to-Value Ratio, the principal balance as of the 
cut-off date, the mortgage rate and maturity). Upon a breach of any of these    
representations which materially and adversely affects the interests of the     
securityholders in a mortgage loan, the Seller will be obligated to cure the    
breach in all material respects, to repurchase the mortgage loan at its purchase
price or, to substitute for the mortgage loan a Qualified Substitute Mortgage   
Loan in accordance with the provisions for substitution by Sellers as described 
above under "The Mortgage Pools--Representations by Sellers." This repurchase or
substitution obligation constitutes the sole remedy available to securityholders
or the trustee for a breach of a representation by the company. Any mortgage    
loan not so repurchased or substituted for shall remain in the related trust    
fund.                                                                           

      Pursuant to the related pooling and servicing agreement or servicing
agreement, the master servicer for any mortgage pool, either directly or through
servicers, will service and administer the mortgage loans included in the       
mortgage pool and assigned to the related trustee as more fully set forth under 
"Servicing of Mortgage Loans." Each of the company and the master servicer will 
make limited representations and warranties regarding its authority to enter    
into, and its ability to perform its obligations under, the pooling and         
servicing agreement or servicing agreement.                                     

DISTRIBUTION ACCOUNT                                                            

        GENERAL. The master servicer and/or the trustee will, as to each trust
fund, establish and maintain or cause to be established and maintained a        
Distribution Account, which will be established so as to comply with the        
standards of each Rating Agency that has rated any one or more classes of       
securities of the related series. A Distribution Account shall be maintained as 
an Eligible Account, and the funds held therein may be held as cash or invested 
in Permitted Investments. Any Permitted Investments shall not cause the company 
to register under the Investment Company Act of 1940. Any interest or other     
income earned on funds in the Distribution Account will be paid to the related  
master servicer or trustee as additional compensation or will be available for  
payments on the securities as provided in the prospectus supplement. If         
permitted by the Rating Agency or Agencies and so specified in the related      
prospectus supplement, a Distribution Account may contain funds relating to more
than one series of mortgage pass-through certificates and may contain other     
funds representing payments on mortgage loans owned by the related master       
servicer or serviced by it on behalf of others.                                 

         DEPOSITS. With respect to each series of securities, the related master
servicer, servicer, trustee or special servicer will be required to deposit or  
cause to be deposited in the Distribution Account for the related trust fund    
within a period following receipt (in the case of collections and payments), the
following payments and collections received, or advances made, by the master    
servicer, the trustee or any special servicer subsequent to the cut-off date    
with respect to the mortgage loans and/or mortgage securities in the trust fund 
(other than payments due on or before the cut-off date):                        

    o        all payments on account of principal, including principal
prepayments, on the mortgage loans;         

     o        all payments on account of interest on the mortgage loans,
                 including any default interest collected, in each case net of
            any portion thereof retained by the master servicer, any
      servicer, or any special servicer as its servicing
               compensation or as compensation to the trustee, and further
net of any retained interest of the company;

o        all payments on the mortgage securities;             

o        all Insurance Proceeds and Liquidation Proceeds;     

       o        any amounts paid under any instrument or drawn from any fund
                 that constitutes credit enhancement for the related series of
        securities as described under "Description of Credit
Enhancement";                               

   o        any advances made as described under "--Advances" below;

        o        any Buydown Funds (and, if applicable, investment earnings on
                 the Buydown Funds) required to be paid to securityholders, as
described below;                            

       o        any amounts paid by the master servicer and the servicers to
           cover Prepayment Interest Shortfalls arising out of the
                 prepayment of mortgage loans as described under "Servicing of
                Mortgage Loans--Servicing and Other Compensation and Payment
of Expenses; Retained Interest";            

     o        to the extent that any item does not constitute additional
                  servicing compensation to the master servicer, a servicer or a
                special servicer, any payments on account of modification or
                assumption fees, late payment charges or prepayment premiums
on the mortgage loans;                      

        o        any amount required to be deposited by the master servicer or
                 the trustee in connection with losses realized on investments
                 for the benefit of the master servicer or the trustee, as the
               case may be, of funds held in the Distribution Account; and

         o        any other amounts required to be deposited in the Distribution
            Account as provided in the related pooling and servicing
                  agreement or the related servicing agreement and indenture and
             described in this prospectus or in the related prospectus
supplement.                                 

         With respect to each buydown mortgage loan, the master servicer will be
required to deposit, or cause the related servicer to deposit, the related      
Buydown Funds provided to it in a Buydown Account which will comply with the    
requirements set forth in this prospectus with respect to the Distribution      
Account. The terms of all buydown mortgage loans provide for the contribution of
Buydown Funds in an amount equal to or exceeding either (1) the total payments  
to be made from the funds pursuant to the related buydown plan or (2) if the    
Buydown Funds are to be deposited on a discounted basis, that amount of Buydown 
Funds which, together with investment earnings on the Buydown Funds at a rate as
will support the scheduled level of payments due under the buydown mortgage     
loan. Neither the master servicer, any servicer nor the company will be         
obligated to add to any discounted Buydown Funds any of its own funds should    
investment earnings prove insufficient to maintain the scheduled level of       
payments. To the extent that any insufficiency is not recoverable from the      
mortgagor or, in an appropriate case, from the Seller, distributions to         
securityholders may be affected. With respect to each buydown mortgage loan, the
master servicer will be required monthly to withdraw from the Buydown Account   
and deposit, or cause the related servicer to withdraw from the Buydown Account 
and deposit, in the Distribution Account as described above the amount, if any, 
of the Buydown Funds (and, if applicable, investment earnings on the Buydown    
Funds) for each buydown mortgage loan that, when added to the amount due from   
the mortgagor on the buydown mortgage loan, equals the full monthly payment     
which would be due on the buydown mortgage loan if it were not subject to the   
buydown plan.                                                                   

       If the mortgagor on a buydown mortgage loan prepays the mortgage loan
in its entirety during the Buydown Period, the master servicer or servicer of   
the mortgage loan will be required to withdraw from the Buydown Account and     
remit to the mortgagor or the other designated party in accordance with the     
related buydown plan any Buydown Funds remaining in the Buydown Account. If a   
prepayment by a mortgagor during the Buydown Period together with Buydown Funds 
will result in full prepayment of a buydown mortgage loan, the master servicer  
or servicer of the mortgage loan generally will be required to withdraw from the
Buydown Account and deposit in the Distribution Account the Buydown Funds and   
investment earnings on the Buydown Funds, if any, which together with the       
prepayment will result in a prepayment in full; provided that Buydown Funds may 
not be available to cover a prepayment under some mortgage loan programs. Any   
Buydown Funds so remitted to the master servicer or the servicer of the mortgage
loan in connection with a prepayment described in the preceding sentence will be
deemed to reduce the amount that would be required to be paid by the mortgagor  
to repay fully the related mortgage loan if the mortgage loan were not subject  
to the buydown plan. Any investment earnings remaining in the Buydown Account   
after prepayment or after termination of the Buydown Period will be remitted to 
the related mortgagor or the other designated party pursuant to the Buydown     
Agreement relating to each buydown mortgage loan. If the mortgagor defaults     
during the Buydown Period with respect to a buydown mortgage loan and the       
property securing the buydown mortgage loan is sold in liquidation (either by   
the master servicer, the servicer of the mortgage loan, the primary insurer, any
pool insurer or any other insurer), the master servicer or related servicer will
be required to withdraw from the Buydown Account the Buydown Funds and all      
investment earnings on the Buydown Funds, if any, and either deposit the same in
the Distribution Account or, alternatively, pay the same to the primary insurer 
or the pool insurer, as the case may be, if the mortgaged property is           
transferred to the insurer and the insurer pays all of the loss incurred in     
respect of the default.                                                         

 Prior to the deposit of funds into the Distribution Account, as
described under "--Deposits" above, funds related to the mortgage loans serviced
by a master servicer or a servicer may be maintained by a master servicer or a  
servicer in a Protected Account which will be established so as to comply with  
the standards of each Rating Agency that has rated any one or more classes of   
securities of the related series. Each Protected Account shall be maintained as 
an Eligible Account, and the funds held therein may be held as cash or invested 
in Permitted Investments. Any interest or other income earned on funds in a     
Protected Account will be paid to the master servicer or servicer, as           
applicable, as additional compensation. If permitted by the Rating Agency or    
Agencies and so specified in the related prospectus supplement, a Protected     
Account may contain funds relating to more than one series of mortgage          
pass-through certificates and may contain other funds representing payments on  
mortgage loans owned by the related master servicer or serviced by it on behalf 
of others. In the event that a trust fund has multiple servicers, funds from the
Protected Accounts may first be remitted to a Master Servicer Collection        
Account, meeting the same eligibility standards as the Protected Accounts, prior
to being deposited into the Distribution Account.                               

    WITHDRAWALS. With respect to each series of securities, the master
servicer, trustee or special servicer generally may make withdrawals from the   
Distribution Account for the related trust fund for any one or more of the      
following purposes, unless otherwise provided in the related agreement and      
described in the related prospectus supplement:                                 

       (1)      to make distributions to the related securityholders on each
distribution date;                          

      (2)      to reimburse the master servicer, any servicer or any other
               specified person for unreimbursed amounts advanced by it in
                  respect of mortgage loans in the trust fund as described under
              "--Advances" below, these reimbursements to be made out of
             amounts received which were identified and applied by the
                 master servicer or a servicer as late collections of interest
           (net of related servicing fees) on and principal of the
                particular mortgage loans with respect to which the advances
              were made or out of amounts drawn under any form of credit
   enhancement with respect to the mortgage loans;

    (3)      to reimburse the master servicer, a servicer or a special
            servicer for unpaid servicing fees earned by it and some
                  unreimbursed servicing expenses incurred by it with respect to
               mortgage loans in the trust fund and properties acquired in
                  respect thereof, these reimbursement to be made out of amounts
              that represent Liquidation Proceeds and Insurance Proceeds
                  collected on the particular mortgage loans and properties, and
           net income collected on the particular properties, with
              respect to which the fees were earned or the expenses were
             incurred or out of amounts drawn under any form of credit
                  enhancement with respect to the mortgage loans and properties;

    (4)      to reimburse the master servicer, a servicer or any other
             specified person for any advances described in clause (2)
              above made by it and any servicing expenses referred to in
            clause (3) above incurred by it which, in the good faith
               judgment of the master servicer, the applicable servicer or
              the other person, will not be recoverable from the amounts
       described in clauses (2) and (3), respectively, the
            reimbursement to be made from amounts collected on other
                mortgage loans in the trust fund or, if and to the extent so
                  provided by the related pooling and servicing agreement or the
                  related servicing agreement and indenture and described in the
            related prospectus supplement, only from that portion of
         amounts collected on the other mortgage loans that is
                 otherwise distributable on one or more classes of subordinate
securities of the related series;           

   (5)      if and to the extent described in the related prospectus
                 supplement, to pay the master servicer, a servicer, a special
                 servicer or another specified entity (including a provider of
                  credit enhancement) interest accrued on the advances described
             in clause (2) above made by it and the servicing expenses
            described in clause (3) above incurred by it while these
remain outstanding and unreimbursed;        

       (6)      to reimburse the master servicer, a servicer, the depositor,
                 or any of their respective directors, officers, employees and
       agents, as the case may be, for expenses, costs and
                liabilities incurred thereby, as and to the extent described
               under "The Agreements--Certain Matters Regarding the Master
Servicer and the Company";                  

   (7)      if and to the extent described in the related prospectus
supplement, to pay the fees of the trustee; 

      (8)      to reimburse the trustee or any of its directors, officers,
                 employees and agents, as the case may be, for expenses, costs
          and liabilities incurred thereby, as and to the extent
                 described under The Agreements--Certain Matters Regarding the
Trustee";                                   

   (9)      to pay the master servicer or the trustee, as additional
                  compensation, interest and investment income earned in respect
of amounts held in the Distribution Account;

        (10)     to pay (generally from related income) the master servicer, a
        servicer or a special servicer for costs incurred in
                connection with the operation, management and maintenance of
        any mortgaged property acquired by the trust fund by
  foreclosure or by deed in lieu of foreclosure;

     (11)     if one or more elections have been made to treat the trust
              fund or designated portions thereof as a REMIC, to pay any
                  federal, state or local taxes imposed on the trust fund or its
                assets or transactions, as and to the extent described under
        "Federal Income Tax Consequences--REMICS--Prohibited
 Transactions and Other Possible REMIC Taxes";

   (12)     to pay for the cost of an independent appraiser or other
              expert in real estate matters retained to determine a fair
          sale price for a defaulted mortgage loan or a property
                  acquired in respect thereof in connection with the liquidation
of the mortgage loan or property;           

      (13)     to pay for the cost of various opinions of counsel obtained
                  pursuant to the related pooling and servicing agreement or the
                related servicing agreement and indenture for the benefit of
the related securityholders;                

(14)     to pay to itself, the company, a Seller or any other 
                appropriate person all amounts received with respect to each
                  mortgage loan purchased, repurchased or removed from the trust
         fund pursuant to the terms of the related pooling and
              servicing agreement or the related servicing agreement and
                  indenture and not required to be distributed as of the date on
   which the related purchase price is determined;

         (15)     to make any other withdrawals permitted by the related pooling
                  and servicing agreement or the related servicing agreement and
                 indenture and described in the related prospectus supplement;

       (16)     to pay for costs and expenses incurred by the trust fund for
            environmental site assessments performed with respect to
                 multifamily or commercial properties that constitute security
          for defaulted mortgage loans, and for any containment,
             clean-up or remediation of hazardous wastes and materials
            present on that mortgaged properties, as described under
             "Servicing of Mortgage Loans--Realization Upon or Sale of
Defaulted Mortgage Loans"; and              

   (17)     to clear and terminate the Distribution Account upon the
termination of the trust fund.              

DISTRIBUTIONS                                                                   

      Distributions on the securities of each series will be made by or on
behalf of the related trustee on each distribution date as specified in the     
related prospectus supplement from the available funds for the series and the   
distribution date. The available funds for any series of securities and any     
distribution date will generally refer to the total of all payments or other    
collections (or advances in lieu thereof) on, under or in respect of the        
mortgage loans and/or mortgage securities and any other assets included in the  
related trust fund that are available for distribution to the securityholders of
the series on that date. The particular components of the available funds for   
any series on each distribution date will be more specifically described in the 
related prospectus supplement.                                                  

      Distributions on the securities of each series (other than the final
distribution in retirement of any certificate) will be made to the persons in   
whose names the securities are registered on the Record Date, and the amount of 
each distribution will be determined as of the Determination Date. All          
distributions with respect to each class of securities on each distribution date
will be allocated in accordance with the holder's Percentage Interest in a      
particular class. Payments will be made either by wire transfer in immediately  
available funds to the account of a securityholder at a bank or other entity    
having appropriate facilities therefor, if the securityholder has provided the  
trustee or other person required to make the payments with wiring instructions  
no later than five business days prior to the related Record Date or other date 
specified in the related prospectus supplement (and, if so provided in the      
related prospectus supplement, the securityholder holds securities in any       
requisite amount or denomination specified therein), or by check mailed to the  
address of the securityholder as it appears on the security register; provided, 
however, that the final distribution in retirement of any class of securities   
will be made only upon presentation and surrender of the securities at the      
location specified in the notice to securityholders of the final distribution.  

DISTRIBUTIONS OF INTEREST AND PRINCIPAL ON THE SECURITIES                       

      Each class of securities of each series, other than Strip Securities
and REMIC Residual Certificates that have no security interest rate, may have a 
different per annum rate at which interest accrues on that class of securities, 
which may be fixed, variable or adjustable, or any combination of rates. The    
related prospectus supplement will specify the security interest rate or, in the
case of a variable or adjustable security interest rate, the method for         
determining the security interest rate, for each class. The related prospectus  
supplement will specify whether interest on the securities of the series will be
calculated on the basis of a 360-day year consisting of twelve 30-day months or 
on a different method.                                                          

      Distributions of interest in respect of the securities of any class,
other than any class of Accrual Securities, Strip Securities or REMIC Residual  
Certificates that is not entitled to any distributions of interest, will be made
on each distribution date based on the accrued interest for the class and the   
distribution date, subject to the sufficiency of the portion of the available   
funds allocable to the class on the distribution date. Prior to the time        
interest is distributable on any class of Accrual Securities, the amount of     
accrued interest otherwise distributable on the class will be added to the      
principal balance thereof on each distribution date. With respect to each class 
of interest-bearing securities, accrued interest for each distribution date will
be equal to interest at the applicable security interest rate accrued for a     
specified period (generally one month) on the outstanding principal balance     
thereof immediately prior to the distribution date. Accrued interest for each   
distribution date on Strip Securities entitled to distributions of interest will
be similarly calculated except that it will accrue on a notional amount that is 
based on either (1) the principal balances of some or all of the mortgage loans 
and/or mortgage securities in the related trust fund or (2) the principal       
balances of one or more other classes of securities of the same series.         
Reference to a notional amount with respect to a class of Strip Securities is   
solely for convenience in making calculations of accrued interest and does not  
represent the right to receive any distribution of principal. If so specified in
the related prospectus supplement, the amount of accrued interest that is       
otherwise distributable on (or, in the case of Accrual Securities, that may     
otherwise be added to the principal balance of) one or more classes of the      
securities of a series will be reduced to the extent that any Prepayment        
Interest Shortfalls, as described under "Yield Considerations", exceed the      
amount of any sums (including, if and to the extent specified in the related    
prospectus supplement, the master servicer's or applicable servicer's servicing 
compensation) that are applied to offset the shortfalls. The particular manner  
in which the shortfalls will be allocated among some or all of the classes of   
securities of that series will be specified in the related prospectus           
supplement. The related prospectus supplement will also describe the extent to  
which the amount of accrued interest that is otherwise distributable on (or, in 
the case of Accrual Securities, that may otherwise be added to the principal    
balance of) a class of offered securities may be reduced as a result of any     
other contingencies, including delinquencies, losses and Deferred Interest on or
in respect of the related mortgage loans or application of the Relief Act with  
respect to the mortgage loans. Any reduction in the amount of accrued interest  
otherwise distributable on a class of securities by reason of the allocation to 
the class of a portion of any Deferred Interest on or in respect of the related 
mortgage loans will result in a corresponding increase in the principal balance 
of the class.                                                                   

      As and to the extent described in the related prospectus supplement,
distributions of principal with respect to a series of securities will be made  
on each distribution date to the holders of the class or classes of securities  
of the series entitled thereto until the principal balance or balances of the   
securities have been reduced to zero. In the case of a series of securities     
which includes two or more classes of securities, the timing, order, priority of
payment or amount of distributions in respect of principal, and any schedule or 
formula or other provisions applicable to the determination thereof (including  
distributions among multiple classes of senior securities or subordinate        
securities), shall be as set forth in the related prospectus supplement.        
Distributions of principal with respect to one or more classes of securities may
be made at a rate that is faster (and, in some cases, substantially faster) than
the rate at which payments or other collections of principal are received on the
mortgage loans and/or mortgage securities in the related trust fund, may not    
commence until the occurrence of events such as the retirement of one or more   
other classes of securities of the same series, or may be made at a rate that is
slower (and, in some cases, substantially slower) than the rate at which        
payments or other collections of principal are received on the mortgage loans   
and/or mortgage securities. In addition, distributions of principal with respect
to one or more classes of securities may be made, subject to available funds,   
based on a specified principal payment schedule and, with respect to one or more
classes of securities, may be contingent on the specified principal payment     
schedule for another class of the same series and the rate at which payments and
other collections of principal on the mortgage loans and/or mortgage securities 
in the related trust fund are received.                                         

PRE-FUNDING ACCOUNT                                                             

       If so specified in the related prospectus supplement, the pooling and
servicing agreement or other agreement may provide for the transfer by the      
Sellers of additional mortgage loans to the related trust after the Closing     
Date. The additional mortgage loans will be required to conform to the          
requirements set forth in the related pooling and servicing agreement or other  
agreement providing for the transfer, and will be underwritten to the same      
standards as the mortgage loans initially included in the trust fund as         
described in the prospectus supplement. As specified in the related prospectus  
supplement, the transfer may be funded by the establishment of a pre-funding    
account established with the trustee. If a pre-funding account is established,  
all or a portion of the proceeds of the sale of one or more classes of          
securities of the related series will be deposited in the account to be released
as additional mortgage loans are transferred. A pre-funding account will be     
required to be maintained as an Eligible Account, the amounts therein may be    
required to be invested in Permitted Investments and the amount held therein    
shall at no time exceed 40% of the aggregate outstanding principal balance of   
the related securities. The related pooling and servicing agreement or other    
agreement providing for the transfer of additional mortgage loans generally will
provide that the transfers must be made within up to three months (with respect 
to any series of certificates) or up to one year (with respect to any series of 
notes) after the Closing Date, and that amounts set aside to fund the transfers 
(whether in a pre-funding account or otherwise) and not so applied within the   
required period of time will be deemed to be principal prepayments and applied  
in the manner set forth in the prospectus supplement. To the extent amounts in  
any pre-funding account have not been used to purchase additional mortgage      
loans, holders of the securities may receive an additional prepayment, which may
affect their yield to maturity. In addition, securityholders may not be able to 
reinvest amounts received from any pre-funding account in comparable securities,
or may only be able to do so at a lower interest rate.                          

DISTRIBUTIONS ON THE SECURITIES IN RESPECT OF PREPAYMENT PREMIUMS               

        Prepayment premiums will generally be retained by the master servicer,
a servicer, or by the Seller as additional compensation. However, if so provided
in the related prospectus supplement, prepayment premiums received on or in     
connection with the mortgage loans or mortgage securities in any trust fund will
be distributed on each distribution date to the holders of the class or classes 
of securities of the related series entitled thereto in accordance with the     
provisions described in the prospectus supplement.                              

ALLOCATION OF LOSSES AND SHORTFALLS                                             

       The amount of any losses or shortfalls in collections on the mortgage
loans and/or mortgage securities in any trust fund (to the extent not covered or
offset by draws on any reserve fund or under any instrument of credit           
enhancement or applied against overcollateralization) will be allocated among   
the respective classes of securities of the related series in the priority and  
manner, and subject to the limitations, specified in the related prospectus     
supplement. As described in the related prospectus supplement, these allocations
may result in reductions in the entitlements to interest and/or principal       
balances of one or more classes of securities, or may be effected simply by a   
prioritization of payments among classes of securities.                         

ADVANCES                                                                        

         If and to the extent provided in the related prospectus supplement, and
subject to any limitations specified therein, the related master servicer or any
servicer will be obligated to advance, or have the option of advancing, on or   
before each distribution date, from its own funds or from excess funds held in  
the related Master Servicing Collection Account or Protected Account that are   
not part of the available funds for the related series of securities for that   
distribution date, an amount up to the aggregate of any scheduled payments of   
interest (and, if specified in the related prospectus supplement, principal) on 
the mortgage loans that were delinquent on, or not received by, the related     
Determination Date (or such other date specified in the Agreement, but in any   
event prior to the related distribution date). No notice will be given to the   
certificateholders of these advances. Advances are intended to maintain a       
regular flow of scheduled interest and principal payments to holders of the     
class or classes of securities entitled thereto, rather than to guarantee or    
insure against losses. Accordingly, all advances made from the master servicer's
or a servicer's own funds will be reimbursable out of related recoveries on the 
mortgage loans (including, to the extent described in the prospectus supplement,
amounts received under any fund or instrument constituting credit enhancement)  
respecting which advances were made and other specific sources as may be        
identified in the related prospectus supplement, including amounts which would  
otherwise be payable to the offered securities. No Nonrecoverable Advance will  
be required to be made by the master servicer or a servicer; and, if previously 
made by a master servicer or a servicer, a Nonrecoverable Advance will be       
reimbursable from any amounts in the related Master Servicer Collection Account 
or Protected Account prior to any distributions being made to the related series
of securityholders. If advances have been made from excess funds in a Master    
Servicer Collection Account, the master servicer will be required to replace the
funds in such account on any future distribution date to the extent that funds  
then in such account are insufficient to permit full distributions to           
securityholders on that date. If so specified in the related prospectus         
supplement, the obligation of a master servicer or a servicer to make advances  
may be secured by a cash advance reserve fund or a surety bond. If applicable,  
information regarding the characteristics of, and the identity of any obligor   
on, a surety bond, will be set forth in the related prospectus supplement. If   
any person other than the master servicer has any obligation to make advances as
described above, the related prospectus supplement will identify the person. If 
and to the extent so provided in the related prospectus supplement, any entity  
making advances will be entitled to receive interest on the advances for the    
period that the advances are outstanding at the rate specified in the prospectus
supplement, and the entity will be entitled to payment of the interest          
periodically from general collections on the mortgage loans in the related trust
fund prior to any payment to securityholders or as otherwise provided in the    
related pooling and servicing agreement or servicing agreement and described in 
the prospectus supplement. As specified in the related prospectus supplement    
with respect to any series of securities as to which the trust fund includes    
mortgage securities, the advancing obligations with respect to the underlying   
mortgage loans will be pursuant to the terms of the mortgage securities, as may 
be supplemented by the terms of the applicable pooling and servicing agreements 
or servicing agreements for such mortgage securities, and may differ from the   
provisions described above.                                                     

REPORTS TO SECURITYHOLDERS                                                      

    With each distribution to securityholders of a particular class of
offered securities, the related master servicer, trustee or other specified     
person will make available to each holder of record of the class of securities a
statement or statements with respect to the related trust fund setting forth the
information specifically described in the related pooling and servicing         
agreement or the related servicing agreement or indenture, which generally will 
include the following as applicable except as otherwise provided therein:       

o        the amount, if any, of the distribution allocable to 
principal;                                  

         o        the amount, if any, of the distribution allocable to interest;

       o        the outstanding principal balance or notional amount of each
                 class after giving effect to the distribution of principal on
the distribution date;                      

       o        the amount of servicing compensation received by the related
                master servicer (and, if payable directly out of the related
             trust fund, by any special servicer and any subservicer);

         o        the aggregate amount of advances included in the distributions
         on the distribution date, and the aggregate amount of
         unreimbursed advances at the close of business on the
distribution date;                          

       o        the aggregate principal balance of the mortgage loans in the
               related mortgage pool on, or as of a specified date shortly
prior to, the distribution date;            

     o        the number and aggregate principal balance of any mortgage
                  loans in the related mortgage pool in respect of which (A) one
               scheduled payment is delinquent, (B) two scheduled payments
            are delinquent, (C) three or more scheduled payments are
        delinquent and (D) foreclosure proceedings have been
commenced;                                  

   o        the balance of the reserve fund, if any, at the close of
business on the distribution date;          

        o        the amount of coverage remaining under any financial guaranty
                 insurance policy, mortgage pool insurance policy or letter of
                credit covering default risk and a description of any credit
enhancement substituted therefor;           

      o        the Special Hazard Amount, Fraud Loss Amount and Bankruptcy
             Amount, if applicable, as of the close of business on the
                applicable distribution date and a description of any change
in the calculation of these amounts; and    

         o        with respect to any series of securities as to which the trust
                fund includes mortgage securities, additional information as
             required under the related Agreement and specified in the
related prospectus supplement.              

      In the case of information furnished pursuant to the first two items
above, the amounts will be expressed as a dollar amount per minimum denomination
of the relevant class of offered securities or per a specified portion of the   
minimum denomination. In addition to the information described above, reports to
securityholders will contain other information as is set forth in the applicable
pooling and servicing agreement or the applicable servicing agreement or        
indenture, which may include prepayments, reimbursements to subservicers and the
master servicer and losses borne by the related trust fund. In addition, within 
a reasonable period of time after the end of each calendar year, the master     
servicer or trustee will furnish a report to each holder of record of a class of
offered securities at any time during the calendar year which, for example, will
include information as to the aggregate of amounts reported pursuant to the     
first three items above for the calendar year or, in the event the person was a 
holder of record of a class of securities during a portion of the calendar year,
for the applicable portion of the year.                                         

 DESCRIPTION OF CREDIT ENHANCEMENT

GENERAL                                                                         

        As set forth below and in the applicable prospectus supplement, credit
enhancement may be provided by one or more of a financial guaranty insurance    
policy, a special hazard insurance policy, a mortgage pool insurance policy or a
letter of credit. In addition, if provided in the applicable prospectus         
supplement, in lieu of or in addition to any or all of the foregoing            
arrangements, credit enhancement may be in the form of a reserve fund to cover  
the losses, subordination of one or more classes of subordinate securities for  
the benefit of one or more classes of senior securities, of                     
cross-collateralization or overcollateralization, or a combination of the       
foregoing. The credit support may be provided by an assignment of the right to  
receive specified cash amounts, a deposit of cash into a reserve fund or other  
pledged assets, or by guarantees provided by a third-party or any combination   
thereof identified in the applicable prospectus supplement. Each component will 
have limitations and will provide coverage with respect to Realized Losses on   
the related mortgage loans. Credit support will cover Defaulted Mortgage Losses,
but coverage may be limited or unavailable with respect to Special Hazard       
Losses, Fraud Losses, Bankruptcy Losses and Extraordinary Losses. To the extent 
that the credit support for the offered securities of any series is exhausted,  
the holders thereof will bear all further risk of loss.                         

         The amounts and types of credit enhancement arrangements as well as the
providers thereof, if applicable, with respect to the offered securities of each
series will be set forth in the related prospectus supplement. To the extent    
provided in the applicable prospectus supplement and the pooling and servicing  
agreement or indenture, the credit enhancement arrangements may be periodically 
modified, reduced and substituted for based on the aggregate outstanding        
principal balance of the mortgage loans covered thereby or the principal amount 
or interest due on one or more classes of securities. See "Description of Credit
Enhancement--Reduction or Substitution of Credit Enhancement." If specified in  
the applicable prospectus supplement, credit support for the offered securities 
of one series may cover the offered securities of one or more other series.     

       The amounts and type of credit enhancement arrangement as well as the
provider thereof, if applicable, with respect to the offered securities of each 
series will be set forth in the related prospectus supplement. To the extent    
provided in the applicable prospectus supplement and the pooling and servicing  
agreement or indenture, the credit enhancement arrangements may be periodically 
modified, reduced and substituted for based on the aggregate outstanding        
principal balance of the mortgage loans covered thereby. See "Description of    
Credit Enhancement--Reduction or Substitution of Credit Enhancement." If        
specified in the applicable prospectus supplement, credit support for the       
offered securities of one series may cover the offered securities of one or more
other series.                                                                   

       In general, references to "mortgage loans" under this "Description of
Credit Enhancement" section are to mortgage loans in a trust fund. However, if  
so provided in the prospectus supplement for a series of securities, any        
mortgage securities included in the related trust fund and/or the related       
underlying mortgage loans may be covered by one or more of the types of credit  
support described in this prospectus. The related prospectus supplement will    
specify, as to each form of credit support, the information indicated below with
respect thereto, to the extent the information is material and available.       

SUBORDINATE SECURITIES                                                          

   If so specified in the related prospectus supplement, one or more
classes of securities of a series may be subordinate securities. Subordinate    
securities may be offered securities. To the extent specified in the related    
prospectus supplement, the rights of the holders of subordinate securities to   
receive distributions from the Distribution Account on any distribution date    
will be subordinated to the corresponding rights of the holders of senior       
securities. In addition, as provided in the prospectus supplement, losses or    
shortfalls will be allocated to subordinate securities before they are allocated
to more 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) some types of losses or shortfalls. The related prospectus supplement will  
set forth information concerning the manner and amount of subordination provided
by a class or classes of subordinate securities in a series and the             
circumstances under which the subordination will be available.                  

CROSS-COLLATERALIZATION                                                         

        If the mortgage loans and/or mortgage securities in any trust fund are
divided into separate groups, each supporting a separate class or classes of    
securities of the related series, credit enhancement may be provided by         
cross-collateralization support provisions requiring that distributions be made 
on senior securities evidencing interests in one group of mortgage loans and/or 
mortgage securities prior to distributions on subordinate securities evidencing 
interests in a different group of mortgage loans and/or mortgage securities     
within the trust fund. The prospectus supplement for a series that includes a   
cross-collateralization provision will describe the manner and conditions for   
applying the provisions.                                                        

OVERCOLLATERALIZATION                                                           

If so specified in the related prospectus supplement, interest
collections on the mortgage loans may exceed interest payments on the offered   
securities for the related distribution date. The excess interest may be        
deposited into a reserve fund or applied as a payment of principal on the       
securities. To the extent excess interest is applied as principal payments on   
the securities, the effect will be to reduce the principal balance of the       
securities relative to the outstanding balance of the mortgage loans, thereby   
creating overcollateralization and additional protection to the securityholders,
as specified in the related prospectus supplement. If so provided in the related
prospectus supplement, overcollateralization may also be provided as to any     
series of securities by the issuance of securities in an initial aggregate      
principal amount which is less than the aggregate principal amount of the       
related mortgage loans.                                                         

FINANCIAL GUARANTY INSURANCE POLICY                                             

   If so specified in the related prospectus supplement, a financial
guaranty insurance policy may be obtained and maintained for a class or series  
of securities. The insurer with respect to a financial guaranty insurance policy
will be described in the related prospectus supplement.                         

 A financial guaranty insurance policy will be unconditional and
irrevocable and will guarantee to holders of the applicable securities that an  
amount equal to the full amount of payments due to the holders will be received 
by the trustee or its agent on behalf of the holders for payment on each        
distribution date. The specific terms of any financial guaranty insurance policy
will be set forth in the related prospectus supplement. A financial guaranty    
insurance policy may have limitations and generally will not insure the         
obligation of the Sellers or the master servicer to repurchase or substitute for
a defective mortgage loan, will not insure Prepayment Interest Shortfalls or    
interest shortfalls due to the application of the Relief Act and will not       
guarantee any specific rate of principal payments. The insurer will be          
subrogated to the rights of each holder to the extent the insurer makes payments
under the financial guaranty insurance policy.                                  

MORTGAGE POOL INSURANCE POLICIES                                                

        Any mortgage pool insurance policy obtained by the company for a trust
fund will be issued by the insurer named in the applicable prospectus           
supplement. Each mortgage pool insurance policy will cover Defaulted Mortgage   
Losses in an amount equal to a percentage specified in the applicable prospectus
supplement of the aggregate principal balance of the mortgage loans on the      
cut-off date, or will cover a portion of Defaulted Mortgage Losses on any       
mortgage up to a specified percentage of the Value of that mortgage loan. As set
forth under "Maintenance of Credit Enhancement," the master servicer will use   
reasonable efforts to maintain, or cause the servicers to maintain, any mortgage
pool insurance policy and to present claims thereunder to the insurer on behalf 
of itself, the related trustee and the related securityholders. The mortgage    
pool insurance policies, however, are not blanket policies against loss, since  
claims thereunder may only be made respecting particular defaulted mortgage     
loans and only upon satisfaction of the terms of the related policy. Any        
exceptions to coverage will be described in the related prospectus supplement.  
Unless specified in the related prospectus supplement, the mortgage pool        
insurance policies may not cover losses due to a failure to pay or denial of a  
claim under a Primary Insurance Policy, irrespective of the reason therefor.    

LETTER OF CREDIT                                                                

        If any component of credit enhancement as to the offered securities of
a series is to be provided by a letter of credit, a bank will deliver to the    
related trustee an irrevocable letter of credit. The letter of credit may       
provide direct coverage with respect to the mortgage loans. The bank that       
delivered the letter of credit, as well as the amount available under the letter
of credit with respect to each component of credit enhancement, will be         
specified in the applicable prospectus supplement. If so specified in the       
related prospectus supplement, the letter of credit may permit draws only in the
event of certain types of losses and shortfalls. The letter of credit may also  
provide for the payment of required advances which the master servicer or any   
servicer fails to make. The amount available under the letter of credit will, in
all cases, be reduced to the extent of any unreimbursed payments thereunder and 
may otherwise be reduced as described in the related prospectus supplement. The 
letter of credit will expire on the expiration date set forth in the related    
prospectus supplement, unless earlier terminated or extended in accordance with 
its terms.                                                                      

SPECIAL HAZARD INSURANCE POLICIES                                               

    Any special hazard insurance policy covering Special Hazard Losses
obtained by the company for a trust fund will be issued by the insurer named in 
the applicable prospectus supplement. Each special hazard insurance policy will,
subject to limitations described below, protect holders of the related series of
securities from Special Hazard Losses. See "Description of Primary Mortgage     
Insurance, Hazard Insurance; Claims Thereunder." However, a special hazard      
insurance policy will not cover losses occasioned by war, civil insurrection,   
some governmental actions, errors in design, faulty workmanship or materials    
(except under some circumstances), nuclear reaction, chemical contamination,    
waste by the mortgagor and other risks. Aggregate claims under a special hazard 
insurance policy will be limited to the amount set forth in the related         
prospectus supplement and will be subject to reduction as described in the      
related prospectus supplement.                                                  

         Subject to the foregoing limitations, a special hazard insurance policy
will provide that, where there has been damage to property securing a foreclosed
mortgage loan (title to which has been acquired by the insured) and to the      
extent the damage is not covered by the hazard insurance policy or flood        
insurance policy, if any, maintained by the mortgagor or the master servicer,   
special servicer or the servicer, the insurer will pay the lesser of (1) the    
cost of repair or replacement of the property or (2) upon transfer of the       
property to the insurer, the unpaid principal balance of the mortgage loan at   
the time of acquisition of the property by foreclosure or deed in lieu of       
foreclosure, plus accrued interest at the mortgage rate to the date of claim    
settlement and expenses incurred by the master servicer, special servicer or    
servicer with respect to the property. If the property is transferred to a third
party in a sale approved by the issuer of the special hazard insurance policy,  
the amount that the issuer will pay will be the amount under (2) above reduced  
by the net proceeds of the sale of the property. No claim may be validly        
presented under the special hazard insurance policy unless hazard insurance on  
the property securing a 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 by the issuer of the special hazard   
insurance policy). If the unpaid principal balance plus accrued interest and    
expenses is paid by the insurer, the amount of further coverage under the       
related special hazard insurance policy will be reduced by that amount less any 
net proceeds from the sale of the property. Any amount paid as the cost of      
repair of the property will further reduce coverage by that amount. Restoration 
of the property with the proceeds described under (1) above will satisfy the    
condition under each mortgage pool insurance policy that the property be        
restored before a claim under the mortgage pool insurance policy may be validly 
presented with respect to the defaulted mortgage loan secured by the property.  
The payment described under (2) above will render presentation of a claim in    
respect of the mortgage loan under the related mortgage pool insurance policy   
unnecessary. Therefore, so long as a mortgage pool insurance policy remains in  
effect, the payment by the insurer under a special hazard insurance policy of   
the cost of repair or of the unpaid principal balance of the related mortgage   
loan plus accrued interest and expenses will not affect the total Insurance     
Proceeds paid to securityholders, but will affect the relative amounts of       
coverage remaining under the related special hazard insurance policy and        
mortgage pool insurance policy.                                                 

         As and to the extent set forth in the applicable prospectus supplement,
coverage in respect of Special Hazard Losses for a series of securities may be  
provided, in whole or in part, by a type of instrument other than a special     
hazard insurance policy or by means of a special hazard representation of the   
Seller or the company.                                                          

RESERVE FUNDS                                                                   

       If so provided in the related prospectus supplement, the company will
deposit or cause to be deposited in a reserve fund any combination of cash, one 
or more irrevocable letters of credit or one or more Permitted Investments in   
specified amounts, or any other instrument satisfactory to the relevant Rating  
Agency or Agencies, which will be applied and maintained in the manner and under
the conditions specified in the prospectus supplement. In the alternative or in 
addition to the deposit, to the extent described in the related prospectus      
supplement, a reserve fund may be funded through application of all or a portion
of amounts otherwise payable on any related subordinate securities, from the    
retained interest of the company or otherwise. To the extent that the funding of
the reserve fund is dependent on amounts otherwise payable on related           
subordinate securities, any retained interest of the company or other cash flows
attributable to the related mortgage loans or reinvestment income, the reserve  
fund may provide less coverage than initially expected if the cash flows or     
reinvestment income on which the funding is dependent are lower than            
anticipated. In addition, with respect to any series of securities as to which  
credit enhancement includes a letter of credit, if so specified in the related  
prospectus supplement, if specified conditions are met, the remaining amount of 
the letter of credit may be drawn by the trustee and deposited in a reserve     
fund. Amounts in a reserve fund may be distributed to securityholders, or       
applied to reimburse the master servicer or a servicer for outstanding advances,
or may be used for other purposes, in the manner and to the extent specified in 
the related prospectus supplement. The related prospectus supplement will       
disclose whether a reserve fund is part of the related trust fund. If set forth 
in the related prospectus supplement, a reserve fund may provide coverage to    
more than one series of securities.                                             

       In connection with the establishment of any reserve fund, the reserve
fund will be structured so that the trustee will have a perfected security      
interest for the benefit of the securityholders in the assets in the reserve    
fund. However, to the extent that the company, any affiliate thereof or any     
other entity has an interest in any reserve fund, in the event of the           
bankruptcy, receivership or insolvency of that entity, there could be delays in 
withdrawals from the reserve fund and corresponding payments to the             
securityholders which could adversely affect the yield to investors on the      
related securities.                                                             

        Amounts deposited in any reserve fund for a series will be invested in
Permitted Investments by, or at the direction of, and for the benefit of the    
master servicer or any other person named in the related prospectus supplement. 

CASH FLOW AGREEMENTS                                                            

         If so provided in the related prospectus supplement, the trust fund may
include guaranteed investment contracts pursuant to which moneys held in the    
funds and accounts established for the related series will be invested at a     
specified rate. The principal terms of a guaranteed investment contract or other
cash flow agreement, and the identity of the obligor, will be described in the  
prospectus supplement for a series of notes.                                    

MAINTENANCE OF CREDIT ENHANCEMENT                                               

  To the extent that the applicable prospectus supplement does not
expressly provide for alternative credit enhancement arrangements in lieu of    
some or all of the arrangements mentioned below, the following paragraphs shall 
apply.                                                                          

       If a financial guaranty insurance policy has been obtained for one or
more classes of securities of a series, the trustee will be obligated to        
exercise reasonable efforts to keep the financial guaranty insurance policy in  
full force and effect throughout the term of the applicable pooling and         
servicing agreement or servicing agreement, until the specified class or classes
of securities have been paid in full, unless coverage thereunder has been       
exhausted through payment of claims, or until the financial guaranty insurance  
policy is replaced in accordance with the terms of the applicable pooling and   
servicing agreement or servicing agreement. The trustee will agree to remit the 
premiums for each financial guaranty insurance policy, from available funds of  
the related trust, in accordance with the provisions and priorities set forth in
the applicable pooling and servicing agreement or servicing agreement, on a     
timely basis. In the event the insurer ceases to be a qualified insurer as      
described in the related prospectus supplement, or fails to make a required     
payment under the related financial guaranty insurance policy, neither the      
trustee nor any other person will have any obligation to replace the insurer.   
Any losses associated with any reduction or withdrawal in rating by an          
applicable Rating Agency shall be borne by the related securityholders.         

       If a mortgage pool insurance policy has been obtained for some or all
of the mortgage loans related to a series of securities, the master servicer    
will be obligated to exercise reasonable efforts to keep the mortgage pool      
insurance policy (or an alternate form of credit support) in full force and     
effect throughout the term of the applicable pooling and servicing agreement or 
servicing agreement to the extent provided in the related prospectus supplement.
The master servicer will agree to pay the premiums for each mortgage pool       
insurance policy on a timely basis. In the event the pool insurer ceases to be a
qualified insurer because it ceases to be qualified by law to transact pool     
insurance business or coverage is terminated for any reason other than          
exhaustion of the coverage, the master servicer will use reasonable efforts to  
obtain from another qualified insurer a replacement insurance policy comparable 
to the mortgage pool insurance policy with a total coverage equal to the then   
outstanding coverage of the mortgage pool insurance policy, provided that, if   
the cost of the replacement policy is greater than the cost of the mortgage pool
insurance policy, the coverage of the replacement policy will, unless otherwise 
agreed to by the company, be reduced to a level such that its premium rate does 
not exceed the premium rate on the mortgage pool insurance policy.              

        If a letter of credit or alternate form of credit enhancement has been
obtained for a series of securities, the trustee will be obligated to exercise  
reasonable efforts cause to be kept or to keep the letter of credit (or an      
alternate form of credit support) in full force and effect throughout the term  
of the applicable pooling and servicing agreement or indenture, unless coverage 
thereunder has been exhausted through payment of claims or otherwise, or        
substitution therefor is made as described below under "--Reduction or          
Substitution of Credit Enhancement." Unless otherwise specified in the          
applicable prospectus supplement, if a letter of credit obtained for a series of
securities is scheduled to expire prior to the date the final distribution on   
the securities is made and coverage under the letter of credit has not been     
exhausted and no substitution has occurred, the trustee will draw the amount    
available under the letter of credit and maintain the amount in trust for the   
securityholders.                                                                

         If a special hazard insurance policy has been obtained for the mortgage
loans related to a series of securities, the master servicer will also be       
obligated to exercise reasonable efforts to maintain and keep the policy in full
force and effect throughout the term of the applicable pooling and servicing    
agreement or servicing agreement, unless coverage thereunder has been exhausted 
through payment of claims or otherwise or substitution therefor is made as      
described below under "--Reduction or Substitution of Credit Enhancement." If   
coverage for Special Hazard Losses takes the form of a special hazard insurance 
policy, the policy will provide coverage against risks of the type described in 
this prospectus under "Description of Credit Enhancement--Special Hazard        
Insurance Policies." The master servicer may obtain a substitute policy for the 
existing special hazard insurance policy if prior to the substitution the master
servicer obtains written confirmation from the Rating Agency or Agencies that   
rated the related securities that the substitution shall not adversely affect   
the then-current ratings assigned to the securities by the Rating Agency or     
Agencies.                                                                       

The master servicer, on behalf of itself, the trustee and     
securityholders, will provide the trustee information required for the trustee  
to draw under the letter of credit and will present claims to each pool insurer,
to the issuer of each special hazard insurance policy, and, in respect of       
defaulted mortgage loans for which there is no servicer, to each primary insurer
and take any reasonable steps as are necessary to permit recovery under the     
letter of credit, insurance policies or comparable coverage respecting defaulted
mortgage loans or mortgage loans which are the subject of a bankruptcy          
proceeding. As set forth above, all collections by the master servicer under any
mortgage pool insurance policy or any Primary Insurance Policy and, where the   
related property has not been restored, a special hazard insurance policy, are  
to be deposited in the related Distribution Account, subject to withdrawal as   
described above. All draws under any letter of credit are also to be deposited  
in the related Distribution Account. In those cases in which a mortgage loan is 
serviced by a servicer, the servicer, on behalf of itself, the trustee and the  
securityholders will present claims to the primary insurer, and all paid claims 
shall initially be deposited in a Protected Account prior to being delivered to 
the master servicer for ultimate deposit to the related Distribution Account.   

   If any property securing a defaulted mortgage loan is damaged and
proceeds, if any, from the related hazard insurance policy or any applicable    
special hazard insurance policy are insufficient to restore the damaged property
to a condition sufficient to permit recovery under any financial guaranty       
insurance policy, mortgage pool insurance policy, letter of credit or any       
related Primary Insurance Policy, neither the master servicer nor any servicer  
is required to expend its own funds to restore the damaged property unless it   
determines (1) that the restoration will increase the proceeds to one or more   
classes of securityholders on liquidation of the mortgage loan after            
reimbursement of the master servicer for its expenses and (2) that the expenses 
will be recoverable by it through liquidation Proceeds or Insurance Proceeds. If
recovery under any financial guaranty insurance policy, mortgage pool insurance 
policy, letter of credit or any related Primary Insurance Policy is not         
available because the master servicer or servicer has been unable to make the   
above determinations, has made the determinations incorrectly or recovery is not
available for any other reason, the master servicer and each servicer is        
nevertheless obligated to follow the normal practices and procedures (subject to
the preceding sentence) as it deems necessary or advisable to realize upon the  
defaulted mortgage loan and in the event the determinations have been           
incorrectly made, is entitled to reimbursement of its expenses in connection    
with the restoration.                                                           

REDUCTION OR SUBSTITUTION OF CREDIT ENHANCEMENT                                 

      The amount of credit support provided pursuant to any form of credit
enhancement may be reduced. In most cases, the amount available pursuant to any 
form of credit enhancement will be subject to periodic reduction in accordance  
with a schedule or formula on a nondiscretionary basis pursuant to the terms of 
the related pooling and servicing agreement or indenture. Additionally, in most 
cases, the form of credit support (and any replacements therefor) may be        
replaced, reduced or terminated, and the formula used in calculating the amount 
of coverage with respect to Bankruptcy Losses, Special Hazard Losses or Fraud   
losses may be changed, without the consent of the securityholders, upon the     
written assurance from each applicable Rating Agency that its then-current      
rating of the related series of securities will not be adversely affected.      
Furthermore, in the event that the credit rating of any obligor under any       
applicable credit enhancement is downgraded, the credit rating or ratings of the
related series of securities may be downgraded to a corresponding level, and,   
neither the master servicer nor any other person will be obligated to obtain    
replacement credit support in order to restore the rating or ratings of the     
related series of securities. The master servicer will also be permitted to     
replace the credit support with other credit enhancement instruments issued by  
obligors whose credit ratings are equivalent to the downgraded level and in     
lower amounts which would satisfy the downgraded level, provided that the       
then-current rating or ratings of the related series of securities are          
maintained. Where the credit support is in the form of a reserve fund, a        
permitted reduction in the amount of credit enhancement will result in a release
of all or a portion of the assets in the reserve fund to the company, the master
servicer or the other person that is entitled thereto. Any assets so released   
will not be available for distributions in future periods.                      

 OTHER FINANCIAL OBLIGATIONS RELATED TO THE SECURITIES

SWAPS AND YIELD SUPPLEMENT AGREEMENTS                                           

       The trustee on behalf of a trust fund may enter into interest rate or
other swaps and related caps, floors and collars to minimize the risk to        
securityholders from adverse changes in interest rates or to provide credit     
support, which are collectively referred to as swaps, and other yield supplement
agreements or similar yield maintenance arrangements that do not involve swap   
agreements or other notional principal contracts, which are collectively        
referred to as yield supplement agreements.                                     

         An interest rate swap is an agreement between two parties to exchange a
stream of interest payments on an agreed hypothetical or "notional" principal   
amount. No principal amount is exchanged between the counterparties to an       
interest rate swap. In the typical swap, one party agrees to pay a fixed rate on
a notional principal amount, while the counterparty pays a floating rate based  
on one or more reference interest rates including the London Interbank Offered  
Rate, or LIBOR, a specified bank's prime rate or U.S. Treasury Bill rates.      
Interest rate swaps also permit counterparties to exchange a floating rate      
obligation based upon one reference interest rate, such as LIBOR, for a floating
rate obligation based upon another referenced interest rate, such as U.S.       
Treasury Bill rates.                                                            

       Swaps may include "total return swaps," where all or a portion of the
total amount of interest and principal on a security is paid by a third-party in
exchange for an up front payment or a stated periodic payment, and "credit      
derivatives" where credit enhancement is provided in the form of a swap         
agreement, and which may include a "credit support annex" where securities,     
rights, or other amounts are pledged as collateral for the performance of the   
counterparty. Additionally, agreements relating to other types of derivative    
products that are designed to provide credit enhancement to the related series  
may be entered into by a trustee and one or more counterparties. The terms of   
total return swaps, credit derivatives and any other derivative product         
agreement and any counterparties will be described in the accompanying          
prospectus supplement.                                                          

   Yield supplement agreements may be entered into to supplement the
interest rate or other rates on one or more classes of the securities of any    
series.                                                                         

       There can be no assurance that the trustee will be able to enter into
or offset swaps or enter into yield supplement agreements or other derivative   
product agreements at any specific time or at prices or on other terms that are 
advantageous. In addition, although the terms of the swaps and yield supplement 
agreements may provide for termination under various circumstances, there can be
no assurance that the trustee will be able to terminate a swap or yield         
supplement agreement when it would be economically advantageous to the trust    
fund to do so.                                                                  

PURCHASE OBLIGATIONS                                                            

  Some types of trust assets and some classes of securities of any
series, as specified in the related prospectus supplement, may be subject to a  
purchase obligation that would become applicable on one or more specified dates,
or upon the occurrence of one or more specified events, or on demand made by or 
on behalf of the applicable securityholders. A purchase obligation may be in the
form of a conditional or unconditional purchase commitment, liquidity facility, 
remarketing agreement, maturity guaranty, put option or demand feature. The     
terms and conditions of each purchase obligation, including the purchase price, 
timing and payment procedure, will be described in the accompanying prospectus  
supplement. A purchase obligation relating to trust assets may apply to those   
trust assets or to the related securities. Each purchase obligation may be a    
secured or unsecured obligation of the provider thereof, which may include a    
bank or other financial institution or an insurance company. Each purchase      
obligation will be evidenced by an instrument delivered to the trustee for the  
benefit of the applicable securityholders of the related series. As specified in
the accompanying prospectus supplement, each purchase obligation relating to    
trust assets will be payable solely to the trustee for the benefit of the       
securityholders of the related series. Other purchase obligations may be payable
to the trustee or directly to the holders of the securities to which that       
obligation relate.                                                              

DESCRIPTION OF PRIMARY MORTGAGE INSURANCE, HAZARD INSURANCE;
 CLAIMS THEREUNDER

GENERAL                                                                         

   The mortgaged property with respect to each mortgage loan will be
required to be covered by a hazard insurance policy and, if required as         
described below, a Primary Insurance Policy. The following is only a brief      
description of these insurance policies and does not purport to summarize or    
describe all of the provisions of these policies. The insurance is subject to   
underwriting and approval of individual mortgage loans by the respective        
insurers.                                                                       

PRIMARY MORTGAGE INSURANCE POLICIES                                             

 In a securitization of single family loans, single family loans
included in the related mortgage pool having a Loan-to-Value Ratio at           
origination of over 80% (or other percentage as described in the related        
prospectus supplement) may be required by the company to be covered by a Primary
Insurance Policy. The Primary Insurance Policy will insure against default on a 
mortgage loan as to at least the principal amount thereof exceeding 75% of the  
Value of the related mortgaged property (or other percentage as described in the
related prospectus supplement) at origination of the mortgage loan, unless and  
until the principal balance of the mortgage loan is reduced to a level that     
would produce a Loan-to-Value Ratio equal to or less than at least 80% (or other
percentage as described in the prospectus supplement). This type of mortgage    
loan will not be considered to be an exception to the foregoing standard if no  
Primary Insurance Policy was obtained at origination but the mortgage loan has  
amortized to below the above Loan-to-Value Ratio percentage as of the applicable
cut-off date. Mortgage loans which are subject to negative amortization will    
only be covered by a Primary Insurance Policy if the coverage was so required   
upon their origination, notwithstanding that subsequent negative amortization   
may cause the mortgage loan's Loan-to-Value Ratio, based on the then-current    
balance, to subsequently exceed the limits which would have required the        
coverage upon their origination. Multifamily, commercial and mixed-use loans    
will not be covered by a Primary Insurance Policy, regardless of the related    
Loan-to-Value Ratio.                                                            

         While the terms and conditions of the Primary Insurance Policies issued
by a primary insurer will differ from those in Primary Insurance Policies issued
by other primary insurers, each Primary Insurance Policy will in general cover  
the Primary Insurance Covered Loss. The primary insurer generally will be       
required to pay:                                                                

        o        the insured percentage of the Primary Insurance Covered Loss;

         o        the entire amount of the Primary Insurance Covered Loss, after
                 receipt by the primary insurer of good and merchantable title
     to, and possession of, the mortgaged property; or

o        at the option of the primary insurer, the sum of the 
             delinquent monthly payments plus any advances made by the
       insured, both to the date of the claim payment and,
              thereafter, monthly payments in the amount that would have
         become due under the mortgage loan if it had not been
              discharged plus any advances made by the insured until the
             earlier of (1) the date the mortgage loan would have been
                discharged in full if the default had not occurred or (2) an
approved sale.                              

     As conditions precedent to the filing or payment of a claim under a
Primary Insurance Policy, in the event of default by the mortgagor, the insured 
will typically be required, among other things, to:                             

        o        advance or discharge (1) hazard insurance premiums and (2) as
                  necessary and approved in advance by the primary insurer, real
          estate taxes, protection and preservation expenses and
foreclosure and related costs;              

       o        in the event of any physical loss or damage to the mortgaged
                  property, have the mortgaged property restored to at least its
            condition at the effective date of the Primary Insurance
 Policy (ordinary wear and tear excepted); and

        o        tender to the primary insurer good and merchantable title to,
and possession of, the mortgaged property.  

         For any single family loan for which the coverage is required under the
standard described above, the master servicer will maintain, or will cause each 
servicer to maintain, in full force and effect and to the extent coverage is    
available a Primary Insurance Policy with regard to each single family loan,    
provided that the Primary Insurance Policy was in place as of the cut-off date  
and the company had knowledge of the Primary Insurance Policy. The master       
servicer or the Seller will not cancel or refuse to renew a Primary Insurance   
Policy in effect at the time of the initial issuance of a series of securities  
that is required to be kept in force under the applicable pooling and servicing 
agreement or indenture unless the replacement Primary Insurance Policy for the  
canceled or non-renewed policy is maintained with an insurer whose claims-paying
ability is acceptable to the Rating Agency or Agencies that rated the series of 
securities for mortgage pass-through certificates having a rating equal to or   
better than the highest then-current rating of any class of the series of       
securities. For further information regarding the extent of coverage under any  
mortgage pool insurance policy or primary Insurance Policy, see "Description of 
Credit Enhancement--Mortgage Pool insurance Policies."                          

HAZARD INSURANCE POLICIES                                                       

      The terms of the mortgage loans require each mortgagor to maintain a
hazard insurance policy for their mortgage loan. Additionally, the pooling and  
servicing agreement or servicing agreement will require the master servicer to  
cause to be maintained for each mortgage loan a hazard insurance policy         
providing for no less than the coverage of the standard form of fire insurance  
policy with extended coverage customary in the state in which the property is   
located. The coverage generally will be in an amount equal to the lesser of the 
principal balance owing on the mortgage loan and 100% of the insurable value of 
the improvements securing the mortgage loan; provided, that in any case, such   
amount shall be sufficient to prevent the mortgagor and/or mortgagee from       
becoming a co-insurer. The ability of the master servicer to ensure that hazard 
insurance proceeds are appropriately applied may be dependent on it, or the     
servicer of the mortgage loan, being named as an additional insured under any   
hazard insurance policy and under any flood insurance policy referred to below, 
or upon the extent to which information in this regard is furnished to the      
master servicer by mortgagors or servicers.                                     

       As set forth above, all amounts collected by the master servicer or a
servicer under any hazard policy (except for amounts to be applied to the       
restoration or repair of the mortgaged property or released to the mortgagor in 
accordance with teamster servicer's normal servicing procedures) will be        
deposited in the related Distribution Account. The pooling and servicing        
agreement or servicing agreement will provide that the master servicer may      
satisfy its obligation to cause hazard policies to be maintained by maintaining,
or causing a servicer to maintain, a blanket policy insuring against losses on  
the mortgage loans. If the blanket policy contains a deductible clause, the     
master servicer will deposit, or will cause the applicable servicer to deposit, 
in the related Distribution Account all sums which would have been deposited    
therein but for the clause.                                                     

    In general, the standard form of fire and extended coverage policy
covers physical damage to or destruction of the improvements on the property by 
fire, lightning, explosion, smoke, windstorm, hail, riot, strike and civil      
commotion, subject to the conditions and exclusions specified in each policy.   
Although the policies relating to the mortgage loans will be underwritten by    
different insurers under different state laws in accordance with different      
applicable state forms and therefore will not contain identical terms and       
conditions, the basic terms thereof are dictated by respective state laws, and  
most of these policies typically do 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 reactions, wet or dry rot, vermin, rodents, insects or       
domestic animals, theft and, depending on the case, vandalism. The foregoing    
list is merely indicative of the kinds of uninsured risks and is not intended to
be all-inclusive. Where the improvements securing a mortgage loan are located in
a federally designated flood area at the time of origination of the mortgage    
loan, the pooling and servicing agreement or servicing agreement requires the   
master servicer to cause to be maintained for this mortgage loan, flood         
insurance (to the extent available) in an amount equal in general to the lesser 
of the amount required to compensate for any loss or damage on a replacement    
cost basis or the maximum insurance available under the federal flood insurance 
program.                                                                        

 The hazard insurance policies covering the mortgaged properties
typically contain a co-insurance clause which in effect requires the insured at 
all times to carry insurance of a specified percentage (generally 80% to 90%) of
the full replacement value of the improvements on the property in order to      
recover the full amount of any partial loss. If the insured's coverage falls    
below this specified percentage, the clause generally provides that the         
insurer's liability in the event of partial loss does not exceed the greater of 
(1) the replacement cost of the improvements damaged or destroyed less physical 
depreciation or (2) the proportion of the loss as the amount of insurance       
carried bears to the specified percentage of the full replacement cost of the   
improvements.                                                                   

      Since the amount of hazard insurance that mortgagors are required to
maintain on the improvements securing the mortgage loans may decline as the     
principal balances of the related mortgage loans decrease, and since residential
properties have historically appreciated in value over time, hazard insurance   
proceeds could be insufficient to restore fully the damaged property in the     
event of a partial loss. See "Description of Credit Enhancement--Special Hazard 
Insurance Policies" for a description of the limited protection afforded by any 
special hazard insurance policy against losses occasioned by hazards which are  
otherwise uninsured against (including losses caused by the application of the  
co-insurance clause described in the preceding paragraph).                      

 Under the terms of the mortgage loans, mortgagors are generally
required to present claims to insurers under hazard insurance policies          
maintained on the mortgaged properties. The master servicer, on behalf of the   
trustee and securityholders, is obligated to present claims, or cause the       
servicer of the mortgage loans to present claims, under any special hazard      
insurance policy and any blanket insurance policy insuring against hazard losses
on the mortgaged properties. However, the ability of the master servicer or     
servicer to present the claims is dependent upon the extent to which information
in this regard is furnished to the master servicer or the servicers by          
mortgagors.                                                                     

FHA MORTGAGE INSURANCE                                                          

     The Housing Act authorizes various FHA mortgage insurance programs.
Some of the mortgage loans may be insured under either Section 203(b), Section  
221, Section 223, Section 234 or Section 235 of the Housing Act. Under Section  
203(b), FHA insures mortgage loans of up to 30 years' duration for the purchase 
of one- to four-family dwelling units. Mortgage loans for the purchase of       
multifamily residential rental properties are insured by the FHA under Section  
221 and Section 223. Mortgage loans for the purchase of condominium units are   
insured by FHA under Section 234. Trust assets insured under these programs must
bear interest at a rate not exceeding the maximum rate in effect at the time the
loan is made, as established by HUD, and may not exceed specified percentages of
the lesser of the appraised value of the property and the sales price, less     
seller-paid closing costs for the property, up to certain specified maximums. In
addition, FHA imposes initial investment minimums and other requirements on     
mortgage loans insured under the Section 203(b) and Section 234 programs.       

         Under Section 235, assistance payments are paid by HUD to the mortgagee
on behalf of eligible borrowers for as long as the borrowers continue to be     
eligible for the payments. To be eligible, a borrower must be part of a family, 
have income within the limits prescribed by HUD at the time of initial          
occupancy, occupy the property and meet requirements for recertification at     
least annually.                                                                 

 The regulations governing these programs provide that insurance
benefits are payable either on foreclosure, or other acquisition of possession, 
and conveyance of the mortgaged premises to HUD or on assignment of the         
defaulted mortgage loan to HUD. The FHA insurance that may be provided under    
these programs on the conveyance of the home to HUD is equal to 100% of the     
outstanding principal balance of the mortgage loan, plus accrued interest, as   
described below, and certain additional costs and expenses. When entitlement to 
insurance benefits results from assignment of the mortgage loan to HUD, the     
insurance payment is computed as of the date of the assignment and includes the 
unpaid principal amount of the mortgage loan plus mortgage interest accrued and 
unpaid to the assignment date.                                                  

     When entitlement to insurance benefits results from foreclosure (or
other acquisition of possession) and conveyance, the insurance payment is equal 
to the unpaid principal amount of the mortgage loan, adjusted to reimburse the  
mortgagee for certain tax, insurance and similar payments made by it and to     
deduct certain amounts received or retained by the mortgagee after default, plus
reimbursement not to exceed two-thirds of the mortgagee's foreclosure costs. Any
FHA insurance relating to the mortgage loans underlying a series of securities  
will be described in the related prospectus supplement.                         

     The mortgage loans may also be insured under Title I Program of the
FHA. The applicable provisions of this program will be described in the related 
prospectus supplement. The master servicer will be required to take steps, or   
cause the servicers of the mortgage loans to take steps, reasonably necessary to
keep any FHA insurance in full force and effect.                                

VA MORTGAGE GUARANTY                                                            

  The Servicemen's Readjustment Act of 1944, as amended, permits a
veteran or, in some instances, his or her spouse, to obtain a mortgage loan     
guaranty by the VA covering mortgage financing of the purchase of a one-to      
four-family dwelling unit to be occupied as the veteran's home at an interest   
rate not exceeding the maximum rate in effect at the time the loan is made, as  
established by HUD. The program has no limit on the amount of a mortgage loan,  
requires no down payment for the purchaser and permits the guaranty of mortgage 
loans with terms, limited by the estimated economic life of the property, up to 
30 years. The maximum guaranty that may be issued by the VA under this program  
is 50% of the original principal amount of the mortgage loan up to a dollar     
limit established by the VA. The liability on the guaranty is reduced or        
increased pro rata with any reduction or increase in amount of indebtedness, but
in no event will the amount payable on the guaranty exceed the amount of the    
original guaranty. Notwithstanding the dollar and percentage limitations of the 
guaranty, a mortgagee will ordinarily suffer a monetary loss only when the      
difference between the unsatisfied indebtedness and the proceeds of a           
foreclosure sale of mortgaged premises is greater than the original guaranty as 
adjusted. The VA may, at its option, and without regard to the guaranty, make   
full payment to a mortgagee of the unsatisfied indebtedness on a mortgage upon  
its assignment to the VA.                                                       

        Since there is no limit imposed by the VA on the principal amount of a
VA-guaranteed mortgage loan but there is a limit on the amount of the VA        
guaranty, additional coverage under a Primary Mortgage Insurance Policy may be  
required by the company for VA loans in excess of amounts specified by the VA.  
The amount of the additional coverage will be set forth in the related          
prospectus supplement. Any VA guaranty relating to Contracts underlying a series
of certificates will be described in the related prospectus supplement.         

 THE COMPANY

The company is MILA Mortgage Acceptance, Inc. The company was 
incorporated in the State of Delaware on June 21, 2005 as a wholly-owned        
subsidiary of MILA, Inc., a Washington corporation. The company was organized   
for the purpose of serving as a private secondary mortgage market conduit. The  
company does not have, nor is it expected in the future to have, any significant
assets.                                                                         

     The company maintains its principal office at 6021 244th Street SW,
Mountlake Terrace, WA 98043. Its telephone number is (800) 332-6452.            

THE AGREEMENTS

GENERAL                                                                         

      Each series of certificates will be issued pursuant to a pooling and
servicing agreement or other agreement specified in the related prospectus      
supplement. In general, the parties to a pooling and servicing agreement will   
include the company, the trustee, the master servicer and, in some cases, a     
special servicer. However, a pooling and servicing agreement that relates to a  
trust fund that includes mortgage securities may include a party solely         
responsible for the administration of the mortgage securities, and a pooling and
servicing agreement that relates to a trust fund that consists solely of        
mortgage securities may not include a master servicer, special servicer or other
servicer as a party. All parties to each pooling and servicing agreement under  
which securities of a series are issued will be identified in the related       
prospectus supplement. Each series of notes will be issued pursuant to an       
indenture. The parties to each indenture will be the related Issuer and the     
trustee. The Issuer will be created pursuant to an owner trust agreement between
the company and the owner trustee and the mortgage loans or mortgage securities 
securing the notes will be serviced pursuant to a servicing agreement between   
the Issuer and the master servicer.                                             

         Forms of the Agreements have been filed as exhibits to the registration
statement of which this prospectus is a part. However, the provisions of each   
Agreement will vary depending upon the nature of the related securities and the 
nature of the related trust fund. The following summaries describe provisions   
that may appear in a pooling and servicing agreement with respect to a series of
certificates or in either the servicing agreement or indenture with respect to a
series of notes. The prospectus supplement for a series of securities will      
describe material provisions of the related Agreements that differ from the     
description thereof set forth below. The company will provide a copy of each    
Agreement (without exhibits) that relates to any series of securities without   
charge upon written request of a holder of an offered security of the series    
addressed to it at its principal executive offices specified in this prospectus 
under "The Company".                                                            

CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE COMPANY                   

     The pooling and servicing agreement or servicing agreement for each
series of securities will provide that the master servicer may not resign from  
its obligations and duties except upon a determination that performance of the  
duties is no longer permissible under applicable law or except (1) in connection
with a permitted transfer of servicing or (2) upon appointment of a successor   
servicer reasonably acceptable to the trustee and upon receipt by the trustee of
letter from each Rating Agency generally to the effect that the resignation and 
appointment will not, in and of itself, result in a downgrading of the          
securities. No resignation will become effective until the trustee or a         
successor servicer has assumed the master servicer's responsibilities, duties,  
liabilities and obligations under the pooling and servicing agreement or        
servicing agreement.                                                            

        Each pooling and servicing agreement and servicing agreement will also
provide that the master servicer, the company and their directors, officers,    
employees or agents will not be under any liability to the trust fund or the    
securityholders for any action taken or for refraining from the taking of any   
action in good faith, or for errors in judgment, unless the liability which     
would otherwise be imposed was by reason of willful misfeasance, bad faith or   
gross negligence in the performance of duties or by reason of reckless disregard
of obligations and duties. Each pooling and servicing agreement and servicing   
agreement will further provide that the master servicer, the company, and any   
director, officer, employee or agent of the master servicer or the company are  
entitled to indemnification by the trust fund and will be held harmless against 
any loss, liability or expense (including reasonable legal fees and             
disbursements of counsel) incurred in connection with any legal action relating 
to the pooling and servicing agreement or servicing agreement or the related    
series of securities, other than any loss, liability or expense related to any  
specific mortgage loan or mortgage loans (except a loss, liability or expense   
otherwise reimbursable pursuant to the pooling and servicing agreement) and any 
loss, liability or expense incurred by reason of willful misfeasance, bad faith 
or gross negligence in the performance of its duties or by reason of reckless   
disregard of obligations and duties. In addition, each pooling and servicing    
agreement and servicing agreement will provide that neither the master servicer 
nor the company will be under any obligation to appear in, prosecute or defend  
any legal or administrative action that is not incidental to its respective     
duties under the pooling and servicing agreement or servicing agreement and     
which in its opinion may involve it in any expense or liability. The master     
servicer or the company may, however, in its discretion undertake any action    
which it may deem necessary or desirable with respect to the pooling and        
servicing agreement or servicing agreement and the rights and duties of the     
parties to that agreement and the interests of the securityholders. The legal   
expenses and costs of the action and any resulting liability will be expenses,  
costs and liabilities of the trust fund, and the master servicer or the company,
as the case may be, will be entitled reimbursement from funds otherwise         
distributable to securityholders.                                               

Any person into which the master servicer may be merged or    
consolidated, any person resulting from any merger or consolidation to which the
master servicer is a party or any person succeeding to the business of the      
master servicer will be the successor of the master servicer under the related  
pooling and servicing agreement or servicing agreement, provided that (1) the   
person is qualified to service mortgage loans on behalf of Fannie Mae or Freddie
Mac and (2) the merger, consolidation or succession does not adversely affect   
the then-current ratings of the classes of securities of the related series that
have been rated. In addition, notwithstanding the prohibition on its            
resignation, the master servicer may assign its rights under a pooling and      
servicing agreement or servicing agreement, provided clauses (1) and (2) above  
are satisfied and the person is reasonably satisfactory to the company and the  
trustee. In the case of an assignment, the master servicer will be released from
its obligations under the pooling and servicing agreement or servicing          
agreement, exclusive of liabilities and obligations incurred by it prior to the 
time of the assignment.                                                         

EVENTS OF DEFAULT AND RIGHTS UPON EVENT OF DEFAULT                              

POOLING AND SERVICING AGREEMENT                               

        Events of default under the pooling and servicing agreement in respect
of a series of certificates, unless otherwise specified in the prospectus       
supplement, will include:                                                       

        o        any failure by the master servicer to make a required deposit
                to the Distribution Account which continues unremedied for 5
                  days (or other time period described in the related prospectus
                 supplement) after the giving of written notice of the failure
               to the master servicer by the trustee or the company, or to
           the master servicer, the company and the trustee by the
               holders of certificates evidencing not less than 25% of the
            aggregate undivided interests (or, if applicable, voting
rights) in the related trust fund;          

      o        any failure by the master servicer to observe or perform in
               any material respect any other of its material covenants or
                  agreements in the pooling and servicing agreement with respect
                to the series of certificates which continues unremedied for
                30 days (15 days in the case of a failure to pay the premium
               for any insurance policy which is required to be maintained
                  under the pooling and servicing agreement) after the giving of
               written notice of the failure to the master servicer by the
                  trustee or the company, or to the master servicer, the company
                 and the trustee by the holders of certificates evidencing not
              less than 25% of the aggregate undivided interests (or, if
         applicable, voting rights) in the related trust fund;

    o        events of insolvency, readjustment of debt, marshaling of
               assets and liabilities or similar proceedings regarding the
           master servicer and some actions by the master servicer
                  indicating its insolvency or inability to pay its obligations,
                as specified in the related pooling and servicing agreement;
and                                         

 o        any failure of the master servicer to make advances as
          described in this prospectus under "Description of the
                Securities--Advances," by the date and time set forth in the
pooling and servicing agreement.            

Additional events of default will be described in the related prospectus        
supplement. A default pursuant to the terms of any mortgage securities included 
in any trust fund will not constitute an event of default under the related     
pooling and servicing agreement.                                                

       So long as an event of default remains unremedied, either the company
or the trustee may, and at the direction of the holders of certificates         
evidencing not less than 51% of the aggregate undivided interests (or, if       
applicable, voting rights) in the related trust fund the trustee shall, by      
written notification to the master servicer and to the company or the trustee,  
as applicable, terminate all of the rights and obligations of the master        
servicer under the pooling and servicing agreement (other than any rights of the
master servicer as certificateholder) covering the trust fund and in and to the 
mortgage loans and the proceeds thereof, whereupon the trustee or, upon notice  
to the company and with the company's consent, its designee will succeed to all 
responsibilities, duties and liabilities of the master servicer under the       
pooling and servicing agreement (other than any obligation to purchase mortgage 
loans) and will be entitled to similar compensation arrangements. In the event  
that the trustee would be obligated to succeed the master servicer but is       
unwilling so to act, it may appoint (or if it is unable so to act, it shall     
appoint) or petition a court of competent jurisdiction for the appointment of,  
an established mortgage loan servicing institution with a net worth of at least 
$15,000,000 to act as successor to the master servicer under the pooling and    
servicing agreement (unless otherwise set forth in the pooling and servicing    
agreement). Pending an appointment, the trustee is obligated to act as master   
servicer. The trustee and the successor may agree upon the servicing            
compensation to be paid, which in no event may be greater than the compensation 
to the initial master servicer under the pooling and servicing agreement.       

        No certificateholder will have any right under a pooling and servicing
agreement to institute any proceeding with respect to the pooling and servicing 
agreement unless (1) that holder previously gave the trustee written notice of a
default that is continuing, (2) the holders of certificates evidencing not less 
than 25% of the aggregate undivided interests (or, if applicable, voting        
rights)in the related trust fund requested the trustee in writing to institute  
the proceeding in its own name as trustee, (3) the trustee receives reasonable  
security or indemnity against the costs, expenses and liabilities that may be   
incurred in or because of the proceeding and (4) the trustee for a reasonable   
time after receipt of the request and indemnity has neglected or refused to     
institute any proceeding.                                                       

        The holders of certificates representing at least 66% of the aggregate
undivided interests (or, if applicable, voting rights) evidenced by those       
certificates affected by a default or event of default may waive the default or 
event of default (other than a failure by the master servicer to make an        
advance); provided, however, that (1) a default or event of default under the   
first or fourth items listed under "--Events of Default" above may be waived    
only by all of the holders of certificates affected by the default or event of  
default and (2) no waiver shall reduce in any manner the amount of, or delay the
timing of, payments received on mortgage loans which are required to be         
distributed to, or otherwise materially adversely affect, any non-consenting    
certificateholder.                                                              

SERVICING AGREEMENT                                           

        For a series of notes, a servicing default under the related servicing
agreement generally will include:                                               

        o        any failure by the master servicer to make a required deposit
                to the Distribution Account or, if the master servicer is so
                required, to distribute to the holders of any class of notes
             or Equity Certificates of the series any required payment
            which continues unremedied for 5 business days (or other
                  period of time described in the related prospectus supplement)
            after the giving of written notice of the failure to the
 master servicer by the trustee or the Issuer;

        o        any failure by the master servicer duly to observe or perform
         in any material respect any other of its covenants or
             agreements in the servicing agreement with respect to the
               series of securities which continues unremedied for 45 days
            after the giving of written notice of the failure to the
 master servicer by the trustee or the Issuer;

    o        events of insolvency, readjustment of debt, marshaling of
               assets and liabilities or similar proceedings regarding the
           master servicer and some actions by the master servicer
                  indicating its insolvency or inability to pay its obligations,
        as specified in the related servicing agreement; and

    o        any other servicing default as set forth in the servicing
agreement.                                  

       So long as a servicing default remains unremedied, either the company
or the trustee may, by written notification to the master servicer and to the   
Issuer or the trustee or trust fund, as applicable, terminate all of the rights 
and obligations of the master servicer under the servicing agreement (other than
any right of the master servicer as noteholder or as holder of the Equity       
Certificates and other than the right to receive servicing compensation and     
expenses for master servicing the mortgage loans during any period prior to the 
date of the termination), whereupon the trustee will succeed to all             
responsibilities, duties and liabilities of the master servicer under the       
servicing agreement (other than any obligation to purchase mortgage loans) and  
will be entitled to similar compensation arrangements. In the event that the    
trustee would be obligated to succeed the master servicer but is unwilling so to
act, it may appoint (or if it is unable so to act, it shall appoint) or petition
a court of competent jurisdiction for the appointment of an approved mortgage   
servicing institution with a net worth of at least $15,000,000 to act as        
successor to the master servicer under the servicing agreement (unless otherwise
set forth in the servicing agreement). Pending the appointment, the trustee is  
obligated to act in the capacity. The trustee and the successor may agree upon  
the servicing compensation to be paid, which in no event may be greater than the
compensation to the initial master servicer under the servicing agreement.      

INDENTURE                                                     

For a series of notes, an event of default under the indenture
generally will include:                                                         

   o        a default for five days or more (or other period of time
                  described in the related prospectus supplement) in the payment
              of any principal of or interest on any note of the series;

     o        failure to perform any other covenant of the Issuer in the
               indenture which continues for a period of thirty days after
             notice thereof is given in accordance with the procedures
described in the related indenture;         

   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 the series having been incorrect in a material
            respect as of the time made, and the breach is not cured
                  within thirty days after notice thereof is given in accordance
           with the procedures described in the related indenture;

        o        events of bankruptcy, insolvency, receivership or liquidation
            of the Issuer, as specified in the related indenture; or

       o        any other event of default provided with respect to notes of
that series.                                

       If an event of default with respect to the notes of any series at the
time outstanding occurs and is continuing, the trustee or the holders of a      
majority of the then aggregate outstanding amount of the notes of the series may
declare the principal amount of all the notes of the series to be due and       
payable immediately. The declaration may, in some circumstances, be rescinded   
and annulled by the holders of a majority in aggregate outstanding amount of the
related notes.                                                                  

       If following an event of default with respect to any series of notes,
the notes of the series have been declared to be due and payable, the trustee   
may, in its discretion, notwithstanding the acceleration, elect to maintain     
possession of the collateral securing the notes of the series and to continue to
apply payments on the collateral as if there had been no declaration of         
acceleration if the collateral continues to provide sufficient funds for the    
payment of principal of and interest on the notes of the series as they would   
have become due if there had not been a declaration. In addition, the trustee   
may not sell or otherwise liquidate the collateral securing the notes of a      
series following an event of default, unless (1) the holders of 100% of the then
aggregate outstanding amount of the notes of the series consent to the sale, (2)
the proceeds of the sale or liquidation are sufficient to pay in full the       
principal of and accrued interest, due and unpaid, on the outstanding notes of  
the series at the date of the sale or (3) the trustee determines that the       
collateral would not be sufficient on an ongoing basis to make all payments on  
the notes as the payments would have become due if the notes had not been       
declared due and payable, and the trustee obtains the consent of the holders of 
66 2/3% of the then aggregate outstanding amount of the notes of the series.    

       In the event that the trustee liquidates the collateral in connection
with an event of default, the indenture provides that the trustee will have a   
prior lien on the proceeds of the liquidation for unpaid fees and expenses. As a
result, upon the occurrence of an event of default, the amount available for    
payments to the noteholders would be less than would otherwise be the case.     
However, the trustee may not institute a proceeding for the enforcement of its  
lien except in connection with a proceeding for the enforcement of the lien of  
the indenture for the benefit of the noteholders after the occurrence of the    
event of default.                                                               

         In the event the principal of the notes of a series is declared due and
payable, as described above, the holders of the notes issued at a discount from 
par may be entitled to receive no more than an amount equal to the unpaid       
principal amount thereof less the amount of the discount that is unamortized.   

      No noteholder or holder of an Equity Certificate generally will have
any right under an owner trust agreement or indenture to institute any          
proceeding with respect to the Agreement unless (1) that holder previously has  
given to the trustee written notice of default and the continuance thereof, (2) 
the holders of notes or Equity Certificates of any class evidencing not less    
than 25% of the aggregate Percentage Interests constituting that class (a) have 
made written request upon the trustee to institute the proceeding in its own    
name as trustee and (b) have offered to the trustee reasonable security or      
indemnity against the costs, expenses and liabilities that may be incurred in or
because of the proceeding, (3) the trustee has neglected or refused to institute
the proceeding for 60 days after receipt of the request and indemnity and (4) no
direction inconsistent with the written request has been given to the trustee   
during the 60 day period by the holders of a majority of the aggregate          
Percentage Interests constituting that class.                                   

AMENDMENT                                                                       

    Each pooling and servicing agreement may be amended by the parties
thereto, without the consent of any of the holders of certificates covered by   
the pooling and servicing agreement,                                            

o        to cure any ambiguity,                               

      o        to correct or supplement any provision therein which may be
               defective or inconsistent with any other provision therein,

o        to change the timing and/or nature of deposits in the
                Distribution Account, provided that (1) the change would not
                 adversely affect in any material respect the interests of any
                 certificateholder, as evidenced by an opinion of counsel, and
              (2) the change would not adversely affect the then-current
                  rating of any rated classes of certificates, as evidenced by a
letter from each applicable Rating Agency,  

        o        if a REMIC election has been made with respect to the related
         trust fund, to modify, eliminate or add to any of its
                  provisions (A) to the extent as shall be necessary to maintain
                 the qualification of the trust fund as a REMIC or to avoid or
             minimize the risk of imposition of any tax on the related
                 trust fund, provided that the trustee has received an opinion
                of counsel to the effect that (1) the action is necessary or
          desirable to maintain the qualification or to avoid or
            minimize the risk, and (2) the action will not adversely
                 affect in any material respect the interests of any holder of
                certificates covered by the pooling and servicing agreement,
         or (B) to restrict the transfer of the REMIC Residual
               Certificates, provided that the company has determined that
               the then-current ratings of the classes of the certificates
           that have been rated will not be adversely affected, as
                 evidenced by a letter from each applicable Rating Agency, and
                 that the amendment will not give rise to any tax with respect
           to the transfer of the REMIC Residual Certificates to a
non-permitted transferee,                   

  o        to make any other provisions with respect to matters or
               questions arising under the pooling and servicing agreement
             which are not materially inconsistent with the provisions
                  thereof, provided that the action will not adversely affect in
                any material respect the interests of any certificateholder,
or                                          

         o        to amend specified provisions that are not material to holders
               of any class of certificates offered under this prospectus.

        The pooling and servicing agreement may also be amended by the parties
thereto with the consent of the holders of certificates of each class affected  
thereby evidencing, in each case, at least 66% of the aggregate Percentage      
Interests constituting the class for the purpose of adding any provisions to or 
changing in any manner or eliminating any of the provisions of the pooling and  
servicing agreement or of modifying in any manner the rights of the holders of  
certificates covered by the pooling and servicing agreement, except that the    
amendment may not (1) reduce in any manner the amount of, or delay the timing   
of, payments received on mortgage loans which are required to be distributed on 
a certificate of any class without the consent of the holder of the certificate 
or (2) reduce the aforesaid percentage of certificates of any class the holders 
of which are required to consent to the amendment without the consent of the    
holders of all certificates of the class covered by the pooling and servicing   
agreement then outstanding.                                                     

       Notwithstanding the foregoing, if a REMIC election has been made with
respect to the related trust fund, the trustee will not be entitled to consent  
to any amendment to a pooling and servicing agreement without having first      
received an opinion of counsel to the effect that the amendment or the exercise 
of any power granted to the master servicer, the company, the trustee or any    
other specified person in accordance with the amendment will not result in the  
imposition of a tax on the related trust fund or cause the trust fund to fail to
qualify as a REMIC.                                                             

        With respect to each series of notes, each related servicing agreement
or indenture may be amended by the parties thereto without the consent of any of
the holders of the notes covered by the Agreement, to cure any ambiguity, to    
correct, modify or supplement any provision therein, or to make any other       
provisions with respect to matters or questions arising under the Agreement     
which are not inconsistent with the provisions thereof, provided that the action
will not adversely affect in any material respect the interests of any holder of
notes covered by the Agreement. Each Agreement may also be amended by the       
parties thereto with the consent of the holders of notes evidencing not less    
than 66% of the voting rights, for any purpose; provided, however, that the     
amendment may not:                                                              

     (1)      reduce in any manner the amount of or delay the timing of,
                payments received on trust fund assets which are required to
                be distributed on any certificate without the consent of the
holder of the certificate,                  

        (2)      adversely affect in any material respect the interests of the
           holders of any class of notes in a manner other than as
                 described in (1), without the consent of the holders of notes
              of the class evidencing not less than 66% of the aggregate
voting rights of the class or               

        (3)      reduce the aforesaid percentage of voting rights required for
           the consent to the amendment without the consent of the
      holders of all notes covered by the Agreement then
outstanding.                                

The voting rights evidenced by any security will be the portion of the voting   
rights of all of the securities in the related series allocated in the manner   
described in the related prospectus supplement.                                 

TERMINATION; RETIREMENT OF SECURITIES                                           

      The obligations created by the related Agreements for each series of
securities (other than the limited payment and notice obligations of the        
trustee) will terminate upon the payment to securityholders of that series of   
all amounts held in the Distribution Account or by the master servicer and      
required to be paid to them pursuant to the Agreements following the earlier of 
(1) the final payment or other liquidation or disposition (or any advance with  
respect thereto) of the last mortgage loan, REO property and/or mortgage        
security subject thereto and (2) the purchase by (a) the master servicer, a     
servicer, the company or its designee, (b) if specified in the related          
prospectus supplement with respect to each series of certificates, by the holder
of the REMIC Residual Certificates (see "Federal Income Tax Consequences" below)
or (c) if specified in the prospectus supplement with respect to each series of 
notes, by the holder of the Equity Certificates, from the trust fund for the    
series of all remaining mortgage loans, REO properties and/or mortgage          
securities. In addition to the foregoing, the master servicer, a servicer, the  
company or its designee will have the option to purchase, in whole but not in   
part, the securities specified in the related prospectus supplement in the      
manner set forth in the related prospectus supplement. With respect to any      
series of certificates which provides for such purchase, the purchase shall not 
be made unless either: (1) the aggregate principal balance of the certificates  
as of the date is equal to or less than the percentage specified in the related 
prospectus supplement (which shall not be greater than 25%) of the aggregate    
principal balance of the certificates as of the Closing Date or (2) the         
aggregate principal balance of the mortgage loans as of the date is equal to or 
less than the percentage specified in the related prospectus supplement (which  
shall not be greater than 25%) of the aggregate principal balance of the        
mortgage loans as of the cut-off date. With respect to any series of notes which
provides for such purchase, the purchase shall not be made unless the aggregate 
principal balance of the notes as of the date is equal to or less than the      
percentage specified in the related prospectus supplement (which shall not be   
greater than 25%) of the aggregate principal balance of the notes as of the     
Closing Date or a period specified in the related prospectus supplement has     
elapsed since the initial distribution date. Upon the purchase of the securities
or at any time thereafter, at the option of the master servicer, a servicer, the
company or its designee, the assets of the trust fund may be sold, thereby      
effecting a retirement of the securities and the termination of the trust fund, 
or the securities so purchased may be held or resold by the master servicer, a  
servicer, the company or its designee. In no event, however, unless otherwise   
provided in the prospectus supplement, will a trust created by a pooling and    
servicing agreement continue beyond the expiration of 21 years from the death of
the survivor of the persons named in the pooling and servicing agreement.       
Written notice of termination of the pooling and servicing agreement will be    
given to each securityholder, and the final distribution will be made only upon 
surrender and cancellation of the securities at an office or agency appointed by
the trustee which will be specified in the notice of termination. If the        
securityholders are permitted to terminate the trust under the applicable       
pooling and servicing agreement, a penalty may be imposed upon the              
securityholders based upon the fee that would be foregone by the master servicer
because of the termination.                                                     

    The purchase of mortgage loans and property acquired in respect of
mortgage loans evidenced by a series of securities shall be made at the option  
of the master servicer, a servicer, the company, its desingee or, if applicable,
the holder of the REMIC Residual Certificates or Equity Certificates at the     
price specified in the related prospectus supplement. The exercise of the right 
will effect early retirement of the securities of that series, but the right of 
the master servicer, the company or, if applicable, the holder to so purchase is
subject to the aggregate principal balance of the mortgage loans and/or mortgage
securities in the trust fund for that series as of the distribution date on     
which the purchase is to occur being less than the percentage specified in the  
related prospectus supplement of the aggregate principal balance of the mortgage
loans and/or mortgage securities for that series at the cut-off date or closing 
date, as specified in the prospectus supplement. The prospectus supplement for  
each series of securities will set forth the amounts that the holders of the    
securities will be entitled to receive upon the early retirement. The early     
termination may adversely affect the yield to holders of the securities. With   
respect to any series of certificates, an optional purchase of the mortgage     
loans in the related trust fund may not result in the related certificates      
receiving an amount equal to the principal balance thereof plus accrued and     
unpaid interest and any undistributed shortfall on the related certificates. If 
a REMIC election has been made, the termination of the related trust fund will  
be effected in a manner consistent with applicable federal income tax           
regulations and its status as a REMIC.                                          

        Following any optional termination, there will be no continuing direct
or indirect liability of the trust fund or any securityholder as sellers of the 
assets of the trust fund.                                                       

THE TRUSTEE                                                                     

      The trustee under each pooling and servicing agreement and indenture
will be named in the related prospectus supplement. The commercial bank,        
national banking association, banking corporation or trust company that serves  
as trustee may have typical banking relationships with the company and its      
affiliates. The trustee shall at all times be a corporation or an association   
organized and doing business under the laws of any state or the United States of
America, authorized under the laws to exercise corporate trust powers, having a 
combined capital and surplus of at least $15,000,000 and subject to supervision 
or examination by federal or state authority.                                   

DUTIES OF THE TRUSTEE                                                           

       The trustee for each series of securities will make no representation
as to the validity or sufficiency of the related Agreements, the securities or  
any underlying mortgage loan, mortgage security or related document and will not
be accountable for the use or application by or on behalf of any master         
servicer, servicer or special servicer of any funds paid to the master servicer,
servicer or special servicer in respect of the securities or the underlying     
mortgage loans or mortgage securities, or any funds deposited into or withdrawn 
from the Distribution Account for the series or any other account by or on      
behalf of the master servicer, servicer or special servicer. If no event of     
default has occurred and is continuing, the trustee for each series of          
securities will be required to perform only those duties specifically required  
under the related pooling and servicing agreement or indenture. However, upon   
receipt of any of the various certificates, reports or other instruments        
required to be furnished to it pursuant to the related Agreement, a trustee will
be required to examine the documents and to determine whether they conform to   
the requirements of the agreement.                                              

SOME MATTERS REGARDING THE TRUSTEE                                              

      As and to the extent described in the related prospectus supplement,
the fees and normal disbursements of any trustee may be the expense of the      
related master servicer or other specified person or may be required to be borne
by the related trust fund.                                                      

         The trustee for each series of securities generally will be entitled to
indemnification, from amounts held in the Distribution Account for the series,  
for any loss, liability or expense incurred by the trustee in connection with   
the trustee's acceptance or administration of its trusts under the related      
pooling and servicing agreement or indenture unless the loss, liability, cost or
expense was incurred by reason of willful misfeasance, bad faith or gross       
negligence on the part of the trustee in the performance of its obligations and 
duties, or by reason of its reckless disregard of its obligations or duties.    

RESIGNATION AND REMOVAL OF THE TRUSTEE                                          

        The trustee may resign at any time, in which event the company will be
obligated to appoint a successor trustee. The company may also remove the       
trustee if the trustee ceases to be eligible to continue under the pooling and  
servicing agreement or if the trustee becomes insolvent. Upon becoming aware of 
the circumstances, the company will be obligated to appoint a successor trustee.
The trustee may also be removed at any time by the holders of securities        
evidencing not less than 51% of the aggregate undivided interests (or, if       
applicable, voting rights) in the related trust fund. 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.                   

YIELD CONSIDERATIONS

       The yield to maturity of an offered security will depend on the price
paid by the holder for the security, the security interest rate on a security   
entitled to payments of interest (which security interest rate may vary if so   
specified in the related prospectus supplement) and the rate and timing of      
principal payments (including prepayments, defaults, liquidations and           
repurchases) on the mortgage loans and the allocation thereof to reduce the     
principal balance of the security (or notional amount thereof if applicable) and
other factors.                                                                  

    A class of securities may be entitled to payments of interest at a
fixed security interest rate, a variable security interest rate or adjustable   
security interest rate, or any combination of security interest rates, each as  
specified in the related prospectus supplement. A variable security interest    
rate may be calculated based on the weighted average of the Net Mortgage Rates  
of the related mortgage loans, or the weighted average of the interest rates    
(which may be net of trustee fees) of the related mortgage securities, for the  
month preceding the distribution date if so specified in the related prospectus 
supplement. As will be described in the related prospectus supplement, the      
aggregate payments of interest on a class of securities, and their yield to     
maturity, will be affected by the rate of payment of principal on the securities
(or the rate of reduction in the notional balance of securities entitled only to
payments of interest), in the case of securities evidencing interests in ARM    
Loans, by changes in the Net Mortgage Rates on the ARM Loans, and in the case of
securities evidencing interests in mortgage securities with floating or variable
rates, by changes in such rates and the indices on which they are based. See    
"Maturity and Prepayment Considerations" below. The yield on the securities will
also be affected by liquidations of mortgage loans following mortgagor defaults 
and by purchases of mortgage loans in the event of breaches of representations  
and warranties made in respect of the mortgage loans by the company, the master 
servicer and others, or conversions of ARM Loans to a fixed interest rate. See  
"The Mortgage Pools--Representations by Sellers" and "Descriptions of the       
Securities--Assignment of Trust Fund Assets" above. Holders of Strip Securities 
or a class of securities having a security interest rate that varies based on   
the weighted average mortgage rate of the underlying mortgage loans may be      
affected by disproportionate prepayments and repurchases of mortgage loans      
having higher Net Mortgage Rates or rates applicable to the Strip Securities, as
applicable.                                                                     

        With respect to any series of securities, a period of time will elapse
between the date upon which payments on the related mortgage loans are due and  
the distribution date on which the payments are passed through to               
securityholders. That delay will effectively reduce the yield that would        
otherwise be produced if payments on the mortgage loans were distributed to     
securityholders on or near the date they were due.                              

       In general, if a class of securities is purchased at initial issuance
at a premium and payments of principal on the related mortgage loans occur at a 
rate faster than anticipated at the time of purchase, the purchaser's actual    
yield to maturity will be lower than that assumed at the time of purchase.      
Similarly, if a class of securities is purchased at initial issuance at a       
discount and payments of principal on the related mortgage loans occur at a rate
slower than that assumed at the time of purchase, the purchaser's actual yield  
to maturity will be lower than that originally anticipated. The effect of       
principal prepayments, liquidations and purchases on yield will be particularly 
significant in the case of a series of securities having a class entitled to    
payments of interest only or to payments of interest that are disproportionately
high relative to the principal payments to which the class is entitled. Such a  
class will likely be sold at a substantial premium to its principal balance and 
any faster than anticipated rate of prepayments will adversely affect the yield 
to its holders. Extremely rapid prepayments may result in the failure of such   
holders to recoup their original investment. In addition, the yield to maturity 
on other types of classes of securities, including Accrual Securities and       
securities with a security interest rate which fluctuates inversely with or at a
multiple of an index, may be relatively more sensitive to the rate of prepayment
on the related mortgage loans than other classes of securities.                 

The timing of changes in the rate of principal payments on or 
repurchases of the mortgage 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 the underlying mortgage loans or a repurchase      
thereof, the greater will be the effect on an investor's yield to maturity. As a
result, the effect on an investor's yield of principal payments and repurchases 
occurring at a rate higher (or lower) than the rate anticipated by the investor 
during the period immediately following the issuance of a series of securities  
would not be fully offset by a subsequent like reduction (or increase) in the   
rate of principal payments.                                                     

     When a principal prepayment in full is made on a mortgage loan, the
borrower is generally charged interest only for the period from the due date of 
the preceding scheduled payment up to the date of the prepayment, instead of for
the full accrual period, that is, the period from the due date of the preceding 
scheduled payment up to the due date for the next scheduled payment. In         
addition, a partial principal prepayment may likewise be applied as of a date   
prior to the next scheduled due date (and, accordingly, be accompanied by       
accrued interest for less than the full accrual period). However, interest      
accrued and distributable on any series of securities on any distribution date  
will generally correspond to interest accrued on the principal balance of       
mortgage loans for their respective full accrual periods. Consequently, if a    
prepayment on any mortgage loan is distributable to securityholders on a        
particular distribution date, but the prepayment is not accompanied by accrued  
interest for the full accrual period, the interest charged to the borrower (net 
of servicing and administrative fees and any retained interest of the company)  
may be less than the corresponding amount of interest accrued and otherwise     
payable on the related mortgage loan, and a Prepayment Interest Shortfall will  
result. If and to the extent that the shortfall is allocated to a class of      
offered securities, its yield will be adversely affected. The prospectus        
supplement for a series of securities will describe the manner in which the     
shortfalls will be allocated among the classes of the securities. If so         
specified in the related prospectus supplement, the master servicer or related  
servicer will be required to apply some or all of its servicing compensation for
the corresponding period to offset the amount of the shortfalls. The related    
prospectus supplement will also describe any other amounts available to off set 
the shortfalls. See "Servicing of Mortgage Loans--Servicing and Other           
Compensation and Payment of Expenses; Retained Interest".                       

        The trust fund with respect to any series may include ARM Loans. As is
the case with conventional, fixed-rate mortgage loans originated in a high      
interest rate environment which may be subject to a greater rate of principal   
prepayments when interest rates decrease, ARM Loans may be subject to a greater 
rate of principal prepayments (or purchases by the related servicer or the      
master servicer) due to their refinancing in a low interest rate environment.   
For example, if prevailing interest rates fall significantly, ARM Loans could be
subject to higher prepayment rates than if prevailing interest rates remain     
constant because the availability of fixed-rate or other adjustable-rate        
mortgage loans at competitive interest rates may encourage mortgagors to        
refinance their adjustable-rate mortgages to "lock in" a lower fixed interest   
rate or to take advantage of the availability of other adjustable-rate mortgage 
loans. A rising interest rate environment may also result in an increase in the 
rate of defaults on the mortgage loans.                                         

       The trust fund with respect to any series may include convertible ARM
Loans. Convertible ARM Loans may be subject to a greater rate of principal      
prepayments (or purchases by the related servicer or the master servicer) due to
their conversion to fixed interest rate loans in a low interest rate            
environment. The conversion feature may also be exercised in a rising interest  
rate environment as mortgagors attempt to limit their risk of higher rates. A   
rising interest rate environment may also result in an increase in the rate of  
defaults on these mortgage loans. If the related servicer or the master servicer
purchases convertible ARM Loans, a mortgagor's exercise of the conversion option
will result in a distribution of the principal portion thereof to the           
securityholders, as described in this prospectus. Alternatively, to the extent a
servicer or the master servicer fails to purchase converting ARM Loans, the     
mortgage pool will include fixed-rate mortgage loans.                           

      The rate of defaults on the mortgage loans will also affect the rate
and timing of principal payments on the mortgage loans and thus the yield on the
securities. In general, defaults on single family loans are expected to occur   
with greater frequency in their early years. The rate of default on single      
family loans which are refinanced or limited documentation mortgage loans, and  
on mortgage loans, with high Loan-to-Value Ratios, may be higher than for other 
types of mortgage loans. Furthermore, the rate and timing of prepayments,       
defaults and liquidations on the mortgage loans will be affected by the general 
economic condition of the region of the country in which the related mortgaged  
properties are located. The risk of delinquencies and loss is greater and       
prepayments are less likely in regions where a weak or deteriorating economy    
exists, as may be evidenced by, among other factors, increasing unemployment or 
falling property values.                                                        

      With respect to some mortgage loans in a mortgage pool, the mortgage
rate at origination may be below the rate that would result if the index and    
margin relating thereto were applied at origination. Under the applicable       
underwriting standards, the mortgagor under each mortgage loan generally will be
qualified, or the mortgage loan otherwise approved, on the basis of the mortgage
rate in effect at origination. The repayment of the mortgage loan may thus be   
dependent on the ability of the mortgagor to make larger level monthly payments 
following the adjustment of the mortgage rate. In addition, the periodic        
increase in the amount paid by the mortgagor of a buydown mortgage loan during  
or at the end of the applicable Buydown Period may create a greater financial   
burden for the mortgagor, who might not have otherwise qualified for a mortgage 
under applicable underwriting guidelines, and may accordingly increase the risk 
of default with respect to the related mortgage loan.                           

  The mortgage rates on ARM Loans subject to negative amortization
generally adjust monthly and their amortization schedules adjust less           
frequently. During a period of rising interest rates as well as immediately     
after origination (initial mortgage rates are generally lower than the sum of   
the Indices applicable at origination and the related Note Margins), the amount 
of interest accruing on the principal balance of the mortgage loans may exceed  
the amount of their minimum scheduled monthly payment. As a result, a portion of
the accrued interest on negatively amortizing mortgage loans may become Deferred
Interest which will be added to the principal balance thereof and will bear     
interest at the applicable mortgage rate. The addition of the Deferred Interest 
to the principal balance of any related class or classes of securities will     
lengthen the weighted average life thereof and may adversely affect yield to    
holders thereof, depending upon the price at which the securities were          
purchased. In addition, with respect to ARM Loans subject to negative           
amortization, during a period of declining interest rates, it might be expected 
that each minimum scheduled monthly payment on the mortgage loan would exceed   
the amount of scheduled principal and accrued interest on the principal balance 
thereof, and since the excess will be applied to reduce the principal balance of
the related class or classes of securities, the weighted average life of the    
securities will be reduced and may adversely affect the yield to holders        
thereof, depending upon the price at which the securities were purchased.       

MATURITY AND PREPAYMENT CONSIDERATIONS

      As indicated above under "The Mortgage Pools," the original terms to
maturity of the mortgage loans in a given mortgage pool will vary depending upon
the type of mortgage loans included in the mortgage pool. The prospectus        
supplement for a series of securities will contain information with respect to  
the types and maturities of the mortgage loans in the related mortgage pool. The
prepayment experience with respect to the mortgage loans in a mortgage pool will
affect the life and yield of the related series of securities.                  

       With respect to balloon loans, payment of the balloon payment (which,
based on the amortization schedule of the mortgage loans, is expected to be a   
substantial amount) will generally depend on the mortgagor's ability to obtain  
refinancing of the mortgage loans or to sell the mortgaged property prior to the
maturity of the balloon loan. The ability to obtain refinancing will depend on a
number of factors prevailing at the time refinancing or sale is required,       
including real estate values, the mortgagor's financial situation, prevailing   
mortgage loan interest rates, the mortgagor's equity in the related mortgaged   
property, tax laws and prevailing general economic conditions. None of the      
company, the master servicer, a servicer or any of their affiliates will be     
obligated to refinance or repurchase any mortgage loan or to sell the mortgaged 
property.                                                                       

     The extent of prepayments of principal of the mortgage loans may be
affected by a number of factors, including solicitations and the availability of
mortgage credit, the relative economic vitality of the area in which the        
mortgaged properties are located and, in the case of multifamily, commercial and
mixed-use loans, the quality of management of the mortgage properties, the      
servicing of the mortgage loans, possible changes in tax laws and other         
opportunities for investment. In addition, the rate of principal payments on the
mortgage loans may be affected by the existence of lock-out periods and         
requirements that principal prepayments be accompanied by prepayment premiums,  
as well as due-on-sale and due-on-encumbrance provisions, and by the extent to  
which the provisions may be practicably enforced. See "Servicing of Mortgage    
Loans--Collection and Other Servicing Procedures" and "Legal Aspects of the     
Mortgage Loans--Enforceability of Certain Provisions" for a description of      
provisions of the pooling and servicing agreement and legal aspects of mortgage 
loans that may affect the prepayment experience on the mortgage loans.          

        The rate of prepayment on a pool of mortgage loans is also affected by
prevailing market interest rates for mortgage loans of a comparable type, term  
and risk level. When the prevailing market interest rate is below a mortgage    
coupon, a borrower may have an increased incentive to refinance its mortgage    
loan. In addition, as prevailing market interest rates decline, even borrowers  
with ARM Loans that have experienced a corresponding interest rate decline may  
have an increased incentive to refinance for purposes of either (1) converting  
to a fixed rate loan and thereby "locking in" the rate or (2) taking advantage  
of the initial "teaser rate" (a mortgage interest rate below what it would      
otherwise be if the applicable index and gross margin were applied) on another  
adjustable rate mortgage loan. Moreover, although the mortgage rates on ARM     
Loans will be subject to periodic adjustments, the adjustments generally will   
not increase or decrease the mortgage rates by more than a fixed percentage     
amount on each adjustment date, will not increase the mortgage rates over a     
fixed percentage amount during the life of any ARM Loan and will be based on an 
index (which may not rise and fall consistently with mortgage interest rates)   
plus the related Note Margin (which may be different from margins being used at 
the time for newly originated adjustable rate mortgage loans). As a result, the 
mortgage rates on the ARM Loans at any time may not equal the prevailing rates  
for similar, newly originated adjustable rate mortgage loans. In high interest  
rate environments, the prevailing rates on fixed-rate mortgage loans may be     
sufficiently high in relation to the then-current mortgage rates on newly       
originated ARM Loans that the rate of prepayment may increase as a result of    
refinancings. There can be no assurance as to the rate of prepayments on the    
mortgage loans during any period or over the life of any series of securities.  

   If the applicable pooling and servicing agreement for a series of
securities provides for a pre-funding account or other means of funding the     
transfer of additional mortgage loans to the related trust fund, as described   
under "Description of the Securities--Pre-Funding Account" in this prospectus,  
and the trust fund is unable to acquire the additional mortgage loans within any
applicable time limit, the amounts set aside for the purpose may be applied as  
principal payments on one or more classes of securities of the series. See      
"Yield Considerations."                                                         

        There can be no assurance as to the rate of prepayment of the mortgage
loans. The company is not aware of any publicly available statistics relating to
the principal prepayment experience of diverse portfolios of mortgage loans such
as the mortgage loans over an extended period of time. All statistics known to  
the company that have been compiled with respect to prepayment experience on    
mortgage loans indicate that while some mortgage loans may remain outstanding   
until their stated maturities, a substantial number will be paid prior to their 
respective stated maturities. No representation is made as to the particular    
factors that will affect the prepayment of the mortgage loans or as to the      
relative importance of these factors.                                           

       As described in this prospectus and in the prospectus supplement, the
master servicer, a servicer, the company or a person specified in the related   
prospectus supplement (other than holder of any class of offered certificates,  
other than the REMIC Residual Certificates, if offered) may have the option to  
purchase the assets in a trust fund and effect early retirement of the related  
series of securities. See "The Agreements--Termination; Retirement of           
Securities."                                                                    

 LEGAL ASPECTS OF MORTGAGE LOANS

     The following discussion summarizes legal aspects of mortgage loans
that is general in nature. The summaries do not purport to be complete. They do 
not reflect the laws of any particular state nor the laws of all states in which
the mortgaged properties may be situated. This is because these legal aspects   
are governed in part by the law of the state that applies to a particular       
mortgaged property and the laws of the states may vary substantially. You should
refer to the applicable federal and state laws governing the mortgage loans.    

MORTGAGES                                                                       

        Each single family, multifamily, commercial and mixed-use loan and, if
applicable, the Contracts (in each case other than cooperative mortgage         
loans),will be evidenced by a note or bond and secured by an instrument granting
a security interest in real property, which may be a mortgage, deed of trust or 
a deed to secure debt, depending upon the prevailing practice and law in the    
state in which the related mortgaged property is located, and may have first,   
second or third priority. Mortgages and deeds to secure debt are referred to as 
"mortgages." Contracts evidence both the obligation of the obligor to repay the 
loan evidenced thereby and grant a security interest in the related Manufactured
Homes to secure repayment of the loan. However, as Manufactured Homes have      
become larger and often have been attached to their sites without any apparent  
intention by the borrowers to move them, courts in many states have held that   
Manufactured Homes may become subject to real estate title and recording laws.  
See "--Contracts" below. In some states, a mortgage or deed of trust creates a  
lien upon the real property encumbered by the mortgage or deed of trust.        
However, in other states, the mortgage or deed of trust conveys legal title to  
the property respectively, to the mortgagee or to a trustee for the benefit of  
the mortgagee subject to a condition subsequent (i.e., the payment of the       
indebtedness secured thereby). The lien created by the mortgage or deed of trust
is not prior to the lien for real estate taxes and assessments and other charges
imposed under governmental police powers. Priority between mortgages depends on 
their terms or on the terms of separate subordination or inter-creditor or      
agreements, the knowledge of the parties in some cases and generally on the     
order of recordation of the mortgage in the appropriate recording office. There 
are two parties to a mortgage, the mortgagor, who is the borrower and homeowner,
and the mortgagee, who is the lender. Under the mortgage instrument, the        
mortgagor delivers to the mortgagee a note or bond and the mortgage. In the case
of a land trust, there are three parties because title to the property is held  
by a land trustee under a land trust agreement of which the borrower is the     
beneficiary; at origination of a mortgage loan, the borrower executes a separate
undertaking to make payments on the mortgage note. Although a deed of trust is  
similar to a mortgage, a deed of trust has three parties: the trustor who is the
borrower-homeowner; the beneficiary who is the lender; 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 obligation. The trustee's authority under a
deed of trust, the grantee's authority under a deed to secure debt and the      
mortgagee's authority under a mortgage are governed by the law of the state in  
which the real property is located, the express provisions of the deed of       
trustor mortgage, and, in deed of trust transactions, the directions of the     
beneficiary.                                                                    

COOPERATIVE MORTGAGE LOANS                                                      

   If specified in the prospectus supplement relating to a series of
certificates, the mortgage loans and Contracts may include cooperative mortgage 
loans. Each mortgage note evidencing a cooperative mortgage loan will be secured
by a security interest in shares issued by the related Cooperative, and in the  
related proprietary lease or occupancy agreement granting exclusive rights to   
occupy a specific dwelling unit in the Cooperative's building. The security     
agreement will create a lien upon the shares of the Cooperative, the priority of
which will depend on, among other things, the terms of the particular security  
agreement as well as the order of recordation and/or filing of the agreement (or
financing statements related thereto) in the appropriate recording office.      

      Cooperative buildings relating to the cooperative mortgage loans are
located primarily in the State of New York. Generally, each Cooperative owns in 
fee or has a long-term leasehold interest in all the real property and owns in  
fee or leases the building and all separate dwelling units therein. The         
Cooperative is directly responsible for property management and, in most cases, 
payment of real estate taxes, other governmental impositions and hazard and     
liability insurance. If there is an underlying mortgage (or mortgages) on the   
Cooperative's building or underlying land, as is generally the case, or an      
underlying lease of the land, as is the case in some instances, the Cooperative,
as mortgagor or lessor, as the case may be, is also responsible for fulfilling  
the mortgage or rental obligations. An underlying mortgage loan is ordinarily   
obtained by the Cooperative in connection with either the construction or       
purchase of the Cooperative's building or the obtaining of capital by the       
Cooperative. The interest of the occupant under proprietary leases or occupancy 
agreements as to which that Cooperative is the landlord is generally subordinate
to the interest of the holder of an underlying mortgage and to the interest of  
the holder of a land lease. If the Cooperative is unable to meet the payment    
obligations (1) arising under an underlying mortgage, the mortgagee holding an  
underlying mortgage could foreclose on that mortgage and terminate all          
subordinate proprietary leases and occupancy agreements or (2) arising under its
land lease, the holder of the landlord's interest under the land lease could    
terminate it and all subordinate proprietary leases and occupancy agreements. In
addition, an underlying mortgage on a Cooperative may provide financing in the  
form of a mortgage that does not fully amortize, with a significant portion of  
principal being due in one final payment at maturity. The inability of the      
Cooperative to refinance a mortgage and its consequent inability to make the    
final payment could lead to foreclosure by the mortgagee. Similarly, a land     
lease has an expiration date and the inability of the Cooperative to extend its 
term or, in the alternative, to purchase the land, could lead to termination of 
the Cooperative's interest in the property and termination of all proprietary   
leases and occupancy agreements. In either event, a foreclosure by the holder of
an underlying mortgage or the termination of the underlying lease could         
eliminate or significantly diminish the value of any collateral held by the     
mortgagee who financed the purchase by an individual tenant-stockholder of      
shares of the Cooperative or, in the case of the mortgage loans, the collateral 
securing the cooperative mortgage loans.                                        

Each Cooperative is owned by shareholders (referred to as     
tenant-stockholders) who, through ownership of stock or shares in the           
Cooperative, receive proprietary leases or occupancy agreements which confer    
exclusive rights to occupy specific dwellings. Generally, a tenant-stockholder  
of a Cooperative must make a monthly payment to the Cooperative pursuant to the 
proprietary lease, which payment represents the tenant-stockholder's            
proportional share of the Cooperative's payments for its underlying mortgage,   
real property taxes, maintenance expenses and other capital or ordinary         
expenses. An ownership interest in a Cooperative and accompanying occupancy     
rights may be financed through a cooperative mortgage loan evidenced by a       
mortgage note and secured by an assignment of and a security interest in the    
occupancy agreement or proprietary lease and a security interest in the related 
shares of the related Cooperative. The mortgagee generally takes possession of  
the share certificate and a counterpart of the proprietary lease or occupancy   
agreement and a financing statement covering the proprietary lease or occupancy 
agreement and the Cooperative shares is filed in the appropriate state and local
offices to perfect the mortgagee's interest in its collateral. Subject to the   
limitations discussed below, upon default of the tenant-stockholder, the lender 
may sue for judgment on the mortgage note, dispose of the collateral at a public
or private sale or otherwise proceed against the collateral or                  
tenant-stockholder as an individual as provided in the security agreement       
covering the assignment of the proprietary lease or occupancy agreement and the 
pledge of Cooperative shares. See "--Foreclosure on Shares of Cooperatives"     
below.                                                                          

TAX ASPECTS OF COOPERATIVE OWNERSHIP                                            

        In general, a "tenant-stockholder" (as defined in Section 216(b)(2) of
the Code) of a corporation that qualifies as a "cooperative housing corporation"
within the meaning of Section 216(b)(1) of the Code is allowed a deduction for  
amounts paid or accrued within his taxable year to the corporation representing 
his proportionate share of interest expenses and real estate taxes allowable as 
a deduction under Section 216(a) of the Code to the corporation under Sections  
163 and 164 of the Code. In order for a corporation to qualify under Section    
216(b)(1) of the Code for its taxable year in which the items are allowable as a
deduction to the corporation, that section requires, among other things, that at
least 80% of the gross income of the corporation be derived from its            
tenant-stockholders. By virtue of this requirement, the status of a corporation 
for purposes of Section 216(b)(1) of the Code must be determined on a           
year-to-year basis. Consequently, there can be no assurance that Cooperatives   
relating to the cooperative mortgage loans will qualify under the section for   
any particular year. In the event that the Cooperative fails to qualify for one 
or more years, the value of the collateral securing any related cooperative     
mortgage loans could be significantly impaired because no deduction would be    
allowable to tenant- stockholders under Section 216(a) of the Code with respect 
to those years. In view of the significance of the tax benefits accorded        
tenant-stockholders of a corporation that qualifies under Section 216(b)(1) of  
the Code, the likelihood that a failure would be permitted to continue over a   
period of years appears remote.                                                 

LEASES AND RENTS                                                                

     Mortgages that encumber income-producing multifamily and commercial
properties often contain an assignment of rents and leases, pursuant to which   
the borrower assigns to the lender the borrower's right, title and interest as  
landlord under each lease and the income derived therefrom, while (unless rents 
are to be paid directly to the lender) retaining a revocable license to collect 
the rents for so long as there is no default. If the borrower defaults, the     
license terminates and the lender is entitled to collect the rents. Local law   
may require that the lender take possession of the property and/or obtain a     
court-appointed receiver before becoming entitled to collect the rents.         

CONTRACTS                                                                       

 Under the laws of most states, manufactured housing constitutes
personal property and is subject to the motor vehicle registration laws of the  
state or other jurisdiction in which the unit is located. In a few states, where
certificates of title are not required for manufactured homes, security         
interests are perfected by the filing of a financing statement under Article 9  
of the UCC which has been adopted by all states. Financing statements are       
effective for five years and must be renewed prior to the end of each five year 
period. The certificate of title laws adopted by the majority of states provide 
that ownership of motor vehicles and manufactured housing shall be evidenced by 
a certificate of title issued by the motor vehicles department (or a similar    
entity) of the state. In the states that have enacted certificate of title laws,
a security interest in a unit of manufactured housing, so long as it is not     
attached to land in so permanent a fashion as to become a fixture, is generally 
perfected by the recording of the interest on the certificate of title to the   
unit in the appropriate motor vehicle registration office or by delivery of the 
required documents and payment of a fee to the appropriate motor vehicle        
registration office, depending on state law.                                    

    The master servicer will be required under the related pooling and
servicing agreement or servicing agreement to, or to cause the servicer of the  
Contract to, effect the notation or delivery of the required documents and fees,
and to obtain possession of the certificate of title, as appropriate under the  
laws of the state in which any Manufactured Home is registered. In the event the
master servicer or servicer, as applicable, fails, due to clerical errors or    
otherwise, to effect the notation or delivery, or files the security interest   
under the wrong law (for example, under a motor vehicle title statute rather    
than under the UCC, in a few states), the trustee may not have a first priority 
security interest in the Manufactured Home securing a Contract. As Manufactured 
Homes have become larger and often have been attached to their sites without any
apparent intention by the borrowers to move them, courts in many states have    
held that Manufactured Homes may become subject to real estate title and        
recording laws. As a result, a security interest in a Manufactured Home could be
rendered subordinate to the interests of other parties claiming an interest in  
the home under applicable state real estate law. In order to perfect a security 
interest in a Manufactured Home under real estate laws, the holder of the       
security interest must file either a "fixture filing" under the provisions of   
the UCC or a real estate mortgage under the real estate laws of the state where 
the home is located. These filings must be made in the real estate records      
office of the county where the home is located. Generally, Contracts will       
contain provisions prohibiting the obligor from permanently attaching the       
Manufactured Home to its site. So long as the obligor does not violate this     
agreement, a security interest in the Manufactured Home will be governed by the 
certificate of title laws or the UCC, and the notation of the security interest 
on the certificate of title or the filing of a UCC financing statement will be  
effective to maintain the priority of the security interest in the Manufactured 
Home. If, however, a Manufactured Home is permanently attached to its site,     
other parties could obtain an interest in the Manufactured Home that is prior to
the security interest originally retained by the Seller and transferred to the  
depositor.                                                                      

        The company will assign or cause to be assigned a security interest in
the Manufactured Homes to the trustee, on behalf of the securityholders. Neither
the company, the master servicer, any servicer, nor the trustee will amend the  
certificates of title to identify the trustee, on behalf of the securityholders,
as the new secured party and, accordingly, the company or the Seller will       
continue to be named as the secured party on the certificates of title relating 
to the Manufactured Homes. In most states, the assignment is an effective       
conveyance of the security interest without amendment of any lien noted on the  
related certificate of title and the new secured party succeeds to the company's
rights as the secured party. However, in some states there exists a risk that,  
in the absence of an amendment to the certificate of title, the assignment of   
the security interest might not be held effective against creditors of the      
company or Seller.                                                              

 In the absence of fraud, forgery or permanent affixation of the
Manufactured Home to its site by the Manufactured Home owner, or administrative 
error by state recording officials, the notation of the lien of the company on  
the certificate of title or delivery of the required documents and fees will be 
sufficient to protect the trustee against the rights of subsequent purchasers of
a Manufactured Home or subsequent lenders who take a security interest in the   
Manufactured Home. If there are any Manufactured Homes as to which the company  
has failed to perfect or cause to be perfected the security interest assigned to
the trust fund, the security interest would be subordinate to, among others,    
subsequent purchasers for value of Manufactured Homes and holders of perfected  
security interests. There also exists a risk in not identifying the trustee, on 
behalf of the securityholders, as the new secured party on the certificate of   
title that, through fraud or negligence, the security interest of the trustee   
could be released.                                                              

        In the event that the owner of a Manufactured Home moves it to a state
other than the state in which the Manufactured Home initially is registered,    
under the laws of most states the perfected security interest in the            
Manufactured Home would continue for four months after the relocation and       
thereafter until the owner re-registers the Manufactured Home in the state of   
relocation. If the owner were to relocate a Manufactured Home to another state  
and re-register the Manufactured Home in that state, and if the company did not 
take steps to re-perfect its security interest in that state, the security      
interest in the Manufactured Home would cease to be perfected. A majority of    
states generally require surrender of a certificate of title to re-register a   
Manufactured Home; accordingly, the company must surrender possession if it     
holds the certificate of title to the Manufactured Home or, in the case of      
Manufactured Homes registered in states that provide for notation of lien, the  
company would receive notice of surrender if the security interest in the       
Manufactured Home is noted on the certificate of title. Accordingly, the company
would have the opportunity to re-perfect its security interest in the           
Manufactured Home in the state of relocation. In states that do not require a   
certificate of title for registration of a Manufactured Home, re-registration   
could defeat perfection. Similarly, when an obligor under a manufactured housing
conditional sales contract sells a Manufactured Home, the obligee must surrender
possession of the certificate of title or it will receive notice as a result of 
its lien noted thereon and accordingly will have an opportunity to require      
satisfaction of the related manufactured housing conditional sales contract     
before release of the lien. Under each related pooling and servicing agreement  
or servicing agreement, the master servicer will be obligated to, or to cause   
each of the servicers to, take these steps, at the master servicer's or         
servicer's expense, as are necessary to maintain perfection of security         
interests in the Manufactured Homes.                                            

 Under the laws of most states, liens for repairs performed on a
Manufactured Home take priority even over a perfected security interest. The    
company will obtain the representation of the related Seller that it has no     
knowledge of any of these liens with respect to any Manufactured Home securing a
Contract. However, these liens could arise at any time during the term of a     
Contract. No notice will be given to the trustee or securityholders in the event
this type of lien arises.                                                       

FORECLOSURE ON MORTGAGES AND SOME CONTRACTS                                     

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     
which authorizes the trustee to sell the property upon any default by the       
borrower under the terms of the note or deed of trust. In addition to any notice
requirements contained in a deed of trust, in some states, the trustee must     
record a notice of default and send a copy to the borrower-trustor and to any   
person who has recorded a request for a copy of notice of default and notice of 
sale. In addition, the trustee must provide notice in some states to any other  
individual having an interest of record in the real property, including any     
junior lienholders. If the deed of trust is not reinstated within a specified   
period, a notice of sale must be posted in a public place and, in most states,  
published for a specific period of time in one or more newspapers in a specified
manner prior to the date of trustee's sale. 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 real property.                      

     In some states, the borrower-trustor has the right to reinstate the
loan at any time following default until shortly before the trustee's sale. In  
general, in these states, the borrower, or any other person having a junior     
encumbrance on the real estate, may, during a reinstatement period, cure the    
default by paying the entire amount in arrears plus the costs and expenses      
incurred in enforcing the obligation.                                           

         Foreclosure of a mortgage is generally accomplished by judicial action.
Generally, the action is initiated by the service of legal pleadings upon all   
parties having an interest of record in the real property. Delays in completion 
of the foreclosure may occasionally result from difficulties in locating        
necessary parties. Judicial foreclosure proceedings are often not contested by  
any of the applicable parties. If the mortgagee's right to foreclose is         
contested, the legal proceedings necessary to resolve the issue can be          
time-consuming.                                                                 

        In the case of foreclosure under either a mortgage or a deed of trust,
the sale by the referee or other designated officer or by the trustee is a      
public sale. However, because of the difficulty a potential buyer at the sale   
would have in determining the exact status of title and because the physical    
condition of the property may have deteriorated during the foreclosure          
proceedings, it is uncommon for a third party to purchase the property at a     
foreclosure sale. Rather, it is common for the lender to purchase the property  
from the trustee or referee for a credit bid less than or equal to the unpaid   
principal amount of the note plus the accrued and unpaid interest and the       
expense of foreclosure, in which case the mortgagor's debt will be extinguished 
unless the lender purchases the property for a lesser amount in order to        
preserve its right against a borrower to seek a deficiency judgment and the     
remedy is available under state law and the related loan documents. In the same 
states, there is a statutory minimum purchase price which the lender may offer  
for the property and generally, state law controls the amount of foreclosure    
costs and expenses, including attorneys' fees, which may be recovered by a      
lender. 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, paying taxes and    
making the repairs at its own expense as are necessary to render the property   
suitable for sale. Generally, the lender will obtain the services of a real     
estate broker and pay the broker's commission in connection with the sale of the
property. Depending upon market conditions, the ultimate proceeds of the sale of
the property may not equal the lender's investment in the property and, in some 
states, the lender may be entitled to a deficiency judgment. Any loss may be    
reduced by the receipt of any mortgage insurance proceeds or other forms of     
credit enhancement for a series of certificates. See "Description of Credit     
Enhancement".                                                                   

        A junior mortgagee may not foreclose on the property securing a junior
mortgage unless it forecloses subject to the senior mortgages. The junior       
mortgagee must either pay the entire amount due on the senior mortgages prior to
or at the time of the foreclosure sale or undertake to pay on any senior        
mortgages on which the mortgagor is currently in default. Under either course of
action, the junior mortgagee may add the amounts paid to the balance due on the 
junior loan, and may be subrogated to the rights of the senior mortgagees. In   
addition, in the event that the foreclosure of a junior mortgage triggers the   
enforcement of a "due-on-sale" clause, the junior mortgagee may be required to  
pay the full amount of the senior mortgages to the senior mortgagees.           
Accordingly, with respect to those single family loans which are junior mortgage
loans, if the lender purchases the property, the lender's title will be subject 
to all senior liens and claims and governmental liens. The proceeds received by 
the referee or trustee from the sale are applied first to the costs, fees and   
expenses of sale and then in satisfaction of the indebtedness secured by the    
mortgage or deed of trust under which the sale was conducted. Any remaining     
proceeds are generally payable to the holders of junior mortgages or deeds of   
trust and other liens and claims in order of their priority, whether or not the 
borrower is in default. Any additional proceeds are generally payable to the    
mortgagor or trustor. The payment of the proceeds to the holders of junior      
mortgages may occur in the foreclosure action of the senior mortgagee or may    
require the institution of separate legal proceeds.                             

       In foreclosure, courts have imposed general equitable principles. The
equitable principles are generally designed to relieve the borrower from the    
legal effect of its defaults under the loan documents. Examples of judicial     
remedies that have been fashioned include judicial requirements that the lender 
undertake affirmative and expensive actions to determine the causes for the     
borrower's default and the likelihood that the borrower will be able to         
reinstate the loan. In some cases, courts have substituted their judgment for   
the lender's judgment and have required that lenders reinstate loans or recast  
payment schedules in order to accommodate borrowers who are suffering from      
temporary financial disability. In other cases, courts have limited the right of
the lender to foreclose if the default under the mortgage instrument is not     
monetary, such as the borrower's failure to adequately maintain the property or 
the borrower's execution of a second mortgage or deed of trust affecting the    
property. Finally, some courts have been faced with the issue of whether or not 
federal or state constitutional provisions reflecting due process concerns for  
adequate notice require that borrowers under deeds of trust or mortgages receive
notices in addition to the statutorily-prescribed minimums. For the most part,  
these cases have upheld the notice provisions as being reasonable or have found 
that 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
protection to the borrower.                                                     

FORECLOSURE ON SHARES OF COOPERATIVES                                           

       The Cooperative shares owned by the tenant-stockholder, together with
the rights of the tenant- stockholder under the proprietary lease or occupancy  
agreement, are pledged to the lender and are, in almost all cases, subject to   
restrictions on transfer as set forth in the Cooperative's certificate of       
incorporation and by-laws, as well as in the proprietary lease or occupancy     
agreement. The Cooperative may cancel the proprietary lease or occupancy        
agreement, even while pledged, for failure by the tenant-stockholder to pay the 
obligations or charges owed by the tenant-stockholder, including mechanics'     
liens against the Cooperative's building incurred by the tenant-stockholder.    
Generally, obligations and charges arising under a proprietary lease or         
occupancy agreement which are owed to the Cooperative are made liens upon the   
shares to which the proprietary lease or occupancy agreement relates. In        
addition, the Cooperative may generally terminate a proprietary lease or        
occupancy agreement in the event the borrower breaches its covenants in the     
proprietary lease or occupancy agreement. Typically, the lender and the         
Cooperative enter into a recognition agreement which, together with any lender  
protection provisions contained in the proprietary lease or occupancy agreement,
establishes the rights and obligations of both parties in the event of a default
by the tenant-stockholder on its obligations under the proprietary lease or     
occupancy agreement. A default by the tenant-stockholder under the proprietary  
lease or occupancy agreement will usually constitute a default under the        
security agreement between the lender and the tenant-stockholder.               

      The recognition agreement generally provides that, in the event that
the tenant-stockholder has defaulted under the proprietary lease or occupancy   
agreement, the Cooperative will take no action to terminate the lease or        
agreement until the lender has been provided with notice of and an opportunity  
to cure the default. The recognition agreement typically provides that if the   
proprietary lease or occupancy agreement is terminated, the Cooperative will    
recognize the lender's lien against proceeds from a sale of the shares and the  
proprietary lease or occupancy agreement allocated to the dwelling, subject,    
however, to the Cooperative's right to sums due under the proprietary lease or  
occupancy agreement or which have become liens on the shares relating to the    
proprietary lease or occupancy agreement. The total amount owed to the          
Cooperative by the tenant-stockholder, which the lender generally cannot        
restrict and does not monitor, could reduce the amount realized upon a sale of  
the collateral below the outstanding principal balance of the cooperative       
mortgage loan and accrued and unpaid interest on the loan.                      

     Recognition agreements also generally provide that in the event the
lender succeeds to the tenant- shareholder's shares and proprietary lease or    
occupancy agreement as the result of realizing upon its collateral for a        
cooperative mortgage loan, the lender must obtain the approval or consent of the
board of directors of the Cooperative as required by the proprietary lease      
before transferring the Cooperative shares or assigning the proprietary lease.  
The approval or consent is usually based on the prospective purchaser's income  
and net worth, among other factors, and may significantly reduce the number of  
potential purchasers, which could limit the ability of the lender to sell and   
realize upon the value of the collateral. Generally, the lender is not limited  
in any rights it may have to dispossess the tenant-stockholder.                 

     Because of the nature of cooperative mortgage loans, lenders do not
require the tenant-stockholder (i.e., the borrower) to obtain title insurance of
any type. Consequently, the existence of any prior liens or other imperfections 
of title affecting the Cooperative's building or real estate also may adversely 
affect the marketability of the shares allocated to the dwelling unit in the    
event of foreclosure.                                                           

       In New York, foreclosure on the Cooperative shares is accomplished by
public sale in accordance with the provisions of Article 9 of the New York UCC  
and the security agreement relating to those shares. Article 9 of the New York  
UCC requires that a sale be conducted in a "commercially reasonable" manner.    
Whether a sale has been conducted in a "commercially reasonable" manner will    
depend on the facts in each case. In determining commercial reasonableness, a   
court will look to the notice given the debtor and the method, manner, time,    
place and terms of the sale and the sale price. Generally, a sale conducted     
according to the usual practice of banks selling similar collateral in the same 
area will be considered reasonably conducted.                                   

     Article 9 of the UCC provides that the proceeds of the sale will be
applied first to pay the costs and expenses of the sale and then to satisfy the 
indebtedness secured by the lender's security interest. The recognition         
agreement, however, generally provides that the lender's right to reimbursement 
is subject to the right of the Cooperative corporation to receive sums due under
the proprietary lease or occupancy agreement. If there are proceeds remaining,  
the lender must account to the tenant-stockholder for the surplus. Conversely,  
if a portion of the indebtedness remains unpaid, the tenant-stockholder is      
generally responsible for the deficiency. See "--Anti-Deficiency Legislation and
other Limitations on Lenders" below.                                            

REPOSSESSION WITH RESPECT TO CONTRACTS                                          

         GENERAL. Repossession of manufactured housing is governed by state law.
A few states have enacted legislation that requires that the debtor be given an 
opportunity to cure its default (typically 30 days to bring the account current)
before repossession can commence. So long as a manufactured home has not become 
so attached to real estate that it would be treated as a part of the real estate
under the law of the state where it is located, repossession of the home in the 
event of a default by the obligor generally will be governed by the UCC (except 
in Louisiana). Article 9 of the UCC provides the statutory framework for the    
repossession of manufactured housing. While the UCC as adopted by the various   
states may vary in small particulars, the general repossession procedure        
established by the UCC is as follows:                                           

         o        Except in those states where the debtor must receive notice of
          the right to cure a default, repossession can commence
               immediately upon default without prior notice. Repossession
                may be effected either through self-help (peaceable retaking
           without court order), voluntary repossession or through
                judicial process (repossession pursuant to court-issued writ
             of replevin). The self-help and/or voluntary repossession
            methods are more commonly employed, and are accomplished
              simply by retaking possession of the manufactured home. In
            cases in which the debtor objects or raises a defense to
         repossession, a court order must be obtained from the
                appropriate state court, and the manufactured home must then
             be repossessed in accordance with that order. Whether the
           method employed is self-help, voluntary repossession or
               judicial repossession, the repossession can be accomplished
                 either by an actual physical removal of the manufactured home
           to a secure location for refurbishment and resale or by
        removing the occupants and their belongings from the
       manufactured home and maintaining possession of the
              manufactured home on the location where the occupants were
                 residing. Various factors may affect whether the manufactured
               home is physically removed or left on location, such as the
           nature and term of the lease of the site on which it is
                 located and the condition of the unit. In many cases, leaving
                 the manufactured home on location is preferable, in the event
            that the home is already set up, because the expenses of
                  retaking and redelivery will be saved. However, in those cases
                 where the home is left on location, expenses for site rentals
will usually be incurred.                   

   o        Once repossession has been achieved, preparation for the
                 subsequent disposition of the manufactured home can commence.
                 The disposition may be by public or private sale provided the
         method, manner, time, place and terms of the sale are
commercially reasonable.                    

         o        Sale proceeds are to be applied first to repossession expenses
                  (expenses incurred in retaking, storage, preparing for sale to
       include refurbishing costs and selling) and then to
              satisfaction of the indebtedness. While some states impose
                  prohibitions or limitations on deficiency judgments if the net
            proceeds from resale do not cover the full amount of the
                indebtedness, the remainder may be sought from the debtor in
                  the form of a deficiency judgement in those states that do not
          prohibit or limit deficiency judgments. The deficiency
              judgment is a personal judgment against the debtor for the
                shortfall. Occasionally, after resale of a manufactured home
            and payment of all expenses and indebtedness, there is a
              surplus of funds. In that case, the UCC requires the party
                 suing for the deficiency judgment to remit the surplus to the
               debtor. Because the defaulting owner of a manufactured home
         generally has very little capital or income available
            following repossession, a deficiency judgment may not be
              sought in many cases or, if obtained, will be settled at a
           significant discount in light of the defaulting owner's
strained financial condition.               

       LOUISIANA LAW. Any contract secured by a manufactured home located in
Louisiana will be governed by Louisiana law rather than Article 9 of the UCC.   
Louisiana laws provide similar mechanisms for perfection and enforcement of     
security interests in manufactured housing used as collateral for an installment
sale contract or installment loan agreement.                                    

    Under Louisiana law, a manufactured home that has been permanently
affixed to real estate will nevertheless remain subject to the motor vehicle    
registration laws unless the obligor and any holder of a security interest in   
the property execute and file in the real estate records for the parish in which
the property is located a document converting the unit into real property. A    
manufactured home that is converted into real property but is then removed from 
its site can be converted back to personal property governed by the motor       
vehicle registration laws if the obligor executes and files various documents in
the appropriate real estate records and all mortgagees under real estate        
mortgages on the property and the land to which it was affixed file releases    
with the motor vehicle commission.                                              

       So long as a manufactured home remains subject to the Louisiana motor
vehicle laws, liens are recorded on the certificate of title by the motor       
vehicle commissioner and repossession can be accomplished by voluntary consent  
of the obligor, executory process (repossession proceedings which must be       
initiated through the courts but which involve minimal court supervision) or a  
civil suit for possession. In connection with a voluntary surrender, the obligor
must be given a full release from liability for all amounts due under the       
contract. In executory process repossessions, a sheriff's sale (without court   
supervision) is permitted, unless the obligor brings suit to enjoin the sale,   
and the lender is prohibited from seeking a deficiency judgment against the     
obligor unless the lender obtained an appraisal of the manufactured home prior  
to the sale and the property was sold for at least two-thirds of its appraised  
value.                                                                          

RIGHTS OF REDEMPTION                                                            

         SINGLE FAMILY, MULTIFAMILY AND COMMERCIAL PROPERTIES. The purposes of a
foreclosure action in respect of a mortgaged property is to enable the lender to
realize upon its security and to bar the borrower, and all persons who have     
interests in the property that are subordinate to that of the foreclosing       
lender, from exercise of their "equity of redemption". The doctrine of equity of
redemption provides that, until the property encumbered by a mortgage has been  
sold in accordance with a properly conducted foreclosure and foreclosure sale,  
those having interests that are subordinate to that of the foreclosing lender   
have an equity of redemption and may redeem the property by paying the entire   
debt with interest. Those having an equity of redemption must generally be made 
parties and joined in the foreclosure proceeding in order for their equity of   
redemption to be terminated.                                                    

      The equity of redemption is a common-law (non-statutory) right which
should be distinguished from post-sale statutory rights of redemption. In some  
states, after sale pursuant to a deed of trust or foreclosure of a mortgage, the
borrower and foreclosed junior lienors are given a statutory period in which to 
redeem the property. In some states, statutory redemption may occur only upon   
payment of the foreclosure sale price. In other states, redemption may be       
permitted if the former borrower pays only a portion of the sums due. The effect
of a statutory right of redemption is to diminish the ability of the lender to  
sell the foreclosed property because the exercise of a right of redemption would
defeat the title of any purchase through a foreclosure. 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      
expired. In some states, a post-sale statutory right of redemption may exist    
following a judicial foreclosure, but not following a trustee's sale under a    
deed of trust.                                                                  

       MANUFACTURED HOMES. While state laws do not usually require notice to
be given to debtors prior to repossession, many states do require delivery of a 
notice of default and of the debtor's right to cure defaults before             
repossession. The law in most states also requires that the debtor be given     
notice of sale prior to the resale of the home so that the owner may redeem at  
or before resale. In addition, the sale must comply with the requirements of the
UCC.                                                                            

ANTI-DEFICIENCY LEGISLATION AND OTHER LIMITATIONS ON LENDERS                    

   SINGLE FAMILY, MULTIFAMILY AND COMMERCIAL LOANS. Some states have
imposed statutory prohibitions which limit the remedies of a beneficiary under a
deed of trust or a mortgagee under a mortgage. In some states (including        
California), statutes limit the right of the beneficiary or mortgagee to obtain 
a deficiency judgment against the borrower following non-judicial foreclosure by
power of sale. A deficiency judgment is a personal judgment against the former  
borrower equal in most cases to the difference between the net amount realized  
upon the public sale of the real property and the amount due to the lender. In  
the case of a mortgage loan secured by a property owned by a trust where the    
mortgage note is executed on behalf of the trust, a deficiency judgment against 
the trust following foreclosure or sale under a deed of trust, even if          
obtainable under applicable law, may be of little value to the mortgagee or     
beneficiary if there are no trust assets against which the deficiency judgment  
may be executed. Some state statutes require the beneficiary or mortgagee to    
exhaust the security afforded under a deed of trust or mortgage by foreclosure  
in an attempt to satisfy the full debt before bringing a personal action against
the borrower. In other states, the lender has the option of bringing a personal 
action against the borrower on the debt without first exhausting the security;  
however in some of these states, the lender, following judgment on the 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, in those states permitting the election, is 
that lenders will usually proceed against the security first rather than        
bringing a personal action against the borrower. Finally, in some states,       
statutory provisions limit any deficiency judgment against the former borrower  
following a foreclosure to the excess of the outstanding debt over the fair     
value of the property at the time of the public sale. The purpose of these      
statutes is generally to prevent a beneficiary or mortgagee from obtaining a    
large deficiency judgment against the former borrower as a result of low or no  
bids at the judicial sale.                                                      

    Generally, Article 9 of the UCC governs foreclosure on Cooperative
Shares and the related proprietary lease or occupancy agreement. Some courts    
have interpreted Article 9 to prohibit or limit a deficiency award in some      
circumstances, including circumstances where the disposition of the collateral  
(which, in the case of a cooperative mortgage loan, would be the shares of the  
Cooperative and the related proprietary lease or occupancy agreement) was not   
conducted in a commercially reasonable manner.                                  

   In addition to laws limiting or prohibiting deficiency judgments,
numerous other federal and state statutory provisions, including the federal    
bankruptcy laws and state laws affording relief to debtors, may interfere with  
or affect the ability of the secured mortgage lender to realize upon collateral 
or enforce a deficiency judgment. For example, under the federal Bankruptcy     
Code, virtually all actions (including foreclosure actions and deficiency       
judgment proceedings) to collect a debt are automatically stayed upon the filing
of the bankruptcy petition and, often, no interest or principal payments are    
made during the course of the bankruptcy case. The delay and the consequences   
thereof caused by the automatic stay can be significant. Also, under the        
Bankruptcy Code, the filing of a petition in a bankruptcy by or on behalf of a  
junior lienor may stay the senior lender from taking action to foreclose out the
junior lien. Moreover, with respect to federal bankruptcy law, a court with     
federal bankruptcy jurisdiction may permit a debtor through his or her Chapter  
11 or Chapter 13 rehabilitative plan to cure a monetary default in respect of a 
mortgage loan on a debtor's residence by paying arrearage within a reasonable   
time period and reinstating the original mortgage loan payment schedule even    
though the lender accelerated the mortgage loan and final judgment of           
foreclosure had been entered in state court (provided no sale of the residence  
had yet occurred) prior to the filing of the debtor's petition. Some courts with
federal bankruptcy jurisdiction have approved plans, based on the particular    
facts of the reorganization case, that effected the curing of a mortgage loan   
default by paying arrearage over a number of years.                             

      Courts with federal bankruptcy jurisdiction have also indicated that
the terms of a mortgage loan secured by property of the debtor may be modified. 
These courts have allowed modifications that include reducing the amount of each
monthly payment, changing the rate of interest, altering the repayment schedule,
forgiving all or a portion of the debt and reducing the lender's security       
interest to the value of the residence, thus leaving the lender a general       
unsecured creditor for the difference between the value of the residence and the
outstanding balance of the loan. Generally, however, the terms of a mortgage    
loan secured only by a mortgage on real property that is the debtor's principal 
residence may not be modified pursuant to a plan confirmed pursuant to Chapter  
13 except with respect to mortgage payment arrearages, which may be cured within
a reasonable time period.                                                       

 In the case of income-producing multifamily properties, federal
bankruptcy law may also have the effect of interfering with or affecting the    
ability of the secured lender to enforce the borrower's assignment of rents and 
leases related to the mortgaged property. Under Section 362 of the Bankruptcy   
Code, the lender will be stayed from enforcing the assignment, and the legal    
proceedings necessary to resolve the issue could be time-consuming, with        
resulting delays in the lender's receipt of the rents.                          

       Tax liens arising under the Code may have priority over the lien of a
mortgage or deed of trust. In addition, substantive requirements are imposed    
upon mortgage lenders in connection with the origination and the servicing of   
mortgage loans by numerous federal and some state consumer protection laws.     
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. These federal laws impose specific   
statutory liabilities upon lenders who originate 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.                                                

       CONTRACTS. In addition to the laws limiting or prohibiting deficiency
judgments, numerous other statutory provisions, including federal bankruptcy    
laws and related state laws, may interfere with or affect the ability of a      
lender to realize upon collateral and/or enforce a deficiency judgment. For     
example, in a Chapter 13 proceeding under the federal bankruptcy law, a court   
may prevent a lender from repossessing a home, and, as part of the              
rehabilitation plan, reduce the amount of the secured indebtedness to the market
value of the home at the time of bankruptcy (as determined by the court),       
leaving the party providing financing as a general unsecured creditor for the   
remainder of the indebtedness. A bankruptcy court may also reduce the monthly   
payments due under a contract or change the rate of interest and time of        
repayment of the indebtedness.                                                  

ENVIRONMENTAL LEGISLATION                                                       

         Under CERCLA, and under state law in some states, a secured party which
takes a deed-in-lieu of foreclosure, purchases a mortgaged property at a        
foreclosure sale, or operates a mortgaged property may become liable for the    
costs of cleaning up hazardous substances regardless of whether they have       
contaminated the property. CERCLA imposes strict, as well as joint and several, 
liability on several classes of potentially responsible parties, including      
current owners and operators of the property who did not cause or contribute to 
the contamination. Furthermore, liability under CERCLA is not limited to the    
original or unamortized principal balance of a loan or to the value of the      
property securing a loan. Lenders may be held liable under CERCLA as owners or  
operators unless they qualify for the secured creditor exemption to CERCLA. This
exemption exempts from the definition of owners and operators those who, without
participating in the management of a facility, hold indicia of ownership        
primarily to protect a security interest in the facility.                       

     The Conservation Act amended, among other things, the provisions of
CERCLA with respect to lender liability and the secured creditor exemption. The 
Conservation Act offers substantial protection to lenders by defining the       
activities in which a lender can engage and still have the benefit of the       
secured creditor exemption. In order for lender to be deemed to have            
participated in the management of a mortgaged property, the lender must actually
participate in the operational affairs of the property of the borrower. The     
Conservation 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 
only 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 Conservation Act also provides that a lender will 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.                                                                          

      Other federal and state laws may impose liability on a secured party
which takes a deed-in-lieu of foreclosure, purchases a mortgaged property at a  
foreclosure sale, or operates a mortgaged property on which contaminants other  
than CERCLA hazardous substances are present, including petroleum, agricultural 
chemicals, hazardous wastes, asbestos, radon, and lead-based paint. The cleanup 
costs may be substantial. It is possible that the cleanup costs could become a  
liability of a trust fund and reduce the amounts otherwise distributable to the 
holders of the related series of certificates. Moreover, federal statutes and   
states by statute may impose a lien for any cleanup costs incurred by the state 
on the property that is the subject of the cleanup costs. All subsequent liens  
on the property generally are subordinated to the lien and, in some states, even
prior recorded liens are subordinated to such lien. In the latter states, the   
security interest of the trustee in a related parcel of real property that is   
subject to the lien could be adversely affected.                                

       Traditionally, many residential mortgage lenders have not taken steps
to evaluate whether contaminants are present with respect to any mortgaged      
property prior to the origination of the mortgage loan or prior to foreclosure  
or accepting a deed-in-lieu of foreclosure. Accordingly, the company has not    
made and will not make the evaluations prior to the origination of the secured  
contracts. Neither the company, the master servicer, nor any servicer will be   
required by any Agreement to undertake these evaluations prior to foreclosure or
accepting a deed-in-lieu of foreclosure. The company does not make any          
representations or warranties or assume any liability with respect to the       
absence or effect of contaminants on any related real property or any casualty  
resulting from the presence or effect of contaminants. However, neither the     
master servicer nor any servicer will be obligated to foreclose on related real 
property or accept a deed-in-lieu of foreclosure if it knows or reasonably      
believes that there are material contaminated conditions on the property. A     
failure so to foreclose may reduce the amounts otherwise available to           
certificateholders of the related series.                                       

CONSUMER PROTECTION LAWS                                                        

         In addition, substantive requirements are imposed upon mortgage lenders
in connection with the origination and the servicing of mortgage loans by       
numerous federal and some state consumer protection laws. These laws include    
TILA, as implemented by Regulation Z, Real Estate Settlement Procedures Act, as 
implemented by Regulation X, Equal Credit Opportunity Act, as implemented by    
Regulation B, Fair Credit Billing Act, Fair Credit Reporting Act and related    
statutes. These federal laws impose specific statutory liabilities upon lenders 
who originate 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.  
In particular, an originator's failure to comply with certain requirements of   
the federal TILA, as implemented by Regulation Z, could subject both originators
and assignees of such obligations to monetary penalties and could result in     
obligors' rescinding the mortgage loans either against the originators or       
assignees.                                                                      

HOMEOWNERSHIP ACT AND SIMILAR STATE LAWS                                        

         Some of the mortgage loans, known as High Cost Loans, may be subject to
special rules, disclosure requirements and other provisions that were added to  
the federal TILA by the Homeownership Act, if such trust assets were originated 
after October 1, 1995, are not loans made to finance the purchase of the        
mortgaged property and have interest rates or origination costs in excess of    
certain prescribed levels. The Homeownership Act requires certain additional    
disclosures, specifies the timing of those disclosures and limits or prohibits  
the inclusion of certain provisions in mortgages subject to the Homeownership   
Act. Purchasers or assignees of any High Cost Loan, including any trust, could  
be liable under federal law for all claims and subject to all defenses that the 
borrower could assert against the originator of the High Cost Loan under the    
federal TILA or any other law, unless the purchaser or assignee did not know and
could not with reasonable diligence have determined that the mortgage loan was  
subject to the provisions of the Homeownership Act. Remedies available to the   
borrower include monetary penalties, as well as rescission rights if the        
appropriate disclosures were not given as required or if the particular mortgage
includes provisions prohibited by law. The maximum damages that may be recovered
under these provisions from an assignee, including the trust, is the remaining  
amount of indebtedness plus the total amount paid by the borrower in connection 
with the mortgage loan.                                                         

         In addition to the Homeownership Act, a number of legislative proposals
have been introduced at the federal, state and local level that are designed to 
discourage predatory lending practices. Some states have enacted, or may enact, 
laws or regulations that prohibit inclusion of some provisions in mortgage loans
that have interest rates or origination costs in excess of prescribed levels,   
and require that borrowers be given certain disclosures prior to the            
consummation of the mortgage loans. In some cases, state or local law may impose
requirements and restrictions greater than those in the Homeownership Act. An   
originators' 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 the 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 allegedly committed by 
the originator. Named defendants in these cases include numerous participants   
within the secondary mortgage market, including some securitization trusts.     

ADDITIONAL CONSUMER PROTECTIONS LAWS WITH RESPECT TO CONTRACTS                  

       Contracts often contain provisions obligating the obligor to pay late
charges if payments are not timely made. Federal and state law may specifically 
limit the amount of late charges that may be collected. Under the related       
pooling and servicing agreement or servicing agreement, late charges will be    
retained by the master servicer or servicer as additional servicing             
compensation, and any inability to collect these amounts will not affect        
payments to Securityholders.                                                    

        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.                                                                        

         In several cases, consumers have asserted that the remedies provided to
secured parties under the UCC and related laws violate the due process          
protections provided under the 14th Amendment to the Constitution of the United 
States. For the most part, courts have upheld the notice provisions of the UCC  
and related laws as reasonable or have found that the repossession and resale by
the creditor does not involve sufficient state action to afford constitutional  
protection to consumers.                                                        

      The FTC Rule has the effect of subjecting a seller (and some related
creditors and their assignees) in a consumer credit transaction and any assignee
of the creditor to all claims and defenses which the debtor in the transaction  
could assert against the seller of the goods. Liability under the FTC Rule is   
limited to the amounts paid by a debtor on the Contract, and the holder of the  
Contract may also be unable to collect amounts still due under the Contract.    
Most of the Contracts in a trust fund will be subject to the requirements of the
FTC Rule. Accordingly, the trust fund, as holder of the Contracts, will be      
subject to any claims or defenses that the purchaser of the related Manufactured
Home may assert against the seller of the Manufactured Home, subject to a       
maximum liability equal to the amounts paid by the obligor on the Contract. If  
an obligor is successful in asserting the claim or defense, and if the Seller   
had or should have had knowledge of the claim or defense, the master servicer   
will have the right to require the Seller to repurchase the Contract because of 
breach of its Seller's representation and warranty that no claims or defenses   
exist that would affect the obligor's obligation to make the required payments  
under the Contract. The Seller would then have the right to require the         
originating dealer to repurchase the Contract from it and might also have the   
right to recover from the dealer any losses suffered by the Seller with respect 
to which the dealer would have been primarily liable to the obligor.            

ENFORCEABILITY OF CERTAIN PROVISIONS                                            

 TRANSFER OF MORTGAGED PROPERTIES. Unless the related prospectus
supplement indicates otherwise, the mortgage loans generally contain due-on-sale
clauses. These clauses permit the lender to accelerate the maturity of the loan 
if the borrower sells, transfers or conveys the property without the prior      
consent of the lender. The enforceability of these clauses has been the subject 
of legislation or litigation in many states, and in some cases the              
enforceability of these clauses was limited or denied. However, Garn-St Germain 
Act preempts state constitutional, statutory and case law that prohibits the    
enforcement of due-on-sale clauses and permits lenders to enforce these clauses 
in accordance with their terms, subject to limited exceptions. The Garn-St      
Germain Act does "encourage" lenders to permit assumption of loans at the       
original rate of interest or at some other rate less than the average of the    
original rate and the market rate.                                              

    The Garn-St Germain Act also sets forth nine specific instances in
which a mortgage lender covered by the Garn-St Germain Act may not exercise a   
due-on-sale clause, notwithstanding the fact that a transfer of the property may
have occurred. These include, amongst others, intra-family transfers, some      
transfers by operation of law, leases of fewer than three years and the creation
of a junior encumbrance. Regulations promulgated under the Garn-St Germain Act  
also prohibit the imposition of a prepayment penalty upon the acceleration of a 
loan pursuant to a due-on-sale clause.                                          

        The inability to enforce a due-on-sale clause may result in a mortgage
loan bearing an interest rate below the current market rate being assumed by the
buyer rather than being paid off, which may have an impact upon the average life
of the mortgage loans and the number of mortgage loans which may be outstanding 
until maturity.                                                                 

         TRANSFER OF MANUFACTURED HOMES. Generally, Contracts contain provisions
prohibiting the sale or transfer of the related Manufactured Home without the   
consent of the obligee on the Contract and permitting the acceleration of the   
maturity of the Contracts by the obligee on the Contract upon a sale or transfer
that is not consented to. The master servicer will, or will cause the servicer  
of the Contract, to the extent it has knowledge of the conveyance or proposed   
conveyance, to exercise or cause to be exercised its rights to accelerate the   
maturity of the related Contracts through enforcement of due-on-sale clauses,   
subject to applicable state law. In some cases, the transfer may be made by a   
delinquent obligor in order to avoid a repossession proceeding with respect to a
Manufactured Home.                                                              

         In the case of a transfer of a Manufactured Home as to which the master
servicer or the servicer of the Contract desires to accelerate the maturity of  
the related Contract, the master servicer's or servicer's ability to do so will 
depend on the enforceability under state law of the due-on-sale clause. The     
Garn-St Germain Act preempts, subject to certain exceptions and conditions,     
state laws prohibiting enforcement of due-on-sale clauses applicable to the     
Manufactured Homes. Consequently, in some cases the master servicer or servicer 
may be prohibited from enforcing a due-on-sale clause in respect of a           
Manufactured Home.                                                              

        LATE PAYMENT CHARGES AND PREPAYMENT RESTRICTIONS. Notes and mortgages,
as well as manufactured housing conditional sales contracts and installment loan
agreements, may contain provisions that obligate the borrower to pay a late     
charge or additional interest if payments are not timely made, and in some      
circumstances, may prohibit prepayments for a specified period and/or condition 
prepayments upon the borrower's payment of prepayment fees or yield maintenance 
penalties. In some states, there are or may be specific limitations upon the    
late charges which a lender may collect from a borrower for delinquent payments.
Some states also limit the amounts that a lender may collect from a borrower as 
an additional charge if the loan is prepaid. In addition, the enforceability of 
provisions that provide for prepayment fees or penalties upon an involuntary    
prepayment is unclear under the laws of many states.                            

SUBORDINATE FINANCING                                                           

         When the mortgagor encumbers mortgaged property with one or more junior
liens, the senior lender is subjected to additional risk. First, the mortgagor  
may have difficulty servicing and repaying multiple loans. In addition, if the  
junior loan permits recourse to the mortgagor (as junior loans often do) and the
senior loan does not, a mortgagor may be more likely to repay sums due on the   
junior loan than those on the senior loan. Second, acts of the senior lender    
that 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     
mortgagor 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 an existing junior lender is harmed or the mortgagor is  
additionally burdened. Third, if the mortgagor 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 or delay the taking of action by the senior lender. Moreover, the
bankruptcy of a junior lender may operate to stay foreclosure or similar        
proceedings by the senior lender.                                               

INSTALLMENT CONTRACTS                                                           

        The trust fund assets may also consist of installment sales contracts.
Under an installment contract the seller (referred to in this section as the    
"lender") retains legal title to the property and enters into an agreement with 
the purchaser (referred to in this section as the "borrower") for the payment of
the purchase price, plus interest, over the term of the contract. Only after    
full performance by the borrower of the installment contract is the lender      
obligated to convey title to the property to the purchaser. As with mortgage or 
deed of trust financing, during the effective period of the installment         
contract, the borrower is generally responsible for the maintaining the property
in good condition and for paying real estate taxes, assessments and hazard      
insurance premiums associated with the property.                                

       The method of enforcing the rights of the lender under an installment
contract varies on a state-by- state basis depending upon the extent to which   
state courts are willing, or able pursuant to state statute, to enforce the     
contract strictly according to its terms. The terms of installment contracts    
generally provide that upon a default by the borrower, the borrower loses his or
her right to occupy the property, the entire indebtedness is accelerated and the
buyer's equitable interest in the property is forfeited. The lender in this     
situation is not required to foreclose in order to obtain title to the property,
although in some cases a quiet title action is in order if the borrower has     
filed the installment contract in local land records and an ejectment action may
be necessary to recover possession. In a few states, particularly in cases of   
borrower default during the early years of an installment contract, the courts  
will permit ejectment of the buyer and a forfeiture of his or her interest in   
the property. However, most state legislatures have enacted provisions by       
analogy to mortgage law protecting borrowers under installment contracts from   
the harsh consequences of forfeiture. Under these statutes, a judicial or       
nonjudicial foreclosure may be required, the lender may be required to give     
notice of default and the borrower may be granted some grace period during which
the installment contract may be reinstated upon full payment of the defaulted   
amount and the borrower may have a post-foreclosure statutory redemption right. 
In other states, courts in equity may permit a borrower with significant        
investment in the property under an installment contract for the sale of real   
estate to share in the proceeds of sale of the property after the indebtedness  
is repaid or may otherwise refuse to enforce the forfeiture clause.             
Nevertheless, the lender's procedures for obtaining possession and clear title  
under an installment contract in a given state are simpler and less time        
consuming and costly than are the procedures for foreclosing and obtaining clear
title to a property subject to one or more liens.                               

APPLICABILITY OF USURY LAWS                                                     

       Title V provides that state usury limitations shall not apply to some
types of residential first mortgage loans originated by some lenders after March
31, 1980. A similar federal statute was in effect with respect to mortgage loans
made during the first three months of 1980. The Office of Thrift Supervision is 
authorized to issue rules and regulations and to publish interpretations        
governing implementation of Title V. The statute authorized any state to        
reimpose interest rate limits by adopting, before April 1, 1983, a law or       
constitutional provision which expressly rejects application of the federal law.
In addition, even where Title V is not so rejected, any state is authorized by  
the law to adopt a provision limiting discount points or other charges on       
mortgage loans covered by Title V. Some states have taken action to reimpose    
interest rate limits or to limit discount points or other charges.              

        Title V also provides that, subject to the following conditions, state
usury limitations shall not apply to any loan that is secured by a first lien on
some kinds of Manufactured Housing. Contracts would be covered if they satisfy  
conditions including, among other things, terms governing any prepayments, late 
charges and deferral fees and requiring a 30-day notice period prior to         
instituting any action leading to repossession of or foreclosure with respect to
the related unit. Title V authorized any state to reimpose limitations on       
interest rates and finance charges by adopting before April 1,1983 a law or     
constitutional provision which expressly rejects application of the federal law.
Fifteen states adopted this type of law prior to the April 1,1983 deadline. In  
addition, even where Title V was not so rejected, any state is authorized by the
law to adopt a provision limiting discount points or other charges on loans     
covered by Title V. In any state in which application of Title V was expressly  
rejected or a provision limiting discount points or other charges has been      
adopted, no Contract which imposes finance charges or provides for discount     
points or charges in excess of permitted levels has been included in the trust  
fund.                                                                           

 Usury limits apply to junior mortgage loans in many states. Any
applicable usury limits in effect at origination will be reflected in the       
maximum mortgage rates for ARM Loans, as set forth in the related prospectus    
supplement.                                                                     

  As indicated above under "The Mortgage Pools--Representations by
Sellers," each Seller of a mortgage loan will have represented that the mortgage
loan was originated in compliance with then applicable state laws, including    
usury laws, in all material respects. However, the mortgage rates on the        
mortgage loans will be subject to applicable usury laws as in effect from time  
to time.                                                                        

ALTERNATIVE MORTGAGE INSTRUMENTS                                                

      Alternative mortgage instruments, including adjustable rate mortgage
loans and early ownership mortgage loans, originated by non-federally chartered 
lenders historically have been subjected to a variety of restrictions. The      
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. Title 
VIII provides that, notwithstanding any state law to the contrary, (1)          
state-chartered banks may originate alternative mortgage instruments in         
accordance with regulations promulgated by the Comptroller of the Currency with 
respect to origination of alternative mortgage instruments by national banks,(2)
state-chartered credit unions may originate alternative mortgage instruments in 
accordance with regulations promulgated by the National Credit Union            
Administration with respect to origination of alternative mortgage instruments  
by federal credit unions, and (3) 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, 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 the provisions. Some states have taken 
this action.                                                                    

FORMALDEHYDE LITIGATION WITH RESPECT TO CONTRACTS                               

         A number of lawsuits are pending in the United States alleging personal
injury from exposure to the chemical formaldehyde, which is present in many     
building materials, including components of manufactured housing such as plywood
flooring and wall paneling. Some of these lawsuits are pending against          
manufacturers of manufactured housing, suppliers of component parts, and related
persons in the distribution process. The company is aware of a limited number of
cases in which plaintiffs have won judgments in these lawsuits.                 

         Under the FTC Rule, which is described above under "Consumer Protection
Laws", the holder of any Contract secured by a Manufactured Home with respect to
which a formaldehyde claim has been successfully asserted may be liable to the  
obligor for the amount paid by the obligor on the related Contract and may be   
unable to collect amounts still due under the Contract. In the event an obligor 
is successful in asserting this claim, the related securityholders could suffer 
a loss if (1) the related Seller fails or cannot be required to repurchase the  
affected Contract for a breach of representation and warranty and (2) the master
servicer, the servicer of the Contract or the trustee were unsuccessful in      
asserting any claim of contribution or subornation on behalf of the             
securityholders against the manufacturer or other persons who were directly     
liable to the plaintiff for the damages. Typical products liability insurance   
policies held by manufacturers and component suppliers of manufactured homes may
not cover liabilities arising from formaldehyde in manufactured housing, with   
the result that recoveries from these manufacturers, suppliers or other persons 
may be limited to their corporate assets without the benefit of insurance.      

SOLDIERS' AND SAILORS' CIVIL RELIEF ACT OF 1940                                 

    Under the terms of the Relief Act, a mortgagor who enters military
service after the origination of the mortgagor's mortgage loan (including a     
mortgagor who was in reserve status and is called to active duty after          
origination of the mortgage loan), may not be charged interest (including fees  
and charges) above an annual rate of 6% during the period of the mortgagor's    
active duty status, unless a court orders otherwise upon application of the     
lender. The Relief Act applies to mortgagors who are members of the Army, Navy, 
Air Force, Marines, National Guard, Reserves, Coast Guard, and officers of the  
U.S. Public Health Service assigned to duty with the military. Because the      
Relief Act applies to mortgagors who enter military service, including          
reservists who are called to active duty, after origination of the related      
mortgage loan, no information can be provided as to the number of loans that may
be affected by the Relief Act. With respect to any mortgage loan subject to the 
Relief Act with an interest rate in excess of 6% per annum, application of the  
Relief Act would adversely affect, for an indeterminate period of time, the     
ability of the master servicer or servicer to collect full amounts of interest  
on that mortgage loan. Any shortfall in interest collections resulting from the 
application of the Relief Act or similar legislation or regulations, which would
not be recoverable from the related mortgage loans, would result in a reduction 
of the amounts distributable to the holders of the related securities, and would
not be covered by advances by the master servicer, any servicer or other entity 
or by any form of credit enhancement provided in connection with the related    
series of securities, unless described in the prospectus supplement. In         
addition, the Relief Act imposes limitations that would impair the ability of   
the master servicer or servicer to foreclose on an affected single family loan  
or enforce rights under a Contract during the mortgagor's period of active duty 
status, and, under some circumstances, during an additional three month period  
thereafter. Thus, in the event that the Relief Act or similar legislation or    
regulations applies to any mortgage loan which goes into default, there may be  
delays in payment and losses on the related securities in connection therewith. 
Any other interest shortfalls, deferrals or forgiveness of payments on the      
mortgage loans resulting from similar legislation or regulations may result in  
delays in payments or losses to securityholders of the related series.          

    Certain states have enacted or may enact their own versions of the
Relief Act which may provide for more enhanced consumer protection provisions   
than those set forth in the Relief Act. The Relief Act may not preempt those    
state laws.                                                                     

FORFEITURES IN DRUG AND RICO PROCEEDINGS                                        

  Federal law provides that property owned by persons convicted of
drug-related crimes or of criminal violations of RICO can be seized by the      
government if the property was used in, or purchased with the proceeds of, these
crimes. Under procedures contained in 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: (1) its mortgage was executed and recorded before commission  
of the crime upon which the forfeiture is based, or (2) 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.                                                                

JUNIOR MORTGAGES                                                                

    Some of the mortgage loans may be secured by mortgages or deeds of
trust which are junior to senior mortgages or deeds of trust which are not part 
of the trust fund. The rights of the securityholders, as mortgagee under a      
junior mortgage, are subordinate to those of the mortgagee under the senior     
mortgage, including the prior rights of the senior mortgagee to receive hazard  
insurance and condemnation proceeds and to cause the property securing the      
mortgage loan to be sold upon default of the mortgagor, which may extinguish the
junior mortgagee's lien unless the junior mortgagee asserts its subordinate     
interest in the property in foreclosure litigation and, in some cases, either   
reinitiates or satisfies the defaulted senior loan or loans. A junior mortgagee 
may satisfy a defaulted senior loan in full or, in some states, may cure the    
default and bring the senior loan current thereby reinstating the senior loan,  
in either event usually adding the amounts expended to the balance due on the   
junior loan. In most states, absent a provision in the mortgage or deed of      
trust, no notice of default is required to be given to a junior mortgagee. Where
applicable law or the terms of the senior mortgage or deed of trust do not      
require notice of default to the junior mortgagee, the lack of this notice may  
prevent the junior mortgagee from exercising any right to reinstate the loan    
which applicable law may provide.                                               

 The standard form of the mortgage or deed of trust used by most
institutional lenders confers on the mortgagee the right both to receive all    
proceeds collected under any hazard insurance policy and all awards made in     
connection with condemnation proceedings, and to apply the proceeds and awards  
to any indebtedness secured by the mortgage or deed of trust, in the order the  
mortgagee may determine. Thus, in the event improvements on the property are    
damaged or destroyed by fire or other casualty, or in the event the property is 
taken by condemnation, the mortgagee or beneficiary under underlying senior     
mortgages will have the prior right to collect any insurance proceeds payable   
under a hazard insurance policy and any award of damages in connection with the 
condemnation and to apply the same to the indebtedness secured by the senior    
mortgages. Proceeds in excess of the amount of senior mortgage indebtedness, in 
most cases, may be applied to the indebtedness of junior mortgages in the order 
of their priority.                                                              

       Another provision sometimes found in the form of the mortgage or deed
of trust used by institutional lenders obligates the mortgagor to pay before    
delinquency all taxes and assessments on the property and, when due, all        
encumbrances, charges and liens on the property which are prior to the mortgage 
or deed of trust, to provide and maintain fire insurance on the property, to    
maintain and repair the property and not to commit or permit any waste thereof, 
and to appear in and defend any action or proceeding purporting to affect the   
property or the rights of the mortgagee under the mortgage. Upon a failure of   
the mortgagor to perform any of these obligations, the mortgagee or beneficiary 
is given the right under some mortgages or deeds of trust to perform the        
obligation itself, at its election, with the mortgagor agreeing to reimburse the
mortgagee for any sums expended by the mortgagee on behalf of the mortgagor. All
sums so expended by a senior mortgagee become part of the indebtedness secured  
by the senior mortgage.                                                         

NEGATIVE AMORTIZATION LOANS                                                     

     A notable case decided by the United States Court of Appeals, First
Circuit, held that state restrictions on the compounding of interest are not    
preempted by the provisions of the DIDMC and as a result, a mortgage loan that  
provided for negative amortization violated New Hampshire's requirement that    
first mortgage loans provide for computation of interest on a simple interest   
basis. The holding was limited to the effect of DIDMC on state laws regarding   
the compounding of interest and the court did not address the applicability of  
the Alternative Mortgage Transaction Parity Act of 1982, which authorizes lender
to make residential mortgage loans that provide for negative amortization. The  
First Circuit's decision is binding authority only on Federal District Courts in
Maine, New Hampshire, Massachusetts, Rhode Island and Puerto Rico.              

 FEDERAL INCOME TAX CONSEQUENCES

GENERAL                                                                         

         The following discussion is the opinion of Thacher Proffitt & Wood LLP,
counsel to the company, with respect to the anticipated material federal income 
tax consequences of the purchase, ownership and disposition of offered          
securities offered under this prospectus and the prospectus supplement insofar  
as it relates to matters of law or legal conclusions with respect thereto. This 
discussion is directed solely to securityholders that hold the securities as    
capital assets within the meaning of Section 1221 of the Code and does not      
purport to discuss all federal income tax consequences that may be applicable to
the individual circumstances of particular categories of investors, some of     
which (such as banks, insurance companies and foreign investors) may be subject 
special treatment under the Code. Further, the authorities on which this        
discussion, and the opinion referred to below, are based are subject to change  
or differing interpretations, which could apply retroactively. Prospective      
investors should note that no rulings have been or will be sought from the IRS  
with respect to any of the federal income tax consequences discussed below, and 
no assurance can be given that the IRS will not take contrary positions.        
Taxpayers and preparers of tax returns (including those filed by any REMIC or   
other issuer) should be aware that under applicable Treasury regulations a      
provider of advice on specific issues of law is not considered an income tax    
return preparer unless the advice (1) is given with respect to events that have 
occurred at the time the advice is rendered and is not given with respect to the
consequences of contemplated actions, and (2) is directly relevant to the       
determination of an entry on a tax return. Accordingly, taxpayers should consult
their own tax advisors and tax return preparers regarding the preparation of any
item on a tax return, even where the anticipated tax treatment has been         
discussed in this prospectus. In addition to the federal income tax consequences
described in this prospectus, potential investors should consider the state and 
local tax consequences, if any, of the purchase, ownership and disposition of   
the securities. See "State and Other Tax Consequences."                         

       The following discussion addresses securities of three general types:

        o        REMIC Certificates representing interests in a trust fund, or
                 a portion thereof, that the REMIC Administrator will elect to
             have treated as a REMIC under the REMIC Provisions of the
Code,                                       

         o        notes representing indebtedness of a trust fund as to which no
REMIC election will be made, and            

         o        Grantor Trust Certificates representing interests in a Grantor
          Trust Fund as to which no REMIC election will be made.

The prospectus supplement for each series of certificates will indicate whether 
a REMIC election (or elections) will be made for the related trust fund and, if 
this election is to be made, will identify all "regular interests" and "residual
interests" in the REMIC. For purposes of this tax discussion, references to a   
"securityholder," "certificateholder" or a "holder" are to the beneficial owner 
of a security or certificate, as the case may be.                               

        The following discussion is based in part upon the OID Regulations and
in part upon REMIC Regulations. The OID Regulations do not adequately address   
issues relevant to securities such as the offered securities. In some instances,
the OID Regulations provide that they are not applicable to securities such as  
the offered securities.                                                         

REMICS                                                                          

  CLASSIFICATION OF REMICS. On or prior to the date of the related
prospectus supplement with respect to the proposed issuance of each series of   
REMIC Certificates, Thacher Proffitt & Wood LLP, counsel to the company, will   
deliver its opinion generally to the effect that, assuming compliance with all  
provisions of the related pooling and servicing agreement, for federal income   
tax purposes, the related trust fund (or each applicable portion thereof) will  
qualify as a REMIC and the REMIC Certificates offered with respect thereto will 
be considered to evidence ownership of REMIC Regular Certificates or REMIC      
Residual Certificates in that REMIC within the meaning of the REMIC Provisions. 

         If an entity electing to be treated as a REMIC fails to comply with one
or more of the ongoing requirements of the Code for status as a REMIC during any
taxable year, the Code provides that the entity will not be treated as a REMIC  
for that year and thereafter. In that event, the entity may be taxable as a     
corporation under Treasury regulations, and the related REMIC Certificates may  
not be accorded the status or given the tax treatment described below. Although 
the Code authorizes the Treasury Department to issue regulations providing      
relief in the event of an inadvertent termination of REMIC status, no such      
regulations have been issued. Any such relief, moreover, 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 in which the requirements for status as a REMIC   
are not satisfied. The pooling and servicing agreement with respect to each     
REMIC will include provisions designed to maintain the related trust fund's     
status as a REMIC under the REMIC Provisions. It is not anticipated that the    
status of any trust fund as a REMIC will be inadvertently terminated.           

        CHARACTERIZATION OF INVESTMENTS IN REMIC CERTIFICATES. In general, the
REMIC Certificates will be "real estate assets" within the meaning of Section   
856(c)(4)(A) of the Code and assets described in Section 7701(a)(19)(C) of the  
Code in the same proportion that the assets of the REMIC underlying the         
certificates would be so treated. Moreover, if 95% or more of the assets of the 
REMIC qualify for any of the foregoing treatments at all times during a calendar
year, the REMIC Certificates will qualify for the corresponding status in their 
entirety for that calendar year. Interest (including original issue discount) on
the REMIC Regular Certificates and income allocated to the class of REMIC       
Residual Certificates will be interest described in Section 856(c)(3)(B) of the 
Code to the extent that the certificates are treated as "real estate assets"    
within the meaning of Section 856(c)(4)(A) of the Code. In addition, the REMIC  
Regular Certificates will be "qualified mortgages" within the meaning of        
Section860G(a)(3) of the Code if transferred to another REMIC on its startup day
in exchange for regular or residual interests therein. The determination as to  
the percentage of the REMIC's assets that constitute assets described in the    
foregoing sections of the Code will be made with respect to each calendar       
quarter based on the average adjusted basis of each category of the assets held 
by the REMIC during the calendar quarter. The REMIC Administrator will report   
those determinations to certificateholders in the manner and at the times       
required by applicable Treasury regulations.                                    

      The assets of the REMIC will include, in addition to mortgage loans,
payments on mortgage loans held pending distribution on the REMIC Certificates  
and any property acquired by foreclosure held pending sale, and may include     
amounts in reserve accounts. It is unclear whether property acquired by         
foreclosure held pending sale and amounts in reserve accounts would be          
considered to be part of the mortgage loans, or whether the assets (to the      
extent not invested in assets described in the foregoing sections) otherwise    
would receive the same treatment as the mortgage loans for purposes of all of   
the Code sections mentioned in the immediately preceding paragraph. In addition,
in some instances mortgage loans may not be treated entirely as assets described
in the foregoing sections of the Code. If so, the related prospectus supplement 
will describe the mortgage loans that may not be so treated. The REMIC          
Regulations do provide, however, that cash received from payments on mortgage   
loans held pending distribution is considered part of the mortgage loans for    
purposes of Section 856(c)(4)(A) of the Code. Furthermore, foreclosure property 
will qualify as "real estate assets" under Section 856(c)(4)(A) of the Code.    

        TIERED REMIC STRUCTURES. For some series of REMIC Certificates, two or
more separate elections may be made to treat designated portions of the related 
trust fund as REMICs for federal income tax purposes. As to each such series of 
REMIC Certificates, in the opinion of counsel to the company, assuming          
compliance with all provisions of the related pooling and servicing agreement,  
each of the REMICs in that trust fund will qualify as a REMIC and the REMIC     
Certificates issued by these REMICs will be considered to evidence ownership of 
REMIC Regular Certificates or REMIC Residual Certificates in the related REMIC  
within the meaning of the REMIC Provisions.                                     

        Solely for purposes of determining whether the REMIC Certificates will
be "real estate assets" within the meaning of Section 856(c)(4)(A) of the Code, 
and "loans secured by an interest in real property" under Section 7701(a)(19)(C)
of the Code, and whether the income on the certificates is interest described in
Section 856(c)(3)(B) of the Code, all of the REMICs in that trust fund will be  
treated as one REMIC.                                                           

TAXATION OF OWNERS OF REMIC REGULAR CERTIFICATES.             

       GENERAL. Except as otherwise stated in this discussion, REMIC Regular
Certificates will be treated for federal income tax purposes as debt instruments
issued by the REMIC and not as ownership interests in the REMIC or its assets.  
Moreover, holders of REMIC Regular Certificates that otherwise report income    
under a cash method of accounting will be required to report income with respect
to REMIC Regular Certificates under an accrual method.                          

         ORIGINAL ISSUE DISCOUNT. A REMIC Regular Certificate may be issued with
"original issue discount" within the meaning of Section 1273(a) of the Code. Any
holder of a REMIC Regular Certificate issued with original issue discount       
generally will be required to include original issue discount in income as it   
accrues, in accordance with the "constant yield" method described below, in     
advance of the receipt of the cash attributable to that income. In addition,    
Section 1272(a)(6) of the Code provides special rules applicable to REMIC       
Regular Certificates and some other debt instruments issued with original issue 
discount. Regulations have not been issued under that section.                  

        The Code requires that a reasonable prepayment assumption be used with
respect to mortgage loans held by a REMIC in computing the accrual of original  
issue discount on REMIC Regular Certificates issued by that REMIC, and that     
adjustments be made in the amount and rate of accrual of that discount to       
reflect differences between the actual prepayment rate and the prepayment       
assumption. The prepayment assumption is to be determined in a manner prescribed
in Treasury regulations; as noted above, those regulations have not been issued.
The Committee Report indicates that the regulations will provide that the       
prepayment assumption used with respect to a REMIC Regular Certificate must be  
the same as that used in pricing the initial offering of the REMIC Regular      
Certificate. The Prepayment Assumption used in reporting original issue discount
for each series of REMIC Regular Certificates will be consistent with this      
standard and will be disclosed in the related prospectus supplement. However,   
none of the company, the master servicer or the trustee will make any           
representation that the mortgage loans will in fact prepay at a rate conforming 
to the Prepayment Assumption or at any other rate.                              

     The original issue discount, if any, on a REMIC Regular Certificate
will be the excess of its stated redemption price at maturity over its issue    
price. The issue price of a particular class of REMIC Regular Certificates will 
be the first cash price at which a substantial amount of REMIC Regular          
Certificates of that class is sold (excluding sales to bond houses, brokers and 
underwriters). If less than a substantial amount of a particular class of REMIC 
Regular Certificates is sold for cash on or prior to the Closing Date, the issue
price for that class will be the fair market value of that class on the Closing 
Date. Under the OID Regulations, the stated redemption price of a REMIC Regular 
Certificate is equal to the total of all payments to be made on the certificate 
other than "qualified stated interest." "Qualified stated interest" is interest 
that is unconditionally payable at least annually (during the entire term of the
instrument) at a single fixed rate, or at a "qualified floating rate," an       
"objective rate," a combination of a single fixed rate and one or more          
"qualified floating rates" or one "qualified inverse floating rate," or a       
combination of "qualified floating rates" that does not operate in a manner that
accelerates or defers interest payments on the REMIC Regular Certificate.       

       In the case of REMIC Regular Certificates bearing adjustable interest
rates, the determination of the total amount of original issue discount and the 
timing of the inclusion thereof will vary according to the characteristics of   
the REMIC Regular Certificates. If the original issue discount rules apply to   
the certificates in a particular series, the related prospectus supplement will 
describe the manner in which these rules will be applied with respect to the    
certificates in that series that bear an adjustable interest rate in preparing  
information returns to the certificateholders and the IRS.                      

       The first interest payment on a REMIC Regular Certificate may be made
more than one month after the date of issuance, which is a period longer than   
the subsequent monthly intervals between interest payments. Assuming the        
"accrual period" (as defined below) for original issue discount is each monthly 
period that ends on the day prior to each distribution date, in some cases, as a
consequence of this "long first accrual period," some or all interest payments  
may be required to be included in the stated redemption price of the REMIC      
Regular Certificate and accounted for as original issue discount. Because       
interest on REMIC Regular Certificates must in any event be accounted for under 
an accrual method, applying this analysis would result in only a slight         
difference in the timing of the inclusion in income of the yield on the REMIC   
Regular Certificates.                                                           

In addition, if the accrued interest to be paid on the first  
distribution date is computed with respect to a period that begins prior to the 
Closing Date, a portion of the purchase price paid for a REMIC Regular          
Certificate will reflect the accrued interest. In such cases, information       
returns to the certificateholders and the IRS will be based on the position that
the portion of the purchase price paid for the interest accrued with respect to 
periods prior to the Closing Date is treated as part of the overall cost of the 
REMIC Regular Certificate (and not as a separate asset the cost of which is     
recovered entirely out of interest received on the next distribution date) and  
that portion of the interest paid on the first distribution date in excess of   
interest accrued for a number of days corresponding to the number of days from  
the Closing Date to the first distribution date should be included in the stated
redemption price of the REMIC Regular Certificate. However, the OID Regulations 
state that all or some portion of the accrued interest may be treated as a      
separate asset the cost of which is recovered entirely out of interest paid on  
the first distribution date. It is unclear how an election to do so would be    
made under the OID Regulations and whether such an election could be made       
unilaterally by a certificateholder.                                            

    Notwithstanding the general definition of original issue discount,
original issue discount on a REMIC Regular Certificate will be considered to be 
de minimis if it is less than 0.25% of the stated redemption price of the REMIC 
Regular Certificate multiplied by its weighted average life. For this purpose,  
the weighted average life of a REMIC Regular Certificate is computed as the sum 
of the amounts determined, as to each payment included in the stated redemption 
price of the REMIC Regular Certificate, by multiplying (1) the number of        
complete years (rounding down for partial years) from the issue date until that 
payment is expected to be made (presumably taking into account the Prepayment   
Assumption) by (2) a fraction, the numerator of which is the amount of the      
payment, and the denominator of which is the stated redemption price at maturity
of the REMIC Regular Certificate. Under the OID Regulations, original issue     
discount of only a de minimis amount (other than de minimis original issue      
discount attributable to a so-called "teaser" interest rate or an initial       
interest holiday) will be included in income as each payment of stated principal
is made, based on the product of the total amount of de minimis original issue  
discount attributable to that certificate and a fraction, the numerator of which
is the amount of the principal payment and the denominator of which is the      
outstanding stated principal amount of the REMIC Regular Certificate. The OID   
Regulations also would permit a certificateholder to elect to accrue de minimis 
original issue discount into income currently based on a constant yield method. 
See "Taxation of Owners of REMIC Regular Certificates--Market Discount" for a   
description of this election under the OID Regulations.                         

        If original issue discount on a REMIC Regular Certificate is in excess
of a de minimis amount, the holder of the certificate must include in ordinary  
gross income the sum of the "daily portions" of original issue discount for each
day during its taxable year on which it held the REMIC Regular Certificate,     
including the purchase date but excluding the disposition date. In the case of  
an original holder of a REMIC Regular Certificate, the daily portions of        
original issue discount will be determined as follows.                          

       As to each "accrual period," that is, each period that ends on a date
that corresponds to the day prior to each distribution date and begins on the   
first day following the immediately preceding accrual period (or in the case of 
the first such period, begins on the Closing Date), a calculation will be made  
of the portion of the original issue discount that accrued during the accrual   
period. The portion of original issue discount that accrues in any accrual      
period will equal the excess, if any, of (1) the sum of (a) the present value,  
as of the end of the accrual period, of all of the distributions remaining to be
made on the REMIC Regular Certificate, if any, in future periods and (b) the    
distributions made on the REMIC Regular Certificate during the accrual period of
amounts included in the stated redemption price, over (2) the adjusted issue    
price of the REMIC Regular Certificate at the beginning of the accrual period.  
The present value of the remaining distributions referred to in the preceding   
sentence will be calculated (1) assuming that distributions on the REMIC Regular
Certificate will be received in future periods based on the mortgage loans being
prepaid at a rate equal to the Prepayment Assumption, (2) using a discount rate 
equal to the original yield to maturity of the certificate and (3) taking into  
account events (including actual prepayments) that have occurred before the     
close of the accrual period. For these purposes, the original yield to maturity 
of the certificate will be calculated based on its issue price and assuming that
distributions on the certificate will be made in all accrual periods based on   
the mortgage loans being prepaid at a rate equal to the Prepayment Assumption.  
The adjusted issue price of a REMIC Regular Certificate at the beginning of any 
accrual period will equal the issue price of the certificate, increased by the  
aggregate amount of original issue discount that accrued with respect to the    
certificate in prior accrual periods, and reduced by the amount of any          
distributions made on the certificate in prior accrual periods of amounts       
included in the stated redemption price. The original issue discount accruing   
during any accrual period, computed as described above, will be allocated       
ratably to each day during the accrual period to determine the daily portion of 
original issue discount for that day.                                           

        A subsequent purchaser of a REMIC Regular Certificate that purchases a
certificate that is treated as having been issued with original issue discount  
at a cost (excluding any portion of the cost attributable to accrued qualified  
stated interest) less than its remaining stated redemption price will also be   
required to include in gross income the daily portions of any original issue    
discount with respect to the certificate. However, each such daily portion will 
be reduced, if the cost of the certificate is in excess of its "adjusted issue  
price," in proportion to the ratio the excess bears to the aggregate original   
issue discount remaining to be accrued on the REMIC Regular Certificate. The    
adjusted issue price of a REMIC Regular Certificate on any given day equals the 
sum of (1) the adjusted issue price (or, in the case of the first accrual       
period, the issue price) of the certificate at the beginning of the accrual     
period which includes that day and (2) the daily portions of original issue     
discount for all days during the accrual period prior to that day.              

     MARKET DISCOUNT. A certificateholder that purchases a REMIC Regular
Certificate at a market discount, that is, in the case of a REMIC Regular       
Certificate issued without original issue discount, at a purchase price less    
than its remaining stated principal amount, or in the case of a REMIC Regular   
Certificate issued with original issue discount, at a purchase price less than  
its adjusted issue price will recognize gain upon receipt of each distribution  
representing stated redemption price. In particular, under Section 1276 of the  
Code such a certificateholder generally will be required to allocate the portion
of each distribution representing stated redemption price first to accrued      
market discount not previously included in income, and to recognize ordinary    
income to that extent. A certificateholder may elect to include market discount 
in income currently as it accrues rather than including it on a deferred basis  
in accordance with the foregoing. If made, the election will apply to all market
discount bonds acquired by the certificateholder on or after the first day of   
the first taxable year to which the election applies. In addition, the OID      
Regulations permit a certificateholder to elect to accrue all interest, discount
(including de minimis market or original issue discount) in income as interest, 
and to amortize premium, based on a constant yield method. If such an election  
were made with respect to a REMIC Regular Certificate with market discount, the 
certificateholder would be deemed to have made an election to include currently 
market discount in income with respect to all other debt instruments having     
market discount that the certificateholder acquires during the taxable year of  
the election or thereafter, and possibly previously acquired instruments.       
Similarly, a certificateholder that made this election for a certificate that is
acquired at a premium would be deemed to have made an election to amortize bond 
premium with respect to all debt instruments having amortizable bond premium    
that the certificateholder owns or acquires. See "Taxation of Owners of REMIC   
Regular Certificates--Premium" below. Each of these elections to accrue         
interest, discount and premium with respect to a certificate on a constant yield
method or as interest would be irrevocable, except with the approval of the IRS.

      However, market discount with respect to a REMIC Regular Certificate
will be considered to be de minimis for purposes of Section 1276 of the Code if 
the market discount is less than 0.25% of the remaining stated redemption price 
of the REMIC Regular Certificate multiplied by the number of complete years to  
maturity remaining after the date of its purchase. In interpreting a similar    
rule with respect to original issue discount on obligations payable in          
installments, the OID Regulations refer to the weighted average maturity of     
obligations, and it is likely that the same rule will be applied with respect to
market discount, presumably taking into account the Prepayment Assumption. If   
market discount is treated as de minimis under this rule, it appears that the   
actual discount would be treated in a manner similar to original issue discount 
of a de minimis amount. See "Taxation of Owners of REMIC Regular                
Certificates--Original Issue Discount" above. This treatment would result in    
discount being included in income at a slower rate than discount would be       
required to be included in income using the method described above.             

     Section 1276(b)(3) of the Code specifically authorizes the Treasury
Department to issue regulations providing for the method for accruing market    
discount on debt instruments, the principal of which is payable in more than one
installment. Until regulations are issued by the Treasury Department, the rules 
described in the Committee Report apply. The Committee Report indicates that in 
each accrual period market discount on REMIC Regular Certificates should accrue,
at the certificateholder's option: (1) on the basis of a constant yield method, 
(2) in the case of a REMIC Regular Certificate issued without original issue    
discount, in an amount that bears the same ratio to the total remaining market  
discount as the stated interest paid in the accrual period bears to the total   
amount of stated interest remaining to be paid on the REMIC Regular Certificate 
as of the beginning of the accrual period, or (3) in the case of a REMIC Regular
Certificate issued with original issue discount, in an amount that bears the    
same ratio to the total remaining market discount as the original issue discount
accrued in the accrual period bears to the total original issue discount        
remaining on the REMIC Regular Certificate at the beginning of the accrual      
period. Moreover, the Prepayment Assumption used in calculating the accrual of  
original issue discount is also used in calculating the accrual of market       
discount. Because the regulations referred to in this paragraph have not been   
issued, it is not possible to predict what effect these regulations might have  
on the tax treatment of a REMIC Regular Certificate purchased at a discount in  
the secondary market.                                                           

      To the extent that REMIC Regular Certificates provide for monthly or
other periodic distributions throughout their term, the effect of these rules   
may be to require market discount to be includible in income at a rate that is  
not significantly slower than the rate at which the discount would accrue if it 
were original issue discount. Moreover, in any event a holder of a REMIC Regular
Certificate generally will be required to treat a portion of any gain on the    
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.                                                                         

     Further, under Section 1277 of the Code a holder of a REMIC Regular
Certificate may be required to defer a portion of its interest deductions for   
the taxable year attributable to any indebtedness incurred or continued to      
purchase or carry a REMIC Regular Certificate purchased with market discount.   
For these purposes, the de minimis rule referred to above applies. Any such     
deferred interest expense would not exceed the market discount that accrues     
during the taxable year and is, in general, allowed as a deduction not later    
than the year in which the market discount is includible in income. If a holder 
elects to include market discount in income currently as it accrues on all      
market discount instruments acquired by the holder in that taxable year or      
thereafter, the interest deferral rule described above will not apply.          

         PREMIUM. A REMIC Regular Certificate purchased at a cost (excluding any
portion of the cost attributable to accrued qualified stated interest) greater  
than its remaining stated redemption price will be considered to be purchased at
a premium. The holder of a REMIC Regular Certificate may elect under Section    
171of the Code to amortize the premium under the constant yield method over the 
life of the certificate. If made, the election will apply to all debt           
instruments having amortizable bond premium that the holder owns or subsequently
acquires. Amortizable premium will be treated as an offset to interest income on
the related debt instrument, rather than as a separate interest deduction. The  
OID Regulations also permit certificateholders to elect to include all interest,
discount and premium in income based on a constant yield method, further        
treating the certificateholder as having made the election to amortize premium  
generally. See "Taxation of Owners of REMIC Regular Certificates--Market        
Discount" above. The Committee Report states that the same rules that apply to  
accrual of market discount (which rules will require use of a Prepayment        
Assumption in accruing market discount with respect to REMIC Regular            
Certificates without regard to whether the certificates have original issue     
discount) will also apply in amortizing bond premium under Section 171 of the   
Code. The use of an assumption that there will be no prepayments may be         
required.                                                                       

        REALIZED LOSSES. Under Section 166 of the Code, both corporate holders
of the REMIC Regular Certificates and non-corporate holders of the REMIC Regular
Certificates that acquire the 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 certificates become wholly or partially    
worthless as the result of one or more realized losses on the mortgage loans.   
However, it appears that a non-corporate holder that does not acquire a REMIC   
Regular Certificate in connection with a trade or business will not be entitled 
to deduct a loss under Section 166 of the Code until the holder's certificate   
becomes wholly worthless (i.e., until its outstanding principal balance has been
reduced to zero) and that the loss will be characterized as a short-term capital
loss.                                                                           

       Each holder of a REMIC Regular Certificate will be required to accrue
interest and original issue discount with respect to the certificate, without   
giving effect to any reductions in distributions attributable to defaults or    
delinquencies on the mortgage loans or the certificate underlying the REMIC     
Certificates, as the case may be, until it can be established that the reduction
ultimately will not be recoverable. As a result, the amount of taxable income   
reported in any period by the holder of a REMIC Regular Certificate could exceed
the amount of economic income actually realized by that holder in the period.   
Although the holder of a REMIC Regular Certificate eventually will recognize a  
loss or reduction in income attributable to previously accrued and included     
income that as the result of a realized loss ultimately will not be realized,   
the law is unclear with respect to the timing and character of this loss or     
reduction in income.                                                            

TAXATION OF OWNERS OF REMIC RESIDUAL CERTIFICATES             

       GENERAL. Although a REMIC is a separate entity for federal income tax
purposes, a REMIC generally is not subject to entity-level taxation, except with
regard to prohibited transactions and some other transactions. See "--Prohibited
Transactions and Other Possible REMIC Taxes" below. Rather, the taxable income  
or net loss of a REMIC is generally taken into account by the holder of the     
REMIC Residual Certificates. Accordingly, the REMIC Residual Certificates will  
be subject to tax rules that differ significantly from those that would apply if
the REMIC Residual Certificates were treated for federal income tax purposes as 
direct ownership interests in the mortgage loans or as debt instruments issued  
by the REMIC.                                                                   

        A holder of a REMIC Residual Certificate generally will be required to
report its daily portion of the taxable income or, subject to the limitations   
noted in this discussion, the net loss of the REMIC for each day during a       
calendar quarter that the holder owned the REMIC Residual Certificate. For this 
purpose, the taxable income or net loss of the REMIC will be allocated to each  
day in the calendar quarter ratably using a "30 days per month/90 days per      
quarter/360 days per year" convention unless otherwise disclosed in the related 
prospectus supplement. The daily amounts so allocated will then be allocated    
among the REMIC Residual Certificateholders in proportion to their respective   
ownership interests on that day. Any amount included in the gross income or     
allowed as a loss of any REMIC Residual Certificateholder by virtue of this     
paragraph will be treated as ordinary income or loss. The taxable income of the 
REMIC will be determined under the rules described below in "Taxable Income of  
the REMIC" and will be taxable to the REMIC Residual Certificateholders without 
regard to the timing or amount of cash distributions by the REMIC. Ordinary     
income derived from REMIC Residual Certificates will be "portfolio income" for  
purposes of the taxation of taxpayers subject to limitations under Section 469  
of the Code on the deductibility of "passive losses."                           

         A holder of a REMIC Residual Certificate that purchased the certificate
from a prior holder of that certificate also will be required to report on its  
federal income tax return amounts representing its daily share of the taxable   
income (or net loss) of the REMIC for each day that it holds the REMIC Residual 
Certificate. Those daily amounts generally will equal the amounts of taxable    
income or net loss determined as described above. The Committee Report indicates
that some modifications of the general rules may be made, by regulations,       
legislation or otherwise to reduce (or increase) the income of a REMIC Residual 
Certificateholder that purchased the REMIC Residual Certificate from a prior    
holder of the certificate at a price greater than (or less than) the adjusted   
basis (as defined below) the REMIC Residual Certificate would have had in the   
hands of an original holder of the certificate. The REMIC Regulations, however, 
do not provide for any such modifications.                                      

      Any payments received by a holder of a REMIC Residual Certificate in
connection with the acquisition of the REMIC Residual Certificate will be taken 
into account in determining the income of the holder for federal income tax     
purposes. Although it appears likely that any of these payments would be        
includible in income immediately upon its receipt, the IRS might assert that    
these payments should be included in income over time according to an           
amortization schedule or according to some other method. Because of the         
uncertainty concerning the treatment of these payments, holders of REMIC        
Residual Certificates should consult their tax advisors concerning the treatment
of these payments for income tax purposes.                                      

         The amount of income REMIC Residual Certificateholders will be required
to report (or the tax liability associated with the income) may exceed the      
amount of cash distributions received from the REMIC for the corresponding      
period. Consequently, REMIC Residual Certificateholders should have other       
sources of funds sufficient to pay any federal income taxes due as a result of  
their ownership of REMIC Residual Certificates or unrelated deductions against  
which income may be offset, subject to the rules relating to "excess inclusions"
and "noneconomic" residual interests discussed below. The fact that the tax     
liability associated with the income allocated to REMIC Residual                
Certificateholders may exceed the cash distributions received by the REMIC      
Residual Certificateholders for the corresponding period may significantly      
adversely affect the REMIC Residual Certificateholders' after-tax rate of       
return. This disparity between income and distributions may not be offset by    
corresponding losses or reductions of income attributable to the REMIC Residual 
Certificateholder until subsequent tax years and, then, may not be completely   
offset due to changes in the Code, tax rates or character of the income or loss.

         TAXABLE INCOME OF THE REMIC. The taxable income of the REMIC will equal
the income from the mortgage loans and other assets of the REMIC plus any       
cancellation of indebtedness income due to the allocation of realized losses to 
REMIC Regular Certificates, less the deductions allowed to the REMIC for        
interest (including original issue discount and reduced by any income from      
premium on issuance) on the REMIC Regular Certificates (and any other class of  
REMIC Certificates constituting "regular interests" in the REMIC not offered by 
the prospectus), amortization of any premium on the mortgage loans, bad debt    
losses with respect to the mortgage loans and, except as described below, for   
servicing, administrative and other expenses.                                   

        For purposes of determining its taxable income, the REMIC will have an
initial aggregate basis in its assets equal to the sum of the issue prices of   
all REMIC Certificates (or, if a class of REMIC Certificates is not sold        
initially, their fair market values). The aggregate basis will be allocated     
among the mortgage loans and the other assets of the REMIC in proportion to     
their respective fair market values. The issue price of any offered REMIC       
Certificates will be determined in the manner described above under "--Taxation 
of Owners of REMIC Regular Certificates--Original Issue Discount." The issue    
price of a REMIC Certificate received in exchange for an interest in the        
mortgage loans or other property will equal the fair market value of the        
interests in the mortgage loans or other property. Accordingly, if one or more  
classes of REMIC Certificates are retained initially rather than sold, the REMIC
Administrator may be required to estimate the fair market value of the interests
in order to determine the basis of the REMIC in the mortgage loans and other    
property held by the REMIC.                                                     

        Subject to possible application of the de minimis rules, the method of
accrual by the REMIC of original issue discount income and market discount      
income with respect to mortgage loans that it holds will be equivalent to the   
method for accruing original issue discount income for holders of REMIC Regular 
Certificates (that is, under the constant yield method taking into account the  
Prepayment Assumption). However, a REMIC that acquires loans at a market        
discount must include the market discount in income currently, as it accrues, on
a constant yield basis. See "--Taxation of Owners of REMIC Regular Certificates"
above, which describes a method for accruing discount income that is analogous  
to that required to be used by a REMIC as to mortgage loans with market discount
that it holds.                                                                  

        A mortgage loan will be deemed to have been acquired with discount (or
premium) to the extent that the REMIC's basis therein, determined as described  
in the preceding paragraph, is less than (or greater than) its stated redemption
price. Any such discount will be includible in the income of the REMIC as it    
accrues, in advance of receipt of the cash attributable to the income, under a  
method similar to the method described above for accruing original issue        
discount on the REMIC Regular Certificates. It is anticipated that each REMIC   
will elect under Section 171 of the Code to amortize any premium on the mortgage
loans. Premium on any mortgage loan to which the election applies may be        
amortized under a constant yield method, presumably taking into account a       
Prepayment Assumption. Further, such an election would not apply to any mortgage
loan originated on or before September 27, 1985. Instead, premium on such a     
mortgage loan should be allocated among the principal payments thereon and be   
deductible by the REMIC as those payments become due or upon the prepayment of  
the mortgage loan.                                                              

     A REMIC will be allowed deductions for interest (including original
issue discount) on the REMIC Regular Certificates (including any other class of 
REMIC Certificates constituting "regular interests" in the REMIC not offered by 
this prospectus) equal to the deductions that would be allowed if the REMIC     
Regular Certificates (including any other class of REMIC Certificates           
constituting "regular interests" in the REMIC not offered by this prospectus)   
were indebtedness of the REMIC. Original issue discount will be considered to   
accrue for this purpose as described above under "--Taxation of Owners of REMIC 
Regular certificates--Original Issue Discount," except that the de minimis rule 
and the adjustments for subsequent holders of REMIC Regular Certificates        
(including any other class of REMIC Certificates constituting "regular          
interests" in the REMIC not offered by this prospectus) described therein will  
not apply.                                                                      

        If a class of REMIC Regular Certificates is issued with Issue Premium,
the net amount of interest deductions that are allowed the REMIC in each taxable
year with respect to the REMIC Regular Certificates of that class will be       
reduced by an amount equal to the portion of the Issue Premium that is          
considered to be amortized or repaid in that year. Although the matter is not   
entirely clear, it is likely that Issue Premium would be amortized under a      
constant yield method in a manner analogous to the method of accruing original  
issue discount described above under "--Taxation of Owners of REMIC Regular     
certificates--Original Issue Discount."                                         

        As a general rule, the taxable income of a REMIC will be determined in
the same manner as if the REMIC were an individual having the calendar year as  
its taxable year and using the accrual method of accounting. However, no item of
income, gain, loss or deduction allocable to a prohibited transaction will      
betaken into account. See "--Prohibited Transactions and Other Possible REMIC   
Taxes" below. Further, the limitation on miscellaneous itemized deductions      
imposed on individuals by Section 67 of the Code (which allows these deductions 
only to the extent they exceed in the aggregate two percent of the taxpayer's   
adjusted gross income) will not be applied at the REMIC level so that the REMIC 
will be allowed deductions for servicing, administrative and other non-interest 
expenses in determining its taxable income. All such expenses will be allocated 
as a separate item to the holders of REMIC Certificates, subject to the         
limitation of Section 67 of the Code. See "--Possible Pass-Through of           
Miscellaneous Itemized Deductions" below. If the deductions allowed to the REMIC
exceed its gross income for a calendar quarter, the excess will be the net loss 
for the REMIC for that calendar quarter.                                        

    BASIS RULES, NET LOSSES AND DISTRIBUTIONS. The adjusted basis of a
REMIC Residual Certificate will be equal to the amount paid for the REMIC       
Residual Certificate, increased by amounts included in the income of the REMIC  
Residual Certificateholder and decreased (but not below zero) by distributions  
made, and by net losses allocated, to the REMIC Residual Certificateholder.     

        A REMIC Residual Certificateholder is not allowed to take into account
any net loss for any calendar quarter to the extent the net loss exceeds the    
REMIC Residual Certificateholder's adjusted basis in its REMIC Residual         
Certificate as of the close of the calendar quarter (determined without regard  
to the net loss). Any loss that is not currently deductible by reason of this   
limitation may be carried forward indefinitely to future calendar quarters and, 
subject to the same limitation, may be used only to offset income from the REMIC
Residual Certificate. The ability of REMIC Residual Certificateholders to deduct
net losses may be subject to additional limitations under the Code, as to which 
REMIC Residual Certificateholders should consult their tax advisors.            

       Any distribution on a REMIC Residual Certificate will be treated as a
non-taxable return of capital to the extent it does not exceed the holder's     
adjusted basis in the REMIC Residual Certificate. To the extent a distribution  
on a REMIC Residual Certificate exceeds the adjusted basis, it will be treated  
as gain from the sale of the REMIC Residual Certificate. Holders of REMIC       
Residual Certificates may be entitled to distributions early in the term of the 
related REMIC under circumstances in which their bases in the REMIC Residual    
Certificates will not be sufficiently large that the distributions will be      
treated as nontaxable returns of capital. Their bases in the REMIC Residual     
Certificates will initially equal the amount paid for the REMIC Residual        
Certificates and will be increased by their allocable shares of taxable income  
of the REMIC. However, these bases increases may not occur until the end of the 
calendar quarter, or perhaps the end of the calendar year, with respect to which
the REMIC taxable income is allocated to the REMIC Residual Certificateholders. 
To the extent the REMIC Residual Certificateholders' initial bases are less than
the distributions to the REMIC Residual Certificateholders, and increases in    
initial bases either occur after the distributions or (together with their      
initial bases) are less than the amount of the distributions, gain will be      
recognized to the REMIC Residual Certificateholders on these distributions and  
will be treated as gain from the sale of their REMIC Residual Certificates.     

      The effect of these rules is that a REMIC Residual Certificateholder
may not amortize its basis in a REMIC Residual Certificate, but may only recover
its basis through distributions, through the deduction of any net losses of the 
REMIC or upon the sale of its REMIC Residual Certificate. See "--Sales of REMIC 
Certificates" below. For a discussion of possible modifications of these rules  
that may require adjustments to income of a holder of a REMIC Residual          
Certificate other than an original holder in order to reflect any difference    
between the cost of the REMIC Residual Certificate to the REMIC Residual        
Certificateholder and the adjusted basis the REMIC Residual Certificate would   
have in the hands of an original holder, see "--Taxation of Owners of REMIC     
Residual Certificates--General" above.                                          

    EXCESS INCLUSIONS. Any "excess inclusions" with respect to a REMIC
Residual Certificate will be subject to federal income tax in all events. In    
general, the "excess inclusions" with respect to a REMIC Residual Certificate   
for any calendar quarter will be the excess, if any, of (1) the daily portions  
of REMIC taxable income allocable to the REMIC Residual Certificate over (2) the
sum of the "daily accruals" (as defined below) for each day during the quarter  
that the REMIC Residual Certificate was held by the REMIC Residual              
Certificateholder. The daily accruals of a REMIC Residual Certificateholder will
be determined by allocating to each day during a calendar quarter its ratable   
portion of the product of the "adjusted issue price" of the REMIC Residual      
Certificate at the beginning of the calendar quarter and 120% of the "long-term 
Federal rate" in effect on the Closing Date. For this purpose, the adjusted     
issue price of a REMIC Residual Certificate as of the beginning of any calendar 
quarter will be equal to the issue price of the REMIC Residual Certificate,     
increased by the sum of the daily accruals for all prior quarters and decreased 
(but not below zero) by any distributions made with respect to the REMIC        
Residual Certificate before the beginning of that quarter. The issue price of a 
REMIC Residual Certificate is the initial offering price to the public          
(excluding bond houses and brokers) at which a substantial amount of the REMIC  
Residual Certificates were sold. The "long-term Federal rate" is an average of  
current yields on Treasury securities with a remaining term of greater than nine
years, computed and published monthly by the IRS. Although it has not done so,  
the Treasury has authority to issue regulations that would treat the entire     
amount of income accruing on a REMIC Residual Certificate as an excess inclusion
if the REMIC Residual Certificates are not considered to have "significant      
value."                                                                         

         For REMIC Residual Certificateholders, an excess inclusion (1) will not
be permitted to be offset by deductions, losses or loss carryovers from other   
activities, (2) will be treated as "unrelated business taxable income" to an    
otherwise tax-exempt organization and (3) will not be eligible for any rate     
reduction or exemption under any applicable tax treaty with respect to the 30%  
United States withholding tax imposed on distributions to REMIC Residual        
Certificateholders that are foreign investors. See, however, "--Foreign         
investors in REMIC Certificates," below.                                        

  Furthermore, for purposes of the alternative minimum tax, excess
inclusions will not be permitted to be offset by the alternative tax net        
operating loss deduction and alternative minimum taxable income may not be less 
than the taxpayer's excess inclusions. The latter rule has the effect of        
preventing nonrefundable tax credits from reducing the taxpayer's income tax to 
an amount lower than the tentative minimum tax on excess inclusions.            

      In the case of any REMIC Residual Certificates held by a real estate
investment trust, the aggregate excess inclusions with respect to the REMIC     
Residual Certificates, reduced (but not below zero) by the real estate          
investment trust taxable income (within the meaning of Section 857(b)(2) of the 
Code, excluding any net capital gain), 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 REMIC Residual Certificate as if held directly by the         
shareholder. 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.                              

       NONECONOMIC REMIC RESIDUAL CERTIFICATES. Under the REMIC Regulations,
transfers of "noneconomic" REMIC Residual Certificates will be disregarded for  
all federal income tax purposes if "a significant purpose of the transfer was to
enable the transferor to impede the assessment or collection of tax." If the    
transfer is disregarded, the purported transferor will continue to remain liable
for any taxes due with respect to the income on the "non-economic" REMIC        
Residual Certificate. The REMIC Regulations provide that a REMIC Residual       
Certificate is non-economic unless, based on the Prepayment Assumption and on   
any required or permitted clean up calls, or required liquidation provided for  
in the REMIC's organizational documents, (1) the present value of the expected  
future distributions (discounted using the "applicable Federal rate" for        
obligations whose term ends on the close of the last quarter in which excess    
inclusions are expected to accrue with respect to the REMIC Residual            
Certificate, which rate is computed and published monthly by the IRS) on the    
REMIC Residual Certificate equals at least the present value of the expected tax
on the anticipated excess inclusions, and (2) the transferor reasonably expects 
that the transferee will receive distributions with respect to the REMIC        
Residual Certificate at or after the time the taxes accrue on the anticipated   
excess inclusions in an amount sufficient to satisfy the accrued taxes.         
Accordingly, all transfers of REMIC Residual Certificates that may constitute   
non-economic residual interests will be subject to restrictions under the terms 
of the related pooling and servicing agreement that are intended to reduce the  
possibility of any such transfer being disregarded. These restrictions will     
require each party to a transfer to provide an affidavit that no purpose of the 
transfer is to impede the assessment or collection of tax, including            
representations as to the financial condition of the prospective transferee, as 
to which the transferor is also required to make a reasonable investigation to  
determine the transferee's historic payment of its debts and ability to continue
to pay its debts as they come due in the future. The IRS has issued final REMIC 
regulations that add to the conditions necessary to assure that a transfer of a 
non-economic residual interest would be respected. The additional conditions    
require that in order to qualify as a safe harbor transfer of a residual, the   
transferee represent that it will not cause the income "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   
either (i) the amount received by the transferee be no less on a present value  
basis than the present value of the net tax detriment attributable to holding   
the residual interest reduced by the present value of the projected payments to 
be received on the residual interest or (ii) the transfer is to a domestic      
taxable corporation with specified large amounts of gross and net assets and    
that meets certain other requirements where agreement is made that all future   
transfers will be to taxable domestic corporations in transactions that qualify 
for the same "safe harbor" provision. Eligibility for the safe harbor requires, 
among other things, that the facts and circumstances known to the transferor at 
the time of transfer not indicate to a reasonable person that the taxes with    
respect to the residual interest will not be paid, with an unreasonably low cost
for the transfer specifically mentioned as negating eligibility. The regulations
generally apply to transfers of residual interests occurring on or after        
February 4, 2000. Prior to purchasing a REMIC Residual Certificate, prospective 
purchasers should consider the possibility that a purported transfer of the     
REMIC Residual Certificate by such a purchaser to another purchaser at some     
future day may be disregarded in accordance with the above described rules which
would result in the retention of tax liability by that purchaser.               

       The related prospectus supplement will disclose whether offered REMIC
Residual Certificates may be considered "noneconomic" residual interests under  
the REMIC Regulations; provided, however, that any disclosure that a REMIC      
Residual Certificate will not be considered "non-economic" will be based upon   
assumptions, and the depositor will make no representation that a REMIC Residual
Certificate will not be considered "non-economic" for purposes of the           
above-described rules. See "--Foreign Investors in REMIC Certificates--REMIC    
Residual Certificates" below for additional restrictions applicable to transfers
of REMIC Residual Certificates to foreign persons.                              

     MARK-TO-MARKET RULES. In general, all securities owned by a dealer,
except to the extent that the dealer has specifically identified a security as  
held for investment, must be marked to market in accordance with the applicable 
Code provision and the related regulations. However, the IRS has issued         
regulations which provide that for purposes of this mark-to-market requirement, 
a REMIC Residual Certificate is not treated as a security and thus may not be   
marked to market.                                                               

      POSSIBLE PASS-THROUGH OF MISCELLANEOUS ITEMIZED DEDUCTIONS. Fees and
expenses of a REMIC generally will be allocated to the holders of the related   
REMIC Residual Certificates. The applicable Treasury regulations indicate,      
however, that in the case of a REMIC that is similar to a single class grantor  
trust, all or a portion of these fees and expenses should be allocated to the   
holders of the related REMIC Regular Certificates. Except as stated in the      
related prospectus supplement, these fees and expenses will be allocated to     
holders of the related REMIC Residual Certificates in their entirety and not to 
the holders of the related REMIC Regular Certificates.                          

With respect to REMIC Residual Certificates or REMIC Regular  
Certificates the holders of which receive an allocation of fees and expenses in 
accordance with the preceding discussion, if any holder thereof is an           
individual, estate or trust, or a "pass-through entity" beneficially owned by   
one or more individuals, estates or trusts, (1) an amount equal to the          
individual's, estate's or trust's share of the fees and expenses will be added  
to the gross income of the holder and (2) the individual's, estate's or trust's 
share of the fees and expenses will be treated as a miscellaneous itemized      
deduction allowable subject to the limitation of Section 67 of the Code, which  
permits these deductions only to the extent they exceed in the aggregate two    
percent of taxpayer's adjusted gross income. In addition, Section 68 of the Code
provides that the amount of itemized deductions otherwise allowable for an      
individual whose adjusted gross income exceeds a specified amount will be       
reduced by the lesser of (1) 3% of the excess of the individual's adjusted gross
income over the amount or (2) 80% of the amount of itemized deductions otherwise
allowable for the taxable year. The amount of additional taxable income         
reportable by REMIC Certificateholders that are subject to the limitations of   
either Section 67 or Section 68 of the Code may be substantial. Furthermore, in 
determining the alternative minimum taxable income of such a holder of a REMIC  
Certificate that is an individual, estate or trust, or a "pass-through entity"  
beneficially owned by one or more individuals, estates or trusts, no deduction  
will be allowed for the holder's allocable portion of servicing fees and other  
miscellaneous itemized deductions of the REMIC, even though an amount equal to  
the amount of the fees and other deductions will be included in the holder's    
gross income. Accordingly, these REMIC Certificates may not be appropriate      
investments for individuals, estates, or trusts, or pass-through entities       
beneficially owned by one or more individuals, estates or trusts. Prospective   
investors should consult with their tax advisors prior to making an investment  
in the certificates.                                                            

  SALES OF REMIC CERTIFICATES. If a REMIC Certificate is sold, the
selling Certificateholder will recognize gain or loss equal to the difference   
between the amount realized on the sale and its adjusted basis in the REMIC     
Certificate. The adjusted basis of a REMIC Regular Certificate generally will   
equal the cost of the REMIC Regular Certificate to the certificateholder,       
increased by income reported by the certificateholder with respect to the REMIC 
Regular Certificate (including original issue discount and market discount      
income) and reduced (but not below zero) by distributions on the REMIC Regular  
Certificate received by the certificateholder and by any amortized premium. The 
adjusted basis of a REMIC Residual Certificate will be determined as described  
under "--Taxation of Owners of REMIC Residual Certificates--Basis Rules, Net    
Losses and Distributions." Except as provided in the following four paragraphs, 
any such gain or loss will be capital gain or loss, provided the REMIC          
Certificate is held as a capital asset (generally, property held for investment)
within the meaning of Section 1221 of the Code.                                 

        Gain from the sale of a REMIC Regular Certificate that might otherwise
be capital gain will be treated as ordinary income to the extent the gain does  
not exceed the excess, if any, of (1) the amount that would have been includible
in the seller's income with respect to the REMIC Regular Certificate assuming   
that income had accrued thereon at a rate equal to 110% of the "applicable      
Federal rate" (generally, a rate based on an average of current yields on       
Treasury securities having a maturity comparable to that of the certificate     
based on the application of the Prepayment Assumption applicable to the         
certificate, which rate is computed and published monthly by the IRS),          
determined as of the date of purchase of the REMIC Regular Certificate, over (2)
the amount of ordinary income actually includible in the seller's income prior  
to the sale. In addition, gain recognized on the sale of a REMIC Regular        
Certificate by a seller who purchased the REMIC Regular Certificate at a market 
discount will be taxable as ordinary income in an amount not exceeding the      
portion of the discount that accrued during the period the REMIC Certificate was
held by the holder, reduced by any market discount included in income under the 
rules described above under "--Taxation of Owners of REMIC Regular              
Certificates--Market Discount" and "--Premium."                                 

   REMIC Certificates will be "evidences of indebtedness" within the
meaning of Section 582(c)(1) of the Code, so that gain or loss recognized from  
the sale of a REMIC Certificate by a bank or thrift institution to which this   
section applies will be ordinary income or loss.                                

         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 the 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 the same 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 the transaction. The amount of gain so 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 enters into the          
conversion transaction, subject to appropriate reduction for prior inclusion of 
interest and other ordinary income items from the transaction.                  

 Finally, a taxpayer may elect to have net capital gain taxed at
ordinary income rates rather than capital gains rates in order to include the   
net capital gain in total net investment income for the taxable year, for       
purposes of the rule that limits the deduction of interest on indebtedness      
incurred to purchase or carry property held for investment to a taxpayer's net  
investment income.                                                              

        Except as may be provided in Treasury regulations yet to be issued, if
the seller of a REMIC Residual Certificate reacquires the REMIC Residual        
Certificate, or acquires any other residual interest in a REMIC or any similar  
interest in a "taxable mortgage pool" (as defined in Section 7701(i) of the     
Code) during the period beginning six months before, and ending six months      
after, the date of the sale, such sale will be subject to the "wash sale" rules 
of Section 1091 of the Code. In that event, any loss realized by the REMIC      
Residual Certificateholder on the sale will not be deductible, but instead will 
be added to the REMIC Residual Certificateholder's adjusted basis in the        
newly-acquired asset.                                                           

   Losses on the sale of a REMIC Residual Certificate in excess of a
threshold amount (which amount could need to be aggregated with similar or      
previous losses) may require disclosure of such loss on an IRS Form 8886.       
Investors should consult with their tax advisors as to the need to file such    
form.                                                                           

        PROHIBITED TRANSACTIONS AND OTHER POSSIBLE REMIC TAXES. In the event a
REMIC engages in a prohibited transaction, the Code imposes a 100% tax on the   
income derived by the REMIC from the prohibited transaction. In general, subject
to specified exceptions, a prohibited transaction means the disposition of a    
mortgage loan, the receipt of income from a source other than a mortgage loan or
other permitted investments, the receipt of compensation for services, or gain  
from the disposition of an asset purchased with the payments on the mortgage    
loans for temporary investment pending distribution on the REMIC Certificates.  
It is not anticipated that any REMIC will engage in any prohibited transactions 
in which it would recognize a material amount of net income.                    

        In addition, a contribution to a REMIC made after the day on which the
REMIC issues all of its interests could result in the imposition on the REMIC of
a tax equal to 100% of the value of the contributed property. Each pooling and  
servicing agreement will include provisions designed to prevent the acceptance  
of any contributions that would be subject to this tax.                         

        REMICs also are subject to federal income tax at the highest corporate
rate on "net income from foreclosure property," determined by reference to the  
rules applicable to real estate investment trusts. "Net income from foreclosure 
property" generally means gain from the sale of a foreclosure property that is  
inventory property and gross income from foreclosure property other than        
qualifying rents and other qualifying income for a real estate investment trust.
It is not anticipated that any REMIC will recognize "net income from foreclosure
property" subject to federal income tax.                                        

         To the extent permitted by then applicable laws, any tax resulting from
a prohibited transaction, tax resulting from a contribution made after the      
Closing Date, tax on "net income from foreclosure property" or state or local   
income or franchise tax that may be imposed on the REMIC will be borne by the   
related master servicer or trustee in either case out of its own funds, provided
that the master servicer or the trustee, as the case may be, has sufficient     
assets to do so, and provided further that the tax arises out of a breach of the
master servicer's or the trustee's obligations, as the case may be, under the   
related pooling and servicing agreement and in respect of compliance with       
applicable laws and regulations. Any such tax not borne by the master servicer  
or the trustee will be charged against the related trust fund resulting in a    
reduction in amounts payable to holders of the related REMIC Certificates.      

     TAX AND RESTRICTIONS ON TRANSFERS OF REMIC RESIDUAL CERTIFICATES TO
CERTAIN ORGANIZATIONS. If a REMIC Residual Certificate is transferred to a      
"disqualified organization" (as defined below), a tax would be imposed in an    
amount (determined under the REMIC Regulations) equal to the product of (1) the 
present value (discounted using the "applicable Federal rate" for obligations   
whose term ends on the close of the last quarter in which excess inclusions are 
expected to accrue with respect to the REMIC Residual Certificate, which rate is
computed and published monthly by the IRS) of the total anticipated excess      
inclusions with respect to the REMIC Residual Certificate for periods after the 
transfer and (2) the highest marginal federal income tax rate applicable to     
corporations. The anticipated excess inclusions must be determined as of the    
date that the REMIC Residual Certificate is transferred and must be based on    
events that have occurred up to the time of the transfer, the Prepayment        
Assumption and any required or permitted clean up calls or required liquidation 
provided for in the REMIC's organizational documents. Such a tax generally would
be imposed on the transferor of the REMIC Residual Certificate, except that     
where the transfer is through an agent for a disqualified organization, the tax 
would instead be imposed on the agent. However, a transferor of a REMIC Residual
Certificate would in no event be liable for the tax with respect to a transfer  
if the transferee furnishes to the transferor an affidavit that the transferee  
is not a disqualified organization and, as of the time of the transfer, the     
transferor does not have actual knowledge that the affidavit is false. Moreover,
an entity will not qualify as a REMIC unless there are reasonable arrangements  
designed to ensure that (1) residual interests in the entity are not held by    
disqualified organizations and (2) information necessary for the application of 
the tax described herein will be made available. Restrictions on the transfer of
REMIC Residual Certificates and other provisions that are intended to meet this 
requirement will be included in the pooling and servicing agreement, and will be
discussed more fully in any prospectus supplement relating to the offering of   
any REMIC Residual Certificate.                                                 

        In addition, if a "pass-through entity" (as defined below) includes in
income excess inclusions with respect to a REMIC Residual Certificate, and a    
disqualified organization is the record holder of an interest in the entity,    
then a tax will be imposed on the entity equal to the product of (1) the amount 
of excess inclusions on the REMIC Residual Certificate that are allocable to the
interest in the pass-through entity held by the disqualified organization and   
(2) the highest marginal federal income tax rate imposed on corporations. A     
pass-through entity will not be subject to this tax for any period, however, if 
each record holder of an interest in the pass-through entity furnishes to the   
pass-through entity (1) the holder's social security number and a statement     
under penalties of perjury that the social security number is that of the       
recordholder or (2) a statement under penalties of perjury that the record      
holder is not a disqualified organization. For taxable years beginning after    
December 31,1997, notwithstanding the preceding two sentences, in the case of a 
REMIC Residual Certificate held by an "electing large partnership," all         
interests in the partnership shall be treated as held by disqualified           
organizations (without regard to whether the record holders of the partnership  
furnish statements described in the preceding sentence) and the amount that is  
subject to tax under the second preceding sentence is excluded from the gross   
income of the partnership allocated to the partners (in lieu of allocating to   
the partners a deduction for the tax paid by the partnership).                  

For these purposes, a "disqualified organization" means:      

         o        the United States, any State or political subdivision thereof,
                  any foreign government, any international organization, or any
             agency or instrumentality of the foregoing (but would not
                  include instrumentalities described in Section 168(h)(2)(D) of
the Code or Freddie Mac),                   

  o        any organization (other than a cooperative described in
               Section 521 of the Code) that is exempt from federal income
                  tax, unless it is subject to the tax imposed by Section 511 of
the Code, or                                

     o        any organization described in Section 1381(a)(2)(C) of the
Code.                                       

For these purposes, a "pass-through entity" means any regulated investment      
company, real estate investment trust, trust, partnership or certain other      
entities described in Section 860E(e)(6) of the Code. In addition, a person     
holding an interest in a pass-through entity as a nominee for another person    
will, with respect to the interest, be treated as a pass-through entity.        

        TERMINATION. A REMIC will terminate immediately after the distribution
date following receipt by the REMIC of the final payment in respect of the      
mortgage loans or upon a sale of the REMIC's assets following the adoption by   
the REMIC of a plan of complete liquidation. The last distribution on a REMIC   
Regular Certificate will be treated as a payment in retirement of a debt        
instrument. In the case of a REMIC Residual Certificate, if the last            
distribution on the REMIC Residual Certificate is less than the REMIC Residual  
Certificateholder's adjusted basis in the certificate, the REMIC Residual       
Certificateholder should (but may not) be treated as realizing a loss equal to  
the amount of the difference, and the loss may be treated as a capital loss.    

        REPORTING AND OTHER ADMINISTRATIVE MATTERS. Solely for purposes of the
administrative provisions of the Code, the REMIC will be treated as a           
partnership and REMIC Residual Certificateholders will be treated as partners.  
The REMIC Administrator (or other party described in the related prospectus     
supplement) will file REMIC federal income tax returns on behalf of the related 
REMIC, and under the terms of the related Agreement will either (1) be          
irrevocably appointed by the holders of the largest percentage interest in the  
related REMIC Residual Certificates as their agent to perform all of the duties 
of the "tax matters person" with respect to the REMIC in all respects or (2)    
will be designated as and will act as the "tax matters person" with respect to  
the related REMIC in all respects and will hold at least a nominal amount of    
REMIC Residual Certificates.                                                    

        The REMIC Administrator, as the tax matters person or as agent for the
tax matters person, subject to notice requirements and various restrictions and 
limitations, generally will have the authority to act on behalf of the REMIC and
the REMIC Residual Certificateholders in connection with the administrative and 
judicial review of items of income, deduction, gain or loss of the REMIC, as    
well as the REMIC's classification. REMIC Residual Certificateholders generally 
will be required to report these REMIC items consistently with their treatment  
on the REMIC's tax return and may in some circumstances be bound by a settlement
agreement between the REMIC Administrator, as either tax matters person or as   
agent for the tax matters person, and the IRS concerning any such REMIC item.   
Adjustments made to the REMIC tax return may require a REMIC Residual           
Certificateholder to make corresponding adjustments on its return, and an audit 
of the REMIC's tax return, or the adjustments resulting from such an audit,     
could result in an audit of a REMIC Residual Certificateholder's return. Any    
person that holds a REMIC 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 the person and other information.     

      Reporting of interest income, including any original issue discount,
with respect to REMIC Regular Certificates is required annually, and may be     
required more frequently under Treasury regulations. These information reports  
generally are required to be sent to individual holders of REMIC Regular        
Interests and the IRS; holders of REMIC Regular Certificates that are           
corporations, trusts, securities dealers and some other non-individuals will be 
provided interest and original issue discount income information and the        
information set forth in the following paragraph upon request in accordance with
the requirements of the applicable regulations. The information must be provided
by the later of 30 days after the end of the quarter for which the information  
was requested, or two weeks after the receipt of the request. The REMIC must    
also comply with rules requiring a REMIC Regular Certificate issued with        
original issue discount to disclose the information to the IRS. Reporting with  
respect to the REMIC Residual Certificates, including income, excess inclusions,
investment expenses and relevant information regarding qualification of the     
REMIC's assets will be made as required under the Treasury regulations,         
generally on a quarterly basis.                                                 

       As applicable, the REMIC Regular Certificate information reports will
include a statement of the adjusted issue price of the REMIC Regular Certificate
at the beginning of each accrual period. In addition, the reports will include  
information required by regulations with respect to computing the accrual of any
market discount. Because exact computation of the accrual of market discount on 
a constant yield method would require information relating to the holder's      
purchase price that the REMIC may not have, Treasury regulations only require   
that information pertaining to the appropriate proportionate method of accruing 
market discount be provided. See "--Taxation of Owners of REMIC Regular         
Certificates--Market Discount."                                                 

     The responsibility for complying with the foregoing reporting rules
will be borne by the REMIC Administrator or other party designated in the       
related prospectus supplement.                                                  

    BACKUP WITHHOLDING WITH RESPECT TO REMIC CERTIFICATES. Payments of
interest and principal, as well as payments of proceeds from the sale of REMIC  
Certificates, may be subject to the "backup withholding tax" under Section 3406 
of the Code if recipients of the payments fail to furnish to the payor certain  
information, including their taxpayer identification numbers, or otherwise fail 
to establish an exemption from the backup withholding tax. Any amounts deducted 
and withheld from a distribution to a recipient would be allowed as a credit    
against the recipient's federal income tax. Furthermore, penalties may be       
imposed by the IRS on a recipient of payments that is required to supply        
information but that does not do so in the proper manner.                       

FOREIGN INVESTORS IN REMIC CERTIFICATES. A REMIC Regular      
Certificateholder that is not a United States Person and is not subject to      
federal income tax as a result of any direct or indirect connection to the      
United States in addition to its ownership of a REMIC Regular Certificate will  
not be subject to United States federal income or withholding tax in respect of 
a distribution on a REMIC Regular Certificate, provided that the holder complies
to the extent necessary with identification requirements, including delivery of 
a statement, signed by the certificateholder under penalties of perjury,        
certifying that the certificateholder is not a United States person and         
providing the name and address of the certificateholder. This statement is      
generally made on IRS Form W-8BEN and must be updated whenever required         
information has changed or within 3 calendar years after the statement is first 
delivered. It is possible that the IRS may assert that the foregoing tax        
exemption should not apply with respect to a REMIC Regular Certificate held by a
REMIC Residual Certificateholder that owns directly or indirectly a 10% or      
greater interest in the REMIC Residual Certificates. If the holder does not     
qualify for exemption, distributions of interest, including distributions in    
respect of accrued original issue discount, to the holder may be subject to a   
tax rate of 30%, subject to reduction under any applicable tax treaty.          

         Special rules apply to partnerships, estates and trusts, and in certain
circumstances certifications as to foreign status and other matters may be      
required to be provided by partners and beneficiaries thereof.                  

    In addition, in certain circumstances the foregoing rules will not
apply to exempt a United States shareholder of a controlled foreign corporation 
from taxation on the United States shareholder's allocable portion of the       
interest income received by the controlled foreign corporation.                 

   Further, it appears that a REMIC Regular Certificate would not be
included in the estate of a non- resident alien individual and would not be     
subject to United States estate taxes. However, certificateholders who are      
non-resident alien individuals should consult their tax advisors concerning this
question.                                                                       

     Except as stated in the related prospectus supplement, transfers of
REMIC Residual Certificates to investors that are not United States persons will
be prohibited under the related pooling and servicing agreement.                

NOTES                                                                           

   On or prior to the date of the related prospectus supplement with
respect to the proposed issuance of each series of notes, Thacher Proffitt &    
Wood LLP, counsel to the company, will deliver its opinion to the effect that,  
assuming compliance with all provisions of the indenture, owner trust agreement 
and other related documents, for federal income tax purposes (1) the notes will 
be treated as indebtedness and (2) the Issuer, as created pursuant to the terms 
and conditions of the owner trust agreement, will not be characterized as an    
association (or publicly traded partnership) taxable as a corporation or as a   
taxable mortgage pool. For purposes of this tax discussion, references to a     
"noteholder" or a "holder" are to the beneficial owner of a note.               

STATUS AS REAL PROPERTY LOANS                                 

      (1)      Notes held by a domestic building and loan association will
not constitute "loans . . . secured by an interest in real property" within the 
meaning of Code section 7701(a)(19)(C)(v); and (2) notes held by a real estate  
investment trust will not constitute "real estate assets" within the meaning of 
Code section 856(c)(4)(A) and interest on notes will not be considered "interest
on obligations secured by mortgages on real property" within the meaning of Code
section 856(c)(3)(B).                                                           

TAXATION OF NOTEHOLDERS                                       

        Notes generally will be subject to the same rules of taxation as REMIC
Regular Certificates issued by a REMIC, as described above, except that (1)     
income reportable on the notes is not required to be reported under the accrual 
method unless the holder otherwise uses the accrual method and (2) the special  
rule treating a portion of the gain on sale or exchange of a REMIC Regular      
Certificate as ordinary income is inapplicable to the notes. See                
"--REMICs--Taxation of Owners of REMIC Regular Certificates" and "--Sales of    
REMIC Certificates."                                                            

GRANTOR TRUST FUNDS                                                             

       CLASSIFICATION OF GRANTOR TRUST FUNDS. On or prior to the date of the
related prospectus supplement with respect to the proposed issuance of each     
series of Grantor Trust Certificates, Thacher Proffitt & Wood LLP, counsel to   
the company, will deliver its opinion generally to the effect that, assuming    
compliance with all provisions of the related pooling and servicing agreement,  
the related Grantor Trust Fund will be classified as a grantor trust under      
subpart E, part I of subchapter J of Chapter 1 of the Code and not as a         
partnership or an association taxable as a corporation.                         

CHARACTERIZATION OF INVESTMENTS IN GRANTOR TRUST CERTIFICATES.

        GRANTOR TRUST FRACTIONAL INTEREST CERTIFICATES. In the case of Grantor
Trust Fractional Interest Certificates, except as disclosed in the related      
prospectus supplement, counsel to the company will deliver an opinion that, in  
general, Grantor Trust Fractional Interest Certificates will represent interests
in (1) "loans . . . secured by an interest in real property" within the meaning 
of Section 7701(a)(19)(C)(v) of the Code; (2) "obligation[s] (including any     
participation or Certificate of beneficial ownership therein) which [are]       
principally secured by an interest in real property" within the meaning of      
Section 860G(a)(3) of the Code; and (3) "real estate assets" within the meaning 
of Section 856(c)(4)(A) of the Code. In addition, counsel to the company will   
deliver an opinion that interest on Grantor Trust Fractional Interest           
Certificates will to the same extent be considered "interest on obligations     
secured by mortgages on real property or on interests in real property" within  
the meaning of Section 856(c)(3)(B) of the Code.                                

GRANTOR TRUST STRIP CERTIFICATES. Even if Grantor Trust Strip 
Certificates evidence an interest in a Grantor Trust Fund consisting of mortgage
loans that are "loans . . . secured by an interest in real property" within the 
meaning of Section 7701(a)(19)(C)(v) of the Code, and "real estate assets"      
within the meaning of Section 856(c)(4)(A) of the Code, and the interest on     
which is "interest on obligations secured by mortgages on real property" within 
the meaning of Section 856(c)(3)(B) of the Code, it is unclear whether the      
Grantor Trust Strip Certificates, and the income therefrom, will be so          
characterized. However, the policies underlying these sections (namely, to      
encourage or require investments in mortgage loans by thrift institutions and   
real estate investment trusts) may suggest that this characterization is        
appropriate. Counsel to the company will not deliver any opinion on these       
questions. Prospective purchasers to which the characterization of an investment
in Grantor Trust Strip Certificates is material should consult their tax        
advisors regarding whether the Grantor Trust Strip Certificates, and the income 
therefrom, will be so characterized.                                            

        The Grantor Trust Strip Certificates will be "obligation[s] (including
any participation or Certificate of beneficial ownership therein) which . . .   
[are] principally secured by an interest in real property" within the meaning   
of Section 860G(a)(3)(A) of the Code.                                           

       TAXATION OF OWNERS OF GRANTOR TRUST FRACTIONAL INTEREST CERTIFICATES.
Holders of a particular series of Grantor Trust Fractional Interest Certificates
generally will be required to report on their federal income tax returns their  
shares of the entire income from the mortgage loans (including amounts used to  
pay reasonable servicing fees and other expenses) and will be entitled to deduct
their shares of any such reasonable servicing fees and other expenses. Because  
of stripped interests, market or original issue discount, or premium, the amount
includible in income on account of a Grantor Trust Fractional Interest          
Certificate may differ significantly from the amount distributable thereon      
representing interest on the mortgage loans. Under Section 67 of the Code, an   
individual, estate or trust holding a Grantor Trust Fractional Interest         
Certificate directly or through some pass-through entities will be allowed a    
deduction for the reasonable servicing fees and expenses only to the extent that
the aggregate of the holder's miscellaneous itemized deductions exceeds two     
percent of the holder's adjusted gross income. In addition, Section 68 of the   
Code provides that the amount of itemized deductions otherwise allowable for an 
individual whose adjusted gross income exceeds a specified amount will be       
reduced by the lesser of (1) 3% of the excess of the individual's adjusted gross
income over the amount or (2) 80% of the amount of itemized deductions otherwise
allowable for the taxable year. The amount of additional taxable income         
reportable by holders of Grantor Trust Fractional Interest Certificates who are 
subject to the limitations of either Section 67 or Section 68 of the Code may be
substantial. Further, certificateholders (other than corporations) subject to   
the alternative minimum tax may not deduct miscellaneous itemized deductions in 
determining the holder's alternative minimum taxable income. Although it is not 
entirely clear, it appears that in transactions in which multiple classes of    
Grantor Trust Certificates (including Grantor Trust Strip Certificates) are     
issued, the fees and expenses should be allocated among the classes of Grantor  
Trust Certificates using a method that recognizes that each such class benefits 
from the related services. In the absence of statutory or administrative        
clarification as to the method to be used, it currently is intended to base     
information returns or reports to the IRS and certificateholders on a method    
that allocates the expenses among classes of Grantor Trust Certificates with    
respect to each period based on the distributions made to each such class during
that period.                                                                    

       The federal income tax treatment of Grantor Trust Fractional Interest
Certificates of any series will depend on whether they are subject to the       
"stripped bond" rules of Section 1286 of the Code. Grantor Trust Fractional     
Interest Certificates may be subject to those rules if (1) a class of Grantor   
Trust Strip Certificates is issued as part of the same series of certificates or
(2) the company or any of its affiliates retains (for its own account or for    
purposes of resale) a right to receive a specified portion of the interest      
payable on the mortgage loans. Further, the IRS has ruled that an unreasonably  
high servicing fee retained by a seller or servicer will be treated as a        
retained ownership interest in mortgages that constitutes a stripped coupon. For
purposes of determining what constitutes reasonable servicing fees for various  
types of mortgages the IRS has established "safe harbors." The servicing fees   
paid with respect to the mortgage loans for a series of Grantor Trust           
Certificates may be higher than the "safe harbors" and, accordingly, may not    
constitute reasonable servicing compensation. The related prospectus supplement 
will include information regarding servicing fees paid to the master servicer,  
any subservicer or their respective affiliates necessary to determine whether   
the preceding "safe harbor" rules apply.                                        

      IF STRIPPED BOND RULES APPLY. If the stripped bond rules apply, each
Grantor Trust Fractional Interest Certificate will be treated as having been    
issued with "original issue discount" within the meaning of Section 1273(a) of  
the Code, subject, however, to the discussion below regarding the treatment of  
some stripped bonds as market discount bonds and the discussion regarding de    
minimis market discount. See "--Taxation of Owners of Grantor Trust Fractional  
Interest Certificates--Market Discount" below. Under the stripped bond rules,   
the holder of a Grantor Trust Fractional Interest Certificate (whether a cash or
accrual method taxpayer) will be required to report interest income from its    
Grantor Trust Fractional Interest Certificate for each month in an amount equal 
to the income that accrues on the certificate in that month calculated under a  
constant yield method, in accordance with the rules of the Code relating to     
original issue discount.                                                        

    The original issue discount on a Grantor Trust Fractional Interest
Certificate will be the excess of the certificate's stated redemption price over
its issue price. The issue price of a Grantor Trust Fractional Interest         
Certificate as to any purchaser will be equal to the price paid by the purchaser
for the Grantor Trust Fractional Interest Certificate. The stated redemption    
price of a Grantor Trust Fractional Interest Certificate will be the sum of all 
payments to be made on the certificate, other than "qualified stated interest," 
if any, as well as the certificate's share of reasonable servicing fees and     
other expenses. See "--Taxation of Owners of Grantor Trust Fractional Interest  
Certificates--If Stripped Bond Rules Do Not Apply" for a definition of          
"qualified stated interest." In general, the amount of the income that accrues  
in any month would equal the product of the holder's adjusted basis in the      
Grantor Trust Fractional Interest Certificate at the beginning of the month (see
"Sales of Grantor Trust Certificates") and the yield of the Grantor Trust       
Fractional Interest Certificate to the holder. This yield would be computed at  
the rate (compounded based on the regular interval between distribution dates)  
that, if used to discount the holder's share of future payments on the mortgage 
loans, would cause the present value of those future payments to equal the price
at which the holder purchased the certificate. In computing yield under the     
stripped bond rules, a certificateholder's share of future payments on the      
mortgage loans will not include any payments made in respect of any ownership   
interest in the mortgage loans retained by the company, the master servicer, any
subservicer or their respective affiliates, but will include the                
certificateholder's share of any reasonable servicing fees and other expenses.  

  To the extent the Grantor Trust Fractional Interest Certificates
represent an interest in any pool of debt instruments the yield on which may be 
affected by reason of prepayments, for taxable years beginning after August 5,  
1997, Section 1272(a)(6) of the Code requires (1) the use of a reasonable       
prepayment assumption in accruing original issue discount and (2) adjustments in
the accrual of original issue discount when prepayments do not conform to the   
prepayment assumption. It is unclear whether those provisions would be          
applicable to the Grantor Trust Fractional Interest Certificates that do not    
represent an interest in any pool of debt instruments the yield on which may be 
affected by reason of prepayments, or for taxable years beginning prior to      
August 5, 1997 or whether use of a reasonable prepayment assumption may be      
required or permitted without reliance on these rules. It is also uncertain, if 
a prepayment assumption is used, whether the assumed prepayment rate would be   
determined based on conditions at the time of the first sale of the Grantor     
Trust Fractional Interest Certificate or, with respect to any holder, at the    
time of purchase of the Grantor Trust Fractional Interest Certificate by that   
holder. Certificateholders are advised to consult their own tax advisors        
concerning reporting original issue discount with respect to Grantor Trust      
Fractional Interest Certificates and, in particular, whether a prepayment       
assumption should be used in reporting original issue discount.                 

         In the case of a Grantor Trust Fractional Interest Certificate acquired
at a price equal to the principal amount of the mortgage loans allocable to the 
certificate, the use of a prepayment assumption generally would not have any    
significant effect on the yield used in calculating accruals of interest income.
In the case, however, of a Grantor Trust Fractional Interest Certificate        
acquired at a discount or premium (that is, at a price less than or greater than
the principal amount, respectively), the use of a reasonable prepayment         
assumption would increase or decrease the yield, and thus accelerate or         
decelerate, respectively, the reporting of income.                              

   If a prepayment assumption is not used, then when a mortgage loan
prepays in full, the holder of a Grantor Trust Fractional Interest Certificate  
acquired at a discount or a premium generally will recognize ordinary income or 
loss equal to the difference between the portion of the prepaid principal amount
of the mortgage loan that is allocable to the certificate and the portion of the
adjusted basis of the certificate that is allocable to the certificateholder's  
interest in the mortgage loan. If a prepayment assumption is used, it appears   
that no separate item of income or loss should be recognized upon a prepayment. 
Instead, a prepayment should be treated as a partial payment of the stated      
redemption price of the Grantor Trust Fractional Interest Certificate and       
accounted for under a method similar to that described for taking account of    
original issue discount on REMIC Regular Certificates. See "--REMICs--Taxation  
of Owners of REMIC Regular Certificates--Original Issue Discount." It is unclear
whether any other adjustments would be required to reflect differences between  
an assumed prepayment rate and the actual rate of prepayments.                  

        It is currently intended to base information reports or returns to the
IRS and certificateholders in transactions subject to the stripped bond rules on
a Prepayment Assumption that will be disclosed in the related prospectus        
supplement and on a constant yield computed using a representative initial      
offering price for each class of certificates. However, none of the company, the
master servicer or the trustee will make any representation that the mortgage   
loans will in fact prepay at a rate conforming to the Prepayment Assumption or  
any other rate and certificateholders should bear in mind that the use of a     
representative initial offering price will mean that the information returns or 
reports, even if otherwise accepted as accurate by the IRS, will in any event be
accurate only as to the initial certificateholders of each series who bought at 
that price.                                                                     

        Under Treasury regulation Section 1.1286-1, some stripped bonds are to
be treated as market discount bonds and, accordingly, any purchaser of such a   
bond is to account for any discount on the bond as market discount rather than  
original issue discount. This treatment only applies, however, if immediately   
after the most recent disposition of the bond by a person stripping one or more 
coupons from the bond and disposing of the bond or coupon (1) there is no       
original issue discount (or only a de minimis amount of original issue discount)
or (2) the annual stated rate of interest payable on the original bond is no    
more than one percentage point lower than the gross interest rate payable on the
original mortgage loan (before subtracting any servicing fee or any stripped    
coupon). If interest payable on a Grantor Trust Fractional Interest Certificate 
is more than one percentage point lower than the gross interest rate payable on 
the mortgage loans, the related prospectus supplement will disclose that fact.  
If the original issue discount or market discount on a Grantor Trust Fractional 
Interest Certificate determined under the stripped bond rules is less than 0.25%
of the stated redemption price multiplied by the weighted average maturity of   
the mortgage loans, then that original issue discount or market discount will be
considered to be de minimis. Original issue discount or market discount of only 
a de minimis amount will be included in income in the same manner as de minimis 
original issue and market discount described in "Characteristics of Investments 
in Grantor Trust Certificates--If Stripped Bond Rules Do Not Apply" and         
"--Market Discount" below.                                                      

         IF STRIPPED BOND RULES DO NOT APPLY. Subject to the discussion below on
original issue discount, if the stripped bond rules do not apply to a Grantor   
Trust Fractional Interest Certificate, the certificateholder will be required to
report its share of the interest income on the mortgage loans in accordance with
the certificateholder's normal method of accounting. The original issue discount
rules will apply to a Grantor Trust Fractional Interest Certificate to the      
extent it evidences an interest in mortgage loans issued with original issue    
discount.                                                                       

       The original issue discount, if any, on the mortgage loans will equal
the difference between the stated redemption price of the mortgage loans and    
their issue price. Under the OID Regulations, the stated redemption price is    
equal to the total of all payments to be made on the mortgage loan other than   
"qualified stated interest." "Qualified stated interest" is interest that is    
unconditionally payable at least annually at a single fixed rate, or at a       
"qualified floating rate," an "objective rate," a combination of a single fixed 
rate and one or more "qualified floating rates" or one "qualified inverse       
floating rate," or a combination of "qualified floating rates" that does not    
operate in a manner that accelerates or defers interest payments on the mortgage
loan. In general, the issue price of a mortgage loan will be the amount received
by the borrower from the lender under the terms of the mortgage loan, less any  
"points" paid by the borrower, and the stated redemption price of a mortgage    
loan will equal its principal amount, unless the mortgage loan provides for an  
initial below-market rate of interest or the acceleration or the deferral of    
interest payments. The determination as to whether original issue discount will 
be considered to be de minimis will be calculated using the same test described 
in the REMIC discussion. See "--Taxation of Owners of REMIC Regular             
Certificates--Original Issue Discount" above.                                   

       In the case of mortgage loans bearing adjustable or variable interest
rates, the related prospectus supplement will describe the manner in which the  
rules will be applied with respect to those mortgage loans by the master        
servicer or the trustee in preparing information returns to the                 
certificateholders and the IRS.                                                 

     If original issue discount is in excess of a de minimis amount, all
original issue discount with respect to a mortgage loan will be required to be  
accrued and reported in income each month, based on a constant yield.           
Section1272(a)(6) of the Code requires that a prepayment assumption be made in  
computing yield with respect to any pool of debt instruments the yield on which 
may be affected by reason of prepayments. Accordingly, for certificates backed  
by these pools, it is intended to base information reports and returns to the   
IRS and certificateholders on the use of a prepayment assumption.               
Certificateholders are advised to consult their own tax advisors concerning     
whether a prepayment assumption should be used in reporting original issue      
discount with respect to Grantor Trust Fractional Interest Certificates.        
Certificateholders should refer to the related prospectus supplement with       
respect to each series to determine whether and in what manner the original     
issue discount rules will apply to mortgage loans in the series.                

     A purchaser of a Grantor Trust Fractional Interest Certificate that
purchases the Grantor Trust Fractional Interest Certificate at a cost less than 
the certificate's allocable portion of the aggregate remaining stated redemption
price of the mortgage loans held in the related trust fund will also be required
to include in gross income the certificate's daily portions of any original     
issue discount with respect to the mortgage loans. However, each such daily     
portion will be reduced, if the cost of the Grantor Trust Fractional Interest   
Certificate to the purchaser is in excess of the certificate's allocable portion
of the aggregate "adjusted issue prices" of the mortgage loans held in the      
related trust fund, approximately in proportion to the ratio the excess bears to
the certificate's allocable portion of the aggregate original issue discount    
remaining to be accrued on the mortgage loans. The adjusted issue price of a    
mortgage loan on any given day equals the sum of (1) the adjusted issue price   
(or, in the case of the first accrual period, the issue price) of the mortgage  
loan at the beginning of the accrual period that includes the day and (2) the   
daily portions of original issue discount for all days during the accrual period
prior to the day. The adjusted issue price of a mortgage loan at the beginning  
of any accrual period will equal the issue price of the mortgage loan, increased
by the aggregate amount of original issue discount with respect to the mortgage 
loan that accrued in prior accrual periods, and reduced by the amount of any    
payments made on the mortgage loan in prior accrual periods of amounts included 
in its stated redemption price.                                                 

         In addition to its regular reports, the master servicer or the trustee,
except as provided in the related prospectus supplement, will provide to any    
holder of a Grantor Trust Fractional Interest Certificate such information as   
the holder may reasonably request from time to time with respect to original    
issue discount accruing on Grantor Trust Fractional Interest Certificates. See  
"Grantor Trust Reporting" below.                                                

         MARKET DISCOUNT. If the stripped bond rules do not apply to the Grantor
Trust Fractional Interest Certificate, a certificateholder may be subject to the
market discount rules of Sections 1276 through 1278 of the Code to the extent an
interest in a mortgage loan is considered to have been purchased at a "market   
discount," that is, in the case of a mortgage loan issued without original issue
discount, at a purchase price less than its remaining stated redemption price   
(as defined above), or in the case of a mortgage loan issued with original issue
discount, at a purchase price less than its adjusted issue price (as defined    
above). If market discount is in excess of a de minimis amount (as described    
below), the holder generally will be required to include in income in each month
the amount of the discount that has accrued (under the rules described in the   
next paragraph) through the month that has not previously been included in      
income, but limited, in the case of the portion of the discount that is         
allocable to any mortgage loan, to the payment of stated redemption price on the
mortgage loan that is received by (or, in the case of accrual basis             
certificateholders, due to) the trust fund in that month. A certificateholder   
may elect to include market discount in income currently as it accrues (under a 
constant yield method based on the yield of the certificate to the holder)      
rather than including it on a deferred basis in accordance with the foregoing   
under rules similar to those described in "--Taxation of Owners of REMIC Regular
Certificates--Market Discount" above.                                           

      Section 1276(b)(3) of the Code authorized the Treasury Department to
issue regulations providing for the method for accruing market discount on debt 
instruments, the principal of which is payable in more than one installment.    
Until such time as regulations are issued by the Treasury Department, some rules
described in the Committee Report will apply. Under those rules, in each accrual
period market discount on the mortgage loans should accrue, at the              
certificateholder's option: (1) on the basis of a constant yield method, (2) in 
the case of a mortgage loan issued without original issue discount, in an amount
that bears the same ratio to the total remaining market discount as the stated  
interest paid in the accrual period bears to the total stated interest remaining
to be paid on the mortgage loan as of the beginning of the accrual period, or   
(3) in the case of a mortgage loan issued with original issue discount, in an   
amount that bears the same ratio to the total remaining market discount as the  
original issue discount accrued in the accrual period bears to the total        
original issue discount remaining at the beginning of the accrual period. The   
prepayment assumption, if any, used in calculating the accrual of original issue
discount is to be used in calculating the accrual of market discount. The effect
of using a prepayment assumption could be to accelerate the reporting of the    
discount income.                                                                

         Because the mortgage loans will provide for periodic payments of stated
redemption price, the market discount may be required to be included in income  
at a rate that is not significantly slower than the rate at which the discount  
would be included in income if it were original issue discount.                 

        Market discount with respect to mortgage loans may be considered to be
de minimis and, if so, will be includible in income under de minimis rules      
similar to those described above in "--REMICs--Taxation of Owners of REMIC      
Regular Certificates--Original Issue Discount" with the exception that it is    
less likely that a prepayment assumption will be used for purposes of these     
rules with respect to the mortgage loans.                                       

        Further, under the rules described in "--REMICs--Taxation of Owners of
REMIC Regular Certificates--Market Discount," above, any discount that is not   
original issue discount and exceeds a de minimis amount may require the deferral
of interest expense deductions attributable to accrued market discount not yet  
includible in income, unless an election has been made to report market discount
currently as it accrues. This rule applies without regard to the origination    
dates of the mortgage loans.                                                    

        PREMIUM. If a certificateholder is treated as acquiring the underlying
mortgage loans at a premium, that is, at a price in excess of their remaining   
stated redemption price, the certificateholder may elect under Section 171 of   
the Code to amortize using a constant yield method the portion of the premium   
allocable to mortgage loans originated after September 27, 1985. Amortizable    
premium is treated as an offset to interest income on the related debt          
instrument, rather than as a separate interest deduction. However, premium      
allocable to mortgage loans originated before September 28, 1985 or to mortgage 
loans for which an amortization election is not made, should be allocated among 
the payments of stated redemption price on the mortgage loan and be allowed as a
deduction as these payments are made (or, for a certificateholder using the     
accrual method of accounting, when the payments of stated redemption price are  
due).                                                                           

 It is unclear whether a prepayment assumption should be used in
computing amortization of premium allowable under Section 171 of the Code. If   
premium is not subject to amortization using a prepayment assumption and a      
mortgage loan prepays in full, the holder of a Grantor Trust Fractional Interest
Certificate acquired at a premium should recognize a loss, equal to the         
difference between the portion of the prepaid principal amount of the mortgage  
loan that is allocable to the certificate and the portion of the adjusted basis 
of the certificate that is allocable to the mortgage loan. If a prepayment      
assumption is used to amortize premium, it appears that such a loss would be    
unavailable. Instead, if a prepayment assumption is used, a prepayment should be
treated as a partial payment of the stated redemption price of the Grantor Trust
Fractional Interest Certificate and accounted for under a method similar to that
described for taking account of original issue discount on REMIC Regular        
Certificates. See "REMICs--Taxation of Owners of REMIC Regular                  
Certificates--Original Issue Discount." It is unclear whether any other         
adjustments would be required to reflect differences between the prepayment     
assumption used, and the actual rate of prepayments.                            

       TAXATION OF OWNERS OF GRANTOR TRUST STRIP CERTIFICATES. The "stripped
coupon" rules of Section 1286 of the Code will apply to the Grantor Trust Strip 
Certificates. Except as described above in "Characterization of Investments in  
Grantor Trust Certificates--If Stripped Bond Rules Apply," no regulations or    
published rulings under Section 1286 of the Code have been issued and some      
uncertainty exists as to how it will be applied to securities such as the       
Grantor Trust Strip Certificates. Accordingly, holders of Grantor Trust Strip   
Certificates should consult their own tax advisors concerning the method to be  
used in reporting income or loss with respect to the certificates.              

       The OID Regulations do not apply to "stripped coupons," although they
provide general guidance as to how the original issue discount sections of the  
Code will be applied. In addition, the discussion below is subject to the       
discussion under "--Possible Application of Contingent Payment Rules" and       
assumes that the holder of a Grantor Trust Strip Certificate will not own any   
Grantor Trust Fractional Interest Certificates.                                 

 Under the stripped coupon rules, it appears that original issue
discount will be required to be accrued in each month on the Grantor Trust Strip
Certificates based on a constant yield method. In effect, each holder of Grantor
Trust Strip Certificates would include as interest income in each month an      
amount equal to the product of the holder's adjusted basis in the Grantor Trust 
Strip Certificate at the beginning of that month and the yield of the Grantor   
Trust Strip Certificate to the holder. The yield would be calculated based on   
the price paid for that Grantor Trust Strip Certificate by its holder and the   
payments remaining to be made thereon at the time of the purchase, plus an      
allocable portion of the servicing fees and expenses to be paid with respect to 
the mortgage loans. See "Characterization of Investments in Grantor Trust       
Certificates--If Stripped Bond Rules Apply" above.                              

As noted above, Section 1272(a)(6) of the Code requires that a
prepayment assumption be used in computing the accrual of original issue        
discount with respect to some categories of debt instruments, and that          
adjustments be made in the amount and rate of accrual of the discount when      
prepayments do not conform to the prepayment assumption. To the extent the      
Grantor Trust Strip Certificates represent an interest in any pool of debt      
instruments the yield on which may be affected by reason of prepayments, those  
provisions will apply to the Grantor Trust Strip Certificates for taxable years 
beginning after August 5, 1997. It is unclear whether those provisions would be 
applicable to the Grantor Trust Strip Certificates that do not represent an     
interest in any such pool or for taxable years beginning prior to August 5,     
1997, or whether use of a prepayment assumption may be required or permitted in 
the absence of these provisions. It is also uncertain, if a prepayment          
assumption is used, whether the assumed prepayment rate would be determined     
based on conditions at the time of the first sale of the Grantor Trust Strip    
Certificate or, with respect to any subsequent holder, at the time of purchase  
of the Grantor Trust Strip Certificate by that holder.                          

       The accrual of income on the Grantor Trust Strip Certificates will be
significantly slower if a prepayment assumption is permitted to be made than if 
yield is computed assuming no prepayments. It currently is intended to base     
information returns or reports to the IRS and certificateholders on the         
Prepayment Assumption disclosed in the related prospectus supplement and on a   
constant yield computed using a representative initial offering price for each  
class of certificates. However, none of the company, the master servicer or the 
trustee will make any representation that the mortgage loans will in fact prepay
at a rate conforming to the Prepayment Assumption or at any other rate and      
certificateholders should bear in mind that the use of a representative initial 
offering price will mean that the information returns or reports, even if       
otherwise accepted as accurate by the IRS, will in any event be accurate only as
to the initial certificateholders of each series who bought at that price.      
Prospective purchasers of the Grantor Trust Strip Certificates should consult   
their own tax advisors regarding the use of the Prepayment Assumption.          

     It is unclear under what circumstances, if any, the prepayment of a
mortgage loan will give rise to a loss to the holder of a Grantor Trust Strip   
Certificate. If a Grantor Trust Strip Certificate is treated as a single        
instrument (rather than an interest in discrete mortgage loans) and the effect  
of prepayments is taken into account in computing yield with respect to the     
Grantor Trust Strip Certificate, it appears that no loss may be available as a  
result of any particular prepayment, except possibly if prepayments occur at a  
rate faster than the Prepayment Assumption. However, if a Grantor Trust Strip   
Certificate is treated as an interest in discrete mortgage loans, or if the     
Prepayment Assumption is not used, then when a mortgage loan is prepaid, the    
holder of a Grantor Trust Strip Certificate should be able to recognize a loss  
equal to the portion of the adjusted issue price of the Grantor Trust Strip     
Certificate that is allocable to the mortgage loan.                             

        POSSIBLE APPLICATION OF CONTINGENT PAYMENT RULES. The coupon stripping
rules' general treatment of stripped coupons is to regard them as newly issued  
debt instruments in the hands of each purchaser. To the extent that payments on 
the Grantor Trust Strip Certificates would cease if the mortgage loans were     
prepaid in full, the Grantor Trust Strip Certificates could be considered to be 
debt instruments providing for contingent payments. Under the OID Regulations,  
debt instruments providing for contingent payments are not subject to the same  
rules as debt instruments providing for noncontingent payments. Regulations were
promulgated on June 14, 1996, regarding contingent payment debt instruments (the
"Contingent Payment Regulations"), but it appears that Grantor Trust Strip      
Certificates, to the extent subject to Section 1272(a)(6) of the Code, as       
described above, or due to their similarity to other mortgage-backed            
securities(such as REMIC regular interests and debt instruments subject to      
Section 1272(a)(6) of the Code) that are expressly excepted from the application
of the Contingent Payment Regulations, are or may be excepted from these        
regulations. Like the OID Regulations, the Contingent Payment Regulations do not
specifically address securities, such as the Grantor Trust Strip Certificates,  
that are subject to the stripped bond rules of Section 1286 of the Code.        

If the contingent payment rules under the Contingent Payment  
Regulations were to apply, the holder of a Grantor Trust Strip Certificate would
be required to apply the "noncontingent bond method." Under the "noncontingent  
bond method," the issuer of a Grantor Trust Strip Certificate determines a      
projected payment schedule on which interest will accrue. Holders of Grantor    
Trust Strip Certificates are bound by the issuer's projected payment schedule.  
The projected payment schedule consists of all noncontingent payments and a     
projected amount for each contingent payment based on the projected yield (as   
described below) of the Grantor Trust Strip Certificate. The projected amount of
each payment is determined so that the projected payment schedule reflects the  
projected yield. The projected amount of each payment must reasonably reflect   
the relative expected values of the payments to be received by the holder of a  
Grantor Trust Strip Certificate. The projected yield referred to above is a     
reasonable rate, not less than the "applicable Federal rate" that, as of the    
issue date, reflects general market conditions, the credit quality of the       
issuer, and the terms and conditions of the mortgage loans. The holder of a     
Grantor Trust Strip Certificate would be required to include as interest income 
in each month the adjusted issue price of the Grantor Trust Strip Certificate at
the beginning of the period multiplied by the projected yield, and would add to,
or subtract from, the income any variation between the payment actually received
in that month and the payment originally projected to be made in that month.    

    Assuming that a prepayment assumption were used, if the Contingent
Payment Regulations or their principles were applied to Grantor Trust Strip     
Certificates, the amount of income reported with respect thereto would be       
substantially similar to that described under "Taxation of Owners of Grantor    
Trust Strip Certificates". Certificateholders should consult their tax advisors 
concerning the possible application of the contingent payment rules to the      
Grantor Trust Strip Certificates.                                               

    SALES OF GRANTOR TRUST CERTIFICATES. Any gain or loss equal to the
difference between the amount realized on the sale or exchange of a Grantor     
Trust Certificate and its adjusted basis, recognized on the sale or exchange of 
a Grantor Trust Certificate by an investor who holds the Grantor Trust          
Certificate as a capital asset, will be capital gain or loss, except to the     
extent of accrued and unrecognized market discount, which will be treated as    
ordinary income, and (in the case of banks and other financial institutions)    
except as provided under Section 582(c) of the Code. The adjusted basis of a    
Grantor Trust Certificate generally will equal its cost, increased by any income
reported by the seller (including original issue discount and market discount   
income) and reduced (but not below zero) by any previously reported losses, any 
amortized premium and by any distributions with respect to the Grantor Trust    
Certificate.                                                                    

  Gain or loss from the sale of a Grantor Trust Certificate may be
partially or wholly ordinary and not capital in some circumstances. Gain        
attributable to accrued and unrecognized market discount will be treated as     
ordinary income, as will gain or loss recognized by banks and other financial   
institutions subject Section 582(c) of the Code. Furthermore, a portion of any  
gain that might otherwise be capital gain may be treated as ordinary income to  
the extent that the Grantor Trust 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 the same 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 the 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 enters   
into the conversion transaction, subject to appropriate reduction for prior     
inclusion of interest and other ordinary income items from the transaction.     
Finally, a taxpayer may elect to have net capital gain taxed at ordinary income 
rates rather than capital gains rates in order to include the net capital gain  
in total net investment income for that taxable year, for purposes of the rule  
that limits the deduction of interest on indebtedness incurred to purchase or   
carry property held for investment to a taxpayer's net investment income.       

  GRANTOR TRUST REPORTING. The master servicer or the trustee will
furnish to each holder of a Grantor Trust Fractional Interest Certificate with  
each distribution a statement setting forth the amount of the distribution      
allocable to principal on the underlying mortgage loans and to interest thereon 
at the related pass-through rate. In addition, the master servicer or the       
trustee will furnish, within a reasonable time after the end of each calendar   
year, to each holder of a Grantor Trust Certificate who was a holder at any time
during that year, information regarding the amount of servicing compensation    
received by the master servicer and subservicer (if any) and any other customary
factual information as the master servicer or the trustee deems necessary or    
desirable to enable holders of Grantor Trust Certificates to prepare their tax  
returns and will furnish comparable information to the IRS as and when required 
by law to do so. Because the rules for accruing discount and amortizing premium 
with respect to the Grantor Trust Certificates are uncertain in various         
respects, there is no assurance the IRS will agree with the trust fund's        
information reports of these items of income and expense. Moreover, these       
information reports, even if otherwise accepted as accurate by the IRS, will in 
any event be accurate only as to the initial certificateholders that bought     
their certificates at the representative initial offering price used in         
preparing the reports.                                                          

Except as disclosed in the related prospectus supplement, the 
responsibility for complying with the foregoing reporting rules will be borne by
the master servicer or the trustee.                                             

BACKUP WITHHOLDING. In general, the rules described in        
"--REMICS--Backup Withholding with Respect to REMIC Certificates" will also     
apply to Grantor Trust Certificates.                                            

     FOREIGN INVESTORS. In general, the discussion with respect to REMIC
Regular certificates in "REMICS--Foreign Investors in REMIC Certificates"       
applies to Grantor Trust Certificates except that Grantor Trust Certificates    
will, except as disclosed in the related prospectus supplement, be eligible for 
exemption from U.S. withholding tax, subject to the conditions described in the 
discussion, only to the extent the related mortgage loans were originated after 
July 18, 1984.                                                                  

     To the extent that interest on a Grantor Trust Certificate would be
exempt under Sections 871(h)(1) and 881(c) of the Code from United States       
withholding tax, and the Grantor Trust Certificate is not held in connection    
with a certificateholder's trade or business in the United States, the Grantor  
Trust Certificate will not be subject to United States estate taxes in the      
estate of a non-resident alien individual.                                      

STATE AND OTHER TAX CONSEQUENCES

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

ERISA CONSIDERATIONS

Sections 404 and 406 of ERISA impose fiduciary and prohibited 
transaction restrictions on ERISA Plans and on various other retirement plans   
and arrangements, including bank collective investment funds and insurance      
company general and separate accounts in which ERISA Plans are invested. Section
4975 of the Code imposes essentially the same prohibited transaction            
restrictions on Tax Favored Plans. ERISA and the Code prohibit a broad range of 
transactions involving assets of Plans and Parties in Interest, unless a        
statutory or administrative exemption is available with respect to any such     
transaction.                                                                    

       Some employee benefit plans, including governmental plans (as defined
in Section 3(32) of ERISA), 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 the ERISA requirements. Accordingly, assets of these plans may be       
invested in the securities without regard to the ERISA considerations described 
below, subject to the provisions of other applicable federal, state and local   
law. Any such plan which 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 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. Any person who has discretionary authority or control with  
respect to the management or disposition of a Plan's assets, or "Plan Assets,"  
and any person who provides investment advice with respect to Plan Assets for a 
fee is a fiduciary of the investing Plan. If the mortgage loans and other assets
included in the trust fund were to constitute Plan Assets, then any party       
exercising management or discretionary control with respect to those Plan Assets
may be deemed to be a Plan "fiduciary," and thus subject to the fiduciary       
responsibility provisions of ERISA and the prohibited transaction provisions of 
ERISA and Section 4975 of the Code with respect to any investing Plan. In       
addition, the acquisition or holding of securities by or on behalf of a Plan or 
with Plan Assets, as well as the operation of the trust fund, may constitute or 
involve a prohibited transaction under ERISA and the Code unless a statutory or 
administrative exemption is available. Further, ERISA and the Code prohibit a   
broad range of transactions involving Plan Assets and persons, having certain   
specified relationships to a Plan called Parties in Interest, unless a statutory
or administrative exemption is available. Some Parties in Interest that         
participate in a prohibited transaction may be subject to a penalty (or an      
excise tax) imposed under Section 502(i) of ERISA or Section 4975 of the Code,  
unless a statutory or administrative exemption is available with respect to any 
transaction of this sort.                                                       

Some transactions involving the trust fund might be deemed to 
constitute prohibited transactions under ERISA and the Code with respect to a   
Plan that purchases the securities, if the mortgage loans and other assets      
included in a trust fund are deemed to be assets of the Plan. The DOL has       
promulgated the DOL Regulations concerning whether or not a Plan's assets would 
be deemed to include an interest in the underlying assets of an entity,         
including a trust fund, for purposes of applying the general fiduciary          
responsibility provisions of ERISA and the prohibited transaction provisions of 
ERISA and the Code. Under the DOL Regulations, generally, when a Plan acquires  
an "equity interest" in another entity (such as the trust fund), the underlying 
assets of that entity may be considered to be Plan Assets unless an exception   
applies. Exceptions contained in the DOL Regulations provide that Plan Assets   
will not include an undivided interest in each asset of an entity in which the  
Plan makes an equity investment if: (1) the entity is an operating company; (2) 
the equity investment made by the Plan is either a "publicly-offered security"  
that is "widely held," both as defined in the DOL Regulations, or a security    
issued by an investment company registered under the Investment Company Act of  
1940, as amended; or (3) Benefit Plan Investors do not own 25% or more in value 
of any class of equity securities issued by the entity. In addition, the DOL    
Regulations provide that the term "equity interest" means any interest in an    
entity other than an instrument which is treated as indebtedness under          
applicable local law and which has no "substantial equity features." Under the  
DOL Regulations, Plan Assets will be deemed to include an interest in the       
instrument evidencing the equity interest of a Plan (such as a certificate or a 
note with "substantial equity features"), and, because of the factual nature of 
some of the rules set forth in the DOL Regulations, Plan Assets may be deemed to
include an interest in the underlying assets of the entity in which a Plan      
acquires an interest (such as the trust fund). Without regard to whether the    
notes or certificates are characterized as equity interests, the purchase, sale 
and holding of notes or certificates by or on behalf of a Plan could be         
considered to give rise to a prohibited transaction if the Issuer, the trustee  
or any of their respective affiliates is or becomes a Party in Interest with    
respect to the Plan. Neither Plans nor persons investing Plan Assets should     
acquire or hold securities solely in reliance upon the availability of any      
exception under the DOL Regulations.                                            

UNDERWRITER EXEMPTION                                                           

     The DOL has issued Exemptions to some underwriters, which generally
exempt from the application of the prohibited transaction provisions of Section 
406 of ERISA, and the excise taxes imposed on those prohibited transactions     
pursuant to Section 4975(a) and (b) of the Code, some transactions, among       
others, relating to the servicing and operation of mortgage pools and the       
initial purchase, holding and subsequent resale of mortgage pass-through        
certificates or other "securities" underwritten by an Underwriter, as defined   
below, provided that the conditions set forth in the Exemption are satisfied.   
For purposes of this section "ERISA Considerations", the term "Underwriter"     
includes (1) the underwriter, (2) any person directly or indirectly, through one
or more intermediaries, controlling, controlled by or under common control with 
the underwriter and (3) any member of the underwriting syndicate or selling     
group of which a person described in (1) or (2) is a manager or co-manager with 
respect to a class of securities.                                               

       GENERAL CONDITIONS OF EXEMPTION. The Exemption sets forth six general
conditions which must be satisfied for the Exemption to apply.                  

         First, the acquisition of securities by a Plan or with Plan Assets must
be on terms that are at least as favorable to the Plan as they would be in an   
arm's-length transaction with an unrelated party.                               

        Second, the Exemption applies only to securities evidencing rights and
interests that are not subordinated to the rights and interests evidenced by    
other securities of the same trust, unless none of the mortgage loans has a     
Current Loan-to-Value Ratio or Loan-to-Value Ratio at the date of issuance of   
the securities that exceeds 100%.                                               

         Third, the securities at the time of acquisition by a Plan or with Plan
Assets must be rated in one of the four highest generic rating categories by an 
Exemption Rating Agency. However, the securities must be rated in one of the two
highest generic categories by an Exemption Rating Agency if the Loan-to-Value   
Ratio of any one- to four-family residential mortgage loan or home equity loan  
held in the trust exceeds 100% but does not exceed 125% at the date of issuance 
of the securities, and in that case the Exemption will not apply: (1) to any of 
the securities if any mortgage loan or other asset held in the trust (other than
a one- to four-family residential mortgage loan or home equity loan) has a      
Loan-to-Value Ratio that exceeds 100% at the Closing Date or (2) to any         
subordinate securities.                                                         

 Fourth, the trustee cannot be an affiliate of any member of the
"Restricted Group" other than the Underwriter. The Restricted Group consists of 
any Underwriter, the depositor, the master servicer, the special servicer, any  
servicer and any obligor with respect to assets included in the trust fund      
constituting more than 5% of the aggregate unamortized principal balance of the 
assets in the trust fund as of the date of initial issuance of the securities.  

        Fifth, the sum of all payments made to and retained by the Underwriter
or Underwriters must represent not more than reasonable compensation for        
underwriting the securities; the sum of all payments made to and retained by the
depositor pursuant to the assignment of the assets to the related trust fund    
must represent not more than the fair market value of the obligations; and the  
sum of all payments made to and retained by the master servicer, the special    
servicer and any servicer must represent not more than reasonable compensation  
for the person's services under the related Agreement and reimbursement of the  
person's reasonable expenses in connection therewith.                           

        Sixth, the investing Plan or Plan Asset investor must be an accredited
investor as defined in Rule 501(a)(1) of Regulation D of the Commission under   
the Securities Act.                                                             

  The Exemption permits an interest rate swap or yield maintenance
agreement to be held by the trust if it meets the conditions of the Exemption.  

        Permitted trust funds include owner-trusts, as well as grantor-trusts,
REMICs and FASITs. Owner-trusts are subject to certain restrictions in their    
governing documents to ensure that their assets may not be reached by creditors 
of the company in the event of bankruptcy or other insolventcy and must provide 
certain legal opinions.                                                         

    The Exemption also requires that the trust fund meet the following
requirements: (1) the trust fund must consist solely of assets of the type that 
have been included in other investment pools; (2) securities evidencing         
interests in the other investment pools must have been rated in one of the four 
highest generic categories of one of the Exemption Rating Agencies for at least 
one year prior to the acquisition of securities by or on behalf of a Plan or    
with Plan Assets; and (3) securities evidencing interests in the other          
investment pools must have been purchased by investors other than Plans for at  
least one year prior to any acquisition of securities by or on behalf of a Plan 
or with Plan Assets.                                                            

         A fiduciary of a Plan or any person investing Plan Assets to purchase a
security must make its own determination that the conditions set forth above    
will be satisfied with respect to the security.                                 

         If the general conditions of the Exemption are satisfied, the Exemption
may provide an exemption from the restrictions imposed by Sections 406(a) and   
407(a) of ERISA, and the excise taxes imposed by Sections 4975(a) and (b) of the
Code by reason of Sections 4975(c)(1)(A) through (D) of the Code, in connection 
with the direct or indirect sale, exchange or transfer of securities in the     
initial issuance of the securities or the direct or indirect acquisition or     
disposition in the secondary market of securities by a Plan or with Plan Assets 
or the continued holding of securities acquired by a Plan or with Plan Assets   
pursuant to either of the foregoing. However, no exemption is provided from the 
restrictions of Sections 406(a)(1)(E), 406(a)(2) and 407 of ERISA for the       
acquisition or holding of a security on behalf of an "Excluded Plan" by any     
person who has discretionary authority or renders investment advice with respect
to the assets of an Excluded Plan. For purposes of the securities, an Excluded  
Plan is a Plan sponsored by any member of the Restricted Group.                 

     If the specific conditions of the Exemption are also satisfied, the
Exemption may provide an exemption from the restrictions imposed by Sections    
406(b)(1) and (b)(2) of ERISA, and the excise taxes imposed by Sections 4975(a) 
and (b) of the Code by reason of Section 4975(c)(1)(E) of the Code, in          
connection with (1) the direct or indirect sale, exchange or transfer of        
securities in the initial issuance of securities between the company or an      
Underwriter and a Plan when the person who has discretionary authority or       
renders investment advice with respect to the investment of Plan Assets in the  
securities is (a) a mortgagor with respect to 5% or less of the fair market     
value of the trust fund assets or (b) an affiliate of such a person, (2) the    
direct or indirect acquisition or disposition in the secondary market of        
securities by a Plan or with Plan Assets and (3) the continued holding of       
securities acquired by a Plan or with Plan Assets pursuant to either of the     
foregoing.                                                                      

         Further, if the 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 of ERISA, and 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  
trust fund. The company expects that the specific conditions of the Exemption   
required for this purpose will be satisfied with respect to the securities so   
that the Exemption would provide an exemption from the restrictions imposed by  
Sections 406(a) and (b) 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 trust fund, provided that the general conditions of the Exemption are       
satisfied.                                                                      

         The Exemption also may provide an exemption from the application of the
prohibited transaction provisions of Sections 406(a) and 407(a) of ERISA, and   
the excise 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 the restrictions are deemed to
otherwise apply merely because a person is deemed to be a Party in Interest with
respect to an investing Plan by virtue of providing services to the Plan (or by 
virtue of having a specified relationship to such a person) solely as a result  
of the Plan's ownership of securities.                                          

The Exemption extends exemptive relief to mortgage-backed and 
asset-backed securities transactions using pre-funding accounts for trusts      
issuing securities. With respect to the securities, the amendment will generally
allow mortgage loans supporting payments to securityholders, and having a value 
equal to no more than 25% of the total principal amount of the securities being 
offered by a trust fund, to be transferred to the trust fund within the         
Pre-Funding Period instead of requiring that all the mortgage loans be either   
identified or transferred on or before the Closing Date. In general, the relief 
applies to the purchase, sale and holding of securities which otherwise qualify 
for the Exemption, provided that the following general conditions are met:      

 o        as mentioned, the ratio of the amount allocated to the
            pre-funding account to the total principal amount of the
               securities being offered must be less than or equal to 25%;

         o        all additional mortgage loans transferred to the related trust
            fund after the Closing Date must meet the same terms and
                  conditions for eligibility as the original mortgage loans used
                  to create the trust fund, which terms and conditions have been
     approved by one of the Exemption Rating Agencies;

     o        the transfer of the additional mortgage loans to the trust
             fund during the Pre-Funding Period must not result in the
                securities to be covered by the Exemptions receiving a lower
                  credit rating from an Exemption Rating Agency upon termination
                  of the Pre-Funding Period than the rating that was obtained at
             the time of the initial issuance of the securities by the
trust fund;                                 

     o        solely as a result of the use of pre-funding, the weighted
                  average annual percentage interest rate for the mortgage loans
                  included in the related trust fund on the Closing Date and all
              additional mortgage loans transferred to the related trust
             fund after the Closing Date at the end of the Pre-Funding
                Period must not be more than 100 basis points lower than the
             rate for the mortgage loans which were transferred to the
trust fund on the Closing Date;             

o        either:                                              

                           (1)      the characteristics of the
                          additional mortgage loans transferred to the related
                         trust fund after the Closing Date must be monitored
                          by an insurer or other credit support provider which
       is independent of the company; or

                                   (2)      an independent accountant retained
                           by the company must provide the company with a letter
                          (with copies provided to the Exemption Rating Agency
                    rating the securities, the Underwriter and the
                         trustee) stating whether or not the characteristics
                         of the additional mortgage loans transferred to the
                          related trust fund after the Closing Date conform to
                        the characteristics described in the prospectus or
                          prospectus supplement and/or agreement. In preparing
                         the letter, the independent accountant must use the
                       same type of procedures as were applicable to the
                        mortgage loans which were transferred to the trust
  fund as of the Closing Date;

        o        the Pre-Funding Period must end no later than three months or
     90 days after the Closing Date or earlier in some
             circumstances if the pre-funding accounts falls below the
           minimum level specified in the Agreement or an event of
default occurs;                             

 o        amounts transferred to any pre-funding accounts and/or
            capitalized interest account used in connection with the
             pre-funding may be invested only in investments which are
         permitted by the Exemption Rating Agencies rating the
securities and must:                        

                             (1)      be direct obligations of, or
                          obligations fully guaranteed as to timely payment of
                         principal and interest by, the United States or any
                          agency or instrumentality thereof (provided that the
                         obligations are backed by the full faith and credit
of the United States); or 

                                    (2)      have been rated (or the obligor has
                     been rated) in one of the three highest generic
                      rating categories by one of the Exemption Rating
               Agencies ("ERISA Permitted Investments");

    o        the prospectus or prospectus supplement must describe the
duration of the Pre-Funding Period;         

        o        the trustee (or any agent with which the trustee contracts to
           provide trust services) must be a substantial financial
                institution or trust company experienced in trust activities
                  and familiar with its duties, responsibilities and liabilities
              with ERISA. The trustee, as legal owner of the trust fund,
   must enforce all the rights created in favor of
                 securityholders of the trust fund, including employee benefit
plans subject to ERISA.                     

OTHER EXEMPTIONS                                                                

     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.                                

     PROHIBITED TRANSACTION CLASS EXEMPTION 83-1. The U.S. Department of
Labor has issued an administrative exemption, Prohibited Transaction Class      
Exemption 83-1 ("PTCE 83-1"), which, under certain conditions, exempts from the 
application of the prohibited transaction rules of ERISA and the excise tax     
provisions of Section 4975 of the Code transactions involving a Plan in         
connection with the operation of a "mortgage pool" and the purchase, sale and   
holding of "mortgage pool pass-through certificates." A "mortgage pool" is      
defined as an investment pool, consisting solely of interest bearing obligations
secured by first or second mortgages or deeds of trust on single-family         
residential property, property acquired in foreclosure and undistributed cash. A
"mortgage pool pass-through certificate" is defined as a certificate which      
represents a beneficial undivided interest in a mortgage pool which entitles the
holder to pass-through payments of principal and interest from the mortgage     
loans.                                                                          

For the exemption to apply, PTCE 83-1 requires that:          

       o        the depositor and the trustee maintain a system of insurance
               or other protection for the mortgage loans and the property
                 securing such mortgage loans, and for indemnifying holders of
                certificates against reductions in pass-through payments due
                to defaults in loan payments or property damage in an amount
                  at least equal to the greater of 1% of the aggregate principal
                 balance of the mortgage loans, or 1% of the principal balance
of the largest covered pooled mortgage loan;

o        the trustee may not be an affiliate of the depositor;

 o        and the payments made and retained by the depositor in
           connection with the trust fund, together with all funds
                  inuring to the depositor's benefit for administering the trust
             fund, represent no more than "adequate consideration" for
                selling the mortgage loans, plus reasonable compensation for
services provided to the trust fund.        

         In addition, if it is applicable, PTCE 83-1 exempts the initial sale of
certificates to a Plan with respect to which the depositor, the special hazard  
insurer, the pool insurer, the master servicer, or other servicer, or the       
trustee are or is a party in interest if the Plan does not pay more than fair   
market value for such certificate and the rights and interests evidenced by such
certificate are not subordinated to the rights and interests evidenced by other 
certificates of the same pool. PTCE 83-1 also exempts from the prohibited       
transaction rules any transactions in connection with the servicing and         
operation of the mortgage pool, provided that any payments made to the master   
servicer in connection with the servicing of the trust fund are made in         
accordance with a binding agreement, copies of which must be made available to  
prospective investors.                                                          

         In the case of any Plan with respect to which the depositor, the master
servicer, the special hazard insurer, the pool insurer, or the trustee is a     
fiduciary, PTCE 83-1 will only apply if, in addition to the other requirements: 

    o        the initial sale, exchange or transfer of certificates is
          expressly approved by an independent fiduciary who has
           authority to manage and control those plan assets being
invested in certificates;                   

        o        the Plan pays no more for the certificates than would be paid
in an arm's length transaction;             

       o        no investment management, advisory or underwriting fee, sale
                commission, or similar compensation is paid to the depositor
                 with regard to the sale, exchange or transfer of certificates
to the Plan;                                

     o        the total value of the certificates purchased by such Plan
 does not exceed 25% of the amount issued; and

  o        at least 50% of the aggregate amount of certificates is
                  acquired by persons independent of the depositor, the trustee,
               the master servicer, and the special hazard insurer or pool
insurer.                                    

      Before purchasing certificates, a fiduciary of a Plan should confirm
that the trust fund is a "mortgage pool," that the certificates constitute      
"mortgage pool pass-through certificates," and that the conditions set forth in 
PTCE 83-1 would be satisfied. In addition to making its own determination as to 
the availability of the exemptive relief provided in PTCE 83-1, the Plan        
fiduciary should consider the availability of any other prohibited transaction  
exemptions. The Plan fiduciary also should consider its general fiduciary       
obligations under ERISA in determining whether to purchase any certificates on  
behalf of a Plan.                                                               

ERISA CONSIDERATIONS RELATING TO NOTES                                          

  Under the DOL Regulations, the assets of the trust fund would be
treated as "plan assets" of a Plan for the purposes of ERISA and the Code only  
if the Plan acquires an "equity interest" in the trust fund and none of the     
exceptions contained in the DOL Regulations is applicable. An equity interest is
defined under the DOL Regulations as an interest other than an instrument which 
is treated as indebtedness under applicable local law and which has no          
substantial equity features. Assuming that the notes are treated as indebtedness
without substantial equity features for purposes of the DOL Regulations, then   
such notes will be eligible for purchase by Plans. However, without regard to   
whether the notes are treated as an "equity interest" for such purposes, 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 trust fund 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 note 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 fund 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 notes.   

The Exemption permits trust funds which are grantor trusts,   
owner-trusts, REMICs or FASITs to issue notes, as well as certificates, provided
a legal opinion is received to the effect that the noteholders have a perfected 
security interest in the trust fund's assets. 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 fund and its      
assets would not be necessary with respect to notes with no substantial equity  
features which are issued as obligations of the trust fund. Nevertheless,       
because other prohibited transactions might be involved, the Exemption would    
provide prohibited transaction exemptive relief, provided that the same         
conditions of the Exemption described above relating to certificates are met    
with respect to the notes. The same limitations of such exemptive relief        
relating to acquisitions of certificates 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 prohibited transactions exemptions 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, but are not limited to,  
Prohibited Transaction Class Exemption 90-1 (regarding investments by insurance 
company pooled separate accounts), Prohibited Transaction Class Exemption 91-38 
(regarding investments by bank collective investments funds), PTCE 84-14        
(regarding transactions effected by "qualified professional asset managers"),   
PTCE 95-60 (regarding investments by insurance company general accounts) and    
PTCE 96-23 (regarding transactions effected by "in-house asset managers")       
(collectively, the "Investor-Based Exemptions"). However, even if the conditions
specified in these Investor-Based Exemptions 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.                                           

       In the event that the Exemption is not applicable to the notes, there
can be no assurance that any class of notes will be treated as indebtedness     
without substantial equity features for purposes of the DOL Regulations. There  
is increased uncertainty regarding the characterization of debt instruments that
do not carry an investment grade rating. Consequently, in the event of a        
withdrawal or downgrade to below investment grade of the rating of a class of   
notes, the subsequent transfer of such notes or any interest therein to a Plan  
trustee or other person acting on behalf of a Plan, or using Plan assets to     
effect such transfer, will be restricted. Unless otherwise stated in the related
prospectus supplement, by acquiring a note, each purchaser will be deemed to    
represent that either (1) it is not acquiring the note with plan assets; or (2) 
(A) either (x) none of the issuer, the depositor any underwriter, the trustee,  
the master servicer, any other servicer or any of their affiliates is a party in
interest with respect to such purchaser that is an ERISA plan or (y) PTCE 90-1, 
PTCE 91-38, PTCE 84-14, PTCE 95-60, PTCE 96-23 or some other prohibited         
transaction exemption is applicable to the acquisition and holding of the note  
by such purchaser and (B) the notes are rated investment grade or better and    
such person believes that the notes are properly treated as indebtedness without
substantial equity features for purposes of the DOL Regulations, and agrees to  
so treat the notes. Alternatively, regardless of the rating of the notes, such  
person may provide the trustee with an opinion of counsel, which opinion of     
counsel will not be at the expense of the issuer, the depositor, the trustee,   
the master servicer or any other servicer, which opines that the purchase,      
holding and transfer of such note or interest therein is permissible under      
applicable law, will not constitute or result in a non exempt prohibited        
transaction under ERISA or Section 4975 of the Code and will not subject the    
issuer, the depositor, the trustee, the master servicer or any other servicer to
any obligation in addition to those undertaken in the indenture.                

EACH PROSPECTUS SUPPLEMENT WILL CONTAIN INFORMATION CONCERNING
CONSIDERATIONS RELATING TO ERISA AND THE CODE THAT ARE APPLICABLE TO THE RELATED
SECURITIES. BEFORE PURCHASING SECURITIES IN RELIANCE ON PTCE 83-1, THE          
EXEMPTION, THE INVESTOR-BASED EXEMPTIONS OR ANY OTHER EXEMPTION, A FIDUCIARY OF 
A PLAN SHOULD ITSELF CONFIRM THAT REQUIREMENTS SET FORTH IN SUCH EXEMPTION WOULD
BE SATISFIED.                                                                   

    ANY PLAN INVESTOR WHO PROPOSES TO USE "PLAN ASSETS" OF ANY PLAN TO
PURCHASE SECURITIES OF ANY SERIES OR CLASS SHOULD CONSULT WITH ITS COUNSEL WITH 
RESPECT TO THE POTENTIAL CONSEQUENCES UNDER ERISA AND SECTION 4975 OF THE CODE  
OF THE ACQUISITION AND OWNERSHIP OF SUCH SECURITIES.                            

TAX EXEMPT INVESTORS                                                            

        A Plan that is exempt from federal income taxation pursuant to Section
501 of the Code nonetheless will be subject to federal income taxation to the   
extent that its income is "unrelated business taxable income" within the meaning
of Section 512 of the Code. All "excess inclusion" of a REMIC allocated to a    
REMIC Residual Certificate and held by such an investor will be considered      
"unrelated business taxable income" and thus will be subject to federal income  
tax. See "Federal Income Tax Consequences--Taxation of Owners of REMIC Residual 
Certificates--Excess Inclusions."                                               

CONSULTATION WITH COUNSEL                                                       

There can be no assurance that the Exemptions or any other 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 fund.        
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 company, the trustees, the master 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.              

       BEFORE PURCHASING AN OFFERED SECURITY IN RELIANCE ON THE EXEMPTION, A
PTCE OR AN INVESTOR-BASED EXEMPTION, A FIDUCIARY OF A PLAN OR OTHER PLAN ASSET  
INVESTOR SHOULD ITSELF CONFIRM THAT (A) ALL THE SPECIFIC AND GENERAL CONDITIONS 
SET FORTH IN THE EXEMPTION, PTCE 83-1 ONE OF THE CLASS EXEMPTIONS OR SECTION    
401(C) OF ERISA WOULD BE SATISFIED AND (B) IN THE CASE OF A SECURITY PURCHASED  
UNDER THE EXEMPTION, THE SECURITY CONSTITUTES A "SECURITY" FOR PURPOSES OF THE  
EXEMPTION. IN ADDITION TO MAKING ITS OWN DETERMINATION AS TO THE AVAILABILITY OF
THE EXEMPTIVE RELIEF PROVIDED IN THE EXEMPTION, ONE OF THE CLASS EXEMPTIONS OR  
SECTION 401(C) OF ERISA, THE PLAN FIDUCIARY SHOULD CONSIDER ITS GENERAL         
FIDUCIARY OBLIGATIONS UNDER ERISA IN DETERMINING WHETHER TO PURCHASE THE        
SECURITIES ON BEHALF OF A PLAN.                                                 

         A governmental plan as defined in Section 3(32) of ERISA is not subject
to ERISA, or Code Section 4975. However, such governmental plan may be subject  
to federal, state and local law, which is, to a material extent, similar to the 
provisions of ERISA or a Code Section 4975. A fiduciary of a governmental plan  
should make its own determination as to the propriety of such investment under  
applicable fiduciary or other investment standards, and the need for the        
availability of any exemptive relief under any similar law.                     

LEGAL INVESTMENT MATTERS

  Each class of certificates offered by this prospectus and by the
related prospectus supplement will be rated at the date of issuance in one of   
the four highest rating categories by at least one Rating Agency. If so         
specified in the related prospectus supplement, each such class that is rated in
one of the two highest rating categories by at least one Rating Agency will     
constitute "mortgage related securities" for purposes of SMMEA, and, as such,   
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 agency or instrumentality thereof constitute legal  
investments for the entities. Under SMMEA, if a State enacted legislation on or 
prior to October 3, 1991 specifically limiting the legal investment authority of
any such entities with respect to "mortgage related securities," such securities
will constitute legal investments for entities subject to the legislation only  
to the extent provided therein. Some States have enacted legislation which      
overrides the preemption provisions of SMMEA. SMMEA provides, however, that in  
no event will the enactment of any such legislation affect the validity of any  
contractual commitment to purchase, hold or invest in "mortgage related         
securities," or require the sale or other disposition of the securities, so long
as the contractual commitment was made or the securities acquired prior to the  
enactment of the legislation.                                                   

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    
with "mortgage related 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. 24 (Seventh), subject in each case to such regulations as
the applicable federal regulatory authority may prescribe.                      

     The Federal Financial Institutions Examination Council has issued a
supervisory policy statement applicable to all depository institutions, setting 
forth guidelines for and significant restrictions on investments in "high-risk  
mortgage securities." The policy statement has been adopted by the Federal      
Reserve Board, the Office of the Comptroller of the Currency, the FDIC and the  
OTS with an effective date of February 10, 1992. 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 as to which classes of offered          
securities will 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 the securities by insolvent,           
undercapitalized or otherwise "troubled" institutions. According to the         
bulletin, such "high-risk" mortgage derivative securities include securities    
having specified characteristics, which may include some classes of offered     
securities. In addition, the National Credit Union Administration has issued    
regulations governing federal credit union investments which prohibit investment
in specified types of securities, which may include some classes of offered     
securities. Similar policy statements have been issued by regulators having     
jurisdiction over other types of depository institutions.                       

     Any class of securities that is not rated in one of the two highest
rating categories by at least one Rating Agency, and any other class of         
securities specified in the related prospectus supplement, will not constitute  
"mortgage related securities" for purposes of SMMEA. Prospective investors in   
these classes of securities, in particular, should consider the matters         
discussed in the following paragraph.                                           

       There may be other restrictions on the ability of investors either to
purchase some classes of offered securities or to purchase any class of offered 
securities representing more than a specified percentage of the investors'      
assets. The company will make no representations as to the proper               
characterization of any class of offered securities for legal investment or     
other purposes, or as to the ability of particular investors to purchase any    
class of certificates under applicable legal investment restrictions. These     
uncertainties may adversely affect the liquidity of any class of certificates.  
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      
thereof constitute legal investments or are subject to investment, capital or   
other restrictions, and, if applicable, whether SMMEA has been overridden in any
jurisdiction relevant to the investor.                                          

 USE OF PROCEEDS

       Substantially all of the net proceeds to be received from the sale of
certificates will be applied by the company to finance the purchase of, or to   
repay short-term loans incurred to finance the purchase of, the mortgage loans  
and/or mortgage securities in the respective mortgage pools and to pay other    
expenses. The company expects that it will make additional sales of securities  
similar to the offered securities from time to time, but the timing and amount  
of any such additional offerings will be dependent upon a number of factors,    
including the volume of mortgage loans purchased by the company, prevailing     
interest rates, availability of funds and general market conditions.            

 METHODS OF DISTRIBUTION

The certificates offered by this prospectus and by the related
prospectus supplements will be offered in series through one or more of the     
methods described below. The prospectus supplement prepared for each series will
describe the method of offering being utilized for that series and will state   
the net proceeds to the company from the sale.                                  

         The company intends that offered securities will be offered through the
following methods from time to time and that offerings may be made concurrently 
through more than one of these methods or that an offering of the offered       
securities of a particular series may be made through a combination of two or   
more of these methods. The methods are as follows:                              

         o        By negotiated firm commitment or best efforts underwriting and
public re-offering by underwriters;         

    o        By placements by the company with institutional investors
through dealers; and                        

 o        By direct placements by the company with institutional
investors.                                  

     If underwriters are used in a sale of any offered securities (other
than in connection with an underwriting on a best efforts basis), the securities
will be acquired by the underwriters for their own account and may be resold    
from time to time in one or more transactions, including negotiated             
transactions, at fixed public offering prices or at varying prices to be        
determined at the time of sale or at the time of commitment therefor. The       
underwriters may be broker-dealers affiliated with the company whose identities 
and relationships to the company will be as set forth in the related prospectus 
supplement. The managing underwriter or underwriters with respect to the offer  
and sale of the offered securities of a particular series will be set forth on  
the cover of the prospectus supplement relating to the series and the members of
the underwriting syndicate, if any, will be named in the prospectus supplement. 

         In connection with the sale of the offered securities, underwriters may
receive compensation from the company or from purchasers of the certificates in 
the form of discounts, concessions or commissions. Underwriters and dealers     
participating in the distribution of the offered securities may be deemed to be 
underwriters in connection with the certificates, and any discounts or          
commissions received by them from the company and any profit on the resale of   
offered securities by them may be deemed to be underwriting discounts and       
commissions under the Securities Act.                                           

     It is anticipated that the underwriting agreement pertaining to the
sale of offered securities of any series will provide that the obligations of   
the underwriters will be subject to conditions precedent, that the underwriters 
will be obligated to purchase all such securities if any are purchased (other   
than in connection with an underwriting on a best efforts basis) and that, in   
limited circumstances, the company will indemnify the several underwriters and  
the underwriters will indemnify the company against specified civil liabilities,
including liabilities under the Securities Act or will contribute to payments   
required to be made in respect thereof.                                         

 The prospectus supplement with respect to any series offered by
placements through dealers will contain information regarding the nature of the 
offering and any agreements to be entered into between the company and          
purchasers of offered securities of the series.                                 

        The company anticipates that the securities offered by this prospectus
and the prospectus supplement will be sold primarily to institutional investors 
or sophisticated non-institutional investors. Purchasers of offered securities, 
including dealers, may, depending on the facts and circumstances of the         
purchases, be deemed to be "underwriters" within the meaning of the Securities  
Act in connection with reoffers and sales by them of the certificates. Holders  
of offered securities should consult with their legal advisors in this regard   
prior to any such reoffer or sale.                                              

 LEGAL MATTERS

         Legal matters, including federal income tax matters, in connection with
the securities of each series will be passed upon for the company by Thacher    
Proffitt & Wood LLP, New York, New York.                                        

 FINANCIAL INFORMATION

      With respect to each series, a new trust fund will be formed, and no
trust fund will engage in any business activities or have any assets or         
obligations prior to the issuance of the related series. Accordingly, no        
financial statements with respect to any trust fund will be included in this    
prospectus or in the related prospectus supplement.                             

RATING

      It is a condition to the issuance of any class of offered 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.           

         Ratings on mortgage pass-through certificates and mortgage-backed notes
address the likelihood of receipt by the holders thereof of all collections on  
the underlying mortgage assets to which the holders are entitled. These ratings 
address the structural, legal and issuer-related aspects associated with the    
certificates and notes, the nature of the underlying mortgage assets and the    
credit quality of the guarantor, if any. Ratings on mortgage pass-through       
certificates and mortgage-backed notes do not represent any assessment of the   
likelihood of principal prepayments by borrowers or of the degree by which the  
prepayments might differ from those originally anticipated. As a result,        
securityholders might suffer a lower than anticipated yield, and, in addition,  
holders of stripped interest securities in extreme cases might fail to recoup   
their initial investments.                                                      

A security rating is not a recommendation to buy, sell or hold
securities and may be subject to revision or withdrawal at any time by the      
assigning rating organization.                                                  

 AVAILABLE INFORMATION

 The company is subject to the informational requirements of the
Exchange Act and in accordance therewith files reports and other information    
with the Commission. Reports and other information filed by the company can be  
inspected and copied at the public reference facilities maintained by the       
Commission at 450 Fifth Street, N.W., Washington, D.C. 20549, and its Regional  
Offices located as follows: Chicago Regional Office, 500 West Madison, 14th     
Floor, Chicago, Illinois 60661; New York Regional Office, 233 Broadway, New     
York, New York 10279. Copies of the material can also be obtained from the      
Public Reference Section of the Commission, 450 Fifth Street, N.W., Washington, 
D.C. 20549, at prescribed rates and electronically through the Commission's     
Electronic Data Gathering, Analysis and Retrieval system at the Commission's    
Website (http://www.sec.gov). The company does not intend to send any financial 
reports to securityholders.                                                     

      This prospectus does not contain all of the information set forth in
the registration statement (of which this prospectus forms a part) and exhibits 
thereto which the company has filed with the Commission under the Securities Act
and to which reference is hereby made.                                          

REPORTS TO SECURITYHOLDERS

      The master servicer or another designated person will be required to
provide periodic unaudited reports concerning each trust fund to all registered 
holders of offered securities of the related series with respect to each trust  
fund as are required under the Exchange Act and the Commission's related rules  
and regulations. See "Description of the Securities--Reports to                 
Securityholders."                                                               

 INCORPORATION OF INFORMATION BY REFERENCE

         There are incorporated in this prospectus and in the related prospectus
supplement by reference all documents and reports filed or caused to be filed by
the company with respect to a trust fund pursuant to Sections 13(a), 13(c), 14  
or 15(d) of the Exchange Act, prior to the termination of the offering of the   
offered securities of the related series. The company will provide or cause to  
be provided without charge to each person to whom this prospectus is delivered  
in connection with the offering of one or more classes of offered securities,   
upon written or oral request of the person, a copy of any or all the reports    
incorporated in this prospectus by reference, in each case to the extent the    
reports relate to one or more of such classes of the offered securities, other  
than the exhibits to the documents, unless the exhibits are specifically        
incorporated by reference in the documents. Requests should be directed in      
writing to MILA Mortgage Acceptance, Inc., 6021 244th Street SW, Mountlake      
Terrace, WA 98043 or by telephone at (800) 332-6452. The company has determined 
that its financial statements will not be material to the offering of any       
offered securities.                                                             

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GLOSSARY

         ACCRUAL SECURITY -- A security with respect to which some or all of its
accrued interest will not be distributed as interest but rather an amount equal 
to that interest will be added to the principal balance thereof on each         
distribution date for the period described in the related prospectus supplement.

       AFFILIATED SELLER -- MILA, Inc., the parent of the company, and their
respective affiliates.                                                          

       AGREEMENT -- An owner trust agreement, servicing agreement, indenture
or pooling and servicing agreement.                                             

ARM LOAN -- A mortgage loan with an adjustable interest rate. 

 BANKRUPTCY AMOUNT - The amount of Bankruptcy Losses that may be
allocated to the credit enhancement of the related series.                      

        BANKRUPTCY CODE -- Title 11 of the United States Code, as amended from
time to time.                                                                   

    BANKRUPTCY LOSS -- A Realized Loss attributable to certain actions
which may be taken by a bankruptcy court in connection with a mortgage loan,    
including a reduction by a bankruptcy court of the principal balance of or the  
mortgage rate on a mortgage loan or an extension of its maturity.               

BENEFICIAL OWNER -- A person acquiring an interest in any DTC 
Registered Security.                                                            

         BENEFIT PLAN INVESTORS -- Plans, as well as any "employee benefit plan"
(as defined in Section 3(3) or ERISA) which is not subject to Title I of ERISA, 
such as governmental plans (as defined in Section 3(32) of ERISA) and church    
plans(as defined in Section 3(33) of ERISA) which have not made an election     
under Section 410(d) of the Code, and any entity whose underlying assets include
Plan Assets by reason of a Plan's investment in the entity.                     

 BUYDOWN ACCOUNT -- With respect to a buydown mortgage loan, the
custodial account where the Buydown Funds are placed.                           

   BUYDOWN FUNDS -- With respect a buydown mortgage loan, the amount
contributed by the seller of the mortgaged property or another source and placed
in the Buydown Account.                                                         

       BUYDOWN PERIOD -- The period during which funds on a buydown mortgage
loan are made up for from the Buydown Account.                                  

CERCLA -- The federal Comprehensive Environmental Response,   
Compensation and Liability Act of 1980, as amended.                             

       CLEARSTREAM - Clearstream Banking, societe anonyme, formerly known as
Cedelbank SA.                                                                   

       CLOSING DATE -- With respect to any series of securities, the date on
which the securities are issued.                                                

CODE -- The Internal Revenue Code of 1986.                    

COMMISSION -- The Securities and Exchange Commission.         

      COMMITTEE REPORT -- The Conference Committee Report accompanying the
Tax Reform Act of 1986.                                                         

  CONSERVATION ACT -- The Asset Conservation, Lender Liability and
Deposit Insurance Act of 1996.                                                  

  CONTRACT -- Manufactured housing conditional sales contracts and
installment loan agreements each secured by a Manufactured Home.                

        CONTRIBUTIONS TAX -- With respect to specific contributions to a REMIC
made after the Closing Date, a tax on the REMIC equal to 100% of the value of   
the contributed property.                                                       

 COOPERATIVE -- With respect to a cooperative mortgage loan, the
corporation that owns the related apartment building.                           

   CRIME CONTROL ACT -- The Comprehensive Crime Control Act of 1984.

        DEFAULTED MORTGAGE LOSS -- A Realized Loss other than a Special Hazard
Loss, Extraordinary Loss or other losses resulting from damage to a mortgaged   
property, Bankruptcy Loss or Fraud Loss.                                        

 DEFERRED INTEREST -- If an adjustment to the mortgage rate on a
mortgage loan has caused the amount of accrued interest on the mortgage loan in 
any month to exceed the scheduled monthly payment on the mortgage loan, the     
resulting amount of interest that has accrued but is not then payable;          

      DELETED MORTGAGE LOAN -- A mortgage loan which has been removed from
the related trust fund.                                                         

   DESIGNATED SELLER TRANSACTION -- A series of securities where the
related mortgage loans are provided either directly or indirectly to the company
by one or more Sellers identified in the related prospectus supplement.         

      DETERMINATION DATE -- The close of business on the date on which the
amount of each distribution to securityholders will be determined, which shall  
be stated in each prospectus supplement.                                        

        DIDMC -- The Depository Institutions Deregulation and Monetary Control
Act of 1980.                                                                    

DISTRIBUTION ACCOUNT -- One or more separate accounts for the 
collection of payments on the related mortgage loans and/or mortgage securities 
constituting the related trust fund, which may be a Master Servicer Collection  
Account.                                                                        

DOL -- The U.S. Department of Labor.                          

DOL REGULATIONS -- Regulations by the DOL promulgated at 29   
C.F.R.ss.2510.3-101.                                                            

DTC - The Depository Trust Company.                           

      DTC REGISTERED SECURITY -- Any security initially issued through the
book-entry facilities of the DTC.                                               

   ELIGIBLE ACCOUNT -- An account maintained with a federal or state
chartered depository institution (i) the short-term obligations of which are    
rated by each of the Rating Agencies in its highest rating at the time of any   
deposit therein, or (ii) insured by the FDIC (to the limits established by the  
FDIC), the uninsured deposits in which account are otherwise secured such that, 
as evidenced by an opinion of counsel (obtained by and at the expense of the    
person requesting that the account be held pursuant to this clause (ii))        
delivered to the trustee prior to the establishment of the account, the         
securityholders will have a claim with respect to the funds in the account and a
perfected first priority security interest against any collateral (which shall  
be limited to Permitted Instruments) securing the funds that is superior to     
claims of any other depositors or general creditors of the depository           
institution with which the account is maintained or (iii) a trust account or    
accounts maintained with a federal or state chartered depository institution or 
trust company with trust powers acting in its fiduciary capacity or (iv) an     
account or accounts of a depository institution acceptable to the Rating        
Agencies (as evidenced in writing by the Rating Agencies that use of any such   
account as the Distribution Account will not have an adverse effect on the      
then-current ratings assigned to the classes of the securities then rated by the
Rating Agencies). Eligible Accounts may or may not bear interest.               

 EQUITY CERTIFICATES -- With respect to any series of notes, the
certificate or certificates representing a beneficial ownership interest in the 
related issuer.                                                                 

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

      ERISA PLANS -- Employee pension and welfare benefit plans subject to
ERISA.                                                                          

        EXEMPTION -- An individual prohibited transactions exemption issued by
the DOL to an underwriter, as amended by PTE 97-34, 62 Fed. Reg. 39021 (July    
21,1997), and PTE 2000-58, 65 Fed. Reg. 67765 (November 13, 2000).              

 EXEMPTION RATING AGENCY -- Standard & Poor's, a division of The
McGraw-Hill Companies, Inc., Moody's Investors Service, Inc., or Fitch, Inc.    

  EXCHANGE ACT -- The Securities Exchange Act of 1934, as amended.

  EXTRAORDINARY LOSS -- Any Realized Loss occasioned by war, civil
insurrection, certain governmental actions, nuclear reaction and certain other  
risks.                                                                          

        FRAUD LOSS -- A Realized Loss incurred on a defaulted mortgage loan as
to which there was fraud in the origination of the mortgage loan.               

         FRAUD LOSS AMOUNT - The amount of Fraud Losses that may be allocated to
the credit enhancement of the related series.                                   

      FTC RULE -- The so-called "Holder-in-Due-Course" Rule of the Federal
Trade Commission.                                                               

        GARN-ST GERMAIN ACT -- The Garn-St Germain Depository Institutions Act
of 1982.                                                                        

         GLOBAL SECURITIES -- The certificated securities registered in the name
of DTC, its nominee or another depository representing interests in the class or
classes specified in the related prospectus supplement which are held in        
book-entry form.                                                                

        GRANTOR TRUST CERTIFICATE -- A certificate representing an interest in
a Grantor Trust Fund.                                                           

  GRANTOR TRUST FRACTIONAL INTEREST CERTIFICATE -- A Grantor Trust
Certificate representing an undivided equitable ownership interest in the       
principal of the mortgage loans constituting the related Grantor Trust Fund,    
together with interest on the Grantor Trust Certificates at a pass-through rate.

         GRANTOR TRUST STRIP CERTIFICATE -- A certificate representing ownership
of all or a portion of the difference between interest paid on the mortgage     
loans constituting the related Grantor Trust Fund (net of normal administration 
fees and any retained interest of the company) and interest paid to the holders 
of Grantor Trust Fractional Interest Certificates issued with respect to the    
Grantor Trust Fund. A Grantor Trust Strip Certificate may also evidence a       
nominal ownership interest in the principal of the mortgage loans constituting  
the related Grantor Trust Fund.                                                 

       GRANTOR TRUST FUND -- A trust fund as to which no REMIC election will
be made and which qualifies as a "grantor trust" within the meaning of Subpart  
E, part I of subchapter J of the Code.                                          

     HIGH COST LOANS -- Mortgage loans subject to the Homeownership Act,
which amended TILA to provide new requirements applicable to loans that exceed  
certain interest rate and/or points and fees thresholds.                        

         HIGH LTV LOANS -- Mortgage loans with Loan-to-Value Ratios in excess of
80% and as high as 150% and which are not be insured by a Primary Insurance     
Policy.                                                                         

     HOMEOWNERSHIP ACT --The Home Ownership and Equity Protection Act of
1994.                                                                           

HOUSING ACT -- The National Housing Act of 1934, as amended.  

        INDEX -- With respect to an ARM Loan, the related index, which will be
specified in the related prospectus supplement and may include one of the       
following indexes: (1) the weekly average yield on U.S. Treasury securities     
adjusted to a constant maturity of either six months or one year, (2) the weekly
auction average investment yield of U.S. Treasury bills of six months, (3) the  
daily Bank Prime Loan rate made available by the Federal Reserve Board, (4) the 
cost of funds of member institutions for the Federal Home Loan Bank of San      
Francisco, (5) the interbank offered rates for U.S. dollar deposits in the      
London market, each calculated as of a date prior to each scheduled interest    
rate adjustment date which will be specified in the related prospectus          
supplement or (6) any other index described in the related prospectus           
supplement.                                                                     

  INSURANCE PROCEEDS -- Proceeds received under any hazard, title,
primary mortgage, FHA or other insurance policy that provides coverage with     
respect to a particular mortgaged property or the related mortgage loan (other  
than proceeds applied to the restoration of the property or released to the     
related borrower in accordance with the customary servicing practices of the    
master servicer (or, if applicable, a special servicer) and/or the terms and    
conditions of the related mortgage.                                             

         INTERMEDIARY -- An institution that is not a participant in the DTC but
clears through or maintains a custodial relationship with a participant.        

IRS -- The Internal Revenue Service.                          

   ISSUE PREMIUM -- The excess of the issue price of a REMIC Regular
Certificate over its stated redemption price.                                   

     ISSUER -- With respect to a series of notes, the Delaware statutory
trust or other trust, created pursuant to the owner trust agreement, that issues
the notes.                                                                      

        LIQUIDATION PROCEEDS -- (1) All amounts, other than Insurance Proceeds
received and retained in connection with the liquidation of defaulted mortgage  
loans or property acquired in respect thereof, by foreclosure or otherwise,     
together with the net operating income (less reasonable reserves for future     
expenses) derived from the operation of any mortgaged properties acquired by the
trust fund through foreclosure or otherwise and (2) all proceeds of any mortgage
loan or mortgage security purchased (or, in the case of a substitution, amounts 
representing a principal adjustment) by the master servicer, the company, a     
Seller or any other person pursuant to the terms of the related pooling and     
servicing agreement or servicing agreement as described under "The Mortgage     
Pools--Representations by Sellers," "Servicing of Mortgage Loans--Realization   
Upon and Sale of Defaulted Mortgage Loans," "--Assignment of Trust Fund Assets" 
above and "The Agreements--Termination."                                        

       LOAN-TO-VALUE RATIO -- With respect to any mortgage loan at any given
time is the ratio (expressed as a percentage) of the then outstanding principal 
balance of the mortgage loan plus the principal balance of any senior mortgage  
loan to the Value of the related mortgaged property.                            

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

     MASTER SERVICER COLLECTION ACCOUNT -- One or more separate accounts
established by a master servicer, into which each of the related servicers are  
required to remit collections of payments on the related mortgage loans included
in the related trust fund.                                                      

         NET MORTGAGE RATE -- With respect to a mortgage loan, the mortgage rate
net of the per annum rate or rates applicable to the calculation of servicing   
and administrative fees and any retained interest of the company.               

        NONRECOVERABLE ADVANCE -- An advance which, in the good faith judgment
of the master servicer, will not be recoverable from recoveries on the related  
mortgage loan or another specifically identified source.                        

      NOTE MARGIN -- With respect to an ARM Loan, the fixed percentage set
forth in the related mortgage note, which when added to the related Index,      
provides the mortgage rate for the ARM Loan.                                    

         OID REGULATIONS -- The rules governing original issue discount that are
set forth in Sections 1271-1273 and 1275 of the Code and in the related Treasury
regulations.                                                                    

OTS -- The Office of Thrift Supervision.                      

 PARTIES IN INTEREST -- With respect to a Plan, persons who have
specified relationships to the Plans, either "Parties in Interest" within the   
meaning of ERISA or "Disqualified Persons" within the meaning of the Code.      

   PERCENTAGE INTEREST -- With respect to a security of a particular
class, the percentage obtained by dividing the initial principal balance or     
notional amount of the security by the aggregate initial amount or notional     
balance of all the securities of the class.                                     

        PERMITTED INVESTMENTS -- United States government securities and other
investment grade obligations specified in the related pooling and servicing     
agreement or the related servicing agreement and indenture.                     

       PLAN ASSETS -- "Plan assets" of a Plan, within the meaning of the DOL
Regulations.                                                                    

PLANS -- ERISA Plans and Tax Favored Plans.                   

         PREPAYMENT ASSUMPTION -- With respect to a REMIC Regular Certificate or
a Grantor Trust Certificate, the prepayment assumption used in pricing the      
initial offering of that security.                                              

         PREPAYMENT INTEREST SHORTFALL -- With respect to any mortgage loan with
a prepayment in part or in full the excess, if any, of interest accrued and     
otherwise payable on the related mortgage loan over the interest charged to the 
borrower (net of servicing and administrative fees and any retained interest of 
the company).                                                                   

   PRIMARY INSURANCE COVERED LOSS -- With respect to a mortgage loan
covered by a Primary Insurance Policy, the amount of the related loss covered   
pursuant to the terms of the Primary Insurance Policy, which will generally     
consist of the unpaid principal amount of the mortgage loan and accrued and     
unpaid interest on the mortgage loan and reimbursement of specific expenses,    
less (1) rents or other payments collected or received by the insured (other    
than the proceeds of hazard insurance) that are derived from the related        
mortgaged property, (2) hazard insurance proceeds in excess of the amount       
required to restore the related mortgaged property and which have not been      
applied to the payment of the mortgage loan, (3) amounts expended but not       
approved by the primary insurer, (4) claim payments previously made on the      
mortgage loan and (5) unpaid premiums and other specific amounts.               

   PRIMARY INSURANCE POLICY -- A primary mortgage guaranty insurance
policy.                                                                         

PRIMARY INSURER -- An issuer of a Primary Insurance Policy.   

        PROTECTED ACCOUNT -- One or more separate accounts established by each
servicer servicing the mortgage loans, for the collection of payments on the    
related mortgage loans included in the related trust fund.                      

PTCE -- Prohibited Transaction Class Exemption.               

         QUALIFIED SUBSTITUTE MORTGAGE LOAN -- A mortgage loan substituted for a
Deleted Mortgage Loan, meeting the requirements described under "The Mortgage   
Pools-- Representations by Sellers" in this prospectus.                         

RATING AGENCY -- A "nationally recognized statistical rating  
organization" within the meaning of Section 3(a)(41) of the Exchange Act.       

  REALIZED LOSS -- Any loss on a mortgage loan attributable to the
mortgagor's failure to make any payment of principal or interest as required    
under the mortgage note.                                                        

      RECORD DATE -- The close of business on the last business day of the
month preceding the month in which the applicable distribution date occurs.     

       RELIEF ACT -- The Soldiers' and Sailors' Civil Relief Act of 1940, as
amended.                                                                        

  REMIC -- A real estate mortgage investment conduit as defined in
Sections 860A through 860G of the Code.                                         

    REMIC ADMINISTRATOR -- The trustee, the master servicer or another
specified party who administers the related REMIC.                              

         REMIC CERTIFICATES -- Certificates evidencing interests in a trust fund
as to which a REMIC election has been made.                                     

REMIC PROVISIONS -- Sections 860A through 860G of the Code.   

  REMIC REGULAR CERTIFICATE -- A REMIC Certificate designated as a
"regular interest" in the related REMIC.                                        

REMIC REGULAR CERTIFICATEHOLDER -- A holder of a REMIC Regular
Certificate.                                                                    

   REMIC RESIDUAL CERTIFICATE -- A REMIC Certificate designated as a
"residual interest" in the related REMIC.                                       

  REMIC RESIDUAL CERTIFICATEHOLDER -- A holder of a REMIC Residual
Certificate.                                                                    

    REMIC REGULATIONS -- The REMIC Provisions and the related Treasury
regulations.                                                                    

 REO MORTGAGE LOAN -- A mortgage loan where title to the related
mortgaged property has been obtained by the trustee or to its nominee on behalf 
of securityholders of the related series.                                       

     RICO -- The Racketeer Influenced and Corrupt Organizations statute.

SECURITIES ACT -- The Securities Act of 1933, as amended.     

   SELLER -- The seller of the mortgage loans or mortgage securities
included in a trust fund to the company with respect a series of securities, who
shall be an Affiliated Seller or an Unaffiliated Seller.                        

       SINGLE FAMILY PROPERTY -- An attached or detached one-family dwelling
unit, two-to four-family dwelling unit, condominium, townhouse, row house,      
individual unit in a planned-unit development and other individual dwelling     
units.                                                                          

 SMMEA -- The Secondary Mortgage Market Enhancement Act of 1984.

         SPECIAL HAZARD AMOUNT - The amount of Special Hazard Losses that may be
allocated to the credit enhancement of the related series.                      

      SPECIAL HAZARD LOSS -- (1) losses due to direct physical damage to a
mortgaged property other than any loss of a type covered by a hazard insurance  
policy or a flood insurance policy, if applicable, and (2) losses from partial  
damage caused by reason of the application of the co-insurance clauses contained
in hazard insurance policies.                                                   

      STRIP SECURITY -- A security which will be entitled to (1) principal
distributions, with disproportionate, nominal or no interest distributions or   
(2) interest distributions, with disproportionate, nominal or no principal      
distributions.                                                                  

  TAX FAVORED PLANS -- Tax-qualified retirement plans described in
Section 401(a) of the Code and on individual retirement accounts described in   
Section 408 of the Code.                                                        

TILA -- The Federal Truth-in-Lending Act.                     

    TITLE V -- Title V of the Depository Institutions Deregulation and
Monetary Control Act of 1980, enacted in March 1980.                            

TITLE VIII -- Title VIII of the Garn-St Germain Act.          

        UNAFFILIATED SELLERS -- Banks, savings and loan associations, mortgage
bankers, mortgage brokers, investment banking firms, the Resolution Trust       
Corporation, the FDIC and other mortgage loan originators or sellers not        
affiliated with the company.                                                    

       UNITED STATES PERSON -- A citizen or resident of the United States, a
corporation or partnership (including an entity treated as a corporation or     
partnership for federal income tax purposes) created or organized in, or under  
the laws of, the United States or any state thereof or the District of Columbia 
(except, in the case of a partnership, to the extent provided in regulations),or
an estate whose income is subject to United States federal income tax regardless
of its source, or a trust if a court within the United States is able to        
exercise primary supervision over the administration of the trust and one or    
more United States persons have the authority to control all substantial        
decisions of the trust. To the extent prescribed in regulations by the Secretary
of the Treasury, which have not yet been issued, a trust which was in existence 
on August 20, 1996 (other than a trust treated as owned by the grantor under    
subpart E of part I of subchapter J of chapter 1 of the Code), and which was    
treated as a United States person on August 20, 1996 may elect to continue to be
treated as a United States person notwithstanding the previous sentence.        

         VALUE -- With respect to a mortgaged property securing a single family,
multifamily, commercial or mixed-use loan, the lesser of (x) the appraised value
determined in an appraisal obtained at origination of the mortgage loan, if any,
or, if the related mortgaged property has been appraised subsequent to          
origination, the value determined in the subsequent appraisal and (y) the sales 
price for the related mortgaged property (except in circumstances in which there
has been a subsequent appraisal). However, in the case of refinanced, modified  
or converted single family, multifamily, commercial or mixed-use loans, the     
"Value" of the related mortgaged property will be equal to the lesser of (x) the
appraised value of the related mortgaged property determined at origination or  
in an appraisal, if any, obtained at the time of refinancing, modification or   
conversion and (y) the sales price of the related mortgaged property or, if the 
mortgage loan is not a rate and term refinance mortgage loan and if the         
mortgaged property was owned for a relatively short period of time prior to     
refinancing, modification or conversion, the sum of the sales price of the      
related mortgaged property plus the added value of any improvements. With       
respect to a new Manufactured Home, the "Value" is no greater than the sum of a 
fixed percentage of the list price of the unit actually billed by the           
manufacturer to the dealer (exclusive of freight to the dealer site), including 
"accessories" identified in the invoice, plus the actual cost of any accessories
purchased from the dealer, a delivery and set-up allowance, depending on the    
size of the unit, and the cost of state and local taxes, filing fees and up to  
three years prepaid hazard insurance premiums. With respect to a used           
Manufactured Home, the "Value" is the least of the sale price, the appraised    
value, and the National Automobile Dealer's Association book value plus prepaid 
taxes and hazard insurance premiums. The appraised value of a Manufactured Home 
is based upon the age and condition of the manufactured housing unit and the    
quality and condition of the mobile home park in which it is situated, if       
applicable. An appraisal for purposes of determining the Value of a mortgaged   
property may include an automated valuation.                                    

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SUBJECT TO COMPLETION, DATED JUNE 27, 2005 [VERSION 1]

 PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED _____________, ____)

$_______________ (APPROXIMATE)

MORTGAGE PASS-THROUGH CERTIFICATES, SERIES ____-__

 [NAME OF MASTER SERVICER]
 MASTER SERVICER

MILA MORTGAGE ACCEPTANCE, INC.
 COMPANY
--------------------------------------------------------------------------------
YOU SHOULD CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE S-___ IN THIS  
PROSPECTUS SUPPLEMENT.                                                          
--------------------------------------------------------------------------------

The information contained in this Prospectus Supplement is not complete and may 
be changed. We may not sell these securities until the registration statement   
filed with the Securities and Exchange Commission is effective. This Prospectus 
Supplement is not an offer to sell these securities and is not soliciting of an 
offer to buy these securities in any state where the offer or sale is not       
permitted.                                                                      
--------------------------------------------------------------------------------

THE TRUST                                                                       

The trust will consist primarily of a mortgage pool of one- to four-family      
[fixed-rate] residential mortgage loans. The trust will be represented by ______
classes of certificates, ______ of which are offered under this prospectus      
supplement.                                                                     

CREDIT ENHANCEMENT                                                              

o        the offered certificates will have credit enhancement in the form of   
subordination.                                                

The price to investors will vary from time to time and will be determined at the
time of sale. The proceeds to the company from the offering are expected to be  
approximately ___% of the aggregate principal balance of the offered            
certificates, less expenses which are estimated to be $_______. SEE "METHOD OF  
DISTRIBUTION" IN THIS PROSPECTUS SUPPLEMENT.                                    

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES         
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE   
ADEQUACY OF THIS PROSPECTUS. 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.        

 [NAME OF UNDERWRITER]
 UNDERWRITER

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

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT. WE HAVE NOT 
AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION.                    

We provide information to you about the offered certificates in two separate    
documents that progressively provide more detail:                               

o        the accompanying prospectus, which provides general information, some  
of which may not apply to this series of certificates; and    

o        this prospectus supplement, which describes the specific terms of this 
series of certificates.                                       

The Company's principal offices are located at 6021 244th Street SW, Mountlake  
Terrace, WA 98043 and its phone number is (800) 332-6452.                       

 TABLE OF CONTENTS

 PROSPECTUS SUPPLEMENT

SUMMARY OF PROSPECTUS SUPPLEMENT................................................
RISK FACTORS....................................................................
THE MORTGAGE POOL...............................................................
ADDITIONAL INFORMATION..........................................................
YIELD ON THE CERTIFICATES.......................................................
MARKET INTEREST RATE AND SUBORDINATION YIELD CONSIDERATIONS.....................
ASSUMED MORTGAGE LOAN CHARACTERISTICS...........................................
YIELD SENSITIVITY OF THE CLASS X CERTIFICATES...................................
YIELD SENSITIVITY OF THE SUBORDINATE CERTIFICATES...............................
ADDITIONAL YIELD CONSIDERATIONS APPLICABLE SOLELY TO THE RESIDUAL CERTIFICATES..
DESCRIPTION OF THE CERTIFICATES.................................................
POOLING AND SERVICING AGREEMENT.................................................
THE TRUSTEE.....................................................................
FEDERAL INCOME TAX CONSEQUENCES.................................................
METHOD OF DISTRIBUTION..........................................................
SECONDARY MARKET................................................................
LEGAL OPINIONS..................................................................
RATINGS.........................................................................
LEGAL INVESTMENT................................................................
ERISA CONSIDERATIONS............................................................
GLOSSARY........................................................................

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SUMMARY OF PROSPECTUS SUPPLEMENT

THE FOLLOWING SUMMARY IS A VERY BROAD OVERVIEW OF THE OFFERED CERTIFICATES AND  
DOES NOT CONTAIN ALL OF THE INFORMATION THAT YOU SHOULD CONSIDER IN MAKING YOUR 
INVESTMENT DECISION. TO UNDERSTAND ALL OF THE TERMS OF THE OFFERED CERTIFICATES,
READ CAREFULLY THIS ENTIRE PROSPECTUS SUPPLEMENT AND THE ENTIRE ACCOMPANYING    
PROSPECTUS. A GLOSSARY IS INCLUDED AT THE END OF THIS PROSPECTUS SUPPLEMENT.    
CAPITALIZED TERMS USED BUT NOT DEFINED IN THE GLOSSARY AT THE END OF THIS       
PROSPECTUS SUPPLEMENT HAVE THE MEANINGS ASSIGNED TO THEM IN THE GLOSSARY AT THE 
END OF THE PROSPECTUS.                                                          

Title of Series.........    MILA Mortgage Acceptance, Inc., Mortgage            
                 Pass-Through Certificates, Series ____-_.

Cut-off Date............    __________ __, ____.                                

Closing Date............    On or about __________ __, ____.                    

Company.................    MILA Mortgage Acceptance, Inc., an affiliate of     
MILA, Inc.              

Seller..................    [Name of Seller].                                   

Originator..............    [Name of Originator].                               

Master Servicer.........    [Name of Master Servicer].                          

Trustee.................    [Name of Trustee].                                  

Distribution Dates......    Distributions on the offered certificates will be   
                          made on the ___ day of each month, or, if such day
                     is not a business day, on the next succeeding
                      business day, beginning in _____________ ____.

Offered Certificates....    The classes of offered certificates and their       
                    pass-through rates and certificate principal
                         balances or notional amounts are set forth in the
table below.            

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                                                        [Enlarge/Download Table]

-------------------------------------------------------------------------------------------------------------------
          CLASS               PASS-THROUGH RATE        CERTIFICATE PRINCIPAL      INITIAL RATING    DESIGNATION    
                                                             BALANCE(1)                                            
-------------------------------------------------------------------------------------------------------------------
                                                                                                                   
A-1.....................           _____%                 $______________            (___/___)                     
A-2.....................           _____%                 $______________            (___/___)                     
A-3.....................           _____%                 $______________            (___/___)                     
A-4.....................           _____%                 $______________            (___/___)                     
A-5.....................           _____%                 $______________            (___/___)                     
A-6.....................           _____%                 $______________            (___/___)                     
X.......................           _____%                 $_____________ (2)         (___/___)                     
B-1.....................           _____%                 $______________            (___/___)                     
B-2.....................           _____%                 $______________            (___/___)                     
B-3.....................           _____%                 $______________            (___/___)                     
R.......................           _____%                      $ 100                 (___/___)                     
-------------------------------------------------------------------------------------------------------------------

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

______________________                                                          
(1)      Approximate.                                                           

(2)      Approximate initial notional amount.                                   

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THE TRUST                                                                       

The company will establish a trust with respect to the Series ____-_            
Certificates, pursuant to a pooling and servicing agreement dated as of         
__________ __, ____ among the company, the master servicer and the trustee.     
There are _____ classes of certificates representing the trust.                 

SEE "DESCRIPTION OF THE CERTIFICATES" IN THIS PROSPECTUS SUPPLEMENT.            

The certificates represent in the aggregate the entire beneficial ownership     
interest in the trust. Distributions of interest and/or principal on the offered
certificates will be made only from payments received in connection with the    
mortgage loans described below.                                                 

THE MORTGAGE LOANS                                                              

The trust will contain approximately _____ conventional, one- to four-family,   
[fixed-rate] mortgage loans secured by first liens on residential real          
properties. The mortgage loans have an aggregate principal balance of           
approximately $__________ as of _________ __ ____.                              

The mortgage loans have original terms to maturity of not greater than [30]     
years and the following characteristics as of __________ __, ____.              

Range of mortgage rates                                                         
(approximate):                      _____% to _____%.                           

Weighted average mortgage rate                                                  
(approximate):                      ______%.                                    

Weighted average remaining                                                      
term to stated maturity months.     ___  years  and  ___                        
months. 

Range of principal balances         $__________ to                              
(approximate):                      $____________.                              

Average principal balance:          $_____________.                             

Range of loan-to-value ratios                                                   
(approximate):                      ____% to ____%.                             

Weighted average loan-to-value      ______%.                                    
ratio (approximate):                                                            

FOR ADDITIONAL INFORMATION REGARDING THE MORTGAGE LOANS, SEE "THE MORTGAGE POOL"
IN THIS PROSPECTUS SUPPLEMENT.                                                  

THE CERTIFICATES                                                                

OFFERED CERTIFICATES. The offered certificates will have the characteristics    
shown in the table above in this prospectus supplement. The pass-through rates  
on each class of offered certificates (other than the Class X Certificates) are 
fixed and shown in the table above.                                             

The pass-through rate on the Class X Certificates is variable. Investors in the 
Class X Certificates should fully consider the risk that a rapid rate of        
prepayments on the mortgage loans that have net mortgage rates higher than ____%
could result in the failure of these investors to fully recover their           
investments.                                                                    

[The Class PO Certificates are not entitled to interest payments and their yield
is extremely sensitive to the rate of prepayments on the mortgage loans.]       

CREDIT ENHANCEMENT                                                              

The credit enhancement provided for the benefit of the holders of the offered   
certificates consists of subordination as described under "Description of the   
Certificates--Allocation of Losses; Subordination" in this prospectus           
supplement.                                                                     

OPTIONAL TERMINATION                                                            

At its option, the master servicer may purchase all of the mortgage loans,      
together with any properties in respect thereof acquired on behalf of the trust,
and thereby effect termination and early retirement of the certificates, after  
the aggregate principal balance of the mortgage loans (and properties acquired  
in respect thereof) remaining in the trust has been reduced to less than [10%]  
of the aggregate principal balance of the mortgage loans as of __________ __,   
____. SEE "POOLING AND SERVICING AGREEMENT--TERMINATION" IN THIS PROSPECTUS     
SUPPLEMENT.                                                                     

FEDERAL INCOME TAX CONSEQUENCES                                                 

An election will be made to treat the trust as a real estate mortgage investment
conduit for federal income tax purposes.                                        

SEE "FEDERAL INCOME TAX CONSEQUENCES" IN THIS PROSPECTUS SUPPLEMENT.            

RATINGS                                                                         

It is a condition to the issuance of the certificates that the offered          
certificates receive the following ratings from [______________ and             
__________________]:                                                            

OFFERED CERTIFICATES         [RA]            [RA]                           
------------------------        ---             ---                             
Class A-1 through Class                                                         
A6                              AAA             AAA                             
Class X                         AAA             AAA                             
Class B-1                       AA              AA                              
Class B2                        A               A                               
Class B3                        BBB             BBB                             
Class R                         AAA             AAA                             

_____________________                                                           
[(1) Not rated.]                                                                

SEE "YIELD ON THE CERTIFICATES" AND "RATINGS" IN THIS PROSPECTUS SUPPLEMENT AND 
"YIELD CONSIDERATIONS" IN THE PROSPECTUS.                                       

LEGAL INVESTMENT                                                                

The offered certificates (other than the Class ___ and Class ___ Certificates)  
will constitute "mortgage related securities" for purposes of SMMEA. The Class  
___ Certificates and the Class ___ Certificates will not constitute "mortgage   
related securities" for purposes of SMMEA.                                      

SEE "LEGAL INVESTMENT" IN THIS PROSPECTUS SUPPLEMENT AND IN THE PROSPECTUS.     

ERISA CONSIDERATIONS                                                            

The offered certificates (other than the Class R Certificates) may be purchased 
by persons investing assets of employee benefit plans or individual retirement  
accounts, subject to important considerations. Plans should consult with their  
legal advisors before investing in the offered certificates.                    

SEE "ERISA CONSIDERATIONS" IN THIS PROSPECTUS SUPPLEMENT.                       

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RISK FACTORS

  You should carefully consider, among other things, the following
factors in connection with the purchase of the offered certificates:            

 [APPROPRIATE RISK FACTORS FROM THE FOLLOWING LIST AS NECESSARY]

THE OFFERED CERTIFICATES WILL HAVE LIMITED LIQUIDITY, SO YOU MAY BE UNABLE TO   
SELL YOUR SECURITIES OR MAY BE FORCED TO SELL THEM AT A DISCOUNT FROM THEIR FAIR
MARKET VALUE                                                                    

   There can be no assurance that a secondary market for the offered
certificates of any series will develop or, if it does develop, that it will    
provide offered certificateholders with liquidity of investment or that it will 
continue for the life of the offered certificates of any series. The prospectus 
supplement for any series of offered certificates may indicate that an          
underwriter specified therein intends to establish a secondary market in the    
offered certificates, however no underwriter will be obligated to do so. As a   
result, any resale prices that may be available for any offered certificate in  
any market that may develop may be at a discount from the initial offering price
or the fair market value thereof. The offered certificates will not be listed on
any securities exchange.                                                        

CREDIT ENHANCEMENT IS LIMITED; THE FAILURE OF CREDIT ENHANCEMENT TO COVER LOSSES
ON THE TRUST FUND ASSETS MAY RESULT IN LOSSES ALLOCATED TO THE OFFERED          
CERTIFICATES                                                                    

      With respect to the offered certificates, credit enhancement will be
provided in limited amounts to cover various types of losses on the underlying  
mortgage loans. Credit enhancement will be provided in one or more of the forms 
referred to in this prospectus supplement, including: subordination of any      
subordinate securities of the same series; a financial guaranty insurance       
policy; a letter of credit; a purchase obligation; a mortgage pool insurance    
policy; a special hazard insurance policy; overcollateralization; a reserve     
fund; a cash flow agreement; or any combination thereof. SEE "SUBORDINATION" AND
"DESCRIPTION OF CREDIT ENHANCEMENT" IN THE PROSPECTUS. Regardless of the form of
credit enhancement provided, 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 enhancement may provide only very      
limited coverage as to some types of losses or risks, and may provide no        
coverage as to other types of losses or risks. In the event losses exceed the   
amount of coverage provided by any credit enhancement or losses of a type not   
covered by any credit enhancement occur, they will be borne by the holders of   
the related offered certificates in the order described in this prospectus      
supplement. The company, the master servicer or other specified person will     
generally be permitted to reduce, terminate or substitute all or a portion of   
the credit enhancement for any series of offered certificates, if each          
applicable rating agency indicates that the then-current rating(s) thereof will 
not be adversely affected. The ratings of any series of offered certificates by 
any applicable rating agencies may be lowered following the initial issuance    
thereof as a result of the downgrading of the obligations of any applicable     
credit support provider, or as a result of losses on the related mortgage loans 
in excess of the levels contemplated by the rating agencies at the time of their
initial rating analysis. Neither the company, the master servicer nor 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(s) of
any series of offered certificates. SEE "DESCRIPTION OF CREDIT                  
ENHANCEMENT--REDUCTION OR SUBSTITUTION OF CREDIT ENHANCEMENT" IN THE PROSPECTUS.

THE RATINGS ON THE OFFERED CERTIFICATES ARE NOT A RECOMMENDATION TO BUY, SELL OR
HOLD THE OFFERED CERTIFICATES AND ARE SUBJECT TO WITHDRAWAL AT ANY TIME, WHICH  
MAY RESULT IN LOSSES ON THE OFFERED CERTIFICATES.                               

         It is a condition to the issuance of the offered certificates that each
class of offered certificates be rated in one of the four highest rating        
categories by a nationally recognized statistical rating agency. A security     
rating is not a recommendation to buy, sell or hold securities and may be       
subject to revision or withdrawal at any time. No person is obligated to        
maintain the rating on any offered certificate, and, accordingly, there can be  
no assurance that the ratings assigned to any offered certificate on the date on
which the offered certificates are initially issued will not be lowered or      
withdrawn by a rating agency at any time thereafter. In the event any rating is 
revised or withdrawn, the liquidity or the market value of the related offered  
certificates may be adversely affected. SEE "RATINGS" IN THIS PROSPECTUS        
SUPPLEMENT AND IN THE PROSPECTUS.                                               

STATUTORY AND JUDICIAL LIMITATIONS ON FORECLOSURE PROCEDURES MAY DELAY RECOVERY 
IN RESPECT OF THE MORTGAGED PROPERTY AND, IN SOME INSTANCES, LIMIT THE AMOUNT   
THAT MAY BE RECOVERED BY THE FORECLOSING LENDER, RESULTING IN LOSSES ON THE     
MORTGAGE LOANS THAT MIGHT BE ALLOCATED TO THE OFFERED CERTIFICATES.             

  Foreclosure procedures may vary from state to state. Two primary
methods of foreclosing a mortgage instrument are judicial foreclosure, involving
court proceedings, and non-judicial foreclosure pursuant to a power of sale     
granted in the mortgage instrument. A foreclosure action is subject to most of  
the delays and expenses of other lawsuits if defenses are raised or             
counterclaims are asserted. Delays may also result from difficulties in locating
necessary defendants. Non-judicial foreclosures may be subject to delays        
resulting from state laws mandating the recording of notice of default and      
notice of sale and, in some states, notice to any party having an interest of   
record in the real property, including junior lienholders. Some states have     
adopted "anti-deficiency" statutes that limit the ability of a lender to collect
the full amount owed on a loan if the property sells at foreclosure for less    
than the full amount owed. In addition, United States courts have traditionally 
imposed general equitable principles to limit the remedies available to lenders 
in foreclosure actions that are perceived by the court as harsh or unfair. The  
effect of these statutes and judicial principles may be to delay and/or reduce  
distributions in respect of the offered certificates. SEE "LEGAL ASPECTS OF     
MORTGAGE LOANS--FORECLOSURE ON MORTGAGE LOANS" IN THE PROSPECTUS.               

THE VALUE OF THE MORTGAGE LOANS MAY BE AFFECTED BY, AMONG OTHER THINGS, A       
DECLINE IN REAL ESTATE VALUES AND CHANGES IN THE BORROWERS' FINANCIAL CONDITION,
WHICH MAY RESULT IN LOSSES ON THE OFFERED CERTIFICATES.                         

        No assurance can be given that values of the mortgaged properties have
remained or will remain at their levels on the dates of origination of the      
related mortgage loans. If the residential real estate market should experience 
an overall decline in property values so that the outstanding balances of the   
mortgage loans, and any secondary financing on the mortgaged properties, in a   
particular mortgage pool become equal to or greater than the value of the       
mortgaged properties, the actual rates of delinquencies, foreclosures and losses
could be higher than those now generally experienced in the mortgage lending    
industry. In particular, mortgage loans with high loan-to-value ratios will be  
affected by any decline in real estate values. Any decrease in the value of the 
mortgage loans may result in the allocation of losses which are not covered by  
credit enhancement to the offered certificates.                                 

THE MORTGAGE LOANS WERE UNDERWRITTEN TO NON-CONFORMING UNDERWRITING STANDARDS,  
WHICH MAY RESULT IN LOSSES OR SHORTFALLS TO BE INCURRED ON THE OFFERED          
CERTIFICATES                                                                    

   The mortgage loans were underwritten generally in accordance with
underwriting standards which are primarily intended to provide for single family
"non-conforming" mortgage loans. A "non-conforming" mortgage loan means a       
mortgage loan which is ineligible for purchase by Fannie Mae or Freddie Mac due 
to either credit characteristics of the related mortgagor or documentation      
standards in connection with the underwriting of the related mortgage loan that 
do not meet the Fannie Mae or Freddie Mac underwriting guidelines for "A" credit
mortgagors. These credit characteristics include mortgagors whose               
creditworthiness and repayment ability do not satisfy such Fannie Mae or Freddie
Mac underwriting guidelines and mortgagors who may have a record of credit      
write-offs, outstanding judgments, prior bankruptcies and other credit items    
that do not satisfy such Fannie Mae or Freddie Mac underwriting guidelines.     
These documentation standards may include mortgagors who provide limited or no  
documentation in connection with the underwriting of the related mortgage loan. 
Accordingly, mortgage loans underwritten under the seller's non-conforming      
credit underwriting standards are likely to experience rates of delinquency,    
foreclosure and loss that are higher, and may be substantially higher, than     
mortgage loans originated in accordance with the Fannie Mae or Freddie Mac      
underwriting guidelines. Any resulting losses, to the extent not covered by     
credit enhancement, will affect the yield to maturity of the offered            
certificates.                                                                   

THE MORTGAGE LOANS HAVE VARIABLE PAYMENTS, WHICH MAY RESULT IN LOSSES WITH      
RESPECT TO THESE MORTGAGE LOANS                                                 

      Some of the types of loans included in the mortgage pool may involve
additional uncertainties not present in traditional types of loans. In the case 
of mortgage loans that are subject to negative amortization, due to the addition
to principal balance of deferred interest, the principal balances of these      
mortgage loans could be increased to an amount equal to or in excess of the     
value of the underlying mortgaged properties, thereby increasing the likelihood 
of default. In the case of buydown loans, the increase in the monthly payment by
the mortgagor during and following the buydown period may result in an increased
risk of default on a buydown loan. Some of the mortgage loans provide for       
escalating or variable payments by the mortgagor, as to which the mortgagor is  
generally qualified on the basis of the initial payment amount. In some         
instances, mortgagors may not be able to make their loan payments as payments   
increase and thus the likelihood of default will increase.                      

       This is a consideration with respect to revolving credit loans, since
additional draws may be made by the mortgagor in the future up to the applicable
credit limit. Although revolving credit loans are generally subject to          
provisions whereby the credit limit may be reduced as a result of a material    
adverse change in the mortgagor's economic circumstances, the servicer or master
servicer generally will not monitor for these changes and may not become aware  
of them until after the mortgagor has defaulted. Under extreme circumstances, a 
mortgagor may draw his entire credit limit in response to personal financial    
needs resulting from an adverse change in circumstances. For a series of offered
certificates backed by the trust balances of revolving credit loans, even though
the trust balance of a revolving credit loan will not increase as a result of   
draws after the offered certificates are issued, the foregoing considerations   
are relevant because the trust balance will share pro rata in any losses        
incurred on a revolving credit loan.                                            

       Any risks associated with the variable payments of the mortgage loans
may affect the yield to maturity of the offered certificates to the extent of   
losses caused by these risks which are not covered by credit enhancement are    
allocated to the offered certificates.                                          

THE MORTGAGE LOANS ARE SECURED BY JUNIOR LIENS, WHICH MAY RESULT IN LOSSES WITH 
RESPECT TO THESE MORTGAGE LOANS                                                 

        The mortgage loan are secured by second liens on the related mortgaged
properties. As to mortgage loans secured by second mortgages, the proceeds from 
any liquidation, insurance or condemnation proceedings will be available to     
satisfy the outstanding balance of these mortgage loans only to the extent that 
the claims of the senior mortgages have been satisfied in full, including any   
related foreclosure costs. In addition, the holder of a mortgage loan secured by
a junior mortgage may not foreclose on the mortgaged property unless it         
forecloses subject to the senior mortgages, in which case it must either pay the
entire amount due on the senior mortgages to the senior mortgagees at or prior  
to the foreclosure sale or undertake the obligation to make payments on the     
senior mortgages in the event the mortgagor is in default. The trust fund will  
not have any source of funds to satisfy the senior mortgages or make payments   
due to the senior mortgagees, although the master servicer or servicer may, at  
its option, advance these amounts to the extent deemed recoverable and prudent. 
In the event that proceeds from a foreclosure or similar sale of the related    
mortgaged property are insufficient to satisfy all senior liens and the mortgage
loan in the aggregate, the trust fund, as the holder of the junior lien, and,   
accordingly, holders of one or more classes of the offered certificates, to the 
extent not covered by credit enhancement, are likely to (1) incur losses in     
jurisdictions in which a deficiency judgment against the borrower is not        
available, and (2) incur losses if any deficiency judgment obtained is not      
realized upon. In addition, the rate of default of second mortgage loans may be 
greater than that of mortgage loans secured by first liens on comparable        
properties.                                                                     

SOME OF THE MORTGAGE LOANS ARE HIGH BALANCE MORTGAGE LOANS                      

     ________ mortgage loans, constituting _____% of the mortgage loans,
have a principal balance of over $_______________ as of the cut-off date.       
Investors are urged to consider the risk that the prepayment, loss and          
delinquency experience on these mortgage loans may have a disproportionate      
effect on the mortgage loans as a whole. A prepayment of these mortgage loans   
may result in a substantial reduction of the weighted average life of the senior
certificates. A loss of the entire principal balance of these mortgage loans may
result in a substantial realized loss, which maybe allocated to the offered     
certificates.                                                                   

THE MORTGAGE LOANS ARE CONCENTRATED IN THE STATE OF [NAME OF STATE], WHICH MAY  
RESULT IN LOSSES WITH RESPECT TO THESE MORTGAGE LOANS                           

       Approximately ___% of the mortgage loans are in the state of [Name of
State.] Investors should note that some geographic regions of the United States 
from time to time will experience weaker regional economic conditions and       
housing markets, and, consequently, 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 directly, or indirectly,  
adversely affected by natural disasters or civil disturbances such as           
earthquakes, hurricanes, floods, eruptions or riots. The economic impact of any 
of these types of events may also be felt in areas beyond the region immediately
affected by the disaster or disturbance. The mortgage loans securing the offered
certificates may be concentrated in these regions, and any concentration may    
present risk considerations in addition to those generally present for similar  
mortgage-backed securities without this concentration. Moreover, as described   
below, any mortgage loan for which a breach of a representation or warranty     
exists will remain in the related trust fund in the event that a seller is      
unable, or disputes its obligation, to repurchase the mortgage loan and the     
breach does not also constitute a breach of any representation made by any other
person. In this event, any resulting losses will be borne by the related form of
credit enhancement, to the extent available. Any risks associated with mortgage 
loan concentration may affect the yield to maturity of the offered certificates 
to the extent losses caused by these risks which are not covered by [credit     
enhancement] are allocated to the offered certificates.                         

SOME OF THE MORTGAGE LOANS PROVIDE FOR BALLOON PAYMENTS AT MATURITY, WHICH MAY  
RESULT IN A GREATER RISK OF LOSS WITH RESPECT TO THESE MORTGAGE LOANS           

   Approximately ___% of the mortgage loans are balloon loans. These
mortgage loans will require substantial payments of principal and interest (that
is, balloon payments) at their stated maturity. Mortgage loans of this type     
involve a greater degree of risk than self-amortizing loans because the ability 
of a mortgagor to make a balloon payment typically will depend upon its ability 
either to fully refinance the loan or to sell the related mortgaged property at 
a price sufficient to permit the mortgagor to make the balloon payment. The     
ability of a mortgagor to accomplish either of these goals will be affected by a
number of factors, including the value of the related mortgaged property, the   
level of available mortgage rates at the time of sale or refinancing, the       
mortgagor's equity in the related mortgaged property, prevailing general        
economic conditions, the availability of credit for loans secured by comparable 
real properties. Any risks associated with the balloon loans may affect the     
yield to maturity of the offered certificates to the extent losses caused by    
these risks which are not covered by credit enhancement are allocated to the    
offered certificates.                                                           

SOME OF THE MORTGAGE LOANS HAVE AN INITIAL INTEREST ONLY PERIOD, WHICH MAY      
RESULT IN INCREASED DELINQUENCIES AND LOSSES WITH RESPECT TO THESE MORTGAGE     
LOANS                                                                           

  Approximately ____%, ____%, ____%, ____% and ____% of the sample
mortgage loans (by aggregate outstanding principal balance of the sample        
mortgage loans as of the cut-off date) have initial interest only periods of    
thirty months, three years, five years, seven years and ten years, respectively.
During this period, the payment made by the related borrower will be less than  
it would be if the mortgage loan amortized. In addition, the mortgage loan      
balance will not be reduced by the principal portion of scheduled monthly       
payments during this period. As a result, no principal payments will be made to 
the offered certificates from these mortgage loans during their interest only   
period except in the case of a prepayment.                                      

       After the initial interest only period, the scheduled monthly payment
on these mortgage loans will increase, which may result in increased            
delinquencies by the related borrowers, particularly if interest rates have     
increased and the borrower is unable to refinance. In addition, losses may be   
greater on these mortgage loans as a result of the mortgage loan not amortizing 
during the early years of these mortgage loans. Although the amount of principal
included in each scheduled monthly payment for a traditional mortgage loan is   
relatively small during the first few years after the origination of a mortgage 
loan, in the aggregate the amount can be significant. Any resulting             
delinquencies and losses, to the extent not covered by credit enhancement, will 
be allocated to the offered certificates.                                       

        Mortgage loans with an initial interest only period are relatively new
in the mortgage marketplace. The performance of these mortgage loans may be     
significantly different than mortgage loans that fully amortize. In particular, 
there may be a higher expectation by these borrowers of refinancing their       
mortgage loans with a new mortgage loan, in particular one with an initial      
interest only period, which may result in higher or lower prepayment speeds than
would otherwise be the case. In addition, the failure to build equity in the    
property by the related mortgagor may affect the delinquency and prepayment of  
these mortgage loans.                                                           

THE MORTGAGE LOANS MAY HAVE LIMITED RECOURSE TO THE RELATED BORROWER, WHICH MAY 
RESULT IN LOSSES WITH RESPECT TO THESE MORTGAGE LOANS                           

      Some or all of the mortgage loans included in the trust fund will be
nonrecourse loans or loans for which recourse may be restricted or              
unenforceable. As to those mortgage loans, recourse in the event of mortgagor   
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 mortgagor 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 mortgagor will  
be sufficient to permit a recovery in respect of a defaulted mortgage loan in   
excess of the liquidation value of the related mortgaged property. Any risks    
associated with mortgage loans with no or limited recourse may affect the yield 
to maturity of the offered certificates to the extent losses caused by these    
risks which are not covered by credit enhancement are allocated to the offered  
certificates.                                                                   

THE MORTGAGE LOANS HAVE HIGH COMBINED LOAN-TO-VALUE RATIOS, SO THAT THE RELATED 
BORROWER HAS LITTLE OR NO EQUITY IN THE RELATED MORTGAGED PROPERTY, WHICH MAY   
RESULT IN LOSSES WITH RESPECT TO THESE MORTGAGE LOANS                           

    The mortgage loans have combined loan-to-value ratios in excess of
100%. These mortgage loans were originated with a limited expectation of        
recovering any amounts from the foreclosure of the related mortgaged property   
and are underwritten with an emphasis on the creditworthiness of the related    
borrower.                                                                       

       If these mortgage loans go into foreclosure and are liquidated, there
may be no amounts recovered from the related mortgaged property because the     
value of the collateral with respect to such mortgage loan may be less than the 
amount of the mortgage loan. Unless the value of the property increases or the  
principal amount of the related senior liens have been reduced so as to reduce  
the current combined loan-to-value ratio of the related mortgage loan to below  
100%, there may be no recovery from the related mortgaged property in the event 
of foreclosure. Any resulting losses, to the extent not covered by credit       
enhancement, may affect the yield to maturity of the offered certificates.      

THE MORTGAGE LOANS PROVIDE FOR REVOLVING LINES OF CREDIT, WHICH MAY RESULT IN   
LOSSES WITH RESPECT TO THESE MORTGAGE LOANS                                     

        With respect to revolving credit loans, except for some programs under
which the draw period is less than the full term thereof, required minimum      
monthly payments are generally equal to or not significantly larger than the    
amount of interest currently accruing on its balance, and therefore are not     
expected to significantly amortize the outstanding principal amount of these    
mortgage loans prior to maturity, which amount may include substantial draws    
recently made. As a result, a borrower will generally be required to pay a      
substantial principal amount at the maturity of a revolving credit loan. The    
ability of a borrower to make this payment may be dependent on the ability to   
obtain refinancing of the balance due on the revolving credit loan or to sell   
the related mortgaged property. Furthermore, revolving credit loans generally   
have adjustable rates that are subject to much higher maximum rates than        
typically apply to adjustable rate first lien mortgage loans, and which may be  
as high as applicable usury limitations. Mortgagors under revolving credit loans
are generally qualified based on an assumed payment which reflects either the   
initial interest rate or a rate significantly lower than the maximum rate. An   
increase in the interest rate over the mortgage rate applicable at the time the 
revolving credit loan was originated may have an adverse effect on the ability  
of the mortgagor to pay the required monthly payment. In addition, an increase  
in prevailing market interest rates may reduce the borrower's ability to obtain 
refinancing and to pay the balance of a revolving credit loan at its maturity.  

VIOLATION OF VARIOUS FEDERAL, STATE AND LOCAL LAWS MAY RESULT IN LOSSES ON THE  
MORTGAGE LOANS                                                                  

      Applicable federal, state and local laws generally regulate interest
rates and other charges, require specific disclosures, prohibit unfair and      
deceptive practices, regulate debt collection, and require licensing of the     
originators of the mortgage loans and contracts. Depending on the provisions of 
the applicable law and the specified facts and circumstances involved,          
violations of those laws, policies and principles may limit the ability to      
collect all or part of the principal of or interest on the mortgage loans and   
may entitle the borrower to a refund of amounts previously paid. SEE "LEGAL     
ASPECTS OF MORTGAGE LOANS" IN THE PROSPECTUS. To the extent these laws and      
regulations result in losses on the mortgage loans, the yield to maturity of the
offered certificates, to the extent not covered by credit enhancement, may be   
affected.                                                                       

THE RATE OF PREPAYMENTS ON THE TRUST FUND ASSETS AND THE PURCHASE PRICE YOU PAID
FOR THE OFFERED CERTIFICATES MAY CAUSE YOUR YIELD TO BE LOWER THAN ANTICIPATED  

       The yield to maturity of the offered certificates of each series will
depend on, among other things, the rate and timing of principal payments        
(including prepayments, liquidations due to defaults, and repurchases due to    
conversion of adjustable rate loans to fixed interest rate loans or breaches of 
representations and warranties), or draws (if applicable) on the related        
mortgage loans and the price paid by offered certificateholders. The yield may  
be adversely affected by a higher or lower than anticipated rate of prepayments 
(or draws if applicable) on the related mortgage loans. The yield to maturity on
interest only offered certificates will be extremely sensitive to the rate of   
prepayments (or draws if applicable) on the related mortgage loans. In addition,
the yield to maturity on other types of classes of offered certificates,        
including offered certificates with an accrual feature, offered certificates    
with an interest rate which fluctuates based on an index or inversely with an   
index or other classes in a series including more than one class of offered     
certificates, may be relatively more sensitive to the rate of prepayment (or    
draws if applicable) on the related mortgage loans than other classes of offered
certificates. In addition, to the extent amounts in any funding account have not
been used to purchase additional mortgage loans, holders of the offered         
certificates may receive an additional prepayment. Prepayments are influenced by
a number of factors, including prevailing mortgage market interest rates, local 
and regional economic conditions and homeowner mobility. SEE "YIELD             
CONSIDERATIONS" AND "MATURITY AND PREPAYMENT CONSIDERATIONS" IN THE PROSPECTUS. 

[THE RATE AND TIMING OF PRINCIPAL DISTRIBUTIONS ON THE OFFERED CERTIFICATES WILL
BE AFFECTED BY PREPAYMENT SPEEDS                                                

    The rate and timing of distributions allocable to principal on the
Class A Certificates will depend, in general, on the rate and timing of         
principal payments (including prepayments and collections upon defaults,        
liquidations and repurchases) on the mortgage loans and the allocation thereof  
to pay principal on these certificates as provided in this prospectus           
supplement. The rate and timing of distributions allocable to principal on the  
other classes of offered certificates, other than the Class X Certificates, will
depend in general, on the rate and timing of principal payments (including      
prepayments and collections upon defaults, liquidations and repurchases) on all 
of the mortgage loans and the allocation thereof to pay principal on these      
certificates as provided in this prospectus supplement. As is the case with     
mortgage pass-through certificates generally, the offered certificates are      
subject to substantial inherent cash-flow uncertainties because the mortgage    
loans may be prepaid at any time. However, with respect to approximately _____% 
of the mortgage loans, by aggregate principal balance as of ________ __, ____, a
prepayment may subject the related mortgagor to a prepayment charge, which may  
act as a deterrent to prepayment of the mortgage loan. SEE "THE MORTGAGE POOL"  
IN THIS PROSPECTUS SUPPLEMENT.                                                  

      Generally, when prevailing interest rates are increasing, prepayment
rates on mortgage loans tend to decrease. A decrease in the prepayment rates on 
the mortgage loans will result in a reduced rate of return of principal to      
investors in the Class A Certificates at a time when reinvestment at higher     
prevailing rates would be desirable. A decrease in the prepayment rates on all  
of the mortgage loans will result in a reduced rate of return of principal to   
investors in the other classes of offered certificates, other than the Class X  
Certificates, at a time when reinvestment at higher prevailing rates would be   
desirable.                                                                      

      Conversely, when prevailing interest rates are declining, prepayment
rates on mortgage loans tend to increase. An increase in the prepayment rates on
the mortgage loans will result in a greater rate of return of principal to      
investors in the related Class A Certificates, at time when reinvestment at     
comparable yields may not be possible. An increase in the prepayment rates on   
all of the mortgage loans will result in a greater rate of return of principal  
to investors in the other classes of offered certificates, other than the Class 
X Certificates, at a time when reinvestment at comparable yields may not be     
possible.                                                                       

 Prior to the distribution date in _______ ____, the subordinate
certificates will be entitled to receive distributions allocable to principal   
based on a disproportionately small percentage of principal prepayments on the  
mortgage loans, and the Class A Certificates will be entitled to receive        
distributions allocable to principal based on a disproportionately large        
percentage (which may be 100%) of principal prepayments on the mortgage loans.  
To the extent that no principal prepayments or a disproportionately small       
percentage of prepayments are distributed on the subordinate certificates, the  
subordination afforded to the Class A Certificates, in the absence of losses    
allocated to the Class A Certificates, will be increased.                       

       For further information regarding the effect of principal prepayments
on the weighted average lives of the offered certificates, see "YIELD ON THE    
CERTIFICATES" in this prospectus supplement, including the table entitled       
"PERCENT OF INITIAL CERTIFICATE PRINCIPAL BALANCE OUTSTANDING AT THE FOLLOWING  
PERCENTAGES OF THE PREPAYMENT ASSUMPTION" in this prospectus supplement].       

THE MORTGAGE LOANS MAY HAVE ENVIRONMENTAL RISKS, WHICH MAY RESULT IN INCREASED  
LOSSES WITH RESPECT TO THESE MORTGAGE LOANS                                     

         To the extent the master servicer for a mortgage loan acquires title to
any related mortgaged property with contaminated with or affected by hazardous  
wastes or hazardous substances, these mortgage loans may incur losses. SEE      
"SERVICING OF MORTGAGE LOANS--REALIZATION UPON OR SALE OF DEFAULTED MORTGAGE    
LOANS" AND "LEGAL ASPECTS OF MORTGAGE LOANS--ENVIRONMENTAL LEGISLATION" IN THE  
PROSPECTUS. To the extent these environmental risks result in losses on the     
mortgage loans, the yield to maturity of the offered certificates, to the extent
not covered by credit enhancement, may be affected.                             

THE [CLASS ___ CERTIFICATES] ARE ERISA-RESTRICTED, WHICH BY RESTRICTING THE     
MARKET, MAY AFFECT THE LIQUIDITY OF THE OFFERED CERTIFICATES                    

        Generally, ERISA applies to investments made by employee benefit plans
and transactions involving the assets of plans. Due to the complexity of        
regulations that govern these plans, prospective investors that are subject to  
ERISA are urged to consult their own counsel regarding consequences under ERISA 
of acquisition, ownership and disposition of the offered certificates of any    
series. SEE "ERISA CONSIDERATIONS" IN THIS PROSPECTUS SUPPLEMENT AND IN THE     
PROSPECTUS.                                                                     

[SOME MORTGAGE LOANS ARE DELINQUENT AS OF THE CUT-OFF DATE, WHICH MAY PRESENT A 
GREATER RISK OF LOSS WITH RESPECT TO THESE MORTGAGE LOANS                       

   Approximately ____% of the mortgage loans, by aggregate principal
balance as of ________ __, ____, were thirty days or more but less than sixty   
days delinquent in their monthly payments as of _______ __, ____. Approximately 
____% of the mortgage loans, by aggregate principal balance as of ________ __,  
____, were sixty days or more but less than ninety days delinquent in their     
monthly payments as of the _________ __, ____. However, investors in the        
mortgage loans should realize that approximately _____% of the mortgage loans,  
by aggregate principal balance as of ________ __, ____, have a first payment    
date occurring on or after _________ __, ____ and, therefore, these mortgage    
loans could not have been delinquent as of ________ __, ____].                  

[THE YIELD TO MATURITY ON THE OFFERED CERTIFICATES WILL DEPEND ON A VARIETY OF  
FACTORS                                                                         

     The yield to maturity on the offered certificates, particularly the
Class X Certificates, will depend, in general, on:                              

o        the applicable purchase price; and                                     

o        the rate and timing of principal payments (including prepayments and   
         collections upon defaults, liquidations and repurchases) on the related
     mortgage loans and the allocation thereof to reduce the certificate
      principal balance or notional amount of the offered certificates, as
well as other factors.                                        

      The yield to investors on the offered certificates will be adversely
affected by any allocation thereto of interest shortfalls on the mortgage loans.

 In general, if the offered certificates, other than the Class X
Certificates, are purchased at a premium and principal distributions occur at a 
rate faster than anticipated at the time of purchase, the investor's actual     
yield to maturity will be lower than that assumed at the time of purchase.      
Conversely, if the offered certificates, other than the Class X Certificates,   
are purchased at a discount and principal distributions occur at a rate slower  
than that anticipated at the time of purchase, the investor's actual yield to   
maturity will be lower than that originally assumed.                            

       The proceeds to the company from the sale of the offered certificates
were determined based on a number of assumptions, including a prepayment        
assumption of ____% of the standard prepayment assumption, and weighted average 
lives corresponding thereto. No representation is made that the mortgage loans  
will prepay at this rate or at any other rate, or that the mortgage loans will  
prepay at the same rate. The yield assumptions for the offered certificates will
vary as determined at the time of sale. SEE "YIELD ON THE CERTIFICATES" IN THIS 
PROSPECTUS SUPPLEMENT].                                                         

[THE MULTIPLE CLASS STRUCTURE OF THE OFFERED CERTIFICATES CAUSES THE YIELD OF   
SOME CLASSES TO BE PARTICULARLY SENSITIVE TO CHANGES IN THE RATES OF PREPAYMENT 
OF THE RELATED MORTGAGE LOANS AND OTHER FACTORS                                 

CLASS X CERTIFICATES: The Class X Certificates will receive a portion of the    
interest payments ONLY from mortgage loans that have net mortgage rates higher  
than ____%. Therefore, the yield on the Class X Certificates will be extremely  
sensitive to the rate and timing of principal prepayments and defaults on the   
mortgage loans. Investors in the Class X Certificates should be aware that      
mortgage loans with higher mortgage rates may prepay faster than mortgage loans 
with lower mortgage rates. If the mortgage loans that have net mortgage rates   
higher than ____% are prepaid at a rate faster than an investor assumed at the  
time of purchase, the yield to investors in the Class X Certificates will be    
adversely affected. Investors in the Class X Certificates should fully consider 
the risk that a rapid rate of prepayments on the mortgage loans that have net   
mortgage rates higher than ____% could result in the failure of these investors 
to fully recover their investments.                                             

[CLASS PO CERTIFICATES: The Class PO Certificates are extremely sensitive to the
rate of prepayments on the mortgage loans. A slower than expected rate of       
principal prepayments may result in a negative yield to investors in the Class  
PO Certificates.]                                                               

SUBORDINATE CERTIFICATES: The weighted average lives of, and the yield to       
maturity on, the Class B-1 Certificates, the Class B-2 Certificates and the     
Class B-3 Certificates will be progressively more sensitive, in increasing order
of their numerical class designations, to losses due to defaults on the mortgage
loans (and the timing thereof), to the extent these losses are not covered by   
subordinate certificates with a higher numerical class designation (including   
covered by the Class B-4, Class B-5 and Class B-6 Certificates which are not    
offered by this prospectus supplement). Furthermore, as described in this       
prospectus supplement, the timing of receipt of principal and interest by any   
class of subordinate certificates may be adversely affected by losses even if   
this class does not ultimately bear this loss].                                 

[THE RESIDUAL CERTIFICATES WILL RECEIVE LIMITED DISTRIBUTIONS OF PRINCIPAL AND  
INTEREST AND MAY HAVE SIGNIFICANT TAX LIABILITIES                               

Holders of the Class R Certificates are entitled to receive   
distributions of principal and interest as described in this prospectus         
supplement, but the holders of the Class R Certificates are not expected to     
receive any distributions after the first distribution date. In addition,       
holders of the Class R Certificates will have tax liabilities with respect to   
their certificates during the early years of the term of the trust that         
substantially exceed the principal and interest payable during or prior to that 
time. SEE "FEDERAL INCOME TAX CONSEQUENCES" BELOW AND IN THE PROSPECTUS AND     
"YIELD ON THE CERTIFICATES--ADDITIONAL YIELD CONSIDERATIONS APPLICABLE SOLELY TO
THE RESIDUAL CERTIFICATES" IN THIS PROSPECTUS SUPPLEMENT].                      

[VIOLATION OF VARIOUS FEDERAL, STATE AND LOCAL LAWS MAY RESULT IN LOSSES ON THE 
MORTGAGE LOANS                                                                  

       Applicable state and local laws generally regulate interest rates and
other charges, require specific disclosure, and require licensing of the        
originator. In addition, other state and local laws, public policy and general  
principles of equity relating to the protection of consumers, unfair and        
deceptive practices and debt collection practices may apply to the origination, 
servicing and collection of the mortgage loans.                                 

 The mortgage loans are also subject to federal laws, including:

o        the Federal Truth-in-Lending Act and Regulation Z promulgated          
 thereunder, which require specific disclosures to the borrowers
regarding the terms of the mortgage loans;                    

o        the Equal Credit Opportunity Act and Regulation B promulgated          
      thereunder, which 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; and        

o        the Fair Credit Reporting Act, which regulates the use and reporting of
information related to the borrower's credit experience.      

    Depending on the provisions of the applicable law and the specific
facts and circumstances involved, violations of these federal or state laws,    
policies and principles may limit the ability of the trust to collect all or    
part of the principal of or interest on the mortgage loans, may entitle the     
borrower to a refund of amounts previously paid and, in addition, could subject 
the originator to damages and administrative enforcement. SEE "LEGAL ASPECTS OF 
THE MORTGAGE LOANS" IN THE PROSPECTUS.                                          

 The originator will represent that as of the closing date, each
mortgage loan is in compliance with applicable federal and state laws and       
regulations. In the event of a breach of this representation, it will be        
obligated to cure the breach or repurchase or replace the affected mortgage loan
in the manner described in the prospectus].                                     

 THE MORTGAGE POOL

GENERAL                                                                         

        References to percentages of the mortgage loans unless otherwise noted
are calculated based on the aggregate principal balance of the mortgage loans as
of the Cut-off Date.                                                            

     The mortgage pool will consist of approximately _____ conventional,
one- to four-family, [fixed-rate,] fully-amortizing mortgage loans secured by   
first liens on mortgaged properties and having an aggregate principal balance as
of the Cut-off Date of approximately $___________, after application of         
scheduled payments due on or before the Cut-off Date whether or not received and
subject to a permitted variance of plus or minus __%. The mortgage loans have   
original terms to maturity of not greater than [30] years.                      

        The mortgage loans are secured by first mortgages or deeds of trust or
other similar security instruments creating first liens on one- to four-family  
residential properties consisting of one- to four-family dwelling units,        
townhouses, individual condominium units and individual units in planned unit   
developments. The mortgage loans to be included in the mortgage pool will be    
acquired by the company from the Originator.                                    

    SEE "--UNDERWRITING STANDARDS; REPRESENTATIONS" IN THIS PROSPECTUS
SUPPLEMENT. THE ORIGINATOR WILL ACT AS THE MASTER SERVICER FOR THE MORTGAGE     
LOANS ORIGINATED BY IT PURSUANT TO THE AGREEMENT.                               

      All of the mortgage loans have scheduled monthly payments due on the
Due Date. Each mortgage loan will contain a customary "due-on-sale" clause.     

       Approximately _____% of the mortgage loans provide for payment by the
mortgagor of a prepayment charge in limited circumstances on prepayments.       
Generally, these mortgage loans provide for payment of a prepayment charge on   
partial or full prepayments made within one year, five years or other period as 
provided in the related mortgage note from the date of origination of the       
mortgage loan. The amount of the prepayment charge is as provided in the related
mortgage note, and the prepayment charge will generally apply if, in any        
twelve-month period during the first year, five years or other period as        
provided in the related mortgage note from the date of origination of the       
mortgage loan, the Mortgagor prepays an aggregate amount exceeding __% of the   
original principal balance of the mortgage loan. With respect to _____% of the  
mortgage loans, the amount of the prepayment charge will generally be equal to  
___ months' advance interest calculated on the basis of the mortgage rate in    
effect at the time of the prepayment on the amount prepaid in excess of __% of  
the original principal balance of the mortgage loan for a period of five years  
and one year, respectively. The _____________ will be entitled to all prepayment
charges received on the mortgage loans, and these amounts will not be available 
for distribution on the Certificates. The Master Servicer may, in its           
discretion, waive the collection of any otherwise applicable prepayment charge  
or reduce the amount thereof actually collected, and accordingly, there can be  
no assurance that the prepayment charges will have any effect on the prepayment 
performance of the mortgage loans.                                              

        The average principal balance of the mortgage loans at origination was
approximately $______. No mortgage loan had a principal balance at origination  
of greater than approximately $_______ or less than approximately $______. The  
average principal balance of the mortgage loans as of the Cut-off Date was      
approximately $______. No mortgage loan had a principal balance as of the       
Cut-off Date of greater than approximately $_______ or less than approximately  
$______.                                                                        

       As of the Cut-off Date, the mortgage loans had mortgage rates ranging
from approximately _____% per annum to approximately ______% per annum and the  
weighted average mortgage rate was approximately _____% per annum. The weighted 
average remaining term to stated maturity of the mortgage loans will be         
approximately __ years and __ months as of the Cut-off Date. None of the        
mortgage loans will have a first Due Date prior to ________ ____ or after       
_________ ____, or will have a remaining term to maturity of less than __ years 
and __ months or greater than __ years as of the Cut-off Date. The latest       
maturity date of any mortgage loan is ________                                  
____.                                                                           

         The weighted average loan-to-value ratio at origination of the mortgage
loans was approximately ______%. No loan-to-value ratio at origination was      
greater than approximately _____% or less than approximately ____%.             

UNDERWRITING STANDARDS; REPRESENTATIONS                                         

[Standards included as necessary.]                            

ADDITIONAL INFORMATION

        The description in this prospectus supplement of the mortgage pool and
the mortgaged properties is based upon the mortgage pool as constituted at the  
close of business on the Cut-off Date, as adjusted for the scheduled principal  
payments due on or before this date. Prior to the issuance of the Certificates, 
mortgage loans may be removed from the mortgage pool as a result of incomplete  
documentation or otherwise if the company deems this removal necessary or       
desirable, and may be prepaid at any time. A limited number of other mortgage   
loans may be included in the mortgage pool prior to the issuance of the         
Certificates unless including these mortgage loans would materially alter the   
characteristics of the mortgage pool as described in this prospectus supplement.
The company believes that the information set forth in this prospectus          
supplement will be representative of the characteristics of the mortgage pool as
it will be constituted at the time the Certificates are issued, although the    
range of mortgage rates and maturities and other characteristics of the mortgage
loans may vary. In no event, however, will more than 5% (by principal balance at
the Cut- off Date) of the mortgage loans deviate from the characteristics of the
mortgage loans set forth in this prospectus supplement.                         

 YIELD ON THE CERTIFICATES

DELAY IN DISTRIBUTIONS ON THE OFFERED CERTIFICATES                              

    The effective yield to holders of the offered certificates of each
class will be less than the yields otherwise produced by their respective       
Pass-Through Rates and purchase prices because (1) on the first distribution    
date one month's interest is payable even though __ days will have elapsed from 
the date on which interest begins to accrue, (2) on each succeeding distribution
date the interest payable is the interest accrued during the month preceding the
month of the distribution date, which ends __ days prior to the distribution    
date and (3) during each Interest Accrual Period (other than the first Interest 
Accrual Period), interest accrues on a Certificate Principal Balance or Notional
Amount that is less than the Certificate Principal Balance or Notional Amount of
the class actually outstanding for the first __ days of this Interest Accrual   
Period.                                                                         

SHORTFALLS IN COLLECTIONS OF INTEREST                                           

     When a principal prepayment in full is made on a mortgage loan, the
mortgagor is charged interest only for the period from the Due Date of the      
preceding monthly payment up to the date of the principal prepayment, instead of
for a full month. When a partial principal prepayment is made on a mortgage     
loan, the mortgagor is not charged interest on the amount of the prepayment for 
the month in which the prepayment is made. In addition, the application of the  
Relief Act to any mortgage loan will adversely affect, for an indeterminate     
period of time, the ability of the Master Servicer to collect full amounts of   
interest on the mortgage loan. SEE "LEGAL ASPECTS OF THE MORTGAGE               
LOANS--SOLDIERS' AND SAILORS' CIVIL RELIEF ACT OF 1940" IN THE PROSPECTUS. The  
Master Servicer is obligated to pay from its own funds only those interest      
shortfalls attributable to full and partial prepayments by the mortgagors on the
mortgage loans master serviced by it, but only to the extent of its aggregate   
Servicing Fee for the related Due Period. SEE "POOLING AND SERVICING            
AGREEMENT--SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES" in this    
prospectus supplement. Accordingly, the effect of (1) any principal prepayments 
on the mortgage loans, to the extent that any resulting Prepayment Interest     
Shortfall exceeds any Compensating Interest or (2) any shortfalls resulting from
the application of the Relief Act, will be to reduce the aggregate amount of    
interest collected that is available for distribution to holders of the         
Certificates. Any resulting shortfalls will be allocated among the Certificates 
as provided in this prospectus supplement under "DESCRIPTION OF THE             
CERTIFICATES--INTEREST DISTRIBUTIONS".                                          

GENERAL PREPAYMENT CONSIDERATIONS                                               

      The rate of principal payments on each class of offered certificates
(other than the Class X Certificates), the aggregate amount of distributions on 
each class of offered certificates and the yield to maturity of each class of   
offered certificates will be related to the rate and timing of payments of      
principal on the mortgage loans. The rate of principal payments on the mortgage 
loans will in turn be affected by the amortization schedules of the mortgage    
loans and by the rate of principal prepayments on the mortgage loans (including 
for this purpose payments resulting from refinancings, liquidations of the      
mortgage loans due to defaults, casualties, condemnations and repurchases,      
whether optional or required, by the company, the Seller, the Originator or the 
Master Servicer, as the case may be). The mortgage loans generally may be       
prepaid by the mortgagors at any time; however, as described under "The Mortgage
Pool" in this prospectus supplement, with respect to approximately _____% of the
mortgage loans, by aggregate principal balance as of the Cut-off Date, a        
prepayment may subject the related mortgagor to a prepayment charge. All of the 
mortgage loans contain due-on-sale clauses. As described under "Description of  
the Certificates--Principal Distributions on the Senior Certificates" in this   
prospectus supplement, prior to the distribution date in ________ ____, all     
principal prepayments on the mortgage loans will be allocated to the Senior     
Certificates (other than the Class X Certificates). Thereafter, as further      
described in this prospectus supplement, during some periods, subject to loss   
and delinquency criteria described in this prospectus supplement, the Senior    
Prepayment Percentage may continue to be disproportionately large (relative to  
the Senior Percentage) and the percentage of principal prepayments payable to   
the Subordinate Certificates may continue to be disproportionately small.       

      Prepayments, liquidations and repurchases of the mortgage loans will
result in distributions in respect of principal to the holders of the class or  
classes of offered certificates then entitled to receive these principal        
distributions that otherwise would be distributed over the remaining terms of   
the mortgage loans. SEE "MATURITY AND PREPAYMENT CONSIDERATIONS" IN THE         
PROSPECTUS. Since the rates of payment of principal on the mortgage loans will  
depend on future events and a variety of factors (as described more fully in    
this prospectus supplement and in the prospectus under "YIELD CONSIDERATIONS"   
and "MATURITY AND PREPAYMENT CONSIDERATIONS"), no assurance can be given as to  
the rate of principal prepayments. The extent to which the yield to maturity of 
any class of offered certificates (other than the Class X Certificates) may vary
from the anticipated yield will depend upon the degree to which they are        
purchased at a discount or premium and the degree to which the timing of        
payments on the offered certificates is sensitive to prepayments on the mortgage
loans. Further, an investor should consider, in the case of any offered         
certificate purchased at a discount, the risk that a slower than anticipated    
rate of principal payments on the mortgage loans could result in an actual yield
to an investor that is lower than the anticipated yield and, in the case of any 
offered certificate purchased at a premium, the risk that a faster than         
anticipated rate of principal payments could result in an actual yield to the   
investor that is lower than the anticipated yield. In general, the earlier a    
prepayment of principal on the mortgage loans, the greater will be the effect on
the 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 offered certificates would not be fully offset by a subsequent like      
reduction (or increase) in the rate of principal payments.                      

     The yield to maturity on the Class X Certificates will be extremely
sensitive to prepayments on the mortgage loans generally, and most sensitive to 
prepayments on mortgage loans with relatively high mortgage rates. SEE "--YIELD 
SENSITIVITY OF THE CLASS X CERTIFICATES" IN THIS PROSPECTUS SUPPLEMENT.         

  It is highly unlikely that the mortgage loans will prepay at any
constant rate until maturity or that all of the mortgage loans will prepay at   
the same rate. Moreover, the timing of prepayments on the mortgage loans may    
significantly affect the actual yield to maturity on the offered certificates,  
even if the average rate of principal payments experienced over time is         
consistent with an investor's expectation.                                      

     Because principal distributions are paid to some classes of offered
certificates before other classes, holders of classes of offered certificates   
having a later priority of payment bear a greater risk of losses (because the   
offered certificates will represent an increasing percentage interest in the    
trust fund during the period prior to the commencement of distributions of      
principal thereon) than holders of classes having earlier priorities for        
distribution of principal. In particular with respect to the Lockout            
Certificates, as described under "Description of the Certificates--Principal    
Distributions on the Senior Certificates" in this prospectus supplement, during 
some periods, no principal payments or a disproportionately small portion of the
Senior Principal Distribution Amount will be distributed on the Lockout         
Certificates, and during other periods, a disproportionately large portion of   
the Senior Principal Distribution Amount will be distributed on the Lockout     
Certificates. Unless the Certificate Principal Balances of the Class A          
Certificates (other than the Lockout Certificates) have been reduced to zero,   
the Lockout Certificates will not be entitled to receive any distributions of   
principal payments prior to the distribution date in ________ ____.             

         The rate of payments (including prepayments) on pools of mortgage loans
is influenced by a variety of economic, geographic, social and other factors. If
prevailing mortgage rates fall significantly below the mortgage rates on the    
mortgage loans, the rate of prepayment (and refinancing) would be expected to   
increase. Conversely, if prevailing mortgage rates rise significantly above the 
mortgage rates on the mortgage loans, the rate of prepayment on the mortgage    
loans would be expected to decrease. Other factors affecting prepayment of      
mortgage loans include changes in mortgagors' housing needs, job transfers,     
unemployment, mortgagors' net equity in the mortgaged properties and servicing  
decisions. There can be no certainty as to the rate of prepayments on the       
mortgage loans during any period or over the life of the Certificates. SEE      
"YIELD CONSIDERATIONS" AND "MATURITY AND PREPAYMENT CONSIDERATIONS" IN THE      
PROSPECTUS.                                                                     

   In general, defaults on mortgage loans are expected to occur with
greater frequency in their early years. In addition, default rates generally are
higher for mortgage loans used to refinance an existing mortgage loan. In the   
event of a mortgagor's default on a mortgage loan, there can be no assurance    
that recourse beyond the specific mortgaged property pledged as security for    
repayment will be available. SEE "THE MORTGAGE POOL--UNDERWRITING STANDARDS;    
REPRESENTATIONS" IN THIS PROSPECTUS SUPPLEMENT.                                 

 MARKET INTEREST RATE AND SUBORDINATION YIELD CONSIDERATIONS

       Because the mortgage rates on the mortgage loans and the Pass-Through
Rates on the offered certificates (other than the Class X Certificates) are     
fixed, these rates will not change in response to changes in market interest    
rates. Accordingly, if mortgage market interest rates or market yields for      
securities similar to these offered certificates were to rise, the market value 
of these offered certificates may decline.                                      

    As described under "DESCRIPTION OF THE CERTIFICATES--ALLOCATION OF
LOSSES; SUBORDINATION", amounts otherwise distributable to holders of the       
Subordinate Certificates may be made available to protect the holders of the    
Senior Certificates against interruptions in distributions due to mortgagor     
delinquencies, to the extent not covered by P&I Advances, and amounts otherwise 
distributable to holders of the Subordinate Certificates with a higher numerical
class designation may be made available to protect the holders of Subordinate   
Certificates with a lower numerical class designation against interruptions in  
distributions. Delinquencies may affect the yield to investors on the           
Subordinate Certificates, and, even if subsequently cured, will affect the      
timing of the receipt of distributions by the holders of the Subordinate        
Certificates. In addition, a larger than expected rate of delinquencies or      
losses will affect the rate of principal payments on each class of the          
Subordinate Certificates if it delays the scheduled reduction of the Senior     
Prepayment Percentage, triggers an increase of the Senior Prepayment Percentage 
to [100]% or triggers a lockout of one or more classes of Subordinate           
Certificates from distributions of portions of the Subordinate Principal        
Distribution Amount. SEE "DESCRIPTION OF THE CERTIFICATES--PRINCIPAL            
DISTRIBUTIONS ON THE SENIOR CERTIFICATES" AND "--PRINCIPAL DISTRIBUTIONS ON THE 
SUBORDINATE CERTIFICATES" IN THIS PROSPECTUS SUPPLEMENT.                        

WEIGHTED AVERAGE LIFE                                                           

     Weighted average life refers to the amount of time that will elapse
from the date of issuance of a security until each dollar of principal of the   
security will be repaid to the investor. The weighted average life of the       
offered certificates of each class will be influenced by the rate at which      
principal on the mortgage loans is paid, which may be in the form of scheduled  
payments or prepayments (including prepayments of principal by the mortgagor as 
well as amounts received by virtue of condemnation, insurance or foreclosure    
with respect to the mortgage loans), and the timing thereof.                    

Except as otherwise described under "DESCRIPTION OF THE       
CERTIFICATES--PRINCIPAL DISTRIBUTIONS ON THE SENIOR CERTIFICATES" in this       
prospectus supplement, distributions of principal will be made to the classes of
Class A Certificates according to the priorities described in this prospectus   
supplement, rather than on a Pro rata basis among the Class A Certificates,     
unless the Certificate Principal Balances of the Subordinate Certificates have  
been reduced to zero. The timing of commencement of principal distributions and 
the weighted average life of each class of Class A Certificates will be affected
by the rates of prepayment on the mortgage loans experienced both before and    
after the commencement of principal distributions on each class of Class A      
Certificates. Moreover, because the Lockout Certificates do not receive (unless 
the Certificate Principal Balances of the Class A Certificates, other than the  
Lockout Certificates, have been reduced to zero) any portion of principal       
payments prior to the distribution date occurring in ________ ____ and          
thereafter will receive (unless the Certificate Principal Balances of the Class 
A Certificates, other than the Lockout Certificates, have been reduced to zero) 
a disproportionately small or large portion of principal payments, the weighted 
average life of the Lockout Certificates will be longer or shorter than would   
otherwise be the case, and the effect on the market value of the Lockout        
Certificates of changes in market interest rates or market yields for similar   
securities may be greater or lesser than for the other classes of Class A       
Certificates entitled to principal distributions.                               

   Prepayments on mortgage loans are commonly measured relative to a
prepayment standard or model. The model used in this prospectus supplement is   
the Prepayment Assumption No representation is made that the mortgage loans in  
the mortgage pool will prepay at the above-described rates or any other rate.   
CPR refers to 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 or CPR. In generating monthly cash flows, this rate is     
converted to an equivalent constant monthly rate. To assume __% CPR or any other
CPR percentage is to assume that the stated percentage of the outstanding       
principal balance of the pool is prepaid over the course of a year.             

        The tables following the next paragraph indicate the percentage of the
initial Certificate Principal Balance of the indicated classes of Certificates  
that would be outstanding after each of the dates shown at various constant     
percentages of the Prepayment Assumption and the corresponding weighted average 
life of the indicated class of Certificates. The table is based on the following
modeling assumptions:                                                           

(1) the mortgage pool consists of ____ mortgage loans with the
characteristics set forth in the table below,                                   

        (2) distributions on the indicated Certificates are received, in cash,
on the ___ day of each month, commencing in ________ ____,                      

  (3) the mortgage loans prepay at the constant percentages of the
Prepayment Assumption indicated,                                                

        (4) no defaults or delinquencies occur in the payment by mortgagors of
principal and interest on the mortgage loans and no shortfalls due to the       
application of the Relief Act are incurred,                                     

 (5) none of the company, the Seller, the Originator, the Master
Servicer or any other person purchases from the trust fund any mortgage loan    
pursuant to any obligation or option under the Agreement (except as indicated in
footnote (2) in the tables),                                                    

      (6) scheduled monthly payments on the mortgage loans are received on
the first day of each month commencing in ________ ____, and are computed prior 
to giving effect to any prepayments received in the prior month,                

     (7) prepayments representing payment in full of individual mortgage
loans are received on the last day of each month commencing in _______ ____, and
include 30 days' interest,                                                      

        (8) the scheduled monthly payment for each mortgage loan is calculated
based on its principal balance, mortgage rate and remaining term to maturity so 
that the mortgage loan will amortize in amounts sufficient to repay the         
remaining principal balance of the mortgage loan by its remaining term to       
maturity,                                                                       

(9) the Certificates are purchased on _______ __, ____ and    

      (10) the Servicing Fee Rate is ____% per annum and the Trustee's Fee
Rate is _____% per annum.                                                       

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 ASSUMED MORTGAGE LOAN CHARACTERISTICS

                                                                [Download Table]


 PRINCIPAL BALANCE AS OF THE  MORTGAGE     ORIGINAL TERM         REMAINING TERM   
        CUT-OFF DATE            RATE    TO MATURITY (MONTHS)  TO MATURITY (MONTHS)
        ------------            ----    --------------------  --------------------
                                                                                  
$                                %                                                
$                                %                                                
$                                %                                                
$                                %                                                

       There will be discrepancies between the characteristics of the actual
mortgage loans and the characteristics assumed in preparing the table below. Any
discrepancy may have an effect upon the percentages of the initial Certificate  
Principal Balances outstanding (and the weighted average lives) of the classes  
of Certificates set forth in the table. In addition, to the extent that the     
actual mortgage loans included in the mortgage pool have characteristics that   
differ from those assumed in preparing the table below, the classes of          
Certificates set forth below may mature earlier or later than indicated by the  
table below. Based on the foregoing assumptions, the table below indicates the  
weighted average life of each class of the Class A Certificates and the         
Subordinate Certificates and sets forth the percentage of the initial           
Certificate Principal Balance of each of these Certificates that would be       
outstanding after each of the dates shown, at various percentages of the        
Prepayment Assumption. Neither the prepayment model used in this prospectus     
supplement nor any other prepayment model or assumption purports to be a        
historical description of prepayment experience or a prediction of the          
anticipated rate of prepayment of any pool of mortgage loans, including the     
mortgage loans included in the trust fund. Variations in the prepayment         
experience and the balance of the mortgage loans that prepay may increase or    
decrease the percentages of initial Certificate Principal Balance (and weighted 
average lives) shown in the following table. Variations may occur even if the   
average prepayment experience of all of the mortgage loans equals any of the    
specified percentages of the Prepayment Assumption.                             

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 PERCENT OF INITIAL CERTIFICATE PRINCIPAL BALANCE OUTSTANDING AT THE
FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]


                                                          CLASS A-1 CERTIFICATES                  
                                                          ----------------------                  
                                           0%   50%   75%       100%      125%    150%  175%  200%
PREPAYMENT ASSUMPTION                      --   ---   ---       ----      ----    ----  ----  ----
DISTRIBUTION DATE                                                                                 
                                                                                                  
Initial Percentage....................... 100%  100%  100%      100%      100%    100%  100%  100%
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year) and thereafter........                                                         
Weighted Average                                                                                  
Life in years (to Maturity)*.............                                                         

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

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FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]

                                                          CLASS A-2 CERTIFICATES                  
                                                          ----------------------                  
                                           0%   50%   75%       100%      125%    150%  175%  200%
PREPAYMENT ASSUMPTION                      --   ---   ---       ----      ----    ----  ----  ----
DISTRIBUTION DATE                                                                                 
                                                                                                  
Initial Percentage....................... 100%  100%  100%      100%      100%    100%  100%  100%
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year) and thereafter........                                                         
Weighted Average                                                                                  
Life in years (to Maturity)*.............                                                         

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

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FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]


                                                          CLASS A-3 CERTIFICATES                  
                                                          ----------------------                  
                                           0%   50%   75%       100%      125%    150%  175%  200%
PREPAYMENT ASSUMPTION                      --   ---   ---       ----      ----    ----  ----  ----
DISTRIBUTION DATE                                                                                 
                                                                                                  
Initial Percentage....................... 100%  100%  100%      100%      100%    100%  100%  100%
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year) and thereafter........                                                         
Weighted Average                                                                                  
Life in years (to Maturity)*.............                                                         

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

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FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]


                                                          CLASS A-4 CERTIFICATES                  
                                                          ----------------------                  
                                           0%   50%   75%       100%      125%    150%  175%  200%
PREPAYMENT ASSUMPTION                      --   ---   ---       ----      ----    ----  ----  ----
DISTRIBUTION DATE                                                                                 
                                                                                                  
Initial Percentage....................... 100%  100%  100%      100%      100%    100%  100%  100%
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year) and thereafter........                                                         
Weighted Average                                                                                  
Life in years (to Maturity)*.............                                                         

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

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FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]

                                                          CLASS A-5 CERTIFICATES                  
                                                          ----------------------                  
                                           0%   50%   75%       100%      125%    150%  175%  200%
PREPAYMENT ASSUMPTION                      --   ---   ---       ----      ----    ----  ----  ----
DISTRIBUTION DATE                                                                                 
                                                                                                  
Initial Percentage....................... 100%  100%  100%      100%      100%    100%  100%  100%
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year) and thereafter........                                                         
Weighted Average                                                                                  
Life in years (to Maturity)*.............                                                         

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

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FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]

                                                          CLASS A-6 CERTIFICATES                  
                                                          ----------------------                  
                                           0%   50%   75%       100%      125%    150%  175%  200%
PREPAYMENT ASSUMPTION                      --   ---   ---       ----      ----    ----  ----  ----
DISTRIBUTION DATE                                                                                 
                                                                                                  
Initial Percentage....................... 100%  100%  100%      100%      100%    100%  100%  100%
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year).......................                                                         
(Month, day, year) and thereafter........                                                         
Weighted Average                                                                                  
Life in years (to Maturity)*.............                                                         

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

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FOLLOWING PERCENTAGES OF THE PREPAYMENT ASSUMPTION

                                                        [Enlarge/Download Table]

                                                 CLASS B-1, CLASS B-2 AND CLASS B-3 CERTIFICATES           
                                                 -----------------------------------------------           
                                           0%   50%       75%       100%      125%      150%     175%  200%
PREPAYMENT ASSUMPTION                      --   ---       ---       ----      ----      ----     ----  ----
DISTRIBUTION DATE                                                                                          
                                                                                                           
Initial Percentage....................... 100%  100%      100%      100%      100%      100%     100%  100%
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year).......................                                                                  
(Month, day, year) and thereafter........                                                                  
Weighted Average                                                                                           
Life                                  in                                                                   
years (to Maturity)*.....................                                                                  

----------------------                                                          
(*)      The weighted average life of a Certificate is determined by (i)        
     multiplying the net reduction, if any, of the Certificate Principal
 Balance by the number of years from the date of issuance of the
        Certificate to the related distribution date, (ii) adding the results,
      and (iii) dividing the sum by the aggregate of the net reductions of
the Certificate Principal Balance described in (i) above.     

   There is no assurance that prepayments of the mortgage loans will
conform to any of the levels of the Prepayment Assumption indicated in the table
above or to any other level, or that the actual weighted average life of any    
class of Certificates will conform to any of the weighted average lives set     
forth in the table above. Furthermore, the information contained in the table   
with respect to the weighted average life of each specified class of            
Certificates is not necessarily indicative of the weighted average life that    
might be calculated or projected under different or varying prepayment          
assumptions.                                                                    

  The characteristics of the mortgage loans will differ from those
assumed in preparing the table above. In addition, it is unlikely that any      
mortgage loan will prepay at any constant percentage of the Prepayment          
Assumption until maturity or that all of the mortgage loans will prepay at the  
same rate. The timing of changes in the rate of prepayments may significantly   
affect the actual yield to maturity to investors, even if the average rate of   
principal prepayments is consistent with the expectations of investors.         

 YIELD SENSITIVITY OF THE CLASS X CERTIFICATES

     The yield to maturity of the Class X Certificates will be extremely
sensitive to the prepayment, repurchase and default experience on the mortgage  
loans, which may fluctuate significantly from time to time. A rapid rate of     
principal payments on the mortgage loans will have a materially negative effect 
on the yield to maturity of the Class X Certificates, and principal prepayments 
on mortgage loans with higher mortgage rates will have a greater negative impact
on the yield to maturity of the Class X Certificates than principal prepayments 
on mortgage loans with lower mortgage rates. There can be no assurance that the 
mortgage loans will prepay at any particular rate. Prospective investors in the 
Class X Certificates should fully consider the associated risks, including the  
risk that they may not fully recover their initial investment.                  

         The following table indicates the sensitivity of the yield of the Class
X Certificates to various rates of prepayment on the mortgage loans and the     
corresponding pre-tax yield on a corporate bond equivalent basis. The table set 
forth below has been prepared based on the modeling assumptions.                

PRE-TAX YIELD TO MATURITY ON THE CLASS X CERTIFICATES AT
VARIOUS PERCENTAGES OF THE PREPAYMENT ASSUMPTION

      0%           25%          50%        75%        100%        125%      150%
      --           ---          ---        ---        ----        ----      ----

         On the basis of a constant prepayment rate of approximately ___% of the
Prepayment Assumption and the purchase price assumed above, the yield to        
maturity of the Class X Certificates would be approximately __%. If the actual  
prepayment rate were to exceed this rate, initial investors in the Class X      
Certificates would not fully recover their initial investment.                  

        The pre-tax yields set forth in the preceding table were calculated by
determining the monthly discount rates that, when applied to the assumed streams
of cash flows to be paid on the Class X Certificates, would cause the discounted
present value of these assumed stream of cash flows to equal the assumed        
purchase price of the Class X Certificates, and by converting the monthly rates 
to corporate bond equivalent rates. This calculation does not take into account 
shortfalls in collection of interest due to prepayments (or other liquidations) 
on the mortgage loans or the interest rates at which investors may be able to   
reinvest funds received by them as distributions on the Class X Certificates and
consequently does not purport to reflect the return on any investment in the    
Class X Certificates when the reinvestment rates are considered.                

  The characteristics of the mortgage loans will differ from those
assumed in preparing the table above. There can be no assurance that the cash   
flows on the Class X Certificates will correspond to those used to determine the
pre-tax yields shown above or that the aggregate purchase price of the Class X  
Certificates will be as assumed. It is unlikely that any mortgage loan will     
prepay at the specified percentages of the Prepayment Assumption until maturity 
or that all of the mortgage loans will prepay at the same rate. The timing of   
changes in the rate of prepayments may significantly affect the actual yield to 
maturity to investors, even if the average rate of principal prepayments is     
consistent with the expectations of investors. The portion of interest payments 
on the mortgage loans distributable to the Class X Certificates will vary from  
mortgage loan to mortgage loan, and will be greater with respect to mortgage    
loans with higher mortgage rates. Accordingly, the yield on the Class X         
Certificates will be lower than indicated in the applicable table above with    
respect to any particular average prepayment rate if mortgage loans with higher 
mortgage rates prepay faster than mortgage loans with lower mortgage rates,     
assuming no variation in mortgage loan principal balance. Moreover, the variable
Pass-Through Rate on the Class X Certificates will generally decrease as the    
Certificate Principal Balances of Class A Certificates with lower fixed         
Pass-Through Rates decline. There can be no assurance that the mortgage loans   
will prepay at any of the rates shown in the table or at any other particular   
rate, or that mortgage loans with relatively high mortgage rates will prepay at 
the same rate as the mortgage loans generally. Investors must make their own    
decisions as to the appropriate prepayment assumptions to be used in deciding   
whether to purchase the Class X Certificates.                                   

 YIELD SENSITIVITY OF THE SUBORDINATE CERTIFICATES

      If the Certificate Principal Balances of the Class B-6 Certificates,
Class B-5 Certificates, Class B-4 Certificates, Class B-3 Certificates and Class
B-2 Certificates have been reduced to zero, the yield to maturity on the Class  
B-1 Certificates will become extremely sensitive to losses on the mortgage loans
(and the timing thereof) that are covered by subordination, because the entire  
amount of losses on the mortgage loans will be allocated to the Class B-1       
Certificates. If the Certificate Principal Balances of the Class B-6            
Certificates, Class B-5 Certificates, Class B-4 Certificates and Class B-3      
Certificates have been reduced to zero, the yield to maturity on the Class B-2  
Certificates will become extremely sensitive to losses on the mortgage loans    
(and the timing thereof) that are covered by subordination, because the entire  
amount of losses on the mortgage loans will be allocated to the Class B-2       
Certificates. If the Certificate Principal Balances of the Class B-6            
Certificates, Class B-5 Certificates and Class B-4 Certificates have been       
reduced to zero, the yield to maturity on the Class B-3 Certificates will become
extremely sensitive to losses on the mortgage loans (and the timing thereof)    
that are covered by subordination, because the entire amount of losses on the   
mortgage loans will be allocated to the Class B-3 Certificates. The initial     
undivided interest in the trust fund evidenced by the Class B-1 Certificates,   
the Class B-2 Certificates, the Class B-3 Certificates, the Class B-4           
Certificates, the Class B-5 Certificates and the Class B-6 Certificates is      
approximately ____%, approximately ____%, approximately ____%, approximately    
____%, approximately ____% and approximately ____%, respectively. Investors in  
the Subordinate Certificates should fully consider the risk that Realized Losses
on the mortgage loans could result in the failure of these investors to fully   
recover their investments. For additional considerations relating to the yield  
on the Subordinate Certificates, see "YIELD CONSIDERATIONS" and "MATURITY AND   
PREPAYMENT CONSIDERATIONS" in the prospectus.                                   

ADDITIONAL YIELD CONSIDERATIONS APPLICABLE SOLELY TO THE RESIDUAL CERTIFICATES

    The certificateholders' after-tax rate of return on their Residual
Certificates will reflect their pre-tax rate of return, reduced by the taxes    
required to be paid with respect to the Residual Certificates. Holders of       
Residual Certificates will have tax liabilities with respect to their Residual  
Certificates during the early years of the REMIC's term that substantially      
exceed any distributions payable thereon during or prior to any such period. In 
addition, holders of Residual Certificates will have tax liabilities with       
respect to their Residual Certificates the present value of which substantially 
exceeds the present value of distributions payable thereon and of any tax       
benefits that may arise with respect thereto. Accordingly, the after-tax rate of
return on the Residual Certificates may be negative or may otherwise be         
significantly adversely affected. The timing and amount of taxable income       
attributable to the Residual Certificates will depend on, among other things,   
the timing and amounts of prepayments and losses experienced with respect to the
mortgage pool.                                                                  

       The Residual Certificateholders should consult their own tax advisors
as to the effect of taxes and the receipt of any payments made to these holders 
in connection with the transfer of the Residual Certificates on after-tax rates 
of return on the Residual Certificates. SEE "FEDERAL INCOME TAX CONSEQUENCES" IN
THIS PROSPECTUS SUPPLEMENT AND IN THE PROSPECTUS.                               

 DESCRIPTION OF THE CERTIFICATES

GENERAL                                                                         

      The Series ____-___ Certificates will consist of ________ classes of
certificates. Only the offered certificates are offered by this prospectus      
supplement.                                                                     

   The Certificates represent in the aggregate the entire beneficial
ownership interest in a trust fund consisting primarily of a mortgage pool of   
mortgage loans and an aggregate principal balance as of the Cut- off Date, after
application of scheduled payments due whether or not received, of approximately 
$___________, subject to a permitted variance as described in this prospectus   
supplement under "The Mortgage Pool".                                           

  Each class of the offered certificates will have the approximate
initial Certificate Principal Balance or Notional Amount, as applicable, as set 
forth on the cover hereof and will have the Pass-Through Rate determined as     
provided under "Summary--Pass-Through Rate" and "--Interest Distributions" in   
this prospectus supplement. The Residual Certificates also represent the right  
to receive additional distributions in respect of the trust fund on any         
distribution date after all required payments of principal and interest have    
been made on this date in respect of the other classes of Certificates, although
it is not anticipated that funds will be available for any additional           
distribution. The Class B-4 Certificates, Class B-5 Certificates and Class B-6  
Certificates have in the aggregate an initial Certificate Principal Balance of  
approximately $__________ and a fixed Pass-Through Rate for each distribution   
date of ____% per annum. The Class B-4 Certificates, the Class B-5 Certificates 
and the Class B-6 Certificates, which are not being offered by this prospectus  
supplement, will be sold by the company to _________________________ on the     
Closing Date.                                                                   

        The Class A Certificates will be issued, maintained and transferred on
the book-entry records of DTC and its participants in minimum denominations of  
$_____ and integral multiples of $____ in excess thereof. The Class X           
Certificates and the Subordinate Certificates will be issued in registered,     
certificated form, in minimum percentage interests corresponding to initial     
Certificate Principal Balances or notional amounts, as applicable, of $______   
and integral multiples of $_____ in excess thereof, except that one Certificate 
of each of these classes may be issued evidencing an amount equal to either (1) 
the sum of an otherwise authorized denomination thereof plus the remainder of   
the aggregate initial Certificate Principal Balance or Notional Amount, as      
applicable, for the class or (2) the remainder. The Residual Certificates will  
be offered in registered, certificated form, in minimum denominations of $___   
and integral multiples thereof.                                                 

     The Book-Entry Certificates will initially be represented by one or
more global certificates registered in the name of a nominee of DTC. The company
has been informed by DTC that DTC's nominee will be Cede & Co. No person        
acquiring an interest in any class of the Book-Entry Certificates will be       
entitled to receive a certificate representing such person's interest, except as
set forth below under "--Definitive Certificates". Unless and until definitive  
certificates are issued under the limited circumstances described in this       
prospectus supplement, all references to actions by certificateholders with     
respect to the Book-Entry Certificates shall refer to actions taken by DTC upon 
instructions from its participants and all references in this prospectus        
supplement to distributions, notices, reports and statements to                 
certificateholders with respect to the Book-Entry Certificates shall refer to   
distributions, notices, reports and statements to DTC or Cede & Co., as the     
registered holder of the Book-Entry Certificates, for distribution to           
Certificate Owners in accordance with DTC procedures. SEE "--REGISTRATION OF THE
BOOK-ENTRY CERTIFICATES" AND "--DEFINITIVE CERTIFICATES" IN THIS PROSPECTUS     
SUPPLEMENT.                                                                     

     The Class X Certificates, the Class B-1 Certificates, the Class B-2
Certificates, the Class B-3 Certificates, the Residual Certificates and the     
definitive certificates will be transferable and exchangeable at the offices of 
the Trustee. The Subordinate Certificates and the Residual Certificates may not 
be purchased by or transferred to a Plan except upon delivery of a certification
of facts or an opinion of counsel, as provided in this prospectus supplement.   
SEE "--RESTRICTIONS ON TRANSFER OF THE SUBORDINATE CERTIFICATES AND THE RESIDUAL
CERTIFICATES" AND "ERISA CONSIDERATIONS" IN THIS PROSPECTUS SUPPLEMENT. Transfer
of the Residual Certificates will be subject to additional restrictions and     
transfer of the Residual Certificates to any non-United States person will be   
prohibited, in each case as described under "Federal Income Tax                 
Consequences--Special Tax Considerations Applicable to Residual Certificates" in
this prospectus supplement and under "Federal Income Tax                        
Consequences--REMICs--Tax On Transfers of REMIC Residual Certificates to Certain
Organizations" and "--Taxation of Owners of Residual Certificates--Noneconomic  
REMIC Residual Certificates" in the prospectus. No service charge will be       
imposed for any registration of transfer or exchange, but the Trustee may       
require payment of a sum sufficient to cover any tax or other governmental      
charge imposed in connection therewith.                                         

        All distributions to holders of the Certificates, other than the final
distribution on any class of Certificates, will be made on each distribution    
date by or on behalf of the Trustee to the persons in whose names the           
Certificates are registered at the close of business on the related Record Date.
Distributions will be made either (a) by check mailed to the address of each    
certificateholders as it appears in the Certificate Register or (b) upon written
request to the Trustee at least five business days prior to the relevant Record 
Date by any holder of Certificates having an aggregate initial Certificate      
Principal Balance or Notional Amount, as applicable, that is in excess of the   
lesser of (1) $5,000,000 or (2) two-thirds of the initial aggregate Certificate 
Principal Balance or Notional Amount, as applicable, of the class of            
Certificates, by wire transfer in immediately available funds to the account of 
the certificateholders specified in the request. The final distribution on any  
class of Certificates will be made in like manner, but only upon presentment and
surrender of the class at the corporate trust office of the Trustee or any other
location specified in the notice to certificateholders of the final             
distribution.                                                                   

REGISTRATION OF THE BOOK-ENTRY CERTIFICATES                                     

        DTC is a limited-purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a "clearing          
corporation" within the meaning of the New York Uniform Commercial Code, and a  
"clearing agency" registered pursuant to the provisions of Section 17A of the   
Exchange Act. DTC was created to hold securities for its participants and to    
facilitate the clearance and settlement of securities transactions between      
participants through electronic book entries, thereby eliminating the need for  
physical movement of certificates.                                              

       Certificate Owners that are not participants or indirect participants
but desire to purchase, sell or otherwise transfer ownership of, or other       
interests in, the Book-Entry Certificates may do so only through participants   
and indirect participants. In addition, Certificate Owners will receive all     
distributions of principal of and interest on the Book-Entry Certificates from  
the Trustee through DTC and DTC participants. The Trustee will forward payments 
to DTC in same day funds and DTC will forward payments to participants in next  
day funds settled through the New York Clearing House. Each participant will be 
responsible for disbursing the payments. Unless and until definitive            
certificates are issued, it is anticipated that the only certificateholders of  
the Book-Entry Certificates will be Cede & Co., as nominee of DTC. Certificate  
Owners will not be recognized by the Trustee as certificateholders, as such term
is used in the Agreement and Certificate Owners will be permitted to exercise   
the rights of certificateholders only indirectly through DTC and its            
participants.                                                                   

  Under the Rules, DTC is required to make book-entry transfers of
Book-Entry Certificates among participants and to receive and transmit          
distributions of principal of, and interest on, the Book-Entry Certificates.    
Participants and indirect participants with which Certificate Owners have       
accounts with respect to the Book-Entry Certificates similarly are required to  
make book-entry transfers and receive and transmit these payments on behalf of  
their respective Certificate Owners. Accordingly, although Certificate Owners   
will not possess definitive certificates, the Rules provide a mechanism by which
Certificate Owners through their participants and indirect participants will    
receive payments and will be able to transfer their interest.                   

        Because DTC can only act on behalf of participants, who in turn act on
behalf of indirect participants and on behalf of certain banks, the ability of a
Certificate Owner to pledge Book-Entry Certificates to persons or entities that 
do not participate in the DTC system, or to otherwise act with respect to       
Book-Entry Certificates, may be limited due to the absence of physical          
certificates for the Book-Entry Certificates. In addition, under a book-entry   
format, Certificate Owners may experience delays in their receipt of payments   
since distribution will be made by the Trustee to Cede & Co., as nominee for    
DTC.                                                                            

  Under the Rules, DTC will take action permitted to be taken by a
certificateholders under the Agreement only at the direction of one or more     
participants to whose DTC account the Book-Entry Certificates are credited.     
Additionally, under the Rules, DTC will take actions with respect to specified  
voting rights only at the direction of and on behalf of participants whose      
holdings of Book-Entry Certificates evidence these specified voting rights. DTC 
may take conflicting actions with respect to voting rights, to the extent that  
participants whose holdings of Book-Entry Certificates evidence voting rights,  
authorize divergent action.                                                     

         The company, the Master Servicer and the Trustee will have no liability
for any aspect of the records relating to or payments made on account of        
beneficial ownership interests in the Book-Entry Certificates held by Cede &    
Co., as nominee for DTC, or for maintaining, supervising or reviewing any       
records relating to beneficial ownership interests.                             

DEFINITIVE CERTIFICATES                                                         

       Definitive certificates will be issued to Certificate Owners or their
nominees, respectively, rather than to DTC or its nominee, only if (1) the      
company advises the Trustee in writing that DTC is no longer willing or able to 
discharge properly its responsibilities as clearing agency with respect to the  
Book-Entry Certificates and the company is unable to locate a qualified         
successor, (2) the company, at its option, elects to terminate the book-entry   
system through DTC, or (3) after the occurrence of an Event of Default,         
Certificate Owners representing in the aggregate not less than 51% of the voting
rights of the Book-Entry Certificates advise the Trustee and DTC through        
participants, in writing, that the continuation of a book-entry system through  
DTC (or a successor thereto) is no longer in the Certificate Owners' best       
interest.                                                                       

         Upon the occurrence of any event described in the immediately preceding
paragraph, the Trustee is required to notify all Certificate Owners through     
participants of the availability of definitive certificates. Upon surrender by  
DTC of the definitive certificates representing the Book-Entry Certificates and 
receipt of instructions for re-registration, the Trustee will reissue the       
Book-Entry Certificates as definitive certificates issued in the respective     
principal amounts owned by individual Certificate Owners, and thereafter the    
Trustee will recognize the holders of definitive certificates as                
certificateholders under the Agreement. definitive certificates will be issued  
in minimum denominations of $______, except that any beneficial ownership       
represented by a Book-Entry Certificate in an amount less than $______          
immediately prior to the issuance of a definitive certificate shall be issued in
a minimum denomination equal to the amount of the beneficial ownership.         

PASS-THROUGH RATES                                                              

      The Pass-Through Rate for each class of Certificates (other than the
Class X Certificates and the Class PO Certificates) is ____% per annum. The     
Pass-Through Rate applicable to the calculation of the Interest Distribution    
Amount for the Class X Certificates for any distribution date is the rate per   
annum expressed as the percentage equivalent of a fraction, the numerator of    
which is equal to (1) (A) the amount of interest accrued on the mortgage loans  
for the immediately preceding calendar month at the Net Mortgage Rate minus (B) 
the aggregate amount of interest payable on the Certificates (other than the X  
Certificates), and the denominator of which is equal to (2) the Notional Amount 
of the Class X Certificates. The initial variable Pass-Through Rate for the     
Class IO Certificates is approximately ______% per annum.                       

INTEREST DISTRIBUTIONS                                                          

       Distributions on each distribution date will be made to the extent of
the Available Distribution Amount.                                              

Distributions in respect of interest will be made (1) on each 
distribution date to the holders of the Senior Certificates and, on the first   
distribution date, to the holders of the Residual Certificates, in an aggregate 
amount equal to the Senior Interest Distribution Amount and (2) on each         
distribution date to the holders of the Subordinate Certificates, in an         
aggregate amount equal to the Subordinate Interest Distribution Amount, to the  
extent of the portion of the Available Distribution Amount remaining after      
distribution of the Senior Interest Distribution Amount and the Senior Principal
Distribution Amount.                                                            

All distributions of interest will be based on a 360-day year 
consisting of twelve 30-day months. Except as otherwise described in this       
prospectus supplement, on any distribution date, distributions of the Interest  
Distribution Amount for a class of Certificates will be made, to the extent     
provided in this prospectus supplement, on a pari passu basis, based on the     
Certificate Principal Balance or Notional Amount, as applicable, of the         
Certificates of each such class.                                                

       Distributions of the Subordinate Interest Distribution Amount on each
distribution date will be made first, to the holders of the Class B-1           
Certificates, second to the holders of the Class B-2 Certificates, third to the 
holders of the Class B-3 Certificates, and then to the holders of the remaining 
classes of Subordinate Certificates, in each case to the extent of available    
funds and in each case to the extent of the Interest Distribution Amount for    
these Certificates for the distribution date.                                   

PRINCIPAL DISTRIBUTIONS ON THE SENIOR CERTIFICATES                              

         Distributions in respect of principal will be made on each distribution
date to the holders of the class or classes of the Class A Certificates then    
entitled to distributions in respect of principal, and on the first distribution
date to the holders of the Residual Certificates, in an aggregate amount equal  
to the Senior Principal Distribution Amount.                                    

       Holders of the Class A Certificates then entitled to distributions in
respect of principal will be entitled to receive on each distribution date, and 
holders of the Residual Certificates will be entitled to receive on the first   
distribution date, distributions allocable to principal in reduction of the     
Certificate Principal Balances of the Class A Certificates, and on the first    
distribution date the Residual Certificates, equal to the sum of the following: 

      (1) the product of (A) the then applicable Senior Percentage and (B)
the aggregate of the following amounts:                                         

    (2) the principal portion of all scheduled monthly payments on the
mortgage loans due during the related Due Period, whether or not received;      

      (3) the principal portion of all proceeds received in respect of the
repurchase of a mortgage loan (or, in the case of a substitution, amounts       
received representing a principal adjustment) as required by the Agreement      
during the related Prepayment Period; and                                       

       (4) the principal portion of all other unscheduled collections (other
than amounts described in clauses (2) and (3) hereof), including insurance      
proceeds and liquidation proceeds, received during the related Prepayment       
Period, to the extent applied as recoveries of principal;                       

         (5) the product of (A) the then applicable Senior Prepayment Percentage
and (B) the aggregate of all full and partial principal prepayments received    
during the related Prepayment Period;                                           

         (6) with respect to the net liquidation proceeds received and allocable
to principal of any mortgage loan that was finally liquidated during the related
Prepayment Period, the lesser of (a) the then applicable Senior Prepayment      
Percentage multiplied by these net liquidation proceeds and (b) the then        
applicable Senior Percentage multiplied by the Scheduled Principal Balance of   
the mortgage loan at the time of liquidation; and                               

      (7) any amounts allocable to principal for any previous distribution
date (calculated pursuant to the three preceding clauses) that remain           
undistributed, to the extent that any of these amounts are not attributable to  
Realized Losses that were allocated to the Subordinate Certificates.            

     Holders of the Class X Certificates are not entitled to receive any
distributions allocable to principal.                                           

      The Senior Percentage initially will equal approximately _____%, and
will in no event exceed 100%.                                                   

       The disproportionate allocation of unscheduled payments in respect of
principal will have the effect of accelerating the amortization of the Senior   
Certificates (other than the Class X Certificates) while, in the absence of     
Realized Losses, increasing the respective percentage interest in the principal 
balance of the mortgage loans evidenced by the Subordinate Certificates.        
Increasing the respective percentage interest in the trust fund of the          
Subordinate Certificates relative to that of the Senior Certificates is intended
to preserve the availability of the subordination provided by the Subordinate   
Certificates.                                                                   

        If on any distribution date the allocation to the Class A Certificates
of full and partial principal prepayments and other amounts in the percentage   
required above would reduce the aggregate outstanding Certificate Principal     
Balance of the Class A Certificates below zero, the Senior Prepayment Percentage
for the distribution date will be limited to the percentage necessary to reduce 
the aggregate Certificate Principal Balance of the Class A Certificates to zero.

     For purposes of all principal distributions described above and for
calculating the Senior Percentage, the Subordinate Percentage and the Senior    
Prepayment Percentage, the applicable Certificate Principal Balance for any     
distribution date shall be determined after the allocation of losses on the     
mortgage loans in the mortgage pool to be made on such distribution date as     
described under "--Allocation of Losses; Subordination" below.                  

PRIORITY OF PRINCIPAL DISTRIBUTIONS ON THE CLASS A CERTIFICATES AND THE RESIDUAL
CERTIFICATES

        Distributions of the Senior Principal Distribution Amount on the Class
A Certificates and the Residual Certificates on each distribution date will be  
made as follows:                                                                

       (1) First, concurrently, to the holders of each class of the Residual
Certificates on the distribution date in ________ ____, an amount equal to the  
entire Certificate Principal Balance thereof;                                   

     (2) Second, to the holders of the Lockout Certificates, the Lockout
Distribution Percentage of the Senior Principal Distribution Amount, until the  
Certificate Principal Balance thereof has been reduced to zero;                 

    (3) Third, to the holders of the Class A-1 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;                 

     (4) Fourth, to the holders of the Class A-2 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;                 

    (5) Fifth, to the holders of the Class A-3 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;                 

    (6) Sixth, to the holders of the Class A-4 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;                 

      (7) Seventh, to the holders of the Class A-5 Certificates, until the
Certificate Principal Balance thereof has been reduced to zero;                 

   (8) Eighth, to the holders of the Lockout Certificates, until the
Certificate Principal Balance thereof has been reduced to zero.                 

     Notwithstanding the foregoing priorities, upon the reduction of the
Certificate Principal Balances of the Subordinate Certificates to zero, the     
priority of distributions of principal among the Class A Certificates will be   
disregarded and distributions allocable to principal will be paid on each       
succeeding distribution date to holders of the Class A Certificates, on a Pro   
rata basis, based on the Certificate Principal Balances thereof.                

PRINCIPAL DISTRIBUTION ON THE SUBORDINATE CERTIFICATES                          

       Holders of each class of Subordinate Certificates will be entitled to
receive on each distribution date, to the extent of the portion of the Available
Distribution Amount remaining after distribution of the Senior Interest         
Distribution Amount, the Senior Principal Distribution Amount and the           
Subordinate Interest Distribution Amount, distributions allocable to principal  
in reduction of the Certificate Principal Balances thereof equal to the sum of  
the following:                                                                  

       (1) the product of (A) the then applicable related Class B Percentage
and (B) the aggregate of the following amounts:                                 

    (2) the principal portion of all scheduled monthly payments on the
mortgage loans due during the related Due Period, whether or not received;      

      (3) the principal portion of all proceeds received in respect of the
repurchase of a mortgage loan (or, in the case of a substitution, amounts       
received representing a principal adjustment) as required by the Agreement      
during the related Prepayment Period; and                                       

       (4) the principal portion of all other unscheduled collections (other
than amounts described in clauses (2) and (3) hereof), including insurance      
proceeds and liquidation proceeds, received during the related Prepayment       
Period, to the extent applied as recoveries of principal;                       

         (5) the portion allocable to such class of Subordinate Certificates, as
described below, of the product of (A) the then applicable Subordinate          
Prepayment Percentage and (B) the aggregate of all full and partial principal   
prepayments received during the related Prepayment Period;                      

         (6) the portion allocable to such class of Subordinate Certificates, as
described below, of net liquidation proceeds received and allocable to principal
of any mortgage loan that was finally liquidated during the related Prepayment  
Period, to the extent of the amount, if any, by which such net liquidation      
proceeds exceed the amount distributable to the Class A Certificates in respect 
of such net liquidation proceeds pursuant to clause (3) of the definition of    
Senior Principal Distribution Amount; and                                       

      (7) any amounts allocable to principal for any previous distribution
date (calculated pursuant to the three preceding clauses) that remain           
undistributed, to the extent that any of these amounts are not attributable to  
Realized Losses that were allocated to classes of the Subordinate Certificates  
bearing a higher numerical class designation.                                   

     All mortgagor prepayments not otherwise distributable to the Senior
Certificates will be allocated on a pro rata basis among the class of Class B   
Certificates with the highest payment priority then outstanding and each other  
class of Class B Certificates for which certain loss levels established for such
class in the Agreement have not been exceeded. The related loss level on any    
distribution date would be satisfied as to any Class B-2, Class B-3, Class B-4, 
Class B-5 or Class B-6 Certificates, respectively, only if the sum of the       
current percentage interests in the Mortgage Pool evidenced by such class and   
each class, if any, subordinate thereto were at least equal to the sum of the   
initial percentage interests in the Mortgage Pool evidenced by such class and   
each class, if any, subordinate thereto.                                        

     For purposes of all principal distributions described above and for
calculating the Subordinate Percentage, the applicable Certificate Principal    
Balance for any distribution date shall be determined after the allocation of   
losses on the mortgage loans in the mortgage pool to be made on such            
distribution date as described under "--Allocation of Losses; Subordination"    
below.                                                                          

As stated above under "--Principal Distributions on the Senior
Certificates", for each distribution date occurring prior to the distribution   
date in ________ ____, the Senior Prepayment Percentage will equal 100%, and    
until the earlier of such date and the date on which the Class A Certificates   
are paid in full, no distributions based on principal prepayments or, in some   
instances, net liquidation proceeds, on the mortgage loans will be distributed  
to the Subordinate Certificates. Thereafter, unless the Certificate Principal   
Balances of the Senior Certificates have been reduced to zero, the Subordinate  
Prepayment Percentage may continue to be 0% or otherwise be disproportionately  
small relative to the Subordinate Percentage. SEE "--PRINCIPAL DISTRIBUTIONS ON 
THE SENIOR CERTIFICATES" IN THIS PROSPECTUS SUPPLEMENT.                         

        Distributions of the Subordinate Principal Distribution Amount on each
distribution date will be made as follows: first to the holders of the Class B-1
Certificates, second to the holders of the Class B-2 Certificates, third to the 
holders of the Class B-3 Certificates, and then to the holders of the remaining 
classes of Subordinate Certificates, in each case to the extent of available    
funds and in each case to the extent of the portion of the Subordinate Principal
Distribution Amount payable in respect of each such class of Subordinate        
Certificates for such distribution date.                                        

P&I ADVANCES                                                                    

   Subject to the following limitations, the Master Servicer will be
obligated to advance or cause to be advanced on or before each distribution date
its own funds, or funds in the Distribution Account that are not included in the
Available Distribution Amount for such distribution date, in an amount equal to 
the P&I Advances for such distribution date.                                    

         P&I Advances are required to be made only to the extent they are deemed
by the Master Servicer to be recoverable from related late collections,         
insurance proceeds or liquidation proceeds. The purpose of making P&I Advances  
is to maintain a regular cash flow to the certificateholders, rather than to    
guarantee or insure against losses. The Master Servicer will not be required to 
make any P&I Advances with respect to reductions in the amount of the monthly   
payments on the mortgage loans due to bankruptcy proceedings or the application 
of the Relief Act.                                                              

        All P&I Advances will be reimbursable to the Master Servicer from late
collections, insurance proceeds and liquidation proceeds from the mortgage loan 
as to which the unreimbursed P&I Advance was made. In addition, any P&I Advances
previously made in respect of any mortgage loan that are deemed by the Master   
Servicer to be nonrecoverable from related late collections, insurance proceeds 
or liquidation proceeds may be reimbursed to the Master Servicer out of any     
funds in the Distribution Account prior to the distributions on the             
Certificates. In the event the Master Servicer fails in its obligation to make  
any such advance, the Trustee will be obligated to make any such advance, to the
extent required in the Agreement.                                               

ALLOCATION OF LOSSES; SUBORDINATION                                             

     Realized Losses (other than Excess Losses) will be allocated on any
distribution date as follows: first, to the Class B-6 Certificates; second, to  
the Class B-5 Certificates; third, to the Class B-4 Certificates; fourth, to the
Class B-3 Certificates; fifth, to the Class B-2 Certificates; and sixth, to the 
Class B-1 Certificates, in each case until the Certificate Principal Balance of 
such class has been reduced to zero. Thereafter, such Realized Losses will be   
allocated on any distribution date among the Class A Certificates on a Pro rata 
basis. Excess Losses will be allocated on any distribution date among all the   
Certificates (other than the Class X Certificates) on a Pro rata basis. Any     
allocation of a Realized Loss to a Certificate will be made by reducing the     
Certificate Principal Balance thereof by the amount so allocated as of the      
distribution date in the month following the calendar month in which such       
Realized Loss was incurred.                                                     

        An allocation of a Realized Loss on a Pro rata basis among two or more
classes of Certificates means an allocation to each such class of Certificates  
on the basis of its then outstanding Certificate Principal Balance prior to     
giving effect to distributions to be made on such distribution date.            

        With respect to any defaulted mortgage loan that is finally liquidated
through foreclosure sale, disposition of the related mortgaged property if      
acquired on behalf of the certificateholders by deed-in-lieu of foreclosure or  
otherwise, the amount of loss realized, if any, will equal the portion of the   
unpaid principal balance remaining, if any, plus interest thereon through the   
last day of the month in which such mortgage loan was finally liquidated, after 
application of all amounts recovered (net of amounts reimbursable to the Master 
Servicer for P&I Advances, Servicing Fees and Servicing Advances) towards       
interest and principal owing on the mortgage loan. Such amount of loss realized 
and any Special Hazard Losses, Fraud Losses and Bankruptcy Losses are referred  
to in this prospectus supplement as "Realized Losses".                          

        The Special Hazard Amount, Fraud Loss Amount and Bankruptcy Amount may
be reduced or modified upon confirmation from [Rating Agencies] that such       
reduction or modification will not adversely affect the then-current ratings    
assigned to the offered certificates rated thereby. Such a reduction or         
modification may adversely affect the coverage provided by the subordination    
with respect to Special Hazard Losses, Fraud Losses and Bankruptcy Losses.      

    In the event that Realized Losses are incurred that are covered by
subordination, such losses will be allocated to the most subordinate class of   
Certificates then outstanding. The priorities for distribution of cash flows    
described in this prospectus supplement, in some circumstances, may result in   
cash flow shortfalls to any class of Subordinate Certificates even if it is not 
the most subordinate class of Certificates then outstanding; however, the       
interest portion of any such shortfall would be distributable as unpaid Interest
Distribution Amount on future distribution dates as cash flows allow, to the    
extent of available funds, and the principal portion of any such shortfall would
not result in a reduction of the Certificate Principal Balance of such class. In
such event, the percentage interest represented by such class would increase    
relative to the respective Certificate Principal Balances of the more           
subordinate classes of Certificates. With respect to the most subordinate class 
of the Certificates outstanding at the time any Realized Loss is incurred, the  
total amount of the Realized Loss allocated to such class may be greater than   
the concurrent reduction in the Certificate Principal Balance thereof because   
such reduction will not reflect any undistributed Interest Distribution Amount  
on such class. Such undistributed Interest Distribution Amount on the most      
subordinate class of the Certificates outstanding will not be distributable on  
any future distribution date. As a result, it is possible that the total amount 
of Realized Losses that may be allocated to any class of Subordinate            
Certificates may exceed the initial Certificate Principal Balance thereof.      

    In order to maximize the likelihood of distribution in full of the
Senior Interest Distribution Amount and the Senior Principal Distribution       
Amount, on each distribution date, holders of Senior Certificates have a right  
to distributions of the Available Distribution Amount that is prior to the      
rights of the holders of the Subordinate Certificates, to the extent necessary  
to satisfy the Senior Interest Distribution Amount and the Senior Principal     
Distribution Amount.                                                            

      The application of the Senior Prepayment Percentage (when it exceeds
the Senior Percentage) to determine the Senior Principal Distribution Amount    
will accelerate the amortization of the Class A Certificates relative to the    
actual amortization of the mortgage loans. To the extent that the Class A       
Certificates are amortized faster than the mortgage loans, in the absence of    
offsetting Realized Losses allocated to the Subordinate Certificates, the       
percentage interest evidenced by the Class A Certificates in the trust fund will
be decreased (with a corresponding increase in the percentage interest in the   
trust fund evidenced by the Subordinate Certificates), thereby increasing,      
relative to their respective Certificate Principal Balances, the subordination  
afforded the Senior Certificates by the Subordinate Certificates.               

RESTRICTIONS ON TRANSFER OF THE RESIDUAL CERTIFICATES                           

       The Residual Certificates may not be purchased by or transferred to a
Plan except upon the delivery of a certification of facts or an opinion of      
counsel, as provided in this prospectus supplement. SEE "ERISA CONSIDERATIONS"  
IN THIS PROSPECTUS SUPPLEMENT. In addition, the Residual Certificates will be   
subject to additional restrictions described under "FEDERAL INCOME TAX          
CONSEQUENCES--SPECIAL TAX CONSIDERATIONS APPLICABLE TO THE RESIDUAL             
CERTIFICATES" in this prospectus supplement and "FEDERAL INCOME TAX             
CONSEQUENCES--REMICS--TAX ON TRANSFERS OF REMIC RESIDUAL CERTIFICATES TO CERTAIN
ORGANIZATIONS" and "--TAXATION OF OWNERS OF REMIC RESIDUAL                      
CERTIFICATES--NONECONOMIC REMIC RESIDUAL CERTIFICATES" in the prospectus.       

 POOLING AND SERVICING AGREEMENT

GENERAL                                                                         

      The Certificates will be issued pursuant to the Agreement, a form of
which is filed as an exhibit to the registration statement. A current report on 
Form 8-K relating to the Certificates containing a copy of the Agreement as     
executed will be filed by the company with the Securities and Exchange          
Commission within fifteen days of the initial issuance of the Certificates. The 
trust fund created under the Agreement will consist of (1) all of the company's 
right, title and interest in and to the mortgage loans, the related mortgage    
notes, mortgages and other related documents, (2) all payments on or collections
in respect of the mortgage loans due after the Cut-off Date, together with any  
proceeds thereof, (3) any mortgaged properties acquired on behalf of            
certificateholders by foreclosure or by deed in lieu of foreclosure, and any    
revenues received thereon, (4) the rights of the Trustee under all insurance    
policies required to be maintained pursuant to the Agreement and (5) the rights 
of the company under the Mortgage Loan Purchase Agreement among the company, the
Seller and the Originator (other than certain rights of the company to          
indemnification by the Originator). Reference is made to the prospectus for     
important information in addition to that set forth in this prospectus          
supplement regarding the trust fund, the terms and conditions of the Agreement  
and the offered certificates. The offered certificates will be transferable and 
exchangeable at the corporate trust offices of the Trustee, located in          
___________________. The company will provide to prospective or actual          
certificateholders without charge, on written request, a copy (without exhibits)
of the Agreement. Requests should be addressed to the _____________, MILA       
Mortgage Acceptance, Inc., 6021 244th Street SW, Mountlake Terrace, WA 98043 and
its phone number is (800) 332-6452.                                             

ASSIGNMENT OF THE MORTGAGE LOANS                                                

        The company will deliver to the Trustee or to a custodian with respect
to each mortgage loan (1) the mortgage note endorsed without recourse to the    
Trustee to reflect the transfer of the mortgage loan, (2) the original mortgage 
with evidence of recording indicated thereon and (3) an assignment of the       
mortgage in recordable form to the Trustee, reflecting the transfer of the      
mortgage loan. Such assignments of mortgage loans are required to be recorded by
or on behalf of the company in the appropriate offices for real property        
records.                                                                        

 THE TRUSTEE

  ___________________, a national banking association, will act as
Trustee for the Certificates pursuant to the Agreement. The Trustee's offices   
for notices under the Agreement are located at [address].                       

        The principal compensation to be paid to the Trustee in respect of its
obligations under the Agreement will be equal to the Trustee's Fee. The         
Agreement will provide that the Trustee and any director, officer, employee or  
agent of the Trustee will be indemnified by the trust fund and will be held     
harmless against any loss, liability or expense (not including expenses,        
disbursements and advances incurred or made by the Trustee, including the       
compensation and the expenses and disbursements of its agents and counsel, in   
the ordinary course of the Trustee's performance in accordance with the         
provisions of the Agreement) incurred by the Trustee in connection with any     
pending or threatened claim or legal action arising out of or in connection with
the acceptance or administration of its obligations and duties under the        
Agreement, other than any loss, liability or expense (1) resulting from a breach
of either of the Master Servicer's obligations and duties under the Agreement,  
(2) that constitutes a specific liability of Trustee under the Agreement or (3) 
incurred by reason of willful misfeasance, bad faith or negligence in the       
performance of the Trustee's duties under the Agreement or as a result of a     
breach, or by reason of reckless disregard, of the Trustee's obligations and    
duties under the Agreement.                                                     

SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES                        

         The principal compensation to be paid to the Master Servicer in respect
of its servicing activities for the Certificates will be equal to the Servicing 
Fee. As additional servicing compensation, the Master Servicer is entitled to   
retain all assumption fees and late payment charges in respect of mortgage loans
master serviced by it, to the extent collected from mortgagors, together with   
any interest or other income earned on funds held in the Distribution Account   
and any escrow accounts in respect of mortgage loans master serviced by it. The 
Master Servicer is obligated to offset any Prepayment Interest Shortfall in     
respect of the mortgage loans on any distribution date with Compensating        
Interest to the extent of its aggregate Servicing Fee for such distribution     
date. The Master Servicer is obligated to pay insurance premiums and ongoing    
expenses associated with the mortgage pool in respect of mortgage loans and     
incurred by the Master Servicer in connection with its responsibilities under   
the Agreement. However, the Master Servicer is entitled to reimbursement        
therefor as provided in the Agreement. See "DESCRIPTION OF THE                  
CERTIFICATES--RETAINED INTEREST; SERVICING COMPENSATION AND PAYMENT OF EXPENSES"
in the prospectus for information regarding expenses payable by the Master      
Servicer and "FEDERAL INCOME TAX CONSEQUENCES" in this prospectus supplement    
regarding taxes payable by the Master Servicer.                                 

VOTING RIGHTS                                                                   

    At all times, __% of all voting rights will be allocated among the
holders of the Certificates (other than the Class X Certificates and the        
Residual Certificates) in proportion to the then outstanding Certificate        
Principal Balances of their respective Certificates, __% of all voting rights   
will be allocated among the holders of the Class X Certificates in proportion to
the then outstanding Notional Amounts of their respective Certificates and __%  
of all voting rights will be allocated among the holders of the Residual        
Certificates in proportion to the percentage interests in each such class       
evidenced by their respective Certificates.                                     

TERMINATION                                                                     

        The circumstances under which the obligations created by the Agreement
will terminate in respect of the Certificates are described in "Description of  
the Certificates--Termination" in the prospectus. The Master Servicer will have 
the right to purchase the mortgage loans and any properties acquired in respect 
thereof on any distribution date, once the aggregate principal balance of the   
mortgage loans and such properties at the time of purchase is reduced to less   
than __% of the aggregate principal balance of the mortgage loans as of the     
Cut-off Date. If the Master Servicer elects to exercise the foregoing option, it
will effect the termination of the trust fund and the early retirement of the   
Certificates. In the event the Master Servicer exercises this option,           
notwithstanding the terms of the prospectus, the purchase price payable in      
connection therewith generally will be equal to par plus accrued interest for   
each mortgage loan at the related mortgage rate to but not including the first  
day of the month in which the repurchase price is distributed, and the portion  
of the purchase price allocable to the Certificates of each class will be, to   
the extent of available funds, (1) in the case of the Certificates of any class,
other than the Class X Certificates, 100% of the then outstanding Certificate   
Principal Balance thereof, plus (2) in the case of the Certificates of any      
class, one month's interest on the then outstanding Certificate Principal       
Balance or Notional Amount thereof at the then applicable Pass-Through Rate for 
such class plus any previously accrued but unpaid interest thereon. In no event 
will the trust created by the Agreement continue beyond the expiration of 21    
years from the death of the survivor of the persons named in the Agreement. SEE 
"DESCRIPTION OF THE CERTIFICATES--TERMINATION" IN THE PROSPECTUS. In no event   
will the trust created by the Agreement continue beyond the expiration of 21    
years from the death of the survivor of the person or persons named in the      
Agreement. SEE "DESCRIPTION OF THE CERTIFICATES--TERMINATION" in the prospectus.

 FEDERAL INCOME TAX CONSEQUENCES

         An election will be made to treat the trust fund as a REMIC for federal
income tax purposes. Upon the issuance of the offered certificates, Thacher     
Proffitt & Wood LLP, counsel to the company, will deliver its opinion generally 
to the effect that, assuming compliance with all provisions of the Agreement,   
for federal income tax purposes, the REMIC will qualify as a REMIC under        
Sections 860A through 860G of the Code.                                         

       For federal income tax purposes, (1) the Class R Certificates will be
the sole class of "residual interests" in the REMIC and (2) the Senior          
Certificates and the Subordinate Certificates will evidence the "regular        
interests" in, and will be treated as debt instruments of, the REMIC. SEE       
"FEDERAL INCOME TAX CONSEQUENCES--REMIC--CLASSIFICATION OF REMICS" IN THE       
PROSPECTUS.                                                                     

         For federal income tax reporting purposes, the Class X Certificates and
the Class PO Certificates will, the Class __ Certificates may, and all other    
classes will not, be treated as having been issued with original issue discount.
The prepayment assumption that will be used in determining the rate of accrual  
of original issue discount, premium and market discount, if any, for federal    
income tax purposes will be based on the assumption that, subsequent to the date
of any determination, the mortgage loans will prepay at a rate equal to ____% of
the prepayment assumption. No representation is made that the mortgage loans    
will prepay at that rate or at any other rate. SEE "FEDERAL INCOME TAX          
CONSEQUENCES--REMICS--TAXATION OF OWNERS OF REMIC REGULAR CERTIFICATES--ORIGINAL
ISSUE DISCOUNT" IN THE PROSPECTUS.                                              

       The IRS has issued OID Regulations under Sections 1271 to 1275 of the
Code generally addressing the treatment of debt instruments issued with original
issue discount. Purchasers of the Class X Certificates should be aware that the 
OID Regulations do not adequately address some issues relevant to, or are not   
applicable to, securities such as the Class X Certificates. In addition, there  
is considerable uncertainty concerning the application of the OID Regulations to
REMIC Regular Certificates that provide for payments based on a variable rate   
such as the Class X Certificates. Prospective purchasers of the Class X         
Certificates are advised to consult their tax advisors concerning the tax       
treatment of such Certificates.                                                 

     If the method of computing original issue discount described in the
prospectus results in a negative amount for any period with respect to any      
certificateholders (in particular, the holders of the Class X Certificates), the
amount of original issue discount allocable to such period would be zero, and   
such certificateholders will be permitted to offset such amounts only against   
the respective future income (if any) from such Certificate. Although uncertain,
a certificateholders may be permitted to deduct a loss to the extent that his or
her respective remaining basis in such Certificate exceeds the maximum amount of
future payments to which such certificateholders is entitled, assuming no       
further prepayments of the mortgage loans. Although the matter is not free from 
doubt, any such loss might be treated as a capital loss.                        

       The OID Regulations suggest that original issue discount with respect
to securities such as the Class X Certificates that represent multiple          
uncertificated REMIC regular interests, in which ownership interests will be    
issued simultaneously to the same buyer should be computed on an aggregate      
method. In the absence of further guidance from the IRS, original issue discount
with respect to the uncertificated regular interests represented by the Class X 
Certificates will be reported to the IRS and the certificateholders on an       
aggregate method based on a single overall constant yield and the prepayment    
assumption stated above, treating all such uncertificated regular interests as a
single debt instrument as set forth in the OID Regulations.                     

       The OID Regulations in some circumstances permit the holder of a debt
instrument to recognize original issue discount under a method that differs from
that of the issuer. Accordingly, it is possible that holders of offered         
certificates issued with original issue discount may be able to select a method 
for recognizing original issue discount that differs from that used in preparing
reports to certificateholders and the IRS. Prospective purchasers of offered    
certificates issued with original issue discount are advised to consult their   
tax advisors concerning the tax treatment of such Certificates in this regard.  

    Some Classes of Certificates may be treated for federal income tax
purposes as having been issued with a premium. Certificateholders may elect to  
amortize such premium under a constant yield method in which case such          
amortizable premium will generally be allocated among the interest payments on  
such Certificates and will be applied as an offset against such interest        
payments. SEE "FEDERAL INCOME TAX CONSEQUENCES--REMICS--TAXATION OF OWNERS OF   
REMIC REGULAR CERTIFICATES--PREMIUM" IN THE PROSPECTUS.                         

         The offered certificates will be treated as assets described in Section
7701(a)(19)(C) of the Code and "real estate assets" under Section 856(c)(4)(A)  
of the Code, generally in the same proportion that the assets in the related    
trust fund would be so treated. In addition, interest on the offered            
certificates will be treated as "interest on obligations secured by mortgages on
real property" under Section 856(c)(3)(B) of the Code, generally to the extent  
that the offered certificates are treated as "real estate assets" under Section 
856(c)(4)(A) of the Code. The offered certificates (other than the Residual     
Certificates) also will be treated as "qualified mortgages" under Section       
860G(a)(3) of the Code. SEE "FEDERAL INCOME TAX                                 
CONSEQUENCES--REMICS--CHARACTERIZATION OF INVESTMENTS IN REMIC CERTIFICATES" IN 
THE PROSPECTUS.                                                                 

      It is not anticipated that the REMIC will engage in any transactions
that would subject it to the prohibited transactions tax as defined in Section  
860F(a)(2) of the Code, the contributions tax as defined in Section 860G(d) of  
the Code or the tax on net income from foreclosure property as defined in       
Section 860G(c) of the Code. However, in the event that any such tax is imposed 
on the REMIC, such tax will be borne (1) by the Trustee, if the Trustee has     
breached its obligations with respect to REMIC compliance under the Agreement,  
(2) by the Master Servicer, if the Master Servicer has breached its obligations 
with respect to REMIC compliance under the Agreement and (3) otherwise by the   
trust fund, with a resulting reduction in amounts otherwise distributable to    
holders of the related offered certificates. SEE "DESCRIPTION OF THE            
CERTIFICATES-- GENERAL" AND "FEDERAL INCOME TAX CONSEQUENCES--REMICS            
--PROHIBITED TRANSACTIONS TAX AND OTHER TAXES" IN THE PROSPECTUS.               

      The responsibility for filing annual federal information returns and
other reports will be borne by the Trustee. SEE "FEDERAL INCOME TAX             
CONSEQUENCES--REMICS--REPORTING AND OTHER ADMINISTRATIVE MATTERS" IN THE        
PROSPECTUS.                                                                     

       For further information regarding the federal income tax consequences
of investing in the offered certificates, see "FEDERAL INCOME TAX               
CONSEQUENCES--REMICS" in the prospectus.                                        

SPECIAL TAX CONSIDERATIONS APPLICABLE TO RESIDUAL CERTIFICATES                  

  The IRS has issued REMIC regulations under the provisions of the
Internal Revenue Code that significantly affect holders of Residual             
Certificates. The REMIC regulations impose restrictions on the transfer or      
acquisition of some residual interests, including the Residual Certificates. The
Agreement includes other provisions regarding the transfer of Residual          
Certificates, including:                                                        

o        the requirement that any transferee of a Residual Certificate provide  
an affidavit representing that the transferee:                

o        is not a disqualified organization;                  

   o        is not acquiring the Residual Certificate on behalf of a
disqualified organization; and              

        o        will maintain that status and will obtain a similar affidavit
             from any person to whom the transferee shall subsequently
transfer a Residual Certificate;            

o        a provision that any transfer of a Residual Certificate to a           
disqualified organization shall be null and void; and         

In addition, under the Agreement, the Residual Certificates may not be          
transferred to non-United States persons.                                       

       The REMIC regulations also provide that a transfer to a United States
person of "noneconomic" residual interests will be disregarded for all federal  
income tax purposes, and that the purported transferor of "noneconomic" residual
interests will continue to remain liable for any taxes due with respect to the  
income on the residual interests, unless "no significant purpose of the transfer
was to impede the assessment or collection of tax." Based on the REMIC          
regulations, the Residual Certificates may constitute noneconomic residual      
interests during some or all of their terms for purposes of the REMIC           
regulations and, accordingly, unless no significant purpose of a transfer is to 
impede the assessment or collection of tax, transfers of the Residual           
Certificates may be disregarded and purported transferors may remain liable for 
any taxes due relating to the income on the Residual Certificates. All transfers
of the Residual Certificates will be restricted in accordance with the terms of 
the Agreement that are intended to reduce the possibility of any transfer of a  
Residual Certificate being disregarded to the extent that the Residual          
Certificates constitute noneconomic residual interests.                         

       The IRS has issued final REMIC regulations that add to the conditions
necessary to assure that a transfer of a non-economic residual interest would be
respected. The additional conditions require that in order to qualify as a safe 
harbor transfer of a residual, the transferee represent that it will not cause  
the income "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 either (i) the amount received by the transferee  
be no less on a present value basis than the present value of the net tax       
detriment attributable to holding the residual interest reduced by the present  
value of the projected payments to be received on the residual interest or (ii) 
the transfer is to a domestic taxable corporation with specified large amounts  
of gross and net assets and that meets certain other requirements where         
agreement is made that all future transfers will be to taxable domestic         
corporations in transactions that qualify for the same "safe harbor" provision. 
Eligibility for the safe harbor requires, among other things, that the facts and
circumstances known to the transferor at the time of transfer not indicate to a 
reasonable person that the taxes with respect to the residual interest will not 
be paid, with an unreasonably low cost for the transfer specifically mentioned  
as negating eligibility. The regulations generally apply to transfers of        
residual interests occurring on or after February 4, 2000. SEE "FEDERAL INCOME  
TAX CONSEQUENCES --REMICS--TAXATION OF OWNERS OF REMIC RESIDUAL                 
CERTIFICATES--NONECONOMIC REMIC RESIDUAL CERTIFICATES" IN THE PROSPECTUS.       

         The Residual Certificateholders' may be required to report an amount of
taxable income with respect to the earlier accrual periods of the term of each  
REMIC that significantly exceeds the amount of cash distributions received by   
the Residual Certificateholders from the respective REMIC with respect to those 
periods. Furthermore, the tax on that income may exceed the cash distributions  
with respect to those periods. Consequently, Residual Certificateholders' should
have other sources of funds sufficient to pay any federal income taxes due in   
the earlier years of the REMICs' term as a result of their ownership of the     
Residual Certificates. In addition, the required inclusion of this amount of    
taxable income during the REMICs' earlier accrual periods and the deferral of   
corresponding tax losses or deductions until later accrual periods or until the 
ultimate sale or disposition of a Residual Certificate, or possibly later under 
the "wash sale" rules of Section 1091 of the Internal Revenue Code may cause the
Residual Certificateholders' after-tax rate of return to be zero or negative    
even if the Residual Certificateholders' pre-tax rate of return is positive.    
That is, on a present value basis, the Residual Certificateholders' resulting   
tax liabilities could substantially exceed the sum of any tax benefits and the  
amount of any cash distributions on the Residual Certificates over their life.  

An individual, trust or estate that holds, whether directly or
indirectly through pass-through entities, a Residual Certificate, may have      
significant additional gross income with respect to, but may be limited on the  
deductibility of, servicing and trustee's fees and other administrative expenses
properly allocable to the REMIC in computing the certificateholder's regular tax
liability and will not be able to deduct those fees or expenses to any extent in
computing the certificateholder's alternative minimum tax liability. SEE        
"FEDERAL INCOME TAX CONSEQUENCES--REMICS--TAXATION OF OWNERS OF REMIC RESIDUAL  
CERTIFICATES--POSSIBLE PASS-THROUGH OF MISCELLANEOUS ITEMIZED DEDUCTIONS" IN THE
PROSPECTUS.                                                                     

        Potential investors in Residual Certificates should also be aware that
under the terms of the Agreement, the holders of the largest percentage interest
in the Residual Certificates shall, by their acceptance of such Certificates,   
agree to irrevocably appoint the Trustee as their agent to perform all of the   
duties of the tax matters person for the REMIC.                                 

         Purchasers of the Residual Certificates are strongly advised to consult
their tax advisors as to the economic and tax consequences of investment in the 
Residual Certificates.                                                          

       For further information regarding the federal income tax consequences
of investing in the Residual Certificates, SEE "YIELD ON THE                    
CERTIFICATES--ADDITIONAL YIELD CONSIDERATIONS APPLICABLE SOLELY TO THE RESIDUAL 
CERTIFICATES" IN THIS PROSPECTUS SUPPLEMENT AND "FEDERAL INCOME TAX             
CONSEQUENCES--REMICS--TAXATION OF OWNERS OF REMIC RESIDUAL CERTIFICATES" IN THE 
PROSPECTUS.                                                                     

METHOD OF DISTRIBUTION

   Subject to the terms and conditions set forth in the underwriting
agreement, dated _________ __, ____, the company has agreed to sell, and the    
Underwriter has agreed to purchase the offered certificates. The Underwriter is 
obligated to purchase all offered certificates of the respective classes offered
by this prospectus supplement if it purchases any. The Underwriter is an        
affiliate of the company.                                                       

         Distribution of the offered certificates will be made from time to time
in negotiated transactions or otherwise at varying prices to be determined at   
the time of sale. Proceeds to the company from the sale of the offered          
certificates, before deducting expenses payable by the company, will be         
approximately _________% of the aggregate initial Certificate Principal Balance 
of the offered certificates, plus accrued interest on the offered certificates. 
In connection with the purchase and sale of the offered certificates, the       
Underwriter may be deemed to have received compensation from the company in the 
form of underwriting discounts.                                                 

        The offered certificates are offered subject to receipt and acceptance
by the Underwriter, to prior sale and to the Underwriter's right to reject any  
order in whole or in part and to withdraw, cancel or modify the offer without   
notice. It is expected that delivery of the Book-Entry Certificates will be made
through the facilities of DTC, and that delivery of each other class of offered 
certificates and the Residual Certificates will be made at the offices of the   
Underwriter, [Address], in each case, on or about the Closing Date.             

         The underwriting agreement provides that the company will indemnify the
Underwriter against certain civil liabilities, including liabilities under the  
Securities Act of 1933, as amended, or will contribute to payments the          
Underwriter may be required to make in respect thereof.                         

SECONDARY MARKET

   There can be no assurance that a secondary market for the offered
certificates will develop or, if it does develop, that it will continue. The    
primary source of information available to investors concerning the offered     
certificates will be the monthly statements discussed in the prospectus under   
"DESCRIPTION OF THE SECURITIES--REPORTS TO SECURITYHOLDERS", which will include 
information as to the outstanding principal balance of the offered certificates 
and the status of the applicable form of credit enhancement. There can be no    
assurance that any additional information regarding the offered certificates    
will be available through any other source. In addition, the company is not     
aware of any source through which price information about the offered           
certificates will be generally available on an ongoing basis. The limited nature
of information regarding the offered certificates may adversely affect the      
liquidity of the offered certificates, even if a secondary market for the       
offered certificates becomes available.                                         

LEGAL OPINIONS

        Legal matters relating to the offered certificates will be passed upon
for the company by Thacher Proffitt & Wood LLP, New York, New York and for the  
Underwriter by [______________________].                                        

 RATINGS

        It is a condition to the issuance of the Certificates that the Class A
Certificates and the Residual Certificates be rated "AAA" by _________________  
("_____") and "AAA" by ____________ ("____"), that the Class B-1 Certificates be
rated at least "AA" by _________ and at least "AA" by _______, that the Class   
B-2 Certificates be rated at least "A" by _________ and at least "A" by         
________, and that the Class B-3 Certificates be rated at least "BBB" by        
__________.                                                                     

         The ratings of _________ and ________ assigned to mortgage pass-through
certificates address the likelihood of the receipt by certificateholders of all 
distributions to which the certificateholders are entitled. The rating process  
addresses structural and legal aspects associated with the Certificates,        
including the nature of the underlying mortgage loans. The ratings assigned to  
mortgage pass-through certificates do not represent any assessment of the       
likelihood that principal prepayments will be made by the mortgagors or the     
degree to which the rate and timing principal prepayments will differ from that 
originally anticipated. The ratings do not address the possibility that         
certificateholders might suffer a lower than anticipated yield due to non-credit
events or that the holders of the Class X Certificates may fail to recover fully
their initial investment. In addition, the ratings on the Residual Certificates 
do not address the likelihood of receipt by the holders of the Residual         
Certificates of any amounts in excess of their initial Certificate Balance      
thereof and interest thereon.                                                   

A security rating is not a recommendation to buy, sell or hold
securities and may be subject to revision or withdrawal at any time by the      
assigning rating organization. Each security rating should be evaluated         
independently of any other security rating. In the event that the ratings       
initially assigned to the offered certificates are subsequently lowered for any 
reason, no person or entity is obligated to provide any additional credit       
support or credit enhancement with respect to the offered certificates.         

        The company has not requested that any rating agency rate any class of
the offered certificates other than as stated above. However, there can be no   
assurance as to whether any other rating agency will rate any class of the      
offered certificates, or, if it does, what rating would be assigned by any other
rating agency. A rating on any class of the offered certificates by another     
rating agency, if assigned at all, may be lower than the ratings assigned to the
offered certificates as stated above.                                           

LEGAL INVESTMENT

        The Senior Certificates and the Class B-1 Certificates will constitute
"mortgage related securities" for purposes of SMMEA for so long as they are     
rated not lower than the second highest rating category by a Rating Agency (as  
defined in the prospectus) and, as such, will be legal investments for entities 
to the extent provided in SMMEA. SMMEA, however, provides for state limitation  
on the authority of these entities to invest in "mortgage related securities"   
provided that restrictive legislation by the state was enacted prior to October 
3, 1991. Some states have enacted legislation which overrides the preemption    
provisions of SMMEA. The Class B-2 Certificates and the Class B-3 Certificates  
will not constitute "mortgage related securities" for purposes of SMMEA.        

        The company makes no representations as to the proper characterization
of any class of offered certificates for legal investment or other purposes, or 
as to the ability of particular investors to purchase any class of offered      
certificates under applicable legal investment restrictions. These uncertainties
may adversely affect the liquidity of any class of offered certificates.        
Accordingly, all institutions whose investment activities are subject to legal  
investment laws and regulations, regulatory capital requirements or review by   
regulatory authorities should consult with their legal advisors in determining  
whether and to what extent any class of offered certificates constitutes a legal
investment or is subject to investment, capital or other restrictions.          

SEE "LEGAL INVESTMENT" IN THE PROSPECTUS.                     

ERISA CONSIDERATIONS

     A fiduciary of any Plan and any person investing Plan Assets of any
Plan should carefully review with its legal advisors whether the purchase, sale 
or holding of certificates will give rise to a prohibited transaction under     
ERISA or Section 4975 of the Code.                                              

    The U.S. Department of Labor has issued an Exemption, as described
under "ERISA Considerations" in the prospectus, to the Underwriter. The         
Exemption generally exempts from the application of certain of the prohibited   
transaction provisions of Section 406 of ERISA, and the excise taxes imposed on 
such prohibited transactions by Section 4975(a) and (b) of the Code and Section 
502(i) of ERISA, transactions relating to the purchase, sale and holding of     
pass-through certificates rated at least "BBB-" (or its equivalent) by the      
Exemption Rating Agencies at the time of purchase and underwritten by the       
Underwriter, such as the offered certificates, and the servicing and operation  
of asset pools, such as the mortgage pool, provided that the conditions of the  
Exemption are satisfied. The purchase of the offered certificates by, on behalf 
of or with the Plan Assets of any Plan may qualify for exemptive relief under   
the Exemption, as amended and as currently in effect. However, the Exemption    
contains a number of conditions which must be met for the Exemption, as amended,
to apply (as described in the prospectus), including the requirement that any   
such Plan must be an "accredited investor" as defined in Rule 501(a)(1) of      
Regulation D of the Securities and Exchange Commission under the Securities Act 
of 1933, as amended. A fiduciary of a Plan contemplating purchasing an offered  
certificate must make its own determination that the conditions set forth in the
Exemption, as amended, will be satisfied with respect to such certificates,     
including the requirement that the rating on a particular class of certificates 
be "BBB-" or higher at the time of purchase.                                    

   Any fiduciary or other investor of "Plan Assets" that proposes to
acquire or hold the offered certificates on behalf of or with "Plan Assets" of  
any Plan should consult with its counsel with respect to the application of the 
fiduciary responsibility provisions of ERISA and the prohibited transaction     
provisions of the ERISA and the Code to the proposed investment. SEE "ERISA     
CONSIDERATIONS" IN THE PROSPECTUS.                                              

  The sale of any class of offered certificates to a Plan is in no
respect a representation by the company, the Trustee or the Underwriter that    
such an investment meets all relevant legal requirements with respect to        
investments by Plans generally or any particular Plan, or that such an          
investment is appropriate for Plans generally or any particular Plan.           

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GLOSSARY

AVAILABLE DISTRIBUTION AMOUNT -- For any distribution date, an amount which     
generally includes scheduled payments on the mortgage loans due during the      
related Due Period and received on or prior to the related Determination Date,  
prepayments and other unscheduled collections received on the mortgage loans    
during the related Prepayment Period, any P&I Advances made by the Master       
Servicer for such distribution date and with respect to each mortgage loan with 
a first payment date occurring in _________ ____, a cash amount equal to        
interest on such mortgage loan, net of the amount of any prepayment charges     
received on the mortgage loans and net of fees payable to the Master Servicer   
and the Trustee and amounts reimbursable to the Master Servicer, the company and
the Trustee as provided in the Agreement.                                       

BANKRUPTCY AMOUNT -- The aggregate amount of Realized Losses which may be       
allocated in connection with Bankruptcy Losses through subordination will       
initially be equal to approximately $_______. As of any date of determination,  
the Bankruptcy Amount shall equal the initial Bankruptcy Amount less the sum of 
any amounts allocated through subordination for such losses up to such date of  
determination.                                                                  

BOOK-ENTRY CERTIFICATES -- The Class A Certificates issued, maintained and      
transferred at the DTC.                                                         

CERTIFICATE PRINCIPAL BALANCE -- With respect to any Certificate (other than a  
Class X Certificate), the then maximum amount that the holder thereof is        
thereafter entitled to receive as distributions allocable to principal from the 
cash flow on the mortgage loans and the other assets in the trust fund. The     
Certificate Principal Balance of any class of Certificates (other than the Class
X Certificates) as of any date of determination is equal to the initial         
Certificate Principal Balance thereof, reduced by the aggregate of (a) all      
amounts allocable to principal previously distributed with respect to such      
Certificate and (b) without duplication of amounts described in clause (a)      
above, any reductions in the Certificate Principal Balance thereof deemed to    
have occurred in connection with allocations thereto of Realized Losses on the  
mortgage loans as described below.                                              

CLASS A CERTIFICATES -- The Lockout Certificates together with the Senior       
Sequential Certificates.                                                        

CLASS B PERCENTAGE -- For the Class B-1 Certificates, the Class B-2             
Certificates, the Class B-3 Certificates, the Class B-4 Certificates, the Class 
B-5 Certificates and the Class B-6 Certificates initially will equal            
approximately ____%, approximately ____%, approximately ____%, approximately    
____%, approximately ____% and approximately ____%, respectively, and will in no
event exceed 100%, and will be adjusted for each distribution date to be the    
percentage equal to the Certificate Principal Balance of the related class of   
Subordinate Certificates immediately prior to such distribution date divided by 
the aggregate of the Scheduled Principal Balance of each of the mortgage loans  
immediately prior to such distribution date.                                    

COMPENSATING INTEREST -- Any payments made by the Master Servicer from its own  
funds to cover Prepayment Interest Shortfalls.                                  

CPR -- A constant rate of prepayment on the mortgage loans.                     

CUT-OFF DATE-- [Date]                                                           

DETERMINATION DATE -- With respect to any distribution date is on the 15th day  
of the month in which such distribution date occurs or, if such day is not a    
business day, on the immediately preceding business day.                        

DUE DATE -- With respect to each mortgage loans, the first day of the month.    

DUE PERIOD -- With respect to any distribution date commences on the second day 
of the month immediately preceding the month in which such distribution date    
occurs and ends on the first day of the month in which such distribution date   
occurs.                                                                         

EXCESS BANKRUPTCY LOSSES-- Bankruptcy Losses in excess of the Bankruptcy Amount.

EXCESS FRAUD LOSSES -- Fraud Losses in excess of the Fraud Loss Amount.         

EXCESS LOSSES -- Excess Special Hazard Losses, Excess Bankruptcy Losses, Excess 
Fraud Losses and Extraordinary Losses.                                          

EXCESS SPECIAL HAZARD LOSSES -- Special Hazard Losses in excess of the Special  
Hazard Amount.                                                                  

EXEMPTION-- Prohibited Transaction Exemption __-__.                             

FRAUD LOSS AMOUNT -- The aggregate amount of Realized Losses which may be       
allocated in connection with Fraud Losses through subordination shall initially 
be equal to approximately $_________. As of any date of determination after the 
Cut-off Date, the Fraud Loss Amount shall equal (X) prior to the first          
anniversary of the Cut-off Date an amount equal to ____% of the aggregate       
principal balance of all of the mortgage loans as of the Cut-off Date minus the 
aggregate amounts allocated through subordination with respect to Fraud Losses  
on the mortgage loans up to such date of determination, (Y) from the first to   
the second anniversary of the Cut-off Date, an amount equal to (1) the lesser of
(a) the Fraud Loss Amount as of the most recent anniversary of the Cut-off Date 
and (b) ____% of the aggregate principal balance of all of the mortgage loans as
of the most recent anniversary of the Cut-off Date minus (2) the aggregate      
amounts allocated through subordination with respect to Fraud Losses on the     
mortgage loans since the most recent anniversary of the Cut-off Date up to such 
date of determination and (Z) from the second to the fifth anniversary of the   
Cut-off Date, an amount equal to (1) the lesser of (a) the Fraud Loss Amount as 
of the most recent anniversary of the Cut-off Date, and (b) ____% of the        
aggregate principal balance of all of the mortgage loans as of the most recent  
anniversary of the Cut-off Date minus (2) the aggregate amounts allocated       
through subordination with respect to Fraud Losses on the mortgage loans since  
the most recent anniversary of the Cut-off Date up to such date of              
determination. On and after the fifth anniversary of the Cut-off Date, the Fraud
Loss Amount shall be zero.                                                      

INDUSTRY -- DTC's participants and other members of the financial community.    

INTEREST ACCRUAL PERIOD -- For each class of Certificates for any distribution  
date, the one-month period preceding the month in which such distribution date  
occurs.                                                                         

INTEREST DISTRIBUTION AMOUNT -- With respect to the Certificates of any class on
any distribution date, is equal to interest accrued during the related Interest 
Accrual Period on the Certificate Principal Balance or Notional Amount, as      
applicable, of such Certificates immediately prior to such distribution date at 
the then applicable Pass-Through Rate for such class, plus, in the case of each 
such class, any such amount remaining unpaid from previous distribution dates,  
and reduced (to not less than zero), in the case of each such class, by the     
allocable share for such class of Prepayment Interest Shortfalls to the extent  
not covered by Compensating Interest paid by the Master Servicer, shortfalls    
resulting from the application of the Relief Act and other interest shortfalls  
not covered by the subordination provided by more subordinate classes of        
Certificates. Any Prepayment Interest Shortfalls for any distribution date to   
the extent not covered by Compensating Interest paid by the Master Servicer will
be allocated among the holders of the Certificates on a Pro rata basis based on 
the respective amounts of interest accrued on such Certificates for such        
distribution date. In addition, any shortfalls resulting from the application of
the Relief Act will be allocated among the holders of all of the Certificates on
a Pro rata basis as described above.                                            

LOCKOUT CERTIFICATES -- The Class A-6 Certificates.                             

LOCKOUT CERTIFICATE PERCENTAGE -- As calculated for each distribution date, the 
percentage equal to the aggregate Certificate Principal Balance of the Lockout  
Certificates divided by the sum of the aggregate Certificate Principal Balances 
of the Class A Certificates.                                                    

LOCKOUT DISTRIBUTION PERCENTAGE -- For any distribution date occurring prior to 
the distribution date in _________ ____ will be equal to 0%. The "Lockout       
Distribution Percentage" for any distribution date occurring after the first    
____ years following the Closing Date will be as follows: for any distribution  
date during the _______ year after the Closing Date, __% of the Lockout         
Certificate Percentage for such distribution date; for any distribution date    
during the ______ year after the Closing Date, __% of the Lockout Certificate   
Percentage for such distribution date; for any distribution date during the     
_______ year after the Closing Date, ___% of the Lockout Certificate Percentage 
for such distribution date, and for any distribution date thereafter, the lesser
of (x) 300% of the Lockout Certificate Percentage and (y) 100%. Notwithstanding 
the foregoing, if the Certificate Principal Balances of the Class A Certificates
(other than the Lockout Certificates) have been reduced to zero, the Lockout    
Distribution Percentage will be equal to 100%.                                  

MASTER SERVICER-- [Name of Master Servicer].                                    

NET MORTGAGE RATE -- On any mortgage loan, the then applicable mortgage rate    
thereon minus the sum of (1) the Servicing Fee Rate and (2) the Trustee's Fee   
Rate.                                                                           

NOTIONAL AMOUNT -- With respect to the Class X Certificates as of any date of   
determination, the aggregate principal balance of the then outstanding mortgage 
loans. Reference to the Notional Amount of the Class X Certificates is solely   
for convenience in calculations and does not represent the right to receive any 
distributions allocable to principal.                                           

OFFERED CERTIFICATES -- The Senior Certificates, the Class B-1 Certificates, the
Class B-2 Certificates, the Class B-3 Certificates and the Residual             
Certificates.                                                                   

P&I ADVANCE -- The aggregate of all payments of principal and interest, net of  
the Servicing Fee, that were due during the related Due Period on the mortgage  
loans master serviced by it and that were delinquent on the related             
Determination Date, plus amounts representing assumed payments not covered by   
any current net income on the mortgaged properties acquired by foreclosure or by
deed in lieu of foreclosure.                                                    

PASS-THROUGH RATE -- With respect to any class of Certificates other than the   
Class X Certificates, the fixed rate set forth on the cover hereof. The         
Pass-Through Rate applicable to the calculation of the Interest Distribution    
Amount for the Class X Certificates for any distribution date is the rate per   
annum expressed as the percentage equivalent of a fraction, the numerator of    
which is equal to (1)(A) the amount of interest accrued on the mortgage loans   
for the immediately preceding calendar month at the Net Mortgage Rate minus (B) 
the aggregate amount of interest payable on the Certificates (other than the X  
Certificates), and the denominator of which is equal to (2) the Notional Amount 
of the Class X Certificates. The initial variable Pass-Through Rate for the     
Class X Certificates is approximately _______% per annum.                       

PREPAYMENT ASSUMPTION -- A prepayment rate for the mortgage loans of ___% of the
Prepayment Vector.                                                              

PREPAYMENT PERIOD -- With respect to any distribution date is the calendar month
immediately preceding the month in which such distribution date occurs.         

PREPAYMENT VECTOR -- A ___% Prepayment Vector assumes that the outstanding      
balance of a pool of mortgage loans prepays at a rate of ____% CPR in the first 
month of the life of such pool, such rate increasing by an additional           
approximate ____% CPR (precisely __/__, expressed as a percentage) each month   
thereafter through the eleventh month of the life of such pool, and such rate   
thereafter remaining constant at __% CPR for the remainder of the life of such  
pool. An __% Prepayment Vector assumes, for example, that the outstanding       
balance of a pool of mortgage loans prepays at a rate of ____% CPR in the first 
month of the life of such pool, such rate increasing by an additional           
approximate ____% CPR (precisely _____/__, expressed as a percentage) each month
thereafter through the ________ month of the life of the pool, and such rate    
thereafter remaining constant at __% CPR for the remainder of the life of the   
pool.                                                                           

RATING AGENCIES -- [Names of Rating Agencies].                                  

RECORD DATE -- For each distribution date (1) with respect to any Book-Entry    
Certificate will be the close of business on the business day immediately       
preceding such distribution date or (2) with respect to any other class of      
Certificates, including any definitive certificates, will be the close of       
business on the last business day of the month preceding the month in which such
distribution date occurs.                                                       

RESIDUAL CERTIFICATES-- The Class R Certificates.                               

RULES -- The rules, regulations and procedures creating and affecting DTC and   
its operations.                                                                 

SCHEDULED PRINCIPAL BALANCE -- With respect to any mortgage loan as of any date 
of determination is equal to the principal balance thereof as of the Cut-off    
Date (after application of all scheduled principal payments due on or before the
Cut-off Date, whether or not received), reduced by (x) the principal portion of 
all monthly payments due on or before the date of determination, whether or not 
received, (y) all amounts allocable to unscheduled principal that were received 
prior to the calendar month in which the date of determination occurs, and (z)  
any Bankruptcy Loss occurring out of a Deficient Valuation that was incurred    
prior to the calendar month in which the date of determination occurs.          

SELLER-- [Name of Seller]                                                       

SENIOR CERTIFICATES -- The Class A Certificates and the Class X Certificates    

SENIOR INTEREST DISTRIBUTION AMOUNT -- On each distribution date, the aggregate 
of the Interest Distribution Amounts for such distribution date on all of the   
Senior Certificates and, on the first distribution date, the Residual           
Certificates.                                                                   

SENIOR INTEREST DISTRIBUTION AMOUNT -- On each distribution date, the aggregate 
of the Interest Distribution Amounts for such distribution date on all of the   
Senior Certificates and, on the first distribution date, the Residual           
Certificates.                                                                   

SENIOR PERCENTAGE -- The percentage equal to the aggregate Certificate Principal
Balances of the Class A Certificates immediately prior to such distribution date
divided by the aggregate of the Scheduled Principal Balance of each of the      
mortgage loans immediately prior to such distribution date.                     

SENIOR PREPAYMENT PERCENTAGE -- Except as described below, the Senior Prepayment
Percentage for any distribution date occurring prior to the distribution date in
________ ____ will equal ___%. Except as described below, the Senior Prepayment 
Percentage for any distribution date occurring after the first five years will  
be as follows: for any distribution date during the _____ year after the Closing
Date, the Senior Percentage for such distribution date plus ___% of the         
Subordinate Percentage for such distribution date; for any distribution date    
during the _______ year after the Closing Date, the Senior Percentage for such  
distribution date plus __% of the Subordinate Percentage for such distribution  
date; for any distribution date during the ______ year after the Closing Date,  
the Senior Percentage for such distribution date plus __% of the Subordinate    
Percentage for such distribution date; for any distribution date during the     
_______ year after the Closing Date, the Senior Percentage for such distribution
date plus __% of the Subordinate Percentage for such distribution date; and for 
any distribution date thereafter, the Senior Percentage for such distribution   
date (unless on any such distribution date the Senior Percentage exceeds the    
initial Senior Percentage, in which case the Senior Prepayment Percentage for   
such distribution date will equal ___%). Any scheduled reduction to the Senior  
Prepayment Percentage described above shall not be made as of any distribution  
date unless (1) the outstanding principal balance of mortgage loans delinquent  
60 days or more (including real estate owned and mortgage loans in foreclosure) 
averaged over the last six months does not exceed 50% of the sum of the then    
current Certificate Principal Balances of the Subordinate Certificates and (2)  
Realized Losses on the mortgage loans to date are less than the then applicable 
Trigger Amount. The Trigger Amount for any distribution date occurring after the
first ____ years will be as follows: for any distribution date during the _____ 
year after the Closing Date, __% of the initial sum of the Certificate Principal
Balances of the Subordinate Certificates; for any distribution date during the  
seventh year after the Closing Date, __% of the initial sum of the Certificate  
Principal Balances of the Subordinate Certificates; for any distribution date   
during the ______ year after the Closing Date, __% of the initial sum of the    
Certificate Principal Balances of the Subordinate Certificates; and for any     
distribution date during the _____ year after the Closing Date, __% of the      
initial sum of the Certificate Principal Balances of the Subordinate            
Certificates. Notwithstanding the foregoing, upon reduction of the Certificate  
Principal Balances of the Senior Certificates to zero, the Senior Prepayment    
Percentage will equal 0%.                                                       

SENIOR PRINCIPAL DISTRIBUTION AMOUNT -- With respect to any distribution date,  
the lesser of (a) the balance of the Available Distribution Amount remaining    
after the Senior Interest Distribution Amount is distributed and (b) the sum of 
the amounts described in clauses (1) through (4) in section ___________.        

SENIOR SEQUENTIAL CERTIFICATES -- The Class A-1 Certificates, the Class A-2     
Certificates, the Class A-3 Certificates, the Class A-4 Certificates and the    
Class A-5 Certificates.                                                         

SERVICING FEE -- With respect to each mortgage loan, accrued interest at the    
Servicing Fee Rate of ____% per annum with respect to the mortgage loan on the  
same principal balance on which interest on the mortgage loan accrues for the   
calendar month.                                                                 

SERVICING FEE RATE -- On each mortgage loan, a rate equal to ____% per annum.   

SPECIAL HAZARD AMOUNT -- The aggregate amount of Realized Losses which may be   
allocated in connection with Special Hazard Losses through subordination shall  
initially be equal to approximately $_________. As of any date of determination 
following the Cut-off Date, the Special Hazard Amount shall equal approximately 
$_________ less the sum of (A) any amounts allocated through subordination in   
respect of Special Hazard Losses and (B) the Adjustment Amount. The Adjustment  
Amount will be equal to an amount calculated pursuant to the terms of the       
Agreement.                                                                      

SUBORDINATE CERTIFICATES -- The Class B-1 Certificates, the Class B-2           
Certificates, the Class B-3 Certificates, the Class B-4 Certificates, the Class 
B-5 Certificates and the Class B-6 Certificates                                 

SUBORDINATE PERCENTAGE -- As of any date of determination, a percentage equal to
___% minus the Senior Percentage.                                               

SUBORDINATE INTEREST DISTRIBUTION AMOUNT -- On each distribution date, is equal 
to the aggregate of the Interest Distribution Amounts on all of the Subordinate 
Certificates.                                                                   

SUBORDINATE PREPAYMENT PERCENTAGE -- For any distribution date will equal 100%  
minus the Senior Prepayment Percentage.                                         

SUBORDINATE PRINCIPAL DISTRIBUTION AMOUNT -- With respect to any distribution   
date, the lesser of (a) the balance of the Available Distribution Amount        
remaining after the distribution of the Senior Interest Distribution Amount, the
Senior Principal Distribution Amount and the Subordinate Interest Distribution  
Amount and (b) the aggregate of the sum for each class of Subordinate           
Certificates of the amounts described in clauses (1) through (4) of             
"______".                                                                       

SYSTEMS -- Computer applications, systems and similar items for processing data.

TRUSTEE -- [Name of Trustee].                                                   

TRUSTEE'S FEE -- Accrued interest at the Trustee's Fee Rate of ______% per annum
on the Stated Principal Balance of each mortgage loan.                          

TRUSTEE'S FEE RATE -- On each mortgage loan, a rate equal to ______% per annum. 

UNDERWRITER-- [Name of Underwriter].                                            

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 $____________ (APPROXIMATE)

MILA MORTGAGE ACCEPTANCE, INC.

 COMPANY

MORTGAGE PASS-THROUGH CERTIFICATES

SERIES ____-__

 PROSPECTUS SUPPLEMENT

 DATED _________ ___, ____

 [NAME OF MASTER SERVICER]

 MASTER SERVICER

 [NAME OF UNDERWRITER]

 UNDERWRITER

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE  
IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. WE HAVE NOT      
AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION.                    

WE ARE NOT OFFERING THE OFFERED CERTIFICATES IN ANY STATE WHERE THE OFFER IS NOT
PERMITTED.                                                                      

Dealers will be required to deliver a prospectus supplement and prospectus when 
acting as underwriters of the certificates offered by this prospectus supplement
and with respect to their unsold allotments or subscriptions. In addition, all  
dealers selling the offered certificates, whether or not participating in this  
offering, may be required to deliver a prospectus supplement and prospectus     
until _______ ___, ____.                                                        

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SUBJECT TO COMPLETION, DATED JUNE 27, 2005 [VERSION 2]

PROSPECTUS SUPPLEMENT (TO PROSPECTUS DATED __________, ____)

$_______________ (APPROXIMATE)

 MORTGAGE-BACKED NOTES, SERIES ____-__

 MILA MORTGAGE ACCEPTANCE, INC. TRUST SERIES ____-__
ISSUER

 [NAME OF MASTER SERVICER]
 MASTER SERVICER

MILA MORTGAGE ACCEPTANCE, INC.

 COMPANY

--------------------------------------------------------------------------------
The information contained in this Prospectus Supplement is not complete and may 
be changed. We may not sell these securities until the registration statement   
filed with the Securities and Exchange Commission is effective. This Prospectus 
Supplement is not an offer to sell these securities and is not soliciting of an 
offer to buy these securities in any state where the offer or sale is not       
permitted.                                                                      
--------------------------------------------------------------------------------

--------------------------------------------------------------------------------
YOU SHOULD CONSIDER CAREFULLY THE RISK FACTORS BEGINNING ON PAGE S-__ IN THIS   
PROSPECTUS SUPPLEMENT.                                                          
--------------------------------------------------------------------------------

THE TRUST                                                                       

The trust will consist primarily of a mortgage pool of one- to four-family      
fixed-rate and adjustable-rate residential mortgage loans. The trust will be    
represented by ______ classes of notes, ______ of which are offered by this     
prospectus supplement.                                                          

CREDIT ENHANCEMENT                                                              

o        the notes will have credit enhancement in the form of subordination.   

The price to investors will vary from time to time and will be determined at the
time of sale. The proceeds to the company from the offering will be ___% of the 
aggregate principal balance of the offered notes, less expenses equal to        
$_______. SEE "METHOD OF DISTRIBUTION" IN THIS PROSPECTUS SUPPLEMENT.           

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES         
COMMISSION HAS APPROVED OR DISAPPROVED OF THE OFFERED NOTES OR DETERMINED THAT  
THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IS TRUTHFUL 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.        

 [NAME OF UNDERWRITER]
 UNDERWRITER

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

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT. WE HAVE NOT 
AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION.                    

We provide information to you about the offered notes in two separate documents 
that progressively provide more detail:                                         

o        the accompanying prospectus, which provides general information, some  
of which may not apply to this series of notes; and           

o        this prospectus supplement, which describes the specific terms of this 
series of notes.                                              

The Company's principal offices are located at 6021 244th Street SW, Mountlake  
Terrace, WA 98043 and its phone number is (800) 332-6452.                       

 TABLE OF CONTENTS

 PROSPECTUS SUPPLEMENT

Summary Of Prospectus Supplement............................................    
Risk Factors................................................................    
The Mortgage Pool...........................................................    
Yield On The Notes..........................................................    
Yield Sensitivity Of The Subordinate Notes..................................    
Description Of The Notes....................................................    
The Issuer..................................................................    
The Seller..................................................................    
The Owner Trustee...........................................................    
The Indenture Trustee.......................................................    
The Servicing Agreement.....................................................    
Servicing And Other Compensation And Payment Of Expenses....................    
Servicer Events Of Default..................................................    
The Master Servicer.........................................................    
The Indenture And Owner Trust Agreement.....................................    
Assignment Of Mortgage Loans................................................    
Events Of Default...........................................................    
Voting Rights...............................................................    
Federal Income Tax Consequences.............................................    
Method Of Distribution......................................................    
Secondary Market............................................................    
Legal Opinions..............................................................    
Ratings.....................................................................    
Legal Investment............................................................    
Erisa Considerations........................................................    
Glossary....................................................................    

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SUMMARY OF PROSPECTUS SUPPLEMENT

THE FOLLOWING SUMMARY IS A VERY BROAD OVERVIEW OF THE NOTES OFFERED BY THIS     
PROSPECTUS SUPPLEMENT AND DOES NOT CONTAIN ALL OF THE INFORMATION THAT YOU      
SHOULD CONSIDER IN MAKING YOUR INVESTMENT DECISION. TO UNDERSTAND ALL OF THE    
TERMS OF THE OFFERED NOTES, READ CAREFULLY THIS ENTIRE PROSPECTUS SUPPLEMENT AND
THE ENTIRE ACCOMPANYING PROSPECTUS. CAPITALIZED TERMS USED BUT NOT DEFINED IN   
THIS PROSPECTUS SUPPLEMENT HAVE THE MEANINGS ASSIGNED TO THEM IN THE PROSPECTUS.
A GLOSSARY IS INCLUDED AT THE END OF THIS PROSPECTUS SUPPLEMENT. CAPITALIZED    
TERMS USED BUT NOT DEFINED IN THE GLOSSARY AT THE END OF THIS PROSPECTUS        
SUPPLEMENT HAVE THE MEANINGS ASSIGNED TO THEM IN THE GLOSSARY AT THE END OF THE 
PROSPECTUS.                                                                     

Title of Series.................     MILA Mortgage Acceptance, Inc.,            
                               Mortgage-Backed Notes, Series ____-_.

Cut-off Date....................     __________ __, ____.                       

Closing Date....................     On or about __________ __, ____.           

Issuer..........................     MILA Mortgage Acceptance, Inc. Trust Series
  ____-__.

Company.........................     MILA Mortgage Acceptance, Inc., an         
                 affiliate of MILA, Inc.

Master Servicer.................     [Name of Master Servicer].                 

Originators and Servicers.......     [Names of Originators and Servicers.]      

Seller..........................     [Name of Seller.]                          

Owner Trustee...................     [Name of Owner Trustee.]                   

Indenture Trustee...............     [Name of Indenture Trustee.]               

Distribution Dates..............     Distributions on the offered notes will be 
                                   made on the ___ day of each month, or, if
                                     that day is not a business day, on the next
                                     succeeding business day, beginning in _____
----. 

Offered Notes...................     The classes of offered notes and their     
                                 interest rates, note balances and final
                                     maturity date are shown in the table below.

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 NOTES
--------------------------------------------------------------------------------
                                                                   FINAL
CLASS         INITIAL NOTE BALANCE(1)      NOTE INTEREST RATE      MATURITY DATE
--------------------------------------------------------------------------------
A_______      $_________                   Variable(2)                          
M-1           $_________                                                        
M-2           $_________                                                        
M-3           $_________                                                        

----------                                                                      
(1)      Approximate.                                                           

(2)      Calculated as described in this prospectus supplement.                 

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THE ISSUER                                                                      

The notes will be issued by the issuer, a Delaware statutory trust established  
pursuant to an owner trust agreement between the company and the owner trustee. 
The issuer will issue _____ classes of notes representing non-recourse debt     
obligations of the issuer secured by the trust estate.                          

SEE "DESCRIPTION OF THE NOTES" IN THIS PROSPECTUS SUPPLEMENT.                   

Distributions of interest and/or principal on the offered notes will be made    
only from payments received in connection with the mortgage loans described     
below.                                                                          

THE MORTGAGE LOANS                                                              

The trust will contain approximately _____ conventional, one- to four-family,   
fixed-rate and adjustable-rate mortgage loans secured by first liens on         
residential real properties. The mortgage loans have an aggregate principal     
balance of approximately $__________ as of _________ __ ____.                   

The mortgage loans have original terms to maturity of not greater than [30]     
years and the following characteristics as of __________ __, ____.              

Range of mortgage rates _____% to _____%. (approximate):                        

Weighted average mortgage rate ______%. (approximate):                          

Weighted average remaining ___ years and ___ term to stated maturity months.    
(approximate):                                                                  

Range of principal balances $__________ to (approximate): $____________.        

Average principal balance: $_____________.                                      

Range of loan-to-value ratios _____% to _____%. (approximate):                  

Weighted average loan-to-value ______%. ratio (approximate):                    

Approximately ___% of the mortgage loans are "sub-prime" mortgage loans.        

FOR ADDITIONAL INFORMATION REGARDING THE MORTGAGE LOANS, SEE "THE MORTGAGE POOL"
IN THIS PROSPECTUS SUPPLEMENT.                                                  

THE NOTES                                                                       

OFFERED NOTES. The offered notes will have the characteristics shown in the     
table above in this prospectus supplement. The interest rates on each class of  
offered notes are variable and are calculated for each distribution date as     
described in this prospectus supplement under "DESCRIPTION OF THE               
NOTES--INTEREST RATES" in this prospectus supplement.                           

CREDIT ENHANCEMENT                                                              

The credit enhancement provided for the benefit of the holders of the offered   
notes consists of subordination as described below and under "DESCRIPTION OF THE
NOTES--OF LOSSES; SUBORDINATION" in this prospectus supplement.                 

OPTIONAL REDEMPTION                                                             

At its option, the majority holder of the equity certificates may redeem the    
notes and thereby effect termination and early retirement of the notes, after   
the aggregate Note balance has been reduced to less than [__%] of the aggregate 
initial note balance.                                                           

SEE "THE INDENTURE AND OWNER TRUST AGREEMENT--OPTIONAL REDEMPTION" IN THIS      
PROSPECTUS SUPPLEMENT AND "DESCRIPTION OF THE SECURITIES--TERMINATION" IN THE   
PROSPECTUS.                                                                     

FEDERAL INCOME TAX CONSEQUENCES                                                 

Upon the issuance of the notes, Thacher Proffitt & Wood LLP, counsel to the     
company, will deliver its opinion generally to the effect that the notes will be
characterized as indebtedness and the issuer will not be classified as an       
association taxable as a corporation, a publicly traded partnership or a taxable
mortgage pool.                                                                  

For further information regarding the federal income tax consequences of        
investing in the offered notes, SEE "FEDERAL INCOME TAX CONSEQUENCES" IN THIS   
PROSPECTUS SUPPLEMENT AND IN THE PROSPECTUS.                                    

RATINGS                                                                         

It is a condition to the issuance of the notes that the offered notes receive   
the following ratings from [______________ and ___________]:                    

OFFERED NOTES           [RA]          [RA]                                      
-----------------------------------------------                                 
Class A                 AAA           AAA                                       
Class M-1               AA            AA                                        
Class M-2               A             A                                         
Class M-3               BBB           BBB                                       

_____________________ [(1) Not rated.]                                          

SEE "YIELD ON THE NOTES" and "RATINGS" IN THIS PROSPECTUS SUPPLEMENT AND "YIELD 
CONSIDERATIONS" IN THE PROSPECTUS.                                              

LEGAL INVESTMENT                                                                

The offered notes (other than the Class ___ and Class ___ Notes) will constitute
"mortgage related securities" for purposes of SMMEA. The Class ___ Notes and the
Class ___ Notes will not constitute "mortgage related securities" for purposes  
of SMMEA.                                                                       

SEE "LEGAL INVESTMENT" IN THIS PROSPECTUS SUPPLEMENT AND IN THE PROSPECTUS.     

ERISA CONSIDERATIONS                                                            

Subject to important considerations, the notes may be eligible for purchase by  
persons investing assets of employee benefit plans or individual retirement     
accounts which are deemed to make the representations set forth in "ERISA       
CONSIDERATIONS". Plans should consult with their legal advisors before          
investing.                                                                      

SEE "ERISA CONSIDERATIONS" IN THIS PROSPECTUS SUPPLEMENT AND IN THE PROSPECTUS. 

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RISK FACTORS

  You should carefully consider, among other things, the following
factors in connection with the purchase of the offered notes:                   

[See version 1 of the prospectus supplement for some risk factors that may be   
applicable.]                                                                    

[Appropriate risk factors from the following list are particular to the         
securitization represented by this version of the prospectus supplement]        

[THE CLASS M-1, CLASS M-2 AND CLASS M-3 NOTES WILL BE PARTICULARLY SENSITIVE TO 
LOSSES ON THE MORTGAGE LOANS                                                    

         The weighted average lives of, and the yields to maturity on, the Class
M-1, Class M-2 and Class M-3 Notes will be progressively more sensitive, in     
increasing order of their numerical class designations, to the rate and timing  
of mortgagor defaults and the severity of ensuing losses on the mortgage loans. 
If the actual rate and severity of losses on the mortgage loans is higher than  
those assumed by an investor in one of the Class M-1, Class M-2 or Class M-3    
Notes, the actual yield to maturity of the note may be lower than the yield     
anticipated by the holder based on the investor's assumption. The timing of     
losses on the mortgage loans will also affect an investor's actual yield to     
maturity, even if the rate of defaults and severity of losses over the life of  
the mortgage pool are consistent with an investor's expectations. In general,   
the earlier a loss occurs, the greater the effect on an investor's yield to     
maturity. Losses on the mortgage loans in any due period, to the extent they    
exceed the overcollateralized amount following payments of principal on the     
related payment date, will reduce the note balance of the class of notes then   
outstanding with the highest numerical class designation. As a result of these  
reductions, less interest will accrue on the class of subordinate notes than    
would otherwise be the case].                                                   

[THE CLASS M-1, CLASS M-2 AND CLASS M-3 NOTES WILL GENERALLY NOT BE ENTITLED TO 
RECEIVE PRINCIPAL PAYMENTS UNTIL ALL PRINCIPAL PAYMENTS HAVE BEEN MADE ON THE   
CLASS A NOTES WHICH MAY RESULT IN LOSSES ON THOSE NOTES                         

        Unless the note balance of the Class A Notes has been reduced to zero,
the Class M-1, Class M-2 and Class M-3 Notes will not be entitled to any        
principal payments until _________ ____ or a later period as described in this  
prospectus supplement. As a result, the weighted average lives of these notes   
will be longer than would otherwise be the case if payments of principal were   
allocated among all of the notes at the same time. As a result of the longer    
weighted average lives of these notes, the holders of these notes have a greater
risk of suffering a loss on their investments. Further, because these notes     
might not receive any principal if certain delinquency levels occur, it is      
possible for these notes to receive no principal payments even if no losses have
occurred on the mortgage pool].                                                 

[THE NOTES ARE OBLIGATIONS OF THE TRUST ONLY                                    

  The notes will not represent an interest in or obligation of the
originators, the company, the master servicer, the seller, _________, the owner 
trustee, the indenture trustee or any of their respective affiliates. The only  
obligations of the foregoing entities with respect to the notes or any mortgage 
loan will be the obligations of the seller pursuant to the limited              
representations and warranties made with respect to the mortgage loans and of   
the servicers with respect to their servicing obligations under the related     
servicing agreement (including the limited obligation to make advances, as      
described in this prospectus supplement). Neither the notes nor the underlying  
mortgage loans will be guaranteed or insured by any governmental agency or      
instrumentality, or by the issuer, the originators, the company, the master     
servicer, the seller, ________, the owner trustee, the indenture trustee or any 
of their respective affiliates. Proceeds of the assets included in the trust    
(including the mortgage loans) will be the sole source of payments on the notes,
and there will be no recourse to the issuer, the originators, the company, the  
master servicer, the seller, _______, the owner trustee, the indenture trustee  
or any of their respective affiliates or any other entity in the event that the 
proceeds are insufficient or otherwise unavailable to make all payments provided
for under the notes].                                                           

[THE DIFFERENCE BETWEEN THE INTEREST RATES ON THE NOTES AND THE MORTGAGE LOANS  
MAY RESULT IN INTEREST SHORTFALLS ALLOCATED TO THE NOTES                        

    The note interest rate for each class of the notes adjusts monthly
based on a particular index, subject to the limitations described in this       
prospectus supplement. However, the mortgage rates on the fixed rate mortgage   
loans are fixed and will not vary with any index, and the mortgage rates on the 
adjustable rate mortgage loans adjust semi-annually (after an initial fixed rate
period in the case of some of the adjustable rate mortgage loans) based on the  
index (which may not move in tandem with the index), subject to periodic and    
lifetime limitations as described in this prospectus supplement. As a result of 
the foregoing as well as other factors like the prepayment behavior of the      
mortgage pool, relative increases in the index or relative decreases in the     
weighted average of the mortgage rates on the mortgage loans (i) could cause the
amount of interest generated by the mortgage pool to be less than the aggregate 
of the amount of interest that would otherwise be payable on the notes, leading 
one or more classes of notes to receive payments of interest at a later date, as
described in this prospectus supplement or (ii) could cause the maximum note    
interest rate to apply to one or more classes of notes, as described in this    
prospectus supplement.                                                          

       Because the mortgage rate for each adjustable rate mortgage loan will
be adjusted, subject to periodic and lifetime limitations, to equal the sum of  
the index and the related gross margin, these rates could be higher than        
prevailing market interest rates, possibly resulting in an increase in the rate 
of prepayments on the adjustable rate mortgage loans after their adjustments. In
particular, investors should note that approximately _____% of the adjustable   
rate mortgage loans have their interest rates fixed for two years following     
origination and approximately _____% of the adjustable rate mortgage loans have 
their interest rates fixed for three years following origination, in each case  
by aggregate principal balance as of _________ __, ___. The weighted average    
next adjustment date for the adjustable rate mortgage loans whose interest rates
are fixed for two years is _______ ____, and the weighted average next          
adjustment date for the adjustable rate mortgage loans whose interest rates are 
fixed for three years is _______ ____].                                         

[THE RATE AND TIMING OF PRINCIPAL DISTRIBUTIONS ON THE OFFERED NOTES WILL BE    
AFFECTED BY PREPAYMENT SPEEDS                                                   

    The rate and timing of distributions allocable to principal on the
offered notes will depend, in general, on the rate and timing of principal      
payments (including prepayments and collections upon defaults, liquidations and 
repurchases) on the mortgage loans and the allocation thereof to pay principal  
on the offered notes as provided in this prospectus supplement. As is the case  
with mortgage securities generally, the offered notes are subject to substantial
inherent cash-flow uncertainties because the mortgage loans may be prepaid at   
any time. However, with respect to approximately ____% of the mortgage loans, by
aggregate principal balance as of _______ __, ____, a prepayment may subject the
related mortgagor to a prepayment charge, which may act as a deterrent to       
prepayment of the mortgage loan. SEE "THE MORTGAGE POOL" IN THIS PROSPECTUS     
SUPPLEMENT.                                                                     

      Generally, when prevailing interest rates are increasing, prepayment
rates on mortgage loans tend to decrease; a decrease in the prepayment rates on 
the mortgage loans will result in a reduced rate of return of principal to      
investors in the offered notes at a time when reinvestment at these higher      
prevailing rates would be desirable. Conversely, when prevailing interest rates 
are declining, prepayment rates on mortgage loans tend to increase; an increase 
in the prepayment rates on the mortgage loans will result in a greater rate of  
return of principal to investors in the offered notes at a time when            
reinvestment at comparable yields may not be possible.                          

  Distributions of principal will be made to the subordinate notes
according to the priorities described in this prospectus supplement. The timing 
of commencement of principal distributions and the weighted average life of each
of these classes of notes will be affected by the rates of prepayment on the    
mortgage loans experienced both before and after the commencement of principal  
distributions on the class. For further information regarding the effect of     
principal prepayments on the weighted average lives of the offered notes, see   
"YIELD ON THE NOTES" in this prospectus supplement and the table entitled       
"PERCENT OF INITIAL NOTE BALANCE OUTSTANDING AT THE FOLLOWING PERCENTAGES OF THE
PREPAYMENT ASSUMPTION" herein.                                                  

[THE YIELD TO MATURITY ON THE OFFERED NOTES WILL DEPEND ON A VARIETY OF FACTORS 

         The yield to maturity on the offered notes will depend, in general, on:

o        the applicable note interest rate and note accrual rate thereon from   
time to time;                                                 

o        the applicable purchase price; and                                     

o        the rate and timing of principal payments (including prepayments and   
 collections upon defaults, liquidations and repurchases) on the
         mortgage loans and the allocation thereof to reduce the note balance of
the notes, as well as other factors.                          

        The yield to investors on any class of offered notes will be adversely
affected by any allocation thereto of interest shortfalls on the mortgage loans.

 In general, if the offered notes are purchased at a premium and
principal distributions thereon occur at a rate faster than anticipated at the  
time of purchase, the investor's actual yield to maturity will be lower than    
that assumed at the time of purchase. Conversely, if the offered notes are      
purchased at a discount and principal distributions thereon occur at a rate     
slower than that anticipated at the time of purchase, the investor's actual     
yield to maturity will be lower than that originally assumed.                   

     The proceeds to the company from the sale of the offered notes were
determined based on a number of assumptions, including a prepayment assumption  
of __% of the [constant prepayment rate model] and weighted average lives       
corresponding thereto. No representation is made that the mortgage loans will   
prepay at this particular rate or at any other rate. The yield assumptions for  
the offered notes will vary as determined at the time of sale].                 

 THE MORTGAGE POOL

GENERAL                                                                         

     The mortgage pool will consist of approximately _____ conventional,
one- to four-family, fixed rate mortgage loans and approximately _____          
conventional, one-to four-family, adjustable rate mortgage loans, in each case  
secured by first liens on residential real properties and having an aggregate   
principal balance as of Cut-off Date of approximately $___________ after        
application of scheduled payments due on or before the Cut-off Date whether or  
not received, subject to a permitted variance of plus or minus [5]%. The        
mortgage loans have original terms to maturity of not greater than [30] years.  
References to percentages of the mortgage loans, unless otherwise noted, are    
calculated based on the aggregate principal balance of the mortgage loans as of 
the Cut-off Date. The mortgage loans are secured by first mortgages or deeds of 
trust or other similar security instruments creating first liens on residential 
properties consisting of attached, detached or semi-detached, one- to           
four-family dwelling units, townhouses, individual condominium units, individual
units in planned unit developments and manufactured housing.                    

         The mortgage loans to be included in the mortgage pool will be acquired
by the company on the Closing Date from ________________, who will have acquired
the mortgage loans on the Closing Date from the Seller. SEE "--UNDERWRITING     
STANDARDS; REPRESENTATIONS" below and "THE SELLER" in this prospectus           
supplement. The Seller in turn will have acquired the mortgage loans on the     
Closing Date from [Name of Seller], an affiliate of the company. The Seller will
have acquired the mortgage loans directly or indirectly from the Originators.   

        Each adjustable rate mortgage loan provides for semi-annual adjustment
to the mortgage rate on that adjustable rate mortgage loan and for corresponding
adjustments to the monthly payment amount due on that adjustable rate mortgage  
loan, in each case on each Adjustment Date applicable thereto; provided,        
however, that in the case of approximately _____% and approximately _____% of   
the adjustable rate mortgage loans by aggregate principal balance as of the     
Cut-off Date, the first Adjustment Date will occur after an initial period of   
approximately ____ years and approximately ______ years, respectively, from the 
date of origination of that adjustable rate mortgage loan. On each Adjustment   
Date, the mortgage rate on each adjustable rate mortgage loan will be adjusted  
to equal the sum, rounded as provided in the related mortgage note, of the Index
(as described below) and the Gross Margin; provided, however, that the mortgage 
rate on each adjustable rate mortgage loan, including each Delayed First        
Adjustment Mortgage Loan, will generally not increase or decrease by more than  
the Periodic Rate Cap on any related Adjustment Date and will not exceed the    
Maximum Mortgage Rate or be less than the Minimum Mortgage Rate. For Adjustment 
Dates other than the first Adjustment Date after origination, the Periodic Rate 
Cap for the majority of the adjustable rate mortgage loans is 1.00% per annum,  
and with respect to substantially all of the adjustable rate mortgage loans, for
Adjustment Dates other than the first Adjustment Date after origination, the    
Periodic Rate Cap will not exceed ____% per annum. Effective with the first     
monthly payment due on each adjustable rate mortgage loan 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 adjustable 
rate mortgage loan over its remaining term and pay interest at the mortgage rate
as so adjusted. Due to the application of the Periodic Rate Caps and the Maximum
Mortgage Rates, the mortgage rate on each mortgage loan, as adjusted on any     
related Adjustment Date, may be less than the sum of the Index and Gross Margin,
calculated as described in this prospectus supplement. SEE "--THE INDEX" IN THIS
PROSPECTUS SUPPLEMENT. None of the adjustable rate mortgage loans permits the   
related mortgagor to convert the adjustable mortgage rate on that adjustable    
rate mortgage loan to a fixed mortgage rate.                                    

     The mortgage loans generally have scheduled monthly payments due on
each Due Date. Each mortgage loan will contain a customary "due-on-sale" clause 
or will be assumable by a creditworthy purchaser of the related mortgaged       
property.                                                                       

        Approximately ______% of the mortgage loans provide for payment by the
mortgagor of a Prepayment Charge in limited circumstances on voluntary          
prepayments in full made within one to five years from the date of origination  
of those mortgage loans. The amount of the Prepayment Charge is as provided in  
the related mortgage note. Prepayment Charge obligations generally expire by    
their terms after a limited period specified in the related mortgage note. The  
weighted average month of origination of the mortgage loans with Prepayment     
Charges is _________ ____. The holders of the Equity Certificates will be       
entitled to all Prepayment Charges received on the mortgage loans, and that     
amount will [not] be available for distribution on the notes. Under some        
instances, as described in the related Servicing Agreement, the related Servicer
may waive the payment of any otherwise applicable Prepayment Charge, and        
accordingly, there can be no assurance that the Prepayment Charges will have any
effect on the prepayment performance of the mortgage loans.                     

None of the mortgage loans are buydown mortgage loans.        

   Approximately ____% of the mortgage loans are Balloon Loans. Each
Balloon Loan is a fixed rate mortgage loan that amortizes over ___ months, but  
the Balloon Payment on each Balloon Loan is due and payable on the ___ month.   
The amount of the Balloon Payment on each Balloon Loan is substantially in      
excess of the amount of the scheduled monthly payment on that Balloon Loan for  
the period prior to the Due Date of that Balloon Payment.                       

        The average principal balance of the mortgage loans at origination was
approximately $_______. No mortgage loan had a principal balance at origination 
greater than approximately $________ or less than approximately $______. The    
average principal balance of the mortgage loans as of the Cut-off Date was      
approximately $_______.                                                         

      The mortgage loans had mortgage rates as of the Cut-off Date ranging
from approximately ____% per annum to approximately _____% per annum, and the   
weighted average mortgage rate was approximately ______% per annum. The weighted
average loan-to-value ratio of the mortgage loans at origination was            
approximately _____%. At origination, no mortgage loan will have a loan-to-value
ratio greater than approximately _____% or less than approximately ____%.       

       The weighted average remaining term to maturity of the mortgage loans
will be approximately __ years and __ months as of the Cut-off Date. None of the
mortgage loans will have a first Due Date prior to _______ ____ or after        
___________ ____, or will have a remaining term to maturity of less than __     
years or greater than __ years as of the Cut-off Date. The latest maturity date 
of any mortgage loan is __________ ____.                                        

      As of the Cut-off Date, the adjustable rate mortgage loans had Gross
Margins ranging from approximately ____% to approximately ____%, Minimum        
Mortgage Rates ranging from approximately ____% per annum to approximately      
_____% per annum and Maximum Mortgage Rates ranging from approximately _____%   
per annum to approximately _____% per annum. As of the Cut-off Date, the        
weighted average Gross Margin was approximately ______%, the weighted average   
Minimum Mortgage Rate was approximately _____% per annum and the weighted       
average Maximum Mortgage Rate was approximately _______% per annum. The latest  
first Adjustment Date following the Cut-off Date on any adjustable rate mortgage
loan occurs in _______ ____ and the weighted average next Adjustment Date for   
all of the mortgage loans following the Cut-off Date is _______ ____.           

       The mortgage loans are expected to have the following characteristics
as of the Cut-off Date (the sum in any column may not equal the total indicated 
due to rounding):                                                               

                                                        [Enlarge/Download Table]


             PRINCIPAL BALANCES OF THE MORTGAGE LOANS AT ORIGINATION                 

ORIGINAL RANGE ($)                       % OF AGGREGATE ORIGINAL     % OF AGGREGATE  
PRINCIPAL BALANCE     NUMBER OF LOANS       PRINCIPAL BALANCE       PRINCIPAL BALANCE
-----------------     ---------------       -----------------       -----------------
                                                                                     

Total                                                                                

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         PRINCIPAL BALANCES OF THE MORTGAGE LOANS AS OF THE CUT-OFF DATE                    

                                          AGGREGATE PRINCIPAL      % OF AGGREGATE PRINCIPAL 
AS OF RANGE ($)                       BALANCE OUTSTANDING AS OF    BALANCE OUTSTANDING AS OF
 CUT-OFF DATE      NUMBER OF LOAN         THE CUT-OFF DATE             THE CUT-OFF DATE     
 ------------      --------------         ----------------             ----------------     
                                                                                            

Total                                                                                       

                                                        [Enlarge/Download Table]


           MORTGAGE RATES OF THE MORTGAGE LOANS AS OF THE CUT-OFF DATE                          

                                        AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
                                           OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
MORTGAGE RATE (%)    NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
-----------------    ---------------           ------------                 ----------------    
                                                                                                

Total                                                                                           

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          MAXIMUM MORTGAGE RATES OF THE ADJUSTABLE RATE MORTGAGE LOANS                         

                                       AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
MAXIMUM MORTGAGE                          OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
   RATE (%)         NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
   --------         ---------------           ------------                 ----------------    
                                                                                               

Total                                                                                          

                                                        [Enlarge/Download Table]


          MINIMUM MORTGAGE RATES OF THE ADJUSTABLE RATE MORTGAGE LOANS                         

                                       AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
MINIMUM MORTGAGE                          OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
   RATE (%)         NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
   --------         ---------------           ------------                 ----------------    
                                                                                               

Total                                                                                          

                                                        [Enlarge/Download Table]


               GROSS MARGINS OF THE ADJUSTABLE RATE MORTGAGE LOANS                           

                                       AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
                                          OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
GROSS MARGIN (%)    NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
----------------    ---------------           ------------               ----------------    
                                                                                             

Total                                                                                        

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               ORIGINAL LOAN-TO-VALUE RATIOS OF THE MORTGAGE LOANS                           

                                       AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
   LOAN-TO-                               OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
VALUE RATIO (%)     NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
---------------     ---------------           ------------               ----------------    
                                                                                             

Total                                                                                        

                                                        [Enlarge/Download Table]


            GEOGRAPHIC DISTRIBUTION OF THE MORTGAGED PROPERTIES                      

                             AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
                                OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
LOCATION  NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
--------  ---------------           ------------                 ----------------    
                                                                                     

Total                                                                                

                                                        [Enlarge/Download Table]


               MORTGAGED PROPERTY TYPES OF THE MORTGAGE LOANS                           

                                  AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
                                     OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
PROPERTY TYPE  NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
-------------  ---------------           ------------               ----------------    
                                                                                        

Total                                                                                   

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            MORTGAGED PROPERTY OCCUPANCY STATUS OF THE MORTGAGE LOANS                          

                                       AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
                                          OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
OCCUPANCY STATUS    NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
----------------    ---------------           ------------                 ----------------    
                                                                                               

Total                                                                                          

       The occupancy status of a mortgaged property is as represented by the
mortgagor in its loan application                                               

                                                        [Enlarge/Download Table]


                     LOAN PURPOSE OF THE MORTGAGE LOANS                                

                                 AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
                                    OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
LOAN PURPOSE  NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
------------  ---------------           ------------               ----------------    
                                                                                       

Total                                                                                  

                                                        [Enlarge/Download Table]


                     LOAN PROGRAMS OF THE MORTGAGE LOANS                               

                                 AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
                                    OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
LOAN PROGRAM  NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
------------  ---------------           ------------               ----------------    
                                                                                       

Total                                                                                  

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          RISK CATEGORIES OF THE FIXED RATE ____________ MORTGAGE LOANS                       

                                      AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
                                         OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
RISK CATEGORIES    NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
---------------    ---------------           ------------                 ----------------    
                                                                                              

Total                                                                                         

                                                        [Enlarge/Download Table]


       RISK CATEGORIES OF THE ADJUSTABLE RATE ____________ MORTGAGE LOANS                     

                                      AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
                                         OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
RISK CATEGORIES    NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
---------------    ---------------           ------------                 ----------------    
                                                                                              

Total                                                                                         

                                                        [Enlarge/Download Table]


                RISK CATEGORIES OF THE ___________ MORTGAGE LOANS                           

                                      AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
                                         OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
RISK CATEGORIES    NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
---------------    ---------------           ------------               ----------------    
                                                                                            

Total                                                                                       

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                RISK CATEGORIES OF THE ___________ MORTGAGE LOANS                           

                                      AGGREGATE PRINCIPAL BALANCE   % OF AGGREGATE PRINCIPAL
                                         OUTSTANDING AS OF THE     BALANCE OUTSTANDING AS OF
RISK CATEGORIES    NUMBER OF LOANS           CUT-OFF DATE               THE CUT-OFF DATE    
---------------    ---------------           ------------               ----------------    
                                                                                            

Total                                                                                       

                                                        [Enlarge/Download Table]


          NEXT ADJUSTMENT DATES FOR THE ADJUSTABLE RATE MORTGAGE LOANS                        

                                      AGGREGATE PRINCIPAL BALANCE     % OF AGGREGATE PRINCIPAL
 MONTH OF NEXT                           OUTSTANDING AS OF THE       BALANCE OUTSTANDING AS OF
ADJUSTMENT DATE    NUMBER OF LOANS           CUT-OFF DATE                 THE CUT-OFF DATE    
---------------    ---------------           ------------                 ----------------    
                                                                                              

Total                                                                                         

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THE INDEX                                                                       

         As of any Adjustment Date, the Index applicable to the determination of
the mortgage rate on each mortgage loan will be the average of the interbank    
offered rates for six-month United States dollar deposits in the London market  
as published in THE WALL STREET JOURNAL and as of a date as specified in the    
related mortgage note. In the event that the Index becomes unavailable or       
otherwise unpublished, each Servicer will select a comparable alternative index 
over which it has no direct control and which is readily verifiable.            

        The table below sets forth historical average rates of six-month LIBOR
for the months indicated as made available from Fannie Mae, which rates may     
differ from the rates of the Index, which is six-month LIBOR as published in THE
WALL STREET JOURNAL as described above. The table does not purport to be        
representative of the subsequent rates of the Index which will be used to       
determine the mortgage rate on each mortgage loan.                              

                                                                [Download Table]


                                  SIX-MONTH LIBOR                     

           1995   1996   1997   1998      1999     2000   2001   2002 
           ----   ----   ----   ----      ----     ----   ----   ---- 
                                                                      
January    ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
February   ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
March      ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
April      ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
May        ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
June       ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
July       ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
August     ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
September  ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
October    ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
November   ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%
December   ____%  ____%  ____%  ____%     ____%    ____%  ____%  ____%

UNDERWRITING STANDARDS; REPRESENTATIONS                                         

[Standards included as necessary].                            

REPRESENTATIONS                                                                 

       The Seller will make representations and warranties as of the Closing
Date with respect to the mortgage loans, and will be obligated to repurchase    
that mortgage loan in respect of which a material breach of the representations 
and warranties it has made has occurred (other than those breaches which have   
been cured). For a discussion of the representations and warranties made and the
repurchase obligation, SEE "MORTGAGE LOAN PROGRAM--REPRESENTATIONS BY OR ON     
BEHALF OF THE SELLER; REPURCHASES" IN THE PROSPECTUS.                           

ADDITIONAL INFORMATION                                                          

        The description in this prospectus supplement of the mortgage pool and
the mortgaged properties is based upon the mortgage pool as constituted as of   
the close of business on the Cut-off Date, as adjusted for the scheduled        
principal payments due on or before that date. Prior to the issuance of the     
notes, mortgage loans may be removed from the mortgage pool as a result of      
incomplete documentation or otherwise if the company deems that removal         
necessary or desirable, and may be prepaid at any time. A limited number of     
other mortgage loans may be included in the mortgage pool prior to the issuance 
of the notes unless including those mortgage loans would materially alter the   
characteristics of the mortgage pool as described in this prospectus supplement.
The company believes that the information provided in this prospectus supplement
will be representative of the characteristics of the mortgage pool as it will be
constituted at the time the notes are issued, although the range of mortgage    
rates and maturities and some other characteristics of the mortgage loans may   
vary. In no event, however, will more than 5% (by principal balance at the      
Cut-off Date) of the mortgage loans or mortgage securities deviate from the     
characteristics of the mortgage loans or mortgage securities set forth in this  
prospectus supplement.                                                          

YIELD ON THE NOTES

GENERAL PREPAYMENT CONSIDERATIONS                                               

      The rate of principal payments on the notes, the aggregate amount of
payments on the notes and the yield to maturity of the notes will be related to 
the rate and timing of payments of principal on the mortgage loans. The rate of 
principal payments on the mortgage loans will in turn be affected by the        
amortization schedules of those mortgage loans and by the rate of principal     
prepayments on those mortgage loans (including for this purpose, payments       
resulting from refinancings, liquidations of the mortgage loans due to defaults,
casualties, condemnations and repurchases, whether optional or required, by the 
company, the Seller or the majority holder of the Equity Certificates, as the   
case may be). The mortgage loans generally may be prepaid by the mortgagors at  
any time; however, as described under "The Mortgage Pool" in this prospectus    
supplement, with respect to approximately _____% of the mortgage loans, by      
aggregate principal balance as of the Cut-off Date, a prepayment may subject the
related mortgagor to a Prepayment Charge. Prepayment Charge obligations         
generally expire by their terms after a limited period specified in the related 
mortgage note. The weighted average month of origination of the mortgage loans  
with Prepayment Charges is ________ ____.                                       

      Prepayments, liquidations and repurchases of the mortgage loans will
result in payments in respect of principal to the holders of the class or       
classes of notes then entitled to receive those payments that otherwise would be
distributed over the remaining terms of the mortgage loans. SEE "MATURITY AND   
PREPAYMENT CONSIDERATIONS" IN THE PROSPECTUS. Since the rates of payment of     
principal on the mortgage loans will depend on future events and a variety of   
factors (as described more fully in this prospectus supplement and in the       
prospectus under "Yield Considerations" and "Maturity and Prepayment            
Considerations"), no assurance can be given as to that rate or the rate of      
principal prepayments. The extent to which the yield to maturity of any class of
notes may vary from the anticipated yield will depend upon the degree to which  
those notes are purchased at a discount or premium and the degree to which the  
timing of payments on those notes is sensitive to prepayments on the mortgage   
loans. Further, an investor should consider, in the case of a Note purchased at 
a discount, the risk that a slower than anticipated rate of principal payments  
on the mortgage loans could result in an actual yield to that investor that is  
lower than the anticipated yield and, in the case of a note purchased at a      
premium, the risk that a faster than anticipated rate of principal payments     
could result in an actual yield to that investor that is lower than the         
anticipated yield. In general, the earlier a prepayment of principal is made on 
the mortgage loans, the greater the effect on the yield to maturity of the      
notes. 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 those notes would not be
fully offset by a subsequent like reduction (or increase) in the rate of        
principal payments.                                                             

  It is highly unlikely that the mortgage loans will prepay at any
constant rate until maturity or that all of the mortgage loans will prepay at   
the same rate. Moreover, the timing of prepayments on the mortgage loans may    
significantly affect the actual yield to maturity on the notes, even if the     
average rate of principal payments experienced over time is consistent with an  
investor's expectation.                                                         

         The rate of payments (including prepayments) on pools of mortgage loans
is influenced by a variety of economic, geographic, social and other factors. If
prevailing mortgage rates fall significantly below the mortgage rates on the    
mortgage loans, the rate of prepayment (and refinancing) would be expected to   
increase. Conversely, if prevailing mortgage rates rise significantly above the 
mortgage rates on the mortgage loans, the rate of prepayment on the mortgage    
loans would be expected to decrease. Other factors affecting prepayment of      
mortgage loans include changes in mortgagors' housing needs, job transfers,     
unemployment, mortgagors' net equity in the mortgaged properties and servicing  
decisions. In addition, in the case of the adjustable rate mortgage loans in the
mortgage pool, the existence of the applicable Periodic Rate Cap, Maximum       
Mortgage Rate and Minimum Mortgage Rate may affect the likelihood of prepayments
resulting from refinancings. There can be no certainty as to the rate of        
prepayments on the mortgage loans during any period or over the life of the     
notes. SEE "YIELD CONSIDERATIONS" AND "MATURITY AND PREPAYMENT CONSIDERATIONS"  
IN THE PROSPECTUS.                                                              

     Because principal payments are paid to some classes of notes before
other classes, holders of classes of notes having a later priority of payment   
bear a greater risk of losses (because those notes will represent an increasing 
percentage of the Trust Estate during the period prior to the commencement of   
payments of principal on those notes) than holders of classes having earlier    
priorities for payment of principal. As described under "Description of the     
Notes--Principal Payments on the Notes" in this prospectus supplement, prior to 
the Stepdown Date (as defined in this prospectus supplement), all principal     
payments on the mortgage loans will be allocated to the Class A Notes.          
Thereafter, as further described in this prospectus supplement, subject to      
various delinquency triggers described in this prospectus supplement, all       
principal payments on the mortgage loans will be allocated among all classes of 
the notes then outstanding as described under "Description of the               
Notes--Principal Payments on the Notes" in this prospectus supplement.          

   In general, defaults on mortgage loans are expected to occur with
greater frequency in their early years. In addition, default rates may be higher
for mortgage loans used to refinance an existing mortgage loan. In the event of 
a mortgagor's default on a mortgage loan, there can be no assurance that        
recourse will be available beyond the specific mortgaged property pledged as    
security for repayment. SEE "THE MORTGAGE POOL--UNDERWRITING STANDARDS;         
REPRESENTATIONS" IN THIS PROSPECTUS SUPPLEMENT.                                 

SPECIAL YIELD CONSIDERATIONS                                                    

    The Note Interest Rate for each class of the notes adjusts monthly
based on One-Month LIBOR as described under "DESCRIPTION OF THE                 
NOTES--CALCULATION OF ONE-MONTH LIBOR" in this prospectus supplement, subject to
the Maximum Note Interest Rate and the Available Interest Rate. However, the    
mortgage rates on the fixed rate mortgage loans are fixed and will not vary with
any index, and the mortgage rates on the adjustable rate mortgage loans adjust  
semi-annually (after an initial fixed rate period in the case of Delayed First  
Adjustment Mortgage Loans) based on the Index (which may not move in tandem with
One- Month LIBOR), subject to periodic and lifetime limitations as described in 
this prospectus supplement. Investors should note that approximately _____% of  
the mortgage loans are ____ year Delayed First Adjustment Mortgage Loans,       
approximately ____% of the mortgage loans are _____ year Delayed First          
Adjustment Loans and approximately _____% of the mortgage loans are fixed rate  
mortgage loans, in each case by aggregate principal balance as of the Cut-off   
Date. The weighted average month of origination of the _____ year Delayed First 
Adjustment Mortgage Loans is _____ ____, and the weighted average month of      
origination of the ______ year Delayed First Adjustment Mortgage Loans is ______
____. Because of the application of the Maximum Note Interest Rate and the      
Available Interest Rate, increases in the Note Interest Rate on the notes may be
limited for extended periods or indefinitely in a rising interest rate          
environment. The interest due on the mortgage loans during any Due Period may   
not equal the amount of interest that would accrue at One-Month LIBOR plus the  
applicable margin on the notes during the related Interest Accrual Period. In   
addition, the Index and One-Month LIBOR may respond differently to economic and 
market factors. Thus, it is possible, for example, that if both One-Month LIBOR 
and the Index rise during the same period, One-Month LIBOR may rise more rapidly
than the Index or may rise higher than the Index, potentially resulting in      
Interest Carry Forward Amounts with respect to one or more classes of notes. As 
a result of the foregoing as well as other factors such as the prepayment       
behavior of the mortgage pool, relative increases in One-Month LIBOR or relative
decreases in the weighted average of the mortgage rates on the mortgage loans   
(i) could cause the Current Interest Payment Amount generated by the mortgage   
pool to be less than the aggregate of the Interest Payment Amounts that would   
otherwise be payable on the notes, leading one or more classes of notes to incur
Interest Carry Forward Amounts, or (ii) could cause the Maximum Note Interest   
Rate to apply to one or more classes of notes.                                  

       Because the mortgage rate for each adjustable rate mortgage loan will
be adjusted, subject to periodic and lifetime limitations, to equal the sum of  
the Index and the related Gross Margin, those rates could be higher than        
prevailing market interest rates, possibly resulting in an increase in the rate 
of prepayments on the adjustable rate mortgage loans after their adjustments.   

     As described under "Description of the Notes--Allocation of Losses;
Subordination", amounts otherwise distributable to holders of the Subordinate   
Notes may be made available to protect the holders of the Class A Notes against 
interruptions in payments due to various mortgagor delinquencies, to the extent 
not covered by P&I Advances. Those delinquencies may affect the yield to        
investors on those classes of Subordinate Notes and, even if subsequently cured,
will affect the timing of the receipt of payments by the holders of those       
classes of Subordinate Notes. In addition, a larger than expected rate of       
delinquencies or losses will affect the rate of principal payments on each class
of Subordinate Notes. SEE "DESCRIPTION OF THE NOTES--PRINCIPAL PAYMENTS ON THE  
NOTES" IN THIS PROSPECTUS SUPPLEMENT.                                           

WEIGHTED AVERAGE LIVES                                                          

     Weighted average life refers to the amount of time that will elapse
from the date of issuance of a security until each dollar of principal of that  
security will be repaid to the investor. The weighted average life of each class
of notes will be influenced by the rate at which principal on the mortgage loans
is paid, which may be in the form of scheduled payments or prepayments          
(including repurchases and prepayments of principal by the borrower as well as  
amounts received by virtue of condemnation, insurance or foreclosure with       
respect to the mortgage loans), and the timing of those principal payments.     

   Prepayments on mortgage loans are commonly measured relative to a
prepayment standard or model. The Prepayment Assumption assumes a prepayment    
rate for the mortgage loans of __% CPR. The CPR assumes that the outstanding    
principal balance of a pool of mortgage loans prepays at a specified constant   
annual rate or CPR. In generating monthly cash flows, this rate is converted to 
an equivalent constant monthly rate. To assume __% CPR or any other CPR         
percentage is to assume that the stated percentage of the outstanding principal 
balance of the pool is prepaid over the course of a year. No representation is  
made that the mortgage loans will prepay at __% CPR or any other rate.          

        The tables following the next paragraph indicate the percentage of the
initial Note Balance of the notes that would be outstanding after each of the   
dates shown at various percentages of the Prepayment Assumption and the         
corresponding weighted average lives of those notes. The tables are based on the
following Modeling Assumptions: (i) the mortgage pool consists of __ mortgage   
loans with the characteristics described below, (ii) payments on those notes are
received, in cash, on the 25th day of each month, commencing in _______ ____,   
(iii) the mortgage loans prepay at the percentages of the Prepayment Assumption 
indicated, (iv) no defaults or delinquencies occur in the payment by mortgagors 
of principal and interest on the mortgage loans, (v) none of the majority holder
of the Equity Certificates, the Seller, the Master Servicer, the Servicers or   
any other person purchases from the Trust Estate any mortgage loan or redeems   
the notes pursuant to any obligation or option under the Indenture, the         
Servicing Agreement or any other agreement except as indicated in footnote two  
in the tables below, and no partial early redemption of the notes occurs with   
respect to the ___________ Mortgage Loans, (vi) scheduled monthly payments on   
the mortgage loans are received on the first day of each month commencing in    
_______ ____, and are computed prior to giving effect to any prepayments        
received in the prior month, (vii) prepayments representing payment in full of  
individual mortgage loans are received on the last day of each month commencing 
in ________ ____, and include 30 days' interest on those mortgage loans, (viii) 
the scheduled monthly payment for each mortgage loan is calculated based on its 
principal balance, mortgage rate, original term to stated maturity and remaining
term to stated maturity so that the mortgage loan will amortize in amounts      
sufficient to repay the remaining principal balance of that mortgage loan by its
remaining term to stated maturity, (ix) the notes are purchased on ________ __, 
____, (x) the Index remains constant at _____% per annum and the mortgage rate  
on each adjustable rate mortgage loan is adjusted on the next Adjustment Date   
(and on subsequent Adjustment Dates, if necessary) to equal the Index plus the  
applicable Gross Margin, subject to the applicable Periodic Rate Cap, (xi)      
One-Month LIBOR remains constant at _____% per annum, (xii) the monthly payment 
on each adjustable rate mortgage loan is adjusted on the Due Date immediately   
following the next Adjustment Date (and on subsequent Adjustment Dates, if      
necessary) to equal a fully amortizing monthly payment as described in clause   
(viii) above and (xiii) the Master Servicing Fee Rate is as shown in the        
"Assumed Mortgage Loan Characteristics" table below and the Master Servicing Fee
is payable monthly, the Servicing Fee Rate for each Servicer is equal to ____%  
per annum and the Servicing Fees are payable monthly, and the Indenture Trustee 
Fee Rate is equal to ______% per annum and the Indenture Trustee Fee is paid    
monthly.                                                                        

                                                        [Enlarge/Download Table]


                     ASSUMED MORTGAGE LOAN CHARACTERISTICS                                                               

                                    REMAINING                                                                            
 PRINCIPAL    MORTGAGE   ORIGINAL      TERM                                                            MASTER            
  BALANCE     RATE (%)   TERM TO        TO         NEXT                 MAXIMUM   MINIMUM   PERIODIC  SERVICING  PREPAY  
 AS OF THE    MORTGAGE   MATURITY    MATURITY   ADJUSTMENT    GROSS     MORTGAGE  MORTGAGE    RATE    FEE RATE   PENALTY 
CUT-OFF DATE  RATE (%)   (MONTHS)    (MONTHS)      DATE     MARGIN (%)  RATE (%)  RATE (%)   CAP (%)     (%)     (YES/NO)
------------  --------   --------    --------      ----     ----------  --------  --------   -------     ---     --------
                                                                                                                         


       There will be discrepancies between the characteristics of the actual
mortgage loans and the characteristics assumed in preparing the tables. This    
discrepancy may have an effect upon the percentages of the initial Note Balance 
outstanding (and the weighted average lives) of the notes shown in the tables.  
In addition, since the actual mortgage loans included in the mortgage pool will 
have characteristics that differ from those assumed in preparing the tables     
shown below and since it is not likely the level of the Index or One-Month LIBOR
will remain constant as assumed, the notes may mature earlier or later than     
indicated by the tables. In addition, as described under "Description of the    
Notes--Principal Payments on the Notes" in this prospectus supplement, the      
occurrence of the Stepdown Date or a Trigger Event (each as defined in this     
prospectus supplement) will have the effect of accelerating or decelerating the 
amortization of the notes, affecting the weighted average lives of the notes.   
Based on the foregoing assumptions, the tables indicate the weighted average    
lives of the notes and show the percentages of the initial Note Balance of those
notes that would be outstanding after each of the Payment Dates shown, at       
various percentages of the Prepayment Assumption. Neither the prepayment model  
used in this prospectus supplement nor any other prepayment model or assumption 
purports to be a historical description of prepayment experience or a prediction
of the anticipated rate of prepayment of any pool of mortgage loans, including  
the mortgage loans included in the mortgage pool. Variations in the prepayment  
experience and the balance of the mortgage loans that prepay may increase or    
decrease the percentages of initial Note Balances (and weighted average lives)  
shown in the following tables. Those variations may occur even if the average   
prepayment experience of all the mortgage loans equals any of the specified     
percentages of the Prepayment Assumption.                                       

PERCENT OF INITIAL NOTE BALANCE OUTSTANDING AT THE SPECIFIED  
PERCENTAGES OF THE PREPAYMENT ASSUMPTION                                        

                                                        [Enlarge/Download Table]


                                                                   CLASS A NOTES                           
                                   ------------------------------------------------------------------------
PAYMENT DATE                            0%             15%             25%             35%             45% 
------------                            --             ---             ---             ---             --- 
                                                                                                           
Closing Date.....................                                                                          
Weighted Average Life in Years(1)                                                                          
Weighted Average Life in Years(2)                                                                          

----------                                                                      
   (1)      The weighted average life of a Note is determined by (a)
              multiplying the amount of each payment of principal by the
                number of years from the date of issuance of the Note to the
                 related Payment Date, (b) adding the results and (c) dividing
     the sum by the initial Note Balance of the notes.

       (2)      Calculated pursuant to footnote one but assumes the majority
             holder of the Equity Certificates exercises its option to
             redeem the notes when the aggregate Note Balance has been
          reduced to less than 20% of the initial aggregate Note
Balance. SEE "THE INDENTURE AND OWNER TRUST 
         AGREEMENT--REDEMPTION" IN THIS PROSPECTUS SUPPLEMENT.

                                                        [Enlarge/Download Table]


                                                                   CLASS M-1 NOTES                         
                                   ------------------------------------------------------------------------
PAYMENT DATE                            0%             15%             25%             35%             45% 
------------                            --             ---             ---             ---             --- 
                                                                                                           
Closing Date.....................                                                                          
Weighted Average Life in Years(1)                                                                          
Weighted Average Life in Years(2)                                                                          

----------                                                                      
   (1)      The weighted average life of a Note is determined by (a)
              multiplying the amount of each payment of principal by the
                number of years from the date of issuance of the Note to the
                 related Payment Date, (b) adding the results and (c) dividing
     the sum by the initial Note Balance of the notes.

       (2)      Calculated pursuant to footnote one but assumes the majority
             holder of the Equity Certificates exercises its option to
             redeem the notes when the aggregate Note Balance has been
          reduced to less than 20% of the initial aggregate Note
Balance. See "THE INDENTURE AND OWNER TRUST 
         AGREEMENT--REDEMPTION" IN THIS PROSPECTUS SUPPLEMENT.

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                                                                   CLASS M-2 NOTES                         
                                   ------------------------------------------------------------------------
PAYMENT DATE                            0%             15%             25%             35%             45% 
------------                            --             ---             ---             ---             --- 
                                                                                                           
Closing Date.....................                                                                          
Weighted Average Life in Years(1)                                                                          
Weighted Average Life in Years(2)                                                                          

----------                                                                      
   (1)      The weighted average life of a Note is determined by (a)
              multiplying the amount of each payment of principal by the
                number of years from the date of issuance of the Note to the
                 related Payment Date, (b) adding the results and (c) dividing
     the sum by the initial Note Balance of the notes.

       (2)      Calculated pursuant to footnote one but assumes the majority
             holder of the Equity Certificates exercises its option to
             redeem the notes when the aggregate Note Balance has been
          reduced to less than 20% of the initial aggregate Note
Balance. SEE "THE INDENTURE AND OWNER TRUST 
         AGREEMENT--REDEMPTION" IN THIS PROSPECTUS SUPPLEMENT.

                                                        [Enlarge/Download Table]


                                                                   CLASS M-3 NOTES                         
                                   ------------------------------------------------------------------------
PAYMENT DATE                            0%             15%             25%             35%             45% 
------------                            --             ---             ---             ---             --- 
                                                                                                           
Closing Date.....................                                                                          
Weighted Average Life in Years(1)                                                                          
Weighted Average Life in Years(2)                                                                          

----------                                                                      
   (1)      The weighted average life of a Note is determined by (a)
              multiplying the amount of each payment of principal by the
                number of years from the date of issuance of the Note to the
                 related Payment Date, (b) adding the results and (c) dividing
     the sum by the initial Note Balance of the notes.

       (2)      Calculated pursuant to footnote one but assumes the majority
             holder of the Equity Certificates exercises its option to
             redeem the notes when the aggregate Note Balance has been
          reduced to less than 20% of the initial aggregate Note
Balance. See "THE INDENTURE AND OWNER TRUST 
         AGREEMENT--REDEMPTION" IN THIS PROSPECTUS SUPPLEMENT.

   There is no assurance that prepayments of the mortgage loans will
conform to any of the levels of the Prepayment Assumption indicated in the      
tables above, or to any other level, or that the actual weighted average lives  
of the notes will conform to any of the weighted average lives shown in the     
tables above. Furthermore, the information contained in the tables with respect 
to the weighted average lives of the notes is not necessarily indicative of the 
weighted average lives that might be calculated or projected under different or 
varying prepayment or Index level assumptions.                                  

  The characteristics of the mortgage loans will differ from those
assumed in preparing the tables above. In addition, it is unlikely that any     
mortgage loan will prepay at any constant percentage until maturity, that all of
the mortgage loans will prepay at the same rate or that the level of the Index  
will remain constant or at any level for any period of time. The timing of      
changes in the rate of prepayments may significantly affect the actual yield to 
maturity to investors, even if the average rate of principal prepayments and the
level of the Index is consistent with the expectations of investors.            

YIELD SENSITIVITY OF THE SUBORDINATE NOTES

    If on any Payment Date, the Overcollateralized Amount and the Note
Balances of the Class M-3 Notes and the Class M-2 Notes have been reduced to    
zero, the yield to maturity on the Class M-1 Notes will become extremely        
sensitive to losses on the mortgage loans (and the timing of those losses) that 
are covered by subordination, because the entire amount of any Realized Losses  
(to the extent not covered by Net Monthly Excess Cashflow) will be allocated to 
the Class M-1 Notes. If on any Payment Date, the Overcollateralized Amount and  
the Note Balance of the Class M-3 Notes have been reduced to zero, the yield to 
maturity on the Class M-2 Notes will become extremely sensitive to losses on the
mortgage loans (and the timing of those losses) that are covered by             
subordination, because the entire amount of any Realized Losses (to the extent  
not covered by Net Monthly Excess Cashflow) will be allocated to the Class M-2  
Notes. If on any Payment Date, the Overcollateralized Amount has been reduced to
zero, the yield to maturity on the Class M-3 Notes will become extremely        
sensitive to losses on the mortgage loans (and the timing of those losses) that 
are covered by subordination, because the entire amount of any Realized Losses  
(to the extent not covered by Net Monthly Excess Cashflow) will be allocated to 
the Class M-3 Notes. Once Realized Losses have been allocated to the Subordinate
Notes, those Realized Losses will not be reinstated thereafter. However,        
Allocated Realized Loss Amounts may be paid to the holders of those classes of  
notes, after various distributions to the holders of the Class A Notes and      
Subordinate Notes with lower numerical class designations, but before the Equity
Certificates are entitled to any distributions. SEE "DESCRIPTION OF THE         
NOTES--OVERCOLLATERALIZATION PROVISIONS" IN THIS PROSPECTUS SUPPLEMENT.         

        Investors in the Subordinate Notes should fully consider the risk that
Realized Losses on the mortgage loans could result in the failure of those      
investors to fully recover their investments. For additional considerations     
relating to the yield on the Subordinate Notes, SEE "YIELD CONSIDERATIONS" AND  
"MATURITY AND PREPAYMENT CONSIDERATIONS" IN THE PROSPECTUS.                     

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DESCRIPTION OF THE NOTES

GENERAL                                                                         

       MILA Mortgage Acceptance, Inc., Mortgage-Backed Notes, Series ____-__
will consist of ____ classes of notes, designated as (i) the Class A Notes and  
(ii) the Class M-1 Notes, the Class M-2 Notes and the Class M-3 Notes. The notes
will be issued by MILA Mortgage Acceptance, Inc. Trust Series ____-__ pursuant  
to the Indenture, dated as of ________ __, ____, between the Issuer and the     
Indenture Trustee. Only the notes are offered by this prospectus supplement. The
Equity Certificates will be issued pursuant to the Owner Trust Agreement, dated 
as of ________ __, ____, between the company and the Owner Trustee, and will    
represent the beneficial ownership interest in the Issuer. The Equity           
Certificates are not being offered by this prospectus supplement and will be    
delivered on the Closing Date to the ____________, as partial consideration for 
the conveyance of the mortgage loans by ____________ to the company.            

      Distributions on the offered notes will be made on each Distribution
Date.                                                                           

         The notes represent non-recourse debt obligations of the Issuer secured
by the Trust Estate, which consists primarily of a mortgage pool of             
conventional, one- to four-family, adjustable rate mortgage loans and fixed rate
mortgage loans having an aggregate principal balance as of the Cut-off Date of  
approximately $___________, subject to a permitted variance as described in this
prospectus supplement under "The Mortgage Pool". Proceeds of the Trust Estate   
will be the sole source of payments on the notes. The Issuer is not expected to 
have any significant assets other than the Trust Estate pledged as collateral to
secure the notes.                                                               

     The Class A Notes, the Class M-1 Notes, the Class M-2 Notes and the
Class M-3 Notes will have an aggregate initial Note Balance of approximately    
$___________, approximately $_________, approximately $__________ and           
approximately $__________, respectively, in each case subject to a permitted    
variance of plus or minus [5]%. The Note Interest Rates on the notes are        
adjustable, subject to the Maximum Note Interest Rate and the Available Interest
Rate, and will be calculated for each Payment Date as described under "--Note   
Interest Rate" in this prospectus supplement. The "Final Maturity Date" of the  
notes is the Payment Date occurring in _______ ____.                            

        The notes will be issued, maintained and transferred on the book-entry
records of DTC and its participants in minimum denominations of $[10,000] and   
integral multiples of $[1.00] in excess of that minimum denomination.           

     The notes will initially be represented by one or more global notes
registered in the name of the nominee of DTC, except as provided below. The     
company has been informed by DTC that DTC's nominee will be Cede. No person     
acquiring an interest in any class of the notes will be entitled to receive a   
note representing those person's interest, except as described below under      
"--Definitive Notes". Unless and until Definitive Notes are issued under the    
limited circumstances described in this prospectus supplement, all references to
actions by noteholders with respect to the notes shall refer to actions taken by
DTC upon instructions from its participants (as defined below), and all         
references in this prospectus supplement to payments, notices, reports and      
statements to noteholders with respect to the notes shall refer to payments,    
notices, reports and statements to DTC or Cede, as the registered holder of the 
notes, for payment to Note Owners in accordance with DTC procedures. SEE        
"--REGISTRATION" AND "--DEFINITIVE NOTES" IN THIS PROSPECTUS SUPPLEMENT.        

   Any Definitive Notes will be transferable and exchangeable at the
offices of the Indenture Trustee. No service charge will be imposed for any     
registration of transfer or exchange, but the Indenture Trustee may require     
payment of a sum sufficient to cover any tax or other governmental charge       
imposed in connection therewith.                                                

       All payments to holders of the notes, other than the final payment on
any class of notes, will be made by or on behalf of the Indenture Trustee to the
persons in whose names those notes are registered at the close of business on   
each Record Date. Those payments will be made either (a) by check mailed to the 
address of that noteholder as it appears in the Note Register or (b) upon       
written request to the Indenture Trustee at least five business days prior to   
the relevant Record Date by any holder of notes having an aggregate initial Note
Balance that is in excess of the lesser of (i) $5,000,000 or (ii) two-thirds of 
the initial aggregate Note Balance of that class of notes, by wire transfer in  
immediately available funds to the account of that noteholder specified in the  
request. The final payment on any class of notes will be made in like manner,   
but only upon presentment and surrender of those notes at the corporate trust   
office of the Indenture Trustee or another location specified in the notice to  
noteholders of that final payment.                                              

REGISTRATION                                                                    

        DTC is a limited-purpose trust company organized under the laws of the
State of New York, a member of the Federal Reserve System, a "clearing          
corporation" within the meaning of the New York Uniform Commercial Code, and a  
"clearing agency" registered pursuant to the provisions of Section 17A of the   
Securities Exchange Act of 1934, as amended. DTC was created to hold securities 
for its participants and to facilitate the clearance and settlement of          
securities transactions between participants through electronic book entries,   
thereby eliminating the need for physical movement of notes. participants       
include securities brokers and dealers (including [Name of Underwriter]), banks,
trust companies and clearing corporations. Indirect access to the DTC system is 
also available to indirect participants.                                        

    Note Owners that are not participants or indirect participants but
desire to purchase, sell or otherwise transfer ownership of, or other interests 
in, the notes may do so only through participants and indirect participants. In 
addition, Note Owners will receive all payments of principal of and interest on 
the notes from the Indenture Trustee through DTC and DTC participants. The      
Indenture Trustee will forward payments to DTC in same day funds and DTC will   
forward those payments to participants in next day funds settled through the New
York Clearing House. Each Participant will be responsible for disbursing those  
payments to indirect participants or to Note Owners. Unless and until Definitive
Notes are issued, it is anticipated that the only holder of the notes will be   
Cede, as nominee of DTC. Note Owners will not be recognized by the Indenture    
Trustee as noteholders, as that term is used in the Indenture, and Note Owners  
will be permitted to exercise the rights of noteholders only indirectly through 
DTC and its participants.                                                       

        Under the rules, regulations and procedures creating and affecting DTC
and its operations, DTC is required to make book-entry transfers of notes among 
participants and to receive and transmit payments of principal of, and interest 
on, the notes. Participants and indirect participants with which Note Owners    
have accounts with respect to the notes similarly are required to make          
book-entry transfers and receive and transmit those payments on behalf of their 
respective Note Owners. Accordingly, although Note Owners will not possess      
Definitive Notes, the Rules provide a mechanism by which Note Owners through    
their participants and indirect participants will receive payments and will be  
able to transfer their interest.                                                

        Because DTC can only act on behalf of participants, who in turn act on
behalf of indirect participants and on behalf of some banks, the ability of a   
Note Owner to pledge notes to persons or entities that do not participate in the
DTC system, or to otherwise act with respect to those notes, may be limited due 
to the absence of physical notes for the notes. In addition, under a book-entry 
format, Note Owners may experience delays in their receipt of payments since    
payment will be made by the Indenture Trustee to Cede, as nominee for DTC.      

  Under the Rules, DTC will take action permitted to be taken by a
noteholder under the Indenture only at the direction of one or more participants
to whose DTC account the notes are credited. Clearstream or the Euroclear       
Operator (as defined in this prospectus supplement), as the case may be, will   
take any other action permitted to be taken by a noteholder under the Indenture 
on behalf of a Clearstream Participant (as defined in this prospectus           
supplement) or Euroclear Participant (as defined in this prospectus supplement) 
only in accordance with its relevant rules and procedures and subject to the    
ability of the Relevant Depositary (as defined in this prospectus supplement) to
effect those actions on its behalf through DTC. Additionally, under the Rules,  
DTC will take those actions with respect to specified Voting Rights only at the 
direction of and on behalf of participants whose holdings of notes evidence     
those specified Voting Rights. DTC may take conflicting actions with respect to 
Voting Rights to the extent that participants whose holdings of notes evidence  
those Voting Rights, authorize divergent action.                                

    The Issuer, the Originators, the company, the Master Servicer, the
Seller, ________, the Owner Trustee, the Indenture Trustee and their respective 
affiliates will have no liability for any actions taken by DTC or its nominee or
Clearstream or Euroclear, including actions for any aspect of the records       
relating to or payments made on account of beneficial ownership interests in the
notes held by Cede, as nominee for DTC, or for maintaining, supervising or      
reviewing any records relating to those beneficial ownership interests.         

DEFINITIVE NOTES                                                                

   Definitive Notes will be issued to Note Owners or their nominees,
rather than to DTC or its nominee, only if (i) the company advises the Indenture
Trustee in writing that DTC is no longer willing or able to discharge properly  
its responsibilities as clearing agency with respect to the notes and the       
company is unable to locate a qualified successor, (ii) the company, at its     
option, advises the Indenture Trustee in writing that it elects to terminate the
book-entry system through DTC, or (iii) after the occurrence of an Event of     
Default (as defined in this prospectus supplement), Note Owners representing in 
the aggregate not less than 51% of the Voting Rights of the notes advise the    
Indenture Trustee and DTC through participants, in writing, that the            
continuation of a book-entry system through DTC (or a successor thereto) is no  
longer in the Note Owners' best interest.                                       

         Upon the occurrence of any event described in the immediately preceding
paragraph, the Indenture Trustee is required to notify all Note Owners through  
participants of the availability of Definitive Notes. Upon surrender by DTC of  
the definitive notes representing the Notes and receipt of instructions for re- 
registration, the Indenture Trustee will reissue the notes as Definitive Notes  
issued in the respective principal amounts owned by individual Note Owners, and 
thereafter the Indenture Trustee will recognize the holders of those Definitive 
Notes as noteholders under the Indenture. Those Definitive Notes will be issued 
in minimum denominations of $10,000, except that any beneficial ownership       
represented by a note in an amount less than $10,000 immediately prior to the   
issuance of a Definitive Note shall be issued in a minimum denomination equal to
the amount represented by that note.                                            

BOOK-ENTRY FACILITIES                                                           

        Note Owners may elect to hold their interests in the notes through DTC
in the United States or through Clearstream or Euroclear in Europe, if they are 
participants of those systems, or indirectly through organizations which are    
participants in those systems. The notes of each class will be issued in one or 
more notes which equal the aggregate Note Balance of that class and will        
initially be registered in the name of Cede, the nominee of DTC. Clearstream and
Euroclear will hold omnibus positions on behalf of their participants through   
customers' securities accounts in Clearstream's and Euroclear's names on the    
books of their respective depositaries which in turn will hold those positions  
in customers' securities accounts in the depositaries' names on the books of    
DTC. Citibank will act as depositary for Clearstream and Chase will act as      
depositary for Euroclear.                                                       

     Because of time zone differences, credits of securities received in
Clearstream or Euroclear as a result of a transaction with a Participant will be
made during subsequent securities settlement processing and dated the business  
day following the DTC settlement date. Those credits or any transactions in     
those securities settled during that processing will be reported to the relevant
Euroclear participants or Clearstream participants on that business day. Cash   
received in Clearstream or Euroclear as a result of sales of securities by or   
through a Clearstream Participant or Euroclear Participant to a Participant will
be received with value on the DTC settlement date but will be available in the  
relevant Clearstream or Euroclear cash account only as of the business day      
following settlement in DTC.                                                    

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

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

Clearstream is incorporated under the laws of Luxembourg as a 
professional depository. Clearstream holds securities for its Clearstream       
participants and facilitates the clearance and settlement of securities         
transactions between Clearstream participants through electronic book-entry     
changes in accounts of Clearstream participants, thereby eliminating the need   
for physical movement of notes. Transactions may be settled in Clearstream in   
any of 28 currencies, including United States dollars. Clearstream provides to  
its Clearstream participants, among other things, services for safekeeping,     
administration, clearance and settlement of internationally traded securities   
and securities lending and borrowing. Clearstream interfaces with domestic      
markets in several countries. As a professional depository, Clearstream is      
subject to regulation by the Luxembourg Monetary Institute. Clearstream         
participants are recognized financial institutions around the world, including  
underwriters, securities brokers and dealers, banks, trust companies, clearing  
corporations and other organizations. Indirect access to Clearstream is also    
available to others, such as banks, brokers, dealers and trust companies that   
clear through or maintain a custodial relationship with a Clearstream           
Participant, either directly or indirectly.                                     

    Euroclear was created in 1968 to hold securities for its 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 notes and any risk from lack of   
simultaneous transfers of securities and cash. Transactions may now be settled  
in any of 32 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 the Euroclear Operator, under       
contract with the 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 Cooperative. The     
Cooperative establishes policy for Euroclear on behalf of Euroclear             
participants. Euroclear participants include banks (including central banks),   
securities brokers and dealers and other professional financial intermediaries. 
Indirect access to Euroclear is also available to other firms that clear through
or maintain a custodial relationship with a Euroclear Participant, either       
directly or indirectly.                                                         

    Securities clearance accounts and cash accounts with the Euroclear
Operator are governed by the Terms and Conditions Governing Use of Euroclear and
the related Operating Procedures of the Euroclear System and applicable Belgian 
law. 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. 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 with respect to notes held through Clearstream or Euroclear
will be credited to the cash accounts of Clearstream participants or Euroclear  
participants in accordance with the relevant system's rules and procedures, to  
the extent received by the Relevant Depositary. Those payments will be subject  
to tax reporting in accordance with relevant United States tax laws and         
regulations.                                                                    

      Although DTC, Clearstream and Euroclear have agreed to the foregoing
procedures in order to facilitate transfers of notes among participants of DTC, 
Clearstream and Euroclear, they are under no obligation to perform or continue  
to perform those procedures and those procedures may be discontinued at any     
time. SEE "DESCRIPTION OF THE SECURITIES--FORM OF SECURITIES" IN THE PROSPECTUS.

NOTE INTEREST RATES                                                             

      The Note Interest Rate on the Class A Notes will be a rate per annum
equal to the lesser of (i) One- Month LIBOR plus ____%, in the case of each     
Payment Date through and including the Payment Date on which the aggregate Note 
Balance is reduced to less than __% of the aggregate initial Note Balance, or   
One- Month LIBOR plus ____%, in the case of any Payment Date thereafter, (ii)   
the Available Interest Rate for that Payment Date and (iii) the Maximum Note    
Interest Rate.                                                                  

        The Note Interest Rate on the Class M-1 Notes will be a rate per annum
equal to the lesser of (i) One- Month LIBOR plus ____%, in the case of each     
Payment Date through and including the Payment Date on which the aggregate Note 
Balance is reduced to less than __% of the aggregate initial Note Balance, or   
One- Month LIBOR plus ____%, in the case of any Payment Date thereafter, (ii)   
the Available Interest Rate for that Payment Date and (iii) the Maximum Note    
Interest Rate.                                                                  

        The Note Interest Rate on the Class M-2 Notes will be a rate per annum
equal to the lesser of (i) One- Month LIBOR plus ____%, in the case of each     
Payment Date through and including the Payment Date on which the aggregate Note 
Balance is reduced to less than __% of the aggregate initial Note Balance, or   
One- Month LIBOR plus ____%, in the case of any Payment Date thereafter, (ii)   
the Available Interest Rate for that Payment Date and (iii) the Maximum Note    
Interest Rate.                                                                  

        The Note Interest Rate on the Class M-3 Notes will be a rate per annum
equal to the lesser of (i) One- Month LIBOR plus ____%, in the case of each     
Payment Date through and including the Payment Date on which the aggregate Note 
Balance is reduced to less than __% of the aggregate initial Note Balance, or   
One- Month LIBOR plus _____%, in the case of any Payment Date thereafter, (ii)  
the Available Interest Rate for that Payment Date and (iii) the Maximum Note    
Interest Rate.                                                                  

       SEE "--CALCULATION OF ONE-MONTH LIBOR" IN THIS PROSPECTUS SUPPLEMENT.

        The Note Interest Rate and the Note Accrual Rate for the notes for the
current related Interest Accrual Period, to the extent it has been determined,  
and for the immediately preceding Interest Accrual Period may be obtained by    
telephoning the Indenture Trustee at __________.                                

INTEREST PAYMENTS ON THE NOTES                                                  

         To the extent of the Current Interest Payment Amount, in the priorities
listed below, the holders of each class of notes will be entitled to receive on 
each Payment Date interest payments in an amount equal to the Interest Payment  
Amount for that class. On each Payment Date, the Current Interest Payment Amount
will be distributed in the following order of priority:                         

         FIRST, to the holders of the Class A Notes, the Interest Payment Amount
for those notes;                                              

        SECOND, to the extent of the Current Interest Payment Amount remaining
        after payment of the Interest Payment Amount for the Class A Notes, to
     the holders of the Class M-1 Notes, the Interest Payment Amount for
those Notes;                                                  

       THIRD, to the extent of the Current Interest Payment Amount remaining
         after payment of the Interest Payment Amounts for the Class A Notes and
 the Class M-1 Notes, to the holders of the Class M-2 Notes, the
Interest Payment Amount for those notes; and                  

        FOURTH, to the extent of the Current Interest Payment Amount remaining
      after payment of the Interest Payment Amounts for the Class A Notes,
    the Class M-1 Notes and the Class M-2 Notes, to the holders of the
Class M-3 Notes, the Interest Payment Amount for those notes. 

       With respect to any Payment Date, to the extent that the aggregate of
the Interest Payment Amounts for the notes is limited by the Current Interest   
Payment Amount for the related Due Period, the holders of some classes of notes 
may receive an Interest Payment Amount calculated at the Available Interest Rate
rather than at the applicable Note Accrual Rate for those classes and that      
Payment Date. The Interest Carry Forward Amount, if any, for any class of the   
notes for any Payment Date is payable to the extent of available funds remaining
after some other payments on the notes on that Payment Date, but before any     
payments on the Equity Certificates on that Payment Date. SEE                   
"--OVERCOLLATERALIZATION PROVISIONS" IN THIS PROSPECTUS SUPPLEMENT.             

       All payments of interest on the notes will be based on a 360-day year
and the actual number of days in the applicable Interest Accrual Period.        

        The Note Balance of a note outstanding at any time represents the then
maximum amount that the holder of that note is entitled to receive as payments  
allocable to principal from the cash flow on the mortgage loans and the other   
assets in the Trust Estate.                                                     

CALCULATION OF ONE-MONTH LIBOR                                                  

With respect to each Interest Accrual Period, on the Interest 
Determination Date, the Indenture Trustee will determine One-Month LIBOR for the
next Interest Accrual Period. If that rate does not appear on Telerate Page     
3750, the rate for that day will be determined on the basis of the offered rates
of the Reference Banks (as defined in this prospectus supplement) for one-month 
U.S. dollar deposits, as of 11:00 a.m. (London time) on that Interest           
Determination Date. The Indenture Trustee will request the principal London     
office of each of the Reference Banks to provide a quotation of its rate. If on 
that Interest Determination Date two or more Reference Banks provide those      
offered quotations, One-Month LIBOR for the related Interest Accrual Period     
shall be the arithmetic mean of those offered quotations (rounded upwards if    
necessary to the nearest whole multiple of 0.0625%). If on that Interest        
Determination Date fewer than two Reference Banks provide those offered         
quotations, One-Month LIBOR for the related Interest 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 (as defined in this        
prospectus supplement).                                                         

        As used in this section, "business day" means a day on which banks are
open for dealing in foreign currency and exchange in London and New York City.  

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

PRINCIPAL PAYMENTS ON THE NOTES                                                 

        On each Payment Date, the Principal Payment Amount will be distributed
to the holders of the notes then entitled to payments of principal. In no event 
will the Principal Payment Amount with respect to any Payment Date be (x) less  
than zero or (y) greater than the then-outstanding aggregate Note Balance of the
notes. The Principal Payment Amount for the first Payment Date will include     
approximately $_________ collected by the Servicers in respect of prepayments on
the mortgage loans during the _________ ____ Prepayment Period.                 

       On each Payment Date (a) prior to the Stepdown Date or (b) on which a
Trigger Event is in effect, the Principal Payment Amount shall be distributed:  
first, to the Class A Notes, until the Note Balance thereof has been reduced to 
zero; second, to the Class M-1 Notes, until the Note Balance thereof has been   
reduced to zero; third, to the Class M-2 Notes, until the Note Balance thereof  
has been reduced to zero; and fourth, to the Class M-3 Notes, until the Note    
Balance thereof has been reduced to zero.                                       

         On each Payment Date (a) on or after the Stepdown Date and (b) on which
a Trigger Event is not in effect, the holders of the Class A Notes and the      
Subordinate Notes shall be entitled to receive payments in respect of principal 
to the extent of the Principal Payment Amount in the following amounts and order
of priority:                                                                    

         FIRST, the lesser of (x) the Principal Payment Amount and (y) the Class
        A Principal Payment Amount, shall be distributed to the holders of the
         Class A Notes, until the Note Balance thereof has been reduced to zero;

   SECOND, the lesser of (x) the excess of (i) the Principal Payment
       Amount over (ii) the amount distributed to the holders of the Class A
      notes pursuant to clause first above and (y) the Class M-1 Principal
      Payment Amount, shall be distributed to the holders of the Class M-1
 Notes, until the Note Balance thereof has been reduced to zero;

         THIRD, the lesser of (x) the excess of (i) the Principal Payment Amount
    over (ii) the sum of the amounts distributed to the holders of the
        Class A Notes pursuant to clause first above and to the holders of the
       Class M-1 Notes pursuant to clause second above and (y) the Class M-2
      Principal Payment Amount, shall be distributed to the holders of the
     Class M-2 Notes, until the Note Balance thereof has been reduced to
zero; and                                                     

   FOURTH, the lesser of (x) the excess of (i) the Principal Payment
       Amount over (ii) the sum of the amounts distributed to the holders of
         the Class A Notes pursuant to clause first above, to the holders of the
       Class M-1 Notes pursuant to clause second above and to the holders of
      the Class M-2 Notes pursuant to clause third above and (y) the Class
      M-3 Principal Payment Amount, shall be distributed to the holders of
         the Class M-3 Notes, until the Note Balance thereof has been reduced to
zero.                                                         

      On the Final Maturity Date or the Payment Date immediately following
the acceleration of the notes due to any Event of Default principal will be     
payable on each class of notes in an amount equal to the Note Balance thereof on
that Payment Date. On the Final Maturity Date or the Payment Date immediately   
following the acceleration of the notes due to any Event of Default, amounts in 
respect of accrued interest, Interest Carry Forward Amounts and Allocated       
Realized Loss Amounts will also be payable on each class of notes in the        
priorities listed in the Indenture. There can be no assurance, however, that    
sufficient funds will be available on that date to retire the Note Balances and 
pay those other amounts.                                                        

         The allocation of payments in respect of principal to the Class A Notes
on each Payment Date (a) prior to the Stepdown Date or (b) on which a Trigger   
Event has occurred, will have the effect of accelerating the amortization of the
Class A Notes while, in the absence of Realized Losses, increasing the          
respective percentage interest in the principal balance of the mortgage loans   
evidenced by the Subordinate Notes and the Overcollateralized Amount. Increasing
the respective percentage interest in the Trust Estate of the Subordinate Notes 
and the Overcollateralized Amount relative to that of the Class A Notes is      
intended to preserve the availability of the subordination provided by the      
Subordinate Notes and the Overcollateralized Amount.                            

The holders of the Equity Certificates will be entitled to all
Prepayment Charges received on the mortgage loans and those amounts will not be 
available for distribution on the notes.                                        

CREDIT ENHANCEMENT                                                              

       The Credit Enhancement provided for the benefit of the holders of the
notes consists of subordination, as described below, and overcollateralization, 
as described under "--OVERCOLLATERALIZATION PROVISIONS" in this prospectus      
supplement.                                                                     

   The rights of the holders of the Subordinate Notes and the Equity
Certificates to receive payments will be subordinated, to the extent described  
in this prospectus supplement, to the rights of the holders of the Class A      
Notes. This subordination is intended to enhance the likelihood of regular      
receipt by the holders of the Class A Notes of the full amount of interest and  
principal to which they are entitled and to afford those holders protection     
against Realized Losses.                                                        

         The protection afforded to the holders of the Class A Notes by means of
the subordination of the Subordinate Notes and the Equity Certificates will be  
accomplished by (i) the preferential right of the holders of the Class A Notes  
to receive on any Payment Date, prior to payment on the Subordinate Notes and   
the Equity Certificates, payments in respect of interest and principal, subject 
to available funds, and (ii) if necessary, the right of the holders of the Class
A Notes to receive future payments of amounts that would otherwise be payable to
the holders of the Subordinate Notes and the Equity Certificates.               

        In addition, the rights of the holders of Subordinate Notes with lower
numerical class designations will be senior to the rights of holders of         
Subordinate Notes with higher numerical class designations, and the rights of   
the holders of all of the Subordinate Notes to receive payments in respect of   
the mortgage loans will be senior to the rights of the holders of the Equity    
Certificates, in each case to the extent described in this prospectus           
supplement. This subordination is intended to enhance the likelihood of regular 
receipt by the holders of Subordinate Notes with lower numerical class          
designations relative to the holders of Subordinate Notes with higher numerical 
class designations (and by the holders of all of the Subordinate Notes relative 
to the holders of the Equity Certificates) of the full amount of interest and   
principal to which they are entitled and to afford those holders protection     
against Realized Losses, as described under "--Allocation of Realized Losses" in
this prospectus supplement.                                                     

OVERCOLLATERALIZATION PROVISIONS                                                

        The weighted average mortgage rate for the mortgage loans (adjusted to
reflect the Master Servicing Fee, the Servicing Fees and the Indenture Trustee  
Fee payable from interest received or advanced on the mortgage loans) is        
generally expected to be higher than the weighted average of the Note Interest  
Rates on the notes, thus generating excess interest collections which, in the   
absence of Realized Losses, will not be necessary to fund interest payments on  
the notes. The Indenture requires that, on each Payment Date, the Net Monthly   
Excess Cashflow, if any, be applied on that Payment Date as an accelerated      
payment of principal on the class or classes of notes then entitled to receive  
payments in respect of principal, but only to the limited extent hereafter      
described. With respect to any Payment Date, any Net Monthly Excess Cashflow    
(or, in the case of clause first below, the Net Monthly Excess Cashflow         
exclusive of any Overcollateralization Reduction Amount) shall be paid as       
follows:                                                                        

         FIRST, to the holders of the class or classes of notes then entitled to
     receive payments in respect of principal, in an amount equal to the
     principal portion of any Realized Losses incurred or deemed to have
been incurred on the mortgage loans;                          

       SECOND, to the holders of the class or classes of notes then entitled
        to receive payments in respect of principal, in an amount equal to the
Overcollateralization Increase Amount;                        

       THIRD, to the holders of the Class A Notes, in an amount equal to the
Interest Carry Forward Amount for those notes;                

      FOURTH, to the holders of the Class M-1 Notes, in an amount equal to
the Interest Carry Forward Amount for those notes;            

         FIFTH, to the holders of the Class M-1 Notes, in an amount equal to the
Allocated Realized Loss Amount for those notes;               

         SIXTH, to the holders of the Class M-2 Notes, in an amount equal to the
Interest Carry Forward Amount for those notes;                

       SEVENTH, to the holders of the Class M-2 Notes, in an amount equal to
the Allocated Realized Loss Amount for those notes;           

      EIGHTH, to the holders of the Class M-3 Notes, in an amount equal to
the Interest Carry Forward Amount for those notes;            

         NINTH, to the holders of the Class M-3 Notes, in an amount equal to the
Allocated Realized Loss Amount for those notes; and           

     TENTH, to the holders of the Equity Certificates as provided in the
Indenture.                                                    

  With respect to any Payment Date, the excess, if any, of (a) the
aggregate principal balance of the mortgage loans immediately following that    
Payment Date over (b) the Note Balance of the notes, after taking into account  
the payment of the amounts described in clauses (b)(i) through (iv) of the      
definition of Principal Payment Amount on that Payment Date, is the             
"Overcollateralized Amount" for the notes as of that Payment Date. As of the    
Closing Date, the aggregate principal balance of the mortgage loans as of the   
Cut-off Date will exceed the aggregate Note Balance of the notes by an amount   
equal to approximately $_________. That amount represents approximately ____% of
the aggregate principal balance of the mortgage loans as of the Cut-off Date,   
which is the initial amount of overcollateralization required to be provided by 
the mortgage pool under the Indenture. Under the Indenture, the                 
Overcollateralized Amount is required to be maintained at the Required          
Overcollateralized Amount. In the event that Realized Losses are incurred on the
mortgage loans, those Realized Losses may result in an overcollateralization    
deficiency since those Realized Losses will reduce the principal balance of the 
mortgage loans without a corresponding reduction to the aggregate Note Balance  
of the notes. In that event, the Indenture requires the payment from Net Monthly
Excess Cashflow, subject to available funds, of an amount equal to that         
overcollateralization deficiency, which shall constitute a principal payment on 
the notes in reduction of the Note Balances thereof. This has the effect of     
accelerating the amortization of the notes relative to the amortization of the  
mortgage loans, and of increasing the Overcollateralized Amount.                

         On and after the Stepdown Date and provided that a Trigger Event is not
in effect, the Required Overcollateralized Amount may be permitted to decrease, 
or "step down", below the initial $_________ level to a level equal to          
approximately ____% of the then current aggregate outstanding principal balance 
of the mortgage loans (after giving effect to principal payments to be          
distributed on that Payment Date), subject to a floor of $_________. In the     
event that the Required Overcollateralized Amount is permitted to step down on  
any Payment Date, the Indenture provides that a portion of the principal which  
would otherwise be distributed to the holders of the notes on that Payment Date 
shall be distributed to the holders of the Equity Certificates, subject to the  
priorities listed above. With respect to that Payment Date, the Principal       
Payment Amount will be reduced by the Overcollateralization Reduction Amount    
after taking into account all other payments to be made on that Payment Date,   
which amount shall be distributed as Net Monthly Excess Cashflow pursuant to the
priorities listed above. This has the effect of decelerating the amortization of
the notes relative to the amortization of the mortgage loans, and of reducing   
the Overcollateralized Amount. However, if on any Payment Date a Trigger Event  
is in effect, the Required Overcollateralized Amount will not be permitted to   
step down on that Payment Date.                                                 

ALLOCATION OF LOSSES; SUBORDINATION                                             

        With respect to any defaulted mortgage loan that is finally liquidated
through foreclosure sale, disposition of the related mortgaged property (if     
acquired by deed in lieu of foreclosure) or otherwise, the amount of loss       
realized, if any, will equal the portion of the unpaid principal balance        
remaining, if any, plus interest on that mortgage loan through the last day of  
the month in which that mortgage loan was finally liquidated, after application 
of all amounts recovered (net of amounts reimbursable to the Servicers for P&I  
Advances, servicing advances and Servicing Fees) towards interest and principal 
owing on the mortgage loan.                                                     

  Any Realized Loss on the mortgage loans will be allocated on any
Payment Date, first, to Net Monthly Excess Cashflow, second, to the             
Overcollateralized Amount, third, to the Class M-3 Notes, fourth, to the Class  
M-2 Notes, and fifth, to the Class M-1 Notes. The Indenture does not permit the 
allocation of Realized Losses to the Class A Notes. Investors in the Class A    
Notes should note that although Realized Losses cannot be allocated to those    
notes, under various loss scenarios there will not be enough principal and      
interest collected on the mortgage loans to pay the Class A Notes all interest  
and principal amounts to which they are then entitled.                          

    Once Realized Losses have been allocated to the Subordinate Notes,
those Realized Losses will not be reinstated thereafter. However, Allocated     
Realized Loss Amounts may be paid to the holders of those classes of notes,     
after various distributions to the holders of the Class A Notes and Subordinate 
Notes with lower numerical class designations, but before the Equity            
Certificates are entitled to any distributions.                                 

      Any allocation of a Realized Loss to a note will be made by reducing
the Note Balance thereof by the amount so allocated on the Payment Date in the  
month following the calendar month in which that Realized Loss was incurred.    
Notwithstanding anything to the contrary described in this prospectus           
supplement, in no event will the Note Balance of any note be reduced more than  
once in respect of any particular amount both (i) allocable to those notes in   
respect of Realized Losses and (ii) payable as principal to the holder of those 
notes from Net Monthly Excess Cashflow.                                         

P&I ADVANCES                                                                    

       Subject to the following limitations, each Servicer will be obligated
to advance or cause to be advanced on or before each Payment Date from its own  
funds, or funds in the Distribution Account that are not included in the        
Available Payment Amount for that Payment Date, any P&I Advance.                

         P&I Advances are required to be made only to the extent they are deemed
by the related Servicer to be recoverable from related late collections,        
insurance proceeds or liquidation proceeds. The purpose of making those P&I     
Advances is to maintain a regular cash flow to the noteholders, rather than to  
guarantee or insure against losses. The Servicers will not be required to make  
any P&I Advances with respect to reductions in the amount of the monthly        
payments on the mortgage loans due to bankruptcy proceedings or the application 
of the Relief Act.                                                              

         All P&I Advances will be reimbursable to the related Servicer from late
collections, insurance proceeds and liquidation proceeds from the mortgage loan 
as to which that unreimbursed P&I Advance was made. In addition, any P&I        
Advances previously made in respect of any mortgage loan that are deemed by the 
related Servicer to be nonrecoverable from related late collections, insurance  
proceeds or liquidation proceeds may be reimbursed to the related Servicer out  
of any funds in the Distribution Account prior to the payments on the notes. In 
the event that any Servicer fails in its obligation to make any required        
advance, the Master Servicer will be obligated to make that advance, and in the 
event that the Master Servicer fails in its obligation to make that advance, the
Indenture Trustee will be obligated to make that advance, in each of these cases
to the extent required in the related Servicing Agreement.                      

THE ISSUER

    MILA Mortgage Acceptance, Inc. Trust Series ____-__ is a statutory
trust formed under the laws of the State of Delaware pursuant to the Owner Trust
Agreement, dated as of ________ __, ____, between the company and the Owner     
Trustee for the transactions described in this prospectus supplement. The Owner 
Trust Agreement constitutes the "governing instrument" under the laws of the    
State of Delaware relating to statutory trusts. After its formation, the Issuer 
will not engage in any activity other than (i) acquiring and holding the        
mortgage loans and the proceeds therefrom, (ii) issuing the notes and the Equity
Certificates, (iii) making payments on the notes and the Equity Certificates and
(iv) engaging in other activities that are necessary, suitable or convenient to 
accomplish the foregoing or are incidental thereto or connected therewith. The  
Issuer is not expected to have any significant assets other than the Trust      
Estate pledged as collateral to secure the notes. The assets of the Issuer will 
consist of the mortgage loans pledged to secure the notes. The Issuer's         
principal offices are in __________, ________, in care of ________________, as  
Owner Trustee.                                                                  

THE SELLER

    The Seller, in its capacity as mortgage loan seller, will sell the
mortgage loans to the ___________ pursuant to a mortgage loan Purchase          
Agreement, dated as of _________ __, ____, between the Seller and __________.   

 THE OWNER TRUSTEE

         _________________ is the Owner Trustee under the Owner Trust Agreement.
The Owner Trustee is a _________ banking corporation and its principal offices  
are located in _____________.                                                   

        Neither the Owner Trustee nor any director, officer or employee of the
Owner Trustee will be under any liability to the Issuer or the noteholders under
the Owner Trust Agreement under any circumstances, except for the Owner         
Trustee's own misconduct, gross negligence, bad faith or grossly negligent      
failure to act or in the case of the inaccuracy of some representations made by 
the Owner Trustee in the Owner Trust Agreement. All persons into which the Owner
Trustee may be merged or with which it may be consolidated or any person        
resulting from that merger or consolidation shall be the successor of the Owner 
Trustee under the Owner Trust Agreement.                                        

       The principal compensation to be paid to the Owner Trustee in respect
of its obligations under the Owner Trust Agreement will have been paid by or on 
behalf of the Issuer on or prior to the Closing Date.                           

 THE INDENTURE TRUSTEE

       ____________________, a ____________ banking association, will act as
Indenture Trustee for the notes pursuant to the Indenture. The Indenture        
Trustee's offices for notices under the                                         

 Indenture are located at ______________________________ and its
telephone number is ______________.                                             

    The Indenture will provide that the Indenture Trustee may withdraw
funds from the Distribution Account (i) to reimburse itself for all reasonable  
out-of-pocket expenses incurred or made by it, including costs of collection and
including reasonable compensation and expenses, disbursements and advances of   
its agents, counsel, accountants and experts and (ii) to reimburse the Owner    
Trustee for all reasonable out-of pocket expenses incurred or made by the Owner 
Trustee for all services rendered by the Owner Trustee it in the Owner Trustee's
execution of the trust created under the Owner Trust Agreement and in the       
exercise and performance of any of the Owner Trustee's powers and duties under  
the Owner Trust Agreement. Under the Indenture, the Issuer (from the assets of  
the Trust Estate) shall indemnify the Indenture Trustee against any and all     
loss, liability or expense (including reasonable attorneys' fees) incurred by   
the Indenture Trustee in connection with the administration of the Trust Estate 
and the performance of the Indenture Trustee's duties under this prospectus     
supplement. The Issuer is not required, however, to reimburse any expense or    
indemnify against any loss, liability or expense incurred by the Indenture      
Trustee through the Indenture Trustee's own willful misconduct, negligence or   
bad faith.                                                                      

 THE SERVICING AGREEMENT

    The following summary describes a number of terms of the Servicing
Agreement, dated as of __________ __, ____, among the Issuer, the Indenture     
Trustee, the Master Servicer and the Servicer. The summary does not purport to  
be complete and is subject to, and qualified in its entirety by reference to,   
the provisions of the Servicing Agreement. Whenever particular sections or      
defined terms of the Servicing Agreement are referred to, those sections or     
defined terms are incorporated in this prospectus supplement by reference. The  
company will provide to a prospective or actual noteholder without charge, on   
written request, a copy (without exhibits) of the Servicing Agreement. Requests 
should be addressed to the ____________, MILA Mortgage Acceptance, Inc., 6021   
244th Street SW, Mountlake Terrace, WA 98043.                                   

ORIGINATORS AND SERVICERS                                                       

[See version 1 of the prospectus supplement]                  

[ORIGINATOR]                                                  

        The information shown in the following paragraphs has been provided by
_______________. The following table summarizes ____________'s one- to          
four-family residential mortgage loan origination and sales activity for the    
periods shown below. Sales activity may include sales of mortgage loans         
purchased by __________ from other loan originators.                            

                                                                [Download Table]


                                                          SIX MONTHS  
                YEAR ENDED DECEMBER 31                       ENDED    
                ----------------------                    ----------  
                2000     2001     2002                   JUNE 30, 2003
                ----     ----     ----                   -------------
                              (DOLLARS IN THOUSANDS)                  
                                                                      
Origination                                                           
Sales                                                                 

       The following table sets forth the delinquency and loss experience at
the dates indicated for residential (one- to four-family and multifamily) loans 
serviced by ___________ that were originated or purchased by __________:        

                                                        [Enlarge/Download Table]


                                                                                    SIX MONTHS  
                                                   AT DECEMBER 31,                     ENDED    
                                                   ---------------                     -----    
                                             2000   2001      2002                 JUNE 30, 2003
                                             ----   ----      ----                 -------------
                                                           (DOLLARS IN THOUSANDS)               
                                                                                                
Total Outstanding Principal                                                                     
Balance                                                                                         
Number of Loans                                                                                 
Delinquency                                                                                     
Period of Delinquency                                                                           
31-60 Days                                                                                      
   Principal Balance                                                                            
   Number of Loans                                                                              
Delinquency as a Percentage                                                                     
of Total Outstanding Balance                                                                    
Delinquency as a Percentage                                                                     
of Number of Loans                                                                              
61-90 Days                                                                                      
   Principal Balance                                                                            
   Number of Loans                                                                              
Delinquency as a Percentage                                                                     
of Total Outstanding Balance                                                                    
Delinquency as a Percentage                                                                     
of Number of Loans                                                                              
91 Days or More                                                                                 
   Principal Balance                                                                            
   Number of Loans                                                                              
Delinquency as a Percentage                                                                     
of Total Outstanding Balance                                                                    
Delinquency as a Percentage                                                                     
of Number of Loans                                                                              
FORECLOSURES PENDING(1)                                                                         
   Principal Balance                                                                            
   Number of Loans                                                                              
Delinquency as a Percentage of                                                                  
Total Outstanding Balance Delinquency                                                           
as a Percentage of Number of Loans NET                                                          
LOAN LOSSES for the Period(2) NET LOAN                                                          
LOSSES as a Percentage of Total Outstanding                                                     
Principal Balance                                                                               

     (1)      Includes mortgage loans which are in foreclosure but as to
                which title to the mortgaged property has not been acquired,
                at the end of the period indicated. Foreclosures pending are
included in the delinquencies shown above.  

    (2)      Net Loan Losses is calculated for loans conveyed to REMIC
             trust funds as the aggregate of the net loan loss for all
               those loans liquidated during the period indicated. The net
               loan loss for any of these loans is equal to the difference
           between (a) the principal balance plus accrued interest
                 through the date of liquidation plus all liquidation expenses
        related to that loan and (b) all amounts received in
                 connection with the liquidation of that loan. The majority of
                residential loans serviced by ________ have been conveyed to
REMIC trust funds.                          

[ORIGINATOR]                                                                    

         The information presented in the following paragraphs has been provided
by ______________. Pursuant to the related Servicing Agreement, ____________    
will serve as Servicer for the mortgage loans sold indirectly by it to the      
company. Notwithstanding the foregoing, the Master Servicer and ___________ have
advised the company that with respect to a portion of the mortgage loans        
initially to be serviced by _____________, the servicing thereof is expected to 
be transferred to the Master Servicer, whereupon the Master Servicer will act in
the capacity as "Servicer" under the applicable Servicing Agreement to the      
extent of those mortgage loans. That portion of the mortgage loans that is      
expected to be subject to that servicing transfer represents approximately      
_____% of the mortgage loans, by aggregate principal balance as of the Cut-off  
Date.                                                                           

  The table below sets forth the overall delinquency experience on
residential one-to-four-family mortgage loans for non-conforming credits which  
are currently serviced by ____________. No mortgage loan is considered          
delinquent for purposes of the table until a payment is 30 days past due on a   
contractual basis. It should be noted that ______________ commenced its         
servicing activities for these types of non- conforming mortgage loans in ____  
and that its portfolio consists of mortgage loans that were originated during   
the periods from ____ to ____ in accordance with the underwriting standards it  
had established or other underwriting guidelines that it determined were        
substantially similar. The information in the table below is not intended to    
indicate or predict the expected delinquency experience on past, current or     
future pools of mortgage loans for which ________ is the primary servicer.      

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                NON-CONFORMING MORTGAGE LOAN PORTFOLIO EXPERIENCE                                  

                                                                                       SIX MONTHS  
                                               YEAR ENDED DECEMBER 31                     ENDED    
                                               ----------------------                  ----------  
                                               2000     2001     2002                 JUNE 30, 2003
                                               ----     ----     ----                 -------------
                                                              (DOLLARS IN THOUSANDS)               
                                                                                                   
Total Principal Balance (at                                                                        
period end)                                                                                        
Average portfolio principal balance(1)                                                             
DELINQUENCY (at period end)(2)                                                                     
30-59 boys:                                                                                        
    Principal Balance                                                                              
    Percent(3) 60-89 Days:                                                                         
    Principal Balance                                                                              
    Percent (3)                                                                                    
90 Days or More:                                                                                   
    Principal balance                                                                              
    Percent (3)                                                                                    
Total Delinquencies:                                                                               
    Principal Balance                                                                              
    Percent(3)                                                                                     
FORECLOSURES                                                                                       
    Principal Balance                                                                              
    Percent (3)                                                                                    
REO (at period end)                                                                                
Net gains/(losses) on                                                                              
liquidated loans                                                                                   
Percentage of net                                                                                  
gains/(losses) on liquidated                                                                       
loans (based on average                                                                            
portfolio principal balance)                                                                       

----------                                                                      
(1)      Calculated by summing the actual outstanding principal balances at the 
         end of each month and dividing the total by the number of months in the
applicable period.                                            
(2)      Delinquency information does not include loans in foreclosure or REO.  
(3)      Percentages are expressed based upon the total outstanding principal   
balance at the end of the indicated period.                   
(4)      Annualized.                                                            

      It is unlikely that the delinquency experience of the mortgage loans
comprising the mortgage pool will correspond to the delinquency experience of   
the mortgage portfolios shown in the foregoing tables. The statistics shown     
above represent the delinquency experience for the indicated mortgage servicing 
portfolios only for the periods presented, whereas the aggregate delinquency    
experience on the mortgage loans comprising the mortgage pool will depend on the
results obtained over the life of the mortgage pool. The mortgage servicing     
portfolios shown above include mortgage loans that were originated using a      
variety of different underwriting procedures and standards which may have been  
more selective. They include mortgage loans with a variety of payment and other 
characteristics (including geographic location) which are not necessarily       
representative of the payment and other characteristics of the mortgage loans   
comprising the mortgage pool. It should be noted that if the residential real   
estate market should experience an overall decline in property values, the      
actual rates of delinquencies and foreclosures could be higher than those       
previously experienced by ______________. In addition, adverse economic         
conditions may affect the timely payment by mortgagors of scheduled payments of 
principal and interest on the mortgage loans and, accordingly, the actual rates 
of delinquencies and foreclosures with respect to the mortgage pool.            

SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES

 The Servicing Fee to be paid to each Servicer in respect of its
servicing activities for the notes will be equal to accrued interest at the     
Servicing Fee Rate of ____% per annum with respect to each mortgage loan        
serviced by it for each calendar month on the same principal balance on which   
interest on that mortgage loan accrues for that calendar month. As additional   
servicing compensation, each Servicer is entitled to retain all assumption fees 
and late payment charges in respect of mortgage loans serviced by it, to the    
extent collected from mortgagors, together with any interest or other income    
earned on funds held in the Distribution Account (to the extent not payable as  
compensation to the Indenture Trustee) and any escrow accounts in respect of    
mortgage loans serviced by it.                                                  

     When a principal prepayment in full is made on a mortgage loan, the
mortgagor is charged interest only for the period from the Due Date of the      
preceding monthly payment up to the date of that prepayment, instead of for a   
full month. When a partial principal prepayment is made on a mortgage loan, the 
mortgagor is not charged interest on the amount of that prepayment for the month
in which that prepayment is made. Each Servicer is obligated to pay Compensating
Interest from its own funds a Prepayment Interest Shortfall, but only to the    
extent of its aggregate Servicing Fee for the related Due Period. Each Servicer 
is obligated to pay various insurance premiums and ongoing expenses associated  
with the mortgage pool in respect of mortgage loans serviced by it and incurred 
by that Servicer in connection with its responsibilities under the related      
Servicing Agreement and is entitled to reimbursement therefor as provided in    
that Servicing Agreement. With respect to the mortgage loans serviced by        
_________, _________ will also be entitled to reimbursement of servicing        
advances and principal and interest advances made by it as servicer of those    
mortgage loans prior to the Cut-off Date. SEE "DESCRIPTION OF THE               
SECURITIES--RETAINED INTEREST; SERVICING COMPENSATION AND PAYMENT OF EXPENSES"  
IN THE PROSPECTUS for information regarding expenses payable by the Servicers.  

SERVICER EVENTS OF DEFAULT

       In addition to those Events of Default (as defined in the prospectus)
pertaining to the servicing of the mortgage loans and described under           
"Description of the Securities--Events of Default" in the prospectus, upon the  
occurrence of various loss triggers with respect to the mortgage loans, the     
Servicer may be removed as servicer of the mortgage loans serviced by it in     
accordance with the terms of the related Servicing Agreement. If any Servicer is
removed in connection with an Event of Default applicable to that Servicer under
the terms of the related Servicing Agreement, the Master Servicer will become   
the successor Servicer of the mortgage loans serviced by that terminated        
Servicer.                                                                       

 THE MASTER SERVICER

__________________ IS THE MASTER SERVICER UNDER THE SERVICING 
AGREEMENT. THE MASTER SERVICER IS A ____________ CORPORATION. THE MASTER        
SERVICER'S PRINCIPAL OFFICES ARE LOCATED IN _______________.                    

   The Master Servicing Fee will be equal to accrued interest at the
Master Servicing Fee Rate on the Scheduled Principal Balance of each mortgage   
loan, payable monthly.                                                          

 THE INDENTURE AND OWNER TRUST AGREEMENT

         The following summary describes some of the terms of the Indenture. The
summary does not purport to be complete and is subject to, and qualified in its 
entirety by reference to, the provisions of the Owner Trust Agreement and       
Indenture. Whenever particular defined terms of the Indenture are referred to,  
those defined terms are incorporated in this prospectus supplement by reference.
The company will provide to a prospective or actual noteholder without charge,  
on written request, a copy (without exhibits) of the Indenture and the Owner    
Trust Agreement. Requests should be addressed to the ____________, MILA Mortgage
Acceptance, Inc., 6021 244th Street SW, Mountlake Terrace, WA 98043.            

GENERAL                                                                         

        The notes will be issued pursuant to the Indenture, a form of which is
filed as an exhibit to the registration statement. A Current Report on Form 8-K 
relating to the notes containing a copy of the Indenture and the Owner Trust    
Agreement as executed will be filed by the company with the Securities and      
Exchange Commission within fifteen days of the initial issuance of the notes.   
Reference is made to the prospectus for important information in addition to    
that presented in this prospectus supplement regarding the Trust Estate, the    
terms and conditions of the Indenture and the Owner Trust Agreement and the     
notes. The notes will be transferable and exchangeable at the corporate trust   
offices of the Indenture Trustee, located in _______________.                   

ASSIGNMENT OF MORTGAGE LOANS

      On or prior to the date the notes are issued, the Seller will convey
each mortgage loan to __________, who in turn will convey each that mortgage    
loan to the company, who in turn will convey each mortgage loan to the Issuer.  

         At the time of issuance of the notes, the Issuer will pledge all of its
right, title and interest in and to the mortgage loans, including all principal 
and interest due on that mortgage loan after the Cut-off Dates, without         
recourse, to the Indenture Trustee pursuant to the Indenture as collateral for  
the notes; provided, however, that the Seller will reserve and retain all its   
right, title and interest in and to principal and interest due on that mortgage 
loan on or prior to the Cut-off Date (whether or not received on or prior to the
Cut-off Date), and to prepayments received prior to the Cut-off Date. The       
Indenture Trustee, concurrently with that assignment, will authenticate and     
deliver the notes at the direction of the Issuer in exchange for, among other   
things, the mortgage loans.                                                     

   The Indenture will require the Issuer to deliver to the Indenture
Trustee or to a custodian with respect to each mortgage loan (i) the mortgage   
note endorsed without recourse to the Indenture Trustee, (ii) the original      
mortgage with evidence of recording indicated on that mortgage and (iii) an     
assignment of the mortgage in recordable form to the Indenture Trustee. Those   
assignments of mortgage loans are required to be recorded by or on behalf of the
Seller, at the expense of the Seller, in the appropriate offices for real       
property records.                                                               

 EVENTS OF DEFAULT

       Notwithstanding, the prospectus, if an Event of Default occurs and is
continuing, the Indenture Trustee or the holders of a majority of the Voting    
Rights may declare the Note Balance of all the notes to be due and payable      
immediately. That declaration may, under various circumstances, be rescinded and
annulled by the holders of a majority of the aggregate outstanding Voting       
Rights.                                                                         

      If following an Event of Default, the notes have been declared to be
due and payable, the Indenture Trustee may, in its discretion, notwithstanding  
that acceleration, elect to maintain possession of the collateral securing the  
notes and to continue to apply payments on that collateral as if there had been 
no declaration of acceleration if that collateral continues to provide          
sufficient funds for the payment of principal of and interest on the notes as   
they would have become due if there had not been that declaration. In addition, 
the Indenture Trustee may not sell or otherwise liquidate the collateral        
securing the notes following an Event of Default, unless (a) the holders of 100%
of the then aggregate outstanding Voting Rights consent to that sale, (b) the   
proceeds of that sale or liquidation are sufficient to pay in full the principal
of and accrued interest, due and unpaid at their respective Note Accrual Rates, 
on the outstanding notes at the date of that sale or (c) the Indenture Trustee  
determines that the collateral would not be sufficient on an ongoing basis to   
make all payments on those notes as those payments would have become due if     
those notes had not been declared due and payable, and the Indenture Trustee    
obtains the consent of the holders of 66 2/3% of the then aggregate outstanding 
Voting Rights.                                                                  

      In the event that the Indenture Trustee liquidates the collateral in
connection with an Event of Default, the Indenture provides that the Indenture  
Trustee will have a prior lien on the proceeds of that liquidation for unpaid   
fees and expenses. As a result, upon the occurrence of that Event of Default,   
the amount available for payments to the noteholders would be less than would   
otherwise be the case. However, the Indenture Trustee may not institute a       
proceeding for the enforcement of its lien except in connection with a          
proceeding for the enforcement of the lien of the Indenture for the benefit of  
the noteholders after the occurrence of that Event of Default.                  

         In the event the principal of the notes is declared due and payable, as
described above, the holders of any those notes issued at a discount from par   
may be entitled to receive no more than an amount equal to the unpaid principal 
amount thereof less the amount of that discount that is unamortized.            

        No noteholder will have any right under the Indenture to institute any
proceeding with respect to that Indenture unless (a) that holder previously has 
given to the Indenture Trustee written notice of default and the continuance    
thereof, (b) the holders of notes of any class evidencing not less than 25% of  
the aggregate outstanding Note Balance constituting that class (i) have made    
written request upon the Indenture Trustee to institute that proceeding in its  
own name as Indenture Trustee under the Indenture and (ii) have offered to the  
Indenture Trustee reasonable indemnity, (c) the Indenture Trustee has neglected 
or refused to institute that proceeding for 60 days after receipt of that       
request and indemnity and (d) no direction inconsistent with that written       
request has been given to the Indenture Trustee during that 60 day period by the
holders of a majority of the Note Balance of that class. However, the Indenture 
Trustee will be under no obligation to exercise any of the trusts or powers     
vested in it by the Indenture or to institute, conduct or defend any litigation 
under that Indenture or in relation thereto at the request, order or direction  
of any of the holders of notes covered by that Indenture, unless those holders  
have offered to the Indenture Trustee reasonable security or indemnity against  
the costs, expenses and liabilities which may be incurred therein or thereby.   

 VOTING RIGHTS

     At all times, 100% of all Voting Rights will be allocated among the
holders of the Class A Notes (or, after the Class A Notes have been paid in     
full, the class of Subordinate Notes then outstanding with the lowest numerical 
class designation) in proportion to the then outstanding Note Balances of their 
respective notes.                                                               

 OPTIONAL REDEMPTION

        The circumstances under which the obligations created by the Indenture
will terminate in respect of the notes are described in "Description of the     
Securities--Termination" in the prospectus.                                     

   At its option, the majority holder of the Equity Certificates may
redeem the notes, in whole but not in part, on any Payment Date on or after the 
Payment Date on which the aggregate Note Balance is reduced to less than 20% of 
the aggregate initial Note Balance. That redemption will be paid in cash at a   
price equal to the sum of (w) 100% of the aggregate Note Balance then           
outstanding, (x) the aggregate of any Allocated Realized Loss Amounts on the    
notes remaining unpaid immediately prior to that Payment Date, (y) the aggregate
of the Interest Payment Amounts on the notes for that Payment Date and (z) the  
aggregate of any Interest Carry Forward Amounts for that Payment Date. Upon that
redemption, the remaining assets in the Trust Estate shall be released from the 
lien of the Indenture.                                                          

        In addition, with respect to the ____-___ Mortgage Loans, the majority
holder of the Equity Certificates may at its option obtain the release of that  
portion of the mortgage pool (together with any properties acquired in respect  
thereof) remaining in the Trust Estate from the lien of the Indenture, and in   
connection therewith effect a partial redemption of the notes, on any Payment   
Date on or after the Payment Date following the Due Period in which the         
aggregate principal balance of the ____-___ Mortgage Loans (and properties      
acquired in respect thereof) remaining in the Trust Estate is reduced to less   
than $_____________. The ____-___ Mortgage Loans have an aggregate principal    
balance of approximately $__________ as of the Cut-off Date. That redemption    
shall be paid in cash at a price generally equal to the sum of (x) 100% of the  
then-outstanding principal balance of that mortgage loan plus accrued interest  
on that mortgage loan at their respective mortgage rates through the last day of
the calendar month preceding the month in which that redemption occurs, (y) the 
then fair market value of that property and (z) the amount of any servicing     
advances reimbursable to the related Servicer in respect of those mortgage      
loans. For purposes of payments on the notes and Equity Certificates on the     
Payment Date of that redemption, that redemption price shall be applied by the  
Indenture Trustee as a final liquidation of each of those mortgage loans and    
properties. The redemption price relating to those properties, at their then    
fair market value, may result in a shortfall in payment to, and/or the          
allocation of Realized Losses to, one or more classes of the notes. Furthermore,
the Master Servicing Fee, the Servicing Fee and the Indenture Trustee Fee, as   
well as expenses and reimbursements permitted to be paid from the assets of the 
Trust Estate under the Indenture or the applicable Servicing Agreement, in each 
case to the extent payable or reimbursable with respect to those mortgage loans,
will be payable from the amount received in respect of that redemption price and
therefore, as provided in the Indenture, will be excluded from the Available    
Payment Amount for the Payment Date of that redemption.                         

         In no event will the trust created by the Indenture continue beyond the
expiration of 21 years from the death of the survivor of the persons named in   
the Indenture. SEE "THE AGREEMENTS--TERMINATION; RETIREMENT OF THE SECURITIES"  
IN THE PROSPECTUS.                                                              

 FEDERAL INCOME TAX CONSEQUENCES

         Upon the issuance of the notes, Thacher Proffitt & Wood LLP, counsel to
the company, will deliver its opinion generally to the effect that based on the 
application of existing law and assuming compliance with the Owner Trust        
Agreement, for federal income tax purposes, (a) the notes will be characterized 
as indebtedness to a noteholder, other than the owner of the Equity             
Certificates, and not as representing an ownership interest in the Trust Estate 
or an equity interest in the Issuer or the company and (b) the Issuer will not  
be (i) classified as an association taxable as a corporation for federal income 
tax purposes, (ii) a "publicly traded partnership" as defined in Treasury       
Regulation Section 1.7704 or (iii) a "taxable mortgage pool" within the meaning 
of Section 7701(i) of the Code. The notes will not be treated as having been    
issued with "original issue discount" (as defined in the prospectus). The       
prepayment assumption that will be used in determining the rate of amortization 
of market discount and premium, if any, for federal income tax purposes will be 
based on the assumption that the mortgage loans will prepay at a rate equal to  
__% CPR. No representation is made that the mortgage loans will prepay at that  
rate or at any other rate. SEE "FEDERAL INCOME TAX CONSEQUENCES" IN THE         
PROSPECTUS.                                                                     

The notes will not be treated as assets described in Section  
7701(a)(19)(C) of the Code or "real estate assets" under Section 856(c)(4)(A) of
the Code. In addition, interest on the notes will not be treated as "interest on
obligations secured by mortgages on real property" under Section 856(c)(3)(B) of
the Code. The notes will also not be treated as "qualified mortgages" under     
Section 860G(a)(3)(C) of the Code.                                              

   Prospective investors in the notes should SEE "FEDERAL INCOME TAX
CONSEQUENCES" AND "STATE AND OTHER TAX CONSEQUENCES" in the prospectus for a    
discussion of the application of some federal income and state and local tax    
laws to the Issuer and purchasers of the notes.                                 

METHOD OF DISTRIBUTION

  Subject to the terms and conditions provided in the Underwriting
Agreement, dated ________ __, ____, the company has agreed to sell, and the     
Underwriter has agreed to purchase the notes. The Underwriter is obligated to   
purchase all notes of the respective classes offered by this prospectus         
supplement if it purchases any. The Underwriter is an affiliate of the company. 

     The notes will be purchased from the company by the Underwriter and
will be offered by the Underwriter to the public from time to time in negotiated
transactions or otherwise at varying prices to be determined at the time of     
sale. Proceeds to the company from the sale of the notes, before deducting      
expenses payable by the company, will be approximately ___% of the aggregate    
initial Note Balance of the notes. In connection with the purchase and sale of  
the notes, the Underwriter may be deemed to have received compensation from the 
company in the form of underwriting discounts.                                  

        The offered notes are offered subject to receipt and acceptance by the
Underwriter, to prior sale and to the Underwriter's right to reject any order in
whole or in part and to withdraw, cancel or modify the offer without notice. It 
is expected that delivery of the offered notes will be made through the         
facilities of DTC on or about the Closing Date.                                 

         The Underwriting Agreement provides that the company will indemnify the
Underwriter against some civil liabilities, including liabilities under the     
Securities Act of 1933, as amended, or will contribute to payments the          
Underwriter may be required to make in respect thereof.                         

SECONDARY MARKET

      There can be no assurance that a secondary market for the notes will
develop or, if it does develop, that it will continue. The primary source of    
information available to investors concerning the notes will be the monthly     
statements discussed in the prospectus under "Description of the                
Securities--Reports to Securityholders", which will include information as to   
the outstanding principal balance of the notes and the status of the applicable 
form of credit enhancement. There can be no assurance that any additional       
information regarding the notes will be available through any other source. In  
addition, the company is not aware of any source through which price information
about the notes will be generally available on an ongoing basis. The limited    
nature of that information regarding the notes may adversely affect the         
liquidity of the notes, even if a secondary market for the notes becomes        
available.                                                                      

LEGAL OPINIONS

        Legal matters relating to the offered certificates will be passed upon
for the company by Thacher Proffitt & Wood LLP, New York, New York and for the  
Underwriter by [______________________].                                        

 RATINGS

       It is a condition of the issuance of the notes that the Class A Notes
be rated "AAA" by _____________ and "AAA" by _______________, that the Class M-1
Notes be rated at least "AA" by ____ and at least "AA" by ____, that the Class  
M-2 Notes be rated at least "A" by ____ and at least "A" by _____ and that the  
Class M-3 Notes be rated at least "BBB" by _____.                               

  The ratings of _____ and _____ assigned to the notes address the
likelihood of the receipt by noteholders of all payments to which those         
noteholders are entitled, other than payments of interest to the extent of any  
Interest Carry Forward Amounts. The rating process addresses structural and     
legal aspects associated with the notes, including the nature of the underlying 
mortgage loans. The ratings assigned to the notes do not represent any          
assessment of the likelihood that principal prepayments will be made by the     
mortgagors or the degree to which the rate of those prepayments will differ from
that originally anticipated. The ratings do not address the possibility that    
noteholders might suffer a lower than anticipated yield due to non-credit       
events.                                                                         

A security rating is not a recommendation to buy, sell or hold
securities and may be subject to revision or withdrawal at any time by the      
assigning rating organization. Each security rating should be evaluated         
independently of any other security rating. In the event that the ratings       
initially assigned to the notes are subsequently lowered for any reason, no     
person or entity is obligated to provide any additional credit support or credit
enhancement with respect to the notes.                                          

     The company has not requested that any rating agency rate the notes
other than as stated above. However, there can be no assurance as to whether any
other rating agency will rate the notes, or, if it does, what rating would be   
assigned by another rating agency. A rating on the notes by another rating      
agency, if assigned at all, may be lower than the ratings assigned to the notes 
as stated above.                                                                

LEGAL INVESTMENT

     The Class A Notes and the Class M-1 Notes will constitute "mortgage
related securities" for purposes of SMMEA for so long as they are rated not     
lower than the second highest rating category by a Rating Agency (as defined in 
the prospectus) and, as such, will be legal investments for various entities to 
the extent provided in SMMEA. SMMEA, however, provides for state limitation on  
the authority of those entities to invest in "mortgage related securities",     
provided that this restricting legislation was enacted prior to October 3, 1991.
Some states have enacted legislation which overrides the preemption provisions  
of SMMEA. The Class M-2 Notes and the Class M-3 Notes will not constitute       
"mortgage related securities" for purposes of SMMEA.                            

        The company makes no representations as to the proper characterization
of the notes for legal investment or other purposes, or as to the ability of    
particular investors to purchase the notes under applicable legal investment    
restrictions. These uncertainties may adversely affect the liquidity of the     
notes. Accordingly, all institutions whose investment activities are subject to 
legal investment laws and regulations, regulatory capital requirements or review
by regulatory authorities should consult with their legal advisors in           
determining whether and to what extent the notes constitute a legal investment  
or are subject to investment, capital or other restrictions.                    

SEE "LEGAL INVESTMENT" IN THE PROSPECTUS.                     

ERISA CONSIDERATIONS

    ERISA and the Code impose a number of requirements on Plans and on
persons who are fiduciaries with respect to those Plans. ERISA and the Code     
prohibit various transactions involving the assets of a Plan and Disqualified   
Persons and Parties in Interest who have a number of specified relationships to 
the Plan. Accordingly, prior to making an investment in the notes, investing    
Plans should determine whether the Issuer, the company, the Seller, the Trust   
Estate, the Underwriter, any other underwriter, the Owner Trustee, the Indenture
Trustee, the Master Servicer, the Servicers, any other servicer, any            
administrator, any provider of credit support, or any insurer or any of their   
affiliates is a Party in Interest or Disqualified Person with respect to that   
Plan and, if so, whether that transaction is subject to one or more statutory or
administrative exemptions. Additionally, an investment of the assets of a Plan  
in securities may cause the assets included in the Trust Estate to be deemed    
"Plan Assets" of that Plan, and any person with specified relationships to the  
Trust Estate to be deemed a Party in Interest or Disqualified Person. The DOL   
has promulgated the Plan Asset Regulations defining the term "Plan Assets" for  
purposes of applying the general fiduciary responsibility provisions of ERISA   
and the prohibited transaction provisions of ERISA and Section 4975 of the Code.
Under the Plan Asset Regulations, generally, when a Plan acquires an "equity    
interest" in another entity (such as the Trust Estate), the underlying assets of
that entity may be considered to be Plan Assets. The Plan Asset Regulations     
provide that the term "equity interest" means any interest in an entity other   
than an instrument which is treated as indebtedness under applicable local law  
and which has no "substantial equity features." Although not entirely free from 
doubt, it is believed that, as of the date hereof, the notes will be treated as 
debt obligations without significant equity features for the purposes of the    
Plan Asset Regulations. However, there is increased uncertainty regarding the   
characterization of debt instruments that do not carry an investment grade      
rating. Consequently, in the event of a withdrawal or downgrade to below        
investment grade of the rating of a class of notes, the subsequent transfer of  
such notes or any interest therein to a Plan trustee or other person acting on  
behalf of a Plan, or using Plan assets to effect such transfer, will be         
restricted. By acquiring a note, each purchaser will be deemed to represent that
either (1) it is not acquiring the note with plan assets; or (2) (A) either (x) 
none of the Issuer, the company, the Seller, the Indenture Trustee, the Owner   
Trustee, the Underwriter, the Master Servicer, any other servicer, any provider 
of credit support or any of their affiliates is a party in interest with respect
to such purchaser that is an ERISA plan or (y) PTCE 90-1, PTCE 91-38, PTCE      
84-14, PTCE 95-60, PTCE 96-23 or some other prohibited transaction exemption is 
applicable to the acquisition and holding of the note by such purchaser and (B) 
the notes are rated investment grade or better and such person believes that the
notes are properly treated as indebtedness without substantial equity features  
for purposes of the DOL Regulations, and agrees to so treat the notes.          
Alternatively, regardless of the rating of the notes, such person may provide   
the Indenture Trustee with an opinion of counsel, which opinion of counsel will 
not be at the expense of the company, the Issuer, the Seller, the Indenture     
Trustee, the Owner Trustee, the Underwriter, the Trust Estate, any provider of  
credit support, the Master Servicer or any other servicer, which opines that the
purchase, holding and transfer of such note or interest therein is permissible  
under applicable law, will not constitute or result in a non exempt prohibited  
transaction under ERISA or Section 4975 of the Code and will not subject the    
company, the Issuer, the Seller, the Indenture Trustee, the Owner Trustee, the  
Underwriter, the Trust Estate, any provider of credit support, the Master       
Servicer or any other servicer to any obligation in addition to those undertaken
in the Indenture. Because of the factual nature of some of the above-described  
provisions of ERISA, the Code and the Plan Asset Regulations, Plans or persons  
investing Plan Assets should carefully consider whether that investment might   
constitute or give rise to a prohibited transaction under ERISA or the Code. Any
Plan fiduciary which proposes to cause a Plan to acquire any of the notes should
consult with its counsel with respect to the potential consequences under ERISA 
and the Code of the Plan's acquisition and ownership of those notes.            

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GLOSSARY

       ADJUSTMENT DATE - With respect to the adjustable rate mortgage loans,
each date on which the related mortgage rate adjusts.                           

ALLOCATED REALIZED LOSS AMOUNT - With respect to any class of 
Subordinate Notes and any Payment Date, the sum of (i) any Realized Loss        
allocated to that class of Subordinate Notes on that Payment Date and (ii) any  
Allocated Realized Loss Amount for that class remaining unpaid from previous    
Payment Dates plus accrued interest on that class at the Note Accrual Rate for  
that class.                                                                     

        AVAILABLE INTEREST RATE - With respect to any Payment Date, a rate per
annum equal to the fraction, expressed as a percentage, the numerator of which  
is (i) the Current Interest Payment Amount for that Payment Date, and the       
denominator of which is (ii) the aggregate Note Balance of the notes immediately
prior to that Payment Date multiplied by the actual number of days elapsed in   
the related Interest Accrual Period and divided by 360.                         

      AVAILABLE PAYMENT AMOUNT - With respect to the notes and any Payment
Date, an amount equal to the sum, net of amounts reimbursable therefrom to the  
Master Servicer, the Servicers, the Indenture Trustee or the Owner Trustee, of  
(i) the aggregate amount of scheduled monthly payments on the mortgage loans due
on the related Due Date and received on or prior to the related Determination   
Date, after deduction of the Master Servicing Fee, the Servicing Fees and the   
Indenture Trustee Fee, (ii) various unscheduled payments in respect of the      
mortgage loans, including prepayments, insurance proceeds, liquidation proceeds 
and proceeds from repurchases of and substitutions for the mortgage loans       
occurring during the preceding calendar month and (iii) all P&I Advances with   
respect to the mortgage loans received for that Payment Date.                   

       BALLOON PAYMENT - The final payment made with respect to each Balloon
Loan.                                                                           

CEDE - Cede & Co., or its successors in interest.             

      CLASS A PRINCIPAL PAYMENT AMOUNT - With respect to the Class A Notes
and any Payment Date on or after the Stepdown Date and on which a Trigger Event 
is not in effect, an amount equal to the excess of (x) the Note Balance of the  
Class A Notes immediately prior to that Payment Date over (y) the lesser of (A) 
the product of (i) _____% and (ii) the aggregate principal balance of the       
mortgage loans as of the last day of the related Due Period and (B) the         
aggregate principal balance of the mortgage loans as of the last day of the     
related Due Period minus $_________.                                            

       CLASS M-1 PRINCIPAL PAYMENT AMOUNT - With respect to any Payment Date
on or after the Stepdown Date and on which a Trigger Event is not in effect, an 
amount equal to the excess of (x) the sum of (i) the Note Balance of the Class A
Notes (after taking into account the payment of the Class A Principal Payment   
Amount on that Payment Date) and (ii) the Note Balance of the Class M-1 Notes   
immediately prior to that Payment Date over (y) the lesser of (A) the product of
(i) _____% and (ii) the aggregate principal balance of the mortgage loans as of 
the last day of the related Due Period and (B) the aggregate principal balance  
of the mortgage loans as of the last day of the related Due Period minus        
$_________.                                                                     

       CLASS M-2 PRINCIPAL PAYMENT AMOUNT - With respect to any Payment Date
on or after the Stepdown Date and on which a Trigger Event is not in effect, an 
amount equal to the excess of (x) the sum of (i) the Note Balance of the Class A
Notes (after taking into account the payment of the Class A Principal Payment   
Amount on that Payment Date), (ii) the Note Balance of the Class M-1 Notes      
(after taking into account the payment of the Class M-1 Principal Payment Amount
on that Payment Date) and (iii) the Note Balance of the Class M-2 Notes         
immediately prior to that Payment Date over (y) the lesser of (A) the product of
(i) _____% and (ii) the aggregate principal balance of the mortgage loans as of 
the last day of the related Due Period and (B) the aggregate principal balance  
of the mortgage loans as of the last day of the related Due Period minus        
$__________.                                                                    

       CLASS M-3 PRINCIPAL PAYMENT AMOUNT - With respect to any Payment Date
on or after the Stepdown Date and on which a Trigger Event is not in effect, an 
amount equal to the excess of (x) the sum of (i) the Note Balance of the Class A
Notes (after taking into account the payment of the Class A Principal Payment   
Amount on that Payment Date), (ii) the Note Balance of the Class M-1 Notes      
(after taking into account the payment of the Class M-1 Principal Payment Amount
on that Payment Date), (iii) the Note Balance of the Class M-2 Notes (after     
taking into account the payment of the Class M-2 Principal Payment Amount on    
that date) and (iv) the Note Balance of the Class M-3 Notes immediately prior to
that Payment Date over (y) the lesser of (A) the product of (i) _____% and (ii) 
the aggregate principal balance of the mortgage loans as of the last day of the 
related Due Period and (B) the aggregate principal balance of the mortgage loans
as of the last day of the related Due Period minus                              
$----------.                                                                    

CLEARSTREAM PARTICIPANTS - The participating organizations of 
Clearstream.                                                                    

        COLLATERAL ACCOUNT - Each segregated account maintained by the related
Servicer.                                                                       

      COOPERATIVE - With respect to Euroclear, Euroclear Clearance Systems
S.C., a Belgian cooperative corporation.                                        

        CPR - With respect to the mortgage loans, the constant prepayment rate
model.                                                                          

   CREDIT ENHANCEMENT PERCENTAGE - With respect to the notes and any
Payment Date, the percentage obtained by dividing (x) the sum of the            
Overcollateralized Amount and the aggregate Note Balance of the Subordinate     
Notes by (y) the aggregate principal balance of the mortgage loans, calculated  
after taking into account payments of principal on the mortgage loans and       
payment of the Principal Payment Amount to the notes on that Payment Date.      

        CURRENT INTEREST PAYMENT AMOUNT - With respect to any Payment Date, an
amount equal to interest collections or advances on the mortgage loans during   
the related Due Period (net of the Master Servicing Fee, the Servicing Fees and 
the Indenture Trustee Fee).                                                     

CUT-OFF DATE-- _________, ___.                                

 DEBT SERVICE REDUCTION - With respect to any mortgage loan, any
reduction in the amount which a mortgagor is obligated to pay on a monthly basis
as a result of any proceeding initiated under the United States Bankruptcy Code,
other than a reduction attributable to a Deficient Valuation.                   

         DEFICIENT VALUATION - With respect to any mortgage loan, a valuation by
a court of competent jurisdiction of the related mortgaged property in an amount
less than the then outstanding indebtedness under the mortgage loan, which      
valuation results from a proceeding initiated under the United States Bankruptcy
Code.                                                                           

       DELAYED FIRST ADJUSTMENT MORTGAGE LOAN - The adjustable rate mortgage
loans for which the first Adjustment Date will occur after an initial period    
from the date of origination of that adjustable rate mortgage loan as specified 
in this prospectus supplement.                                                  

       DISQUALIFIED PERSONS - Certain specified persons as defined under the
Code.                                                                           

        DISTRIBUTION DATE - With respect to the offered notes, the 25th day of
each month, or, if that day is a not a business day, on the next succeeding     
business day, beginning in _________, ___.                                      

       DIRECTING HOLDER - The holder of a majority in Percentage Interest of
the Equity Certificates.                                                        

         DTC SERVICES - The timely payment of distributions (including principal
and income payments) to securityholders, book-entry deliveries and settlement of
trades within DTC.                                                              

     DUE DATE - With respect to each mortgage loan, the first day of the
month on which scheduled monthly payments are due.                              

        EQUITY CERTIFICATES - The certificates be issued pursuant to the Owner
Trust Agreement, representing the beneficial ownership interest in the Issuer.  

 EUROCLEAR OPERATOR - With respect to Euroclear, Euroclear Bank,
S.A./N.V..                                                                      

        EUROCLEAR PARTICIPANTS - The participating organizations of Euroclear.

         EUROPEAN DEPOSITARIES - Collectively, Citibank, N.A. and JPMorgan Chase
Bank, acting in their respective capacities as depositaries.                    

         EVENT OF DEFAULT - With respect to the notes, any one of the following:
(a) the failure of the Issuer to pay the Interest Payment Amount, the Principal 
Payment Amount or any Overcollateralization Increase Amount on any Payment Date,
in each case to the extent that funds are available on that Payment Date to make
those payments, which continues unremedied for a period of five days; (b) the   
failure by the Issuer on the Final Maturity Date to reduce the Note Balances of 
any notes then outstanding to zero; (c) a default in the observance or          
performance of any covenant or agreement of the Issuer in the Indenture and the 
continuation of that default for a period of thirty days after notice to the    
Issuer by the Indenture Trustee or by the holders of at least 25% of the Voting 
Rights of the notes; (d) any representation or warranty made by the Issuer in   
the Indenture or in any certificate or other writing delivered pursuant thereto 
having been incorrect in any material respect as of the time made, and the      
circumstance in respect of which that representation or warranty being incorrect
not having been cured within thirty days after notice thereof is given to the   
Issuer by the Indenture Trustee or by the holders of at least 25% of the Voting 
Rights of the notes; or (e) various events of bankruptcy, insolvency,           
receivership or reorganization of the Issuer.                                   

   FINAL MATURITY DATE - With respect to the notes, the Payment Date
occurring in _______ ____.                                                      

    GLOBAL SECURITIES - The globally offered MILA Mortgage Acceptance,
Inc., Mortgage-Backed Notes, Series ____-__, Class A, Class M-1, Class M-2 and  
Class M-3 Notes.                                                                

        GROSS MARGIN - With respect to each adjustable rate mortgage loan, the
fixed percentage amount described in this prospectus supplement.                

      INDENTURE - The indenture dated as of ________ __, ____, between the
Issuer and the Indenture Trustee.                                               

INDENTURE TRUSTEE - ______________.                           

INDENTURE TRUSTEE FEE - The principal compensation paid to the
Indenture Trustee in respect of its obligations under the Indenture, equal to   
(i) the Indenture Trustee Fee Rate on the Scheduled Principal Balance of each   
mortgage loan, payable monthly, and (ii) any interest or other income earned on 
funds held in the Distribution Account (to the extent not payable as            
compensation to the related Servicer) as provided in the Indenture.             

        INDENTURE TRUSTEE FEE RATE - With respect to any mortgage loan, a rate
equal to ________% per annum.                                                   

      INDIRECT PARTICIPANTS - Entities such as banks, brokers, dealers and
trust companies that clear through or maintain a custodial relationship with a  
Participant, either directly or indirectly, having indirect access to the DTC   
system.                                                                         

    INDUSTRY - Collectively, the participants and other members of the
financial community.                                                            

      INTEREST ACCRUAL PERIOD - With respect to any class of notes and any
Payment Date, the period commencing on the Payment Date of the month immediately
preceding the month in which that Payment Date occurs (or, in the case of the   
first period, commencing on the Closing Date) and ending on the day preceding   
that Payment Date.                                                              

        INTEREST CARRY FORWARD AMOUNT - With respect to any class of notes and
any Payment Date, any shortfall in payment of interest represented by the       
excess, if any, of the Interest Payment Amount that would be payable on that    
class at the applicable Note Accrual Rate over the Interest Payment Amount      
actually paid on that class at the Available Interest Rate, together with that  
shortfall in payment of interest remaining unpaid from previous Payment Dates   
plus interest accrued on such excess at the related Note Accrual Rate.          

     INTEREST DETERMINATION DATE - With respect to each Interest Accrual
Period, the second business day preceding that Interest Accrual Period.         

      INTEREST PAYMENT AMOUNT - With respect to any class of notes and any
Payment Date, an amount equal to interest accrued during the related Interest   
Accrual Period on the Note Balance of those notes immediately prior to that     
Payment Date at the then-applicable Note Interest Rate for that class.          

  ISSUER - MILA Mortgage Acceptance, Inc. Trust Series ______-___.

      LOAN APPRAISAL - With respect to the mortgage loans, an appraisal of
the related mortgaged property which the Directing Holder will provide to the   
related Servicer.                                                               

MASTER SERVICER - ______________.                             

      MASTER SERVICING FEE - The principal compensation paid to the Master
Servicer in respect of its obligations under the Servicing Agreement equal to   
accrued interest at the Master Servicing Fee Rate on the Scheduled Principal    
Balance of each mortgage loan, payable monthly.                                 

        MASTER SERVICING FEE RATE - A rate equal to (i) ____% per annum in the
case of each ____-____ Mortgage Loan and (ii) ____% per annum in the case of    
each other mortgage loan.                                                       

       MAXIMUM MORTGAGE RATE - With respect to each adjustable rate mortgage
loan, a specified maximum mortgage rate which will not be exceeded over the life
of that adjustable rate mortgage loan.                                          

       MINIMUM MORTGAGE RATE - With respect to each adjustable rate mortgage
loan, a specified minimum mortgage rate beyond which that mortgage rate will not
be reduced over the life of that adjustable rate mortgage loan.                 

    NET MONTHLY EXCESS CASHFLOW - With respect to any Payment Date, an
amount equal to the sum of (a) any Overcollateralization Reduction Amount and   
(b) the excess of (x) the Available Payment Amount for that Payment Date over   
(y) the sum for that Payment Date of the aggregate of the Interest Payment      
Amounts payable to the holders of the notes and the sum of the amounts described
in clauses (b)(i) through (iii) of the definition of Principal Payment Amount.  

   NOTE BALANCE - With respect to any class of notes and any date of
determination, an amount equal to the initial Note Balance thereof reduced by   
the aggregate of (a) all amounts allocable to principal previously distributed  
with respect to that note and (b) any reductions in the Note Balance thereof    
deemed to have occurred in connection with allocations of Realized Losses in the
manner described in this prospectus supplement.                                 

NOTE OWNER - Any person acquiring an interest in the notes.   

         NOTE ACCRUAL RATE - (i) In the case of the Class A Notes, the lesser of
(a) One-Month LIBOR plus ____%, in the case of each Payment Date through and    
including the Payment Date on which the aggregate Note Balance is reduced to    
less than __% of the aggregate initial Note Balance, or One-Month LIBOR plus    
_____%, in the case of any Payment Date thereafter and (b) the Maximum Note     
Interest Rate; (ii) in the case of the Class M-1 Notes, the lesser of (a)       
One-Month LIBOR plus ____%, in the case of each Payment Date through and        
including the Payment Date on which the aggregate Note Balance is reduced to    
less than __% of the aggregate initial Note Balance, or One-Month LIBOR plus    
_____%, in the case of any Payment Date thereafter and (b) the Maximum Note     
Interest Rate; (iii) in the case of the Class M-2 Notes, the lesser of (a)      
One-Month LIBOR plus ____%, in the case of each Payment Date through and        
including the Payment Date on which the aggregate Note Balance is reduced to    
less than __% of the aggregate initial Note Balance, or One-Month LIBOR plus    
_____%, in the case of any Payment Date thereafter and (b) the Maximum Note     
Interest Rate; and (iv) in the case of the Class M-3 Notes, the lesser of (a)   
One-Month LIBOR plus ____%, in the case of each Payment Date through and        
including the Payment Date on which the aggregate Note Balance is reduced to    
less than __% of the aggregate initial Note Balance, or One-Month LIBOR plus    
_____%, in the case of any Payment Date thereafter and (b) the Maximum Note     
Interest Rate.                                                                  

     ONE-MONTH LIBOR - As of any Interest Determination Date, the London
interbank offered rate for one-month U.S. dollar deposits which appears on      
Telerate Page 3750 as of 11:00 a.m. (London time) on that date.                 

       OVERCOLLATERALIZATION INCREASE AMOUNT - With respect to the notes and
any Payment Date, the Net Monthly Excess Cashflow actually applied as an        
accelerated payment of principal to the extent the Required Overcollateralized  
Amount exceeds the Overcollateralized Amount as of that Payment Date.           

  OVERCOLLATERALIZATION REDUCTION AMOUNT - The amount by which the
Overcollateralized Amount exceeds the Required Overcollateralized Amount.       

       OWNER TRUST AGREEMENT - The trust agreement, dated as of ________ __,
____, between the company and the Owner Trustee.                                

    PARTICIPANTS - The participating organizations for which DTC holds
securities.                                                                     

      P&I ADVANCE - With respect to the mortgage loans, an advance made by
the related Servicer, in an amount equal to the aggregate of all payments of    
principal and interest, net of the related Servicing Fee, that were due during  
the related Due Period on the mortgage loans serviced by that Servicer and that 
were delinquent on the related Determination Date, plus various amounts         
representing assumed payments not covered by any current net income on the      
mortgaged properties acquired by foreclosure or deed in lieu of foreclosure.    

         PERIODIC RATE CAP - With respect to each adjustable rate mortgage loan,
a specified periodic adjustment limitation on the related mortgage rate on any  
related Adjustment Date.                                                        

   PLAN ASSET REGULATIONS - The regulations provided under 29 C.F.R.
Section 2510.3-101.                                                             

       PREPAYMENT ASSUMPTION - The prepayment standard or model used in this
prospectus supplement which assumes a prepayment rate for the mortgage loans of 
__% CPR.                                                                        

     PREPAYMENT INTEREST SHORTFALL - With respect to the mortgage loans,
interest shortfalls attributable to full and partial prepayments by the         
mortgagors on those mortgage loans.                                             

         PRINCIPAL PAYMENT AMOUNT - With respect to any Payment Date, other than
the Final Maturity Date and the Payment Date immediately following the          
acceleration of the notes due to an Event of Default, will be the lesser of (a) 
the excess of the Available Payment Amount over the aggregate of the Interest   
Payment Amounts for the notes; and (b) THE SUM OF: (i) the principal portion of 
all scheduled monthly payments on the mortgage loans due during the related Due 
Period, whether or not received on or prior to the related Determination Date;  
(ii) the principal portion of all proceeds received during the related          
Prepayment Period in respect of the repurchase of a mortgage loan (or, in the   
case of a substitution, amounts representing a principal adjustment) as         
contemplated in the Servicing Agreement; (iii) the principal portion of all     
other unscheduled collections, including insurance proceeds, liquidation        
proceeds and all full and partial principal prepayments, received during the    
related Prepayment Period, to the extent applied as recoveries of principal on  
the mortgage loans; (iv) the principal portion of any Realized Losses incurred  
or deemed to have been incurred on any mortgage loans in the calendar month     
preceding that Payment Date to the extent covered by Net Monthly Excess Cashflow
for that Payment Date; and (v) the amount of any Overcollateralization Increase 
Amount for that Payment Date; MINUS the amount of any Overcollateralization     
Reduction Amount for that Payment Date. With respect to the Final Maturity Date 
or the Payment Date immediately following the acceleration of the notes due to  
an Event of Default, the Principal Payment Amount will equal the amount         
necessary to reduce the Note Balance of any notes outstanding to zero.          

   RECORD DATE - For each Payment Date (i) with respect to the notes
(other than any Definitive Notes), the close of business on the business day    
immediately preceding that Payment Date or (ii) with respect to the Definitive  
Notes, the close of business on the last business day of the month preceding the
month in which that Payment Date occurs.                                        

       REFERENCE BANKS - Leading banks selected by the Indenture Trustee and
engaged in transactions in Eurodollar deposits in the international Eurocurrency
market (i) with an established place of business in London, (ii) which have been
designated as such by the Indenture Trustee and (iii) not controlling,          
controlled by, or under common control with, the company or the Issuer.         

       RELEVANT DEPOSITARY - With respect to Euroclear, JPMorgan Chase Bank,
and with respect to Clearstream, Citibank, N.A.                                 

       REQUIRED OVERCOLLATERALIZED AMOUNT - As of any date of determination,
the amount of overcollateralization required to be provided by the mortgage pool
under the Indenture, which is equal to approximately ____% of the aggregate     
principal balance of the mortgage loans.                                        

       RESERVE INTEREST RATE - The rate per annum that the Indenture Trustee
determines to be either (i) the arithmetic mean (rounded upwards if necessary to
the nearest whole multiple of 0.0625%) of the one-month U.S. dollar lending     
rates which New York City banks selected by the Indenture Trustee are quoting on
the relevant Interest Determination Date to the principal London offices of     
leading banks in the London interbank market or, (ii) in the event that the     
Indenture Trustee cannot determine this arithmetic mean, the lowest one-month   
U.S. dollar lending rate which New York City banks selected by the Indenture    
Trustee are quoting on that Interest Determination Date to leading European     
banks.                                                                          

      RULES - The rules, regulations and procedures creating and affecting
DTC and its operations.                                                         

        SCHEDULED PRINCIPAL BALANCE - With respect to any mortgage loan and as
of any date of determination, an amount equal to the principal balance of that  
mortgage loan as of the Cut-off Date (after application of all scheduled        
principal payments due on or before the Cut-off Date, whether or not received), 
reduced by (x) the principal portion of all monthly payments due on or before   
the date of determination, whether or not received, (y) all amounts allocable to
unscheduled principal that were received prior to the calendar month in which   
the date of determination occurs, and (z) any Bankruptcy Loss occurring out of a
Deficient Valuation that was incurred prior to the calendar month in which the  
date of determination occurs.                                                   

      SELLER - _________________, in its capacity as mortgage loan seller.

        SERVICER - With respect to ____ ___ Mortgage Loans, _________________,
and with respect to _____ ____ Mortgage Loans, _________________.               

       SERVICING AGREEMENT - The Servicing Agreement, dated as of __________
__, ____, among the Issuer, the Indenture Trustee, the Master Servicer and the  
related Servicer.                                                               

     SERVICING FEE - The principal compensation paid to each Servicer in
respect of its servicing activities for the notes equal to accrued interest at  
the Servicing Fee Rate of ____% per annum with respect to each mortgage loan    
serviced by it for each calendar month on the same principal balance on which   
interest on that mortgage loan accrues for that calendar month.                 

         STEPDOWN DATE - The later to occur of (x) the Payment Date occurring in
_______ ____ and (y) the first Payment Date on which the Credit Enhancement     
Percentage (calculated for this purpose only after taking into account payments 
of principal on the mortgage loans, but prior to any payment of the Principal   
Payment Amount to the notes then entitled to payments of principal on that      
Payment Date) is greater than or equal to _____%.                               

      SUBORDINATE NOTES - The Class M-1 Notes, the Class M-2 Notes and the
Class M-3 Notes.                                                                

      SYSTEMS - DTC's computer applications, systems and similar items for
processing data.                                                                

      TELERATE PAGE 3750 - The display page currently so designated on the
Dow Jones Telerate Capital Markets Report (or another page as may replace that  
page on that service for the purpose of displaying comparable rates or prices). 

         TERMS AND CONDITIONS - Collectively, the Terms and Conditions Governing
Use of Euroclear and the related Operating Procedures of the Euroclear System   
and applicable Belgian law.                                                     

      TRIGGER EVENT - With respect to the notes, any Payment Date in which
the percentage obtained by dividing (x) the principal amount of mortgage loans  
delinquent 60 days or more by (y) the aggregate principal balance of the        
mortgage loans, in each case, as of the last day of the previous calendar month,
exceeds the lesser of (i) _____% of the Credit Enhancement Percentage and (ii)  
______%.                                                                        

   TRUST ESTATE - The trust estate established under the Owner Trust
Agreement, which consists primarily of the mortgage pool.                       

UNDERWRITER - _________________.                              

         UNDERWRITING AGREEMENT - The underwriting agreement, dated ________ __,
____, between the company and the Underwriter.                                  

      VALUATION - With respect to any mortgage loan, (i) in the case of an
election by the Directing Holder to delay foreclosure, an amount equal to the   
greater of the outstanding principal balance of that mortgage loan and the fair 
market value of that mortgage loan as provided in the related Loan Appraisal,   
and (ii) in the case of an election by the Directing Holder to commence         
foreclosure, an amount equal to the outstanding principal balance of that       
mortgage loan.                                                                  

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$___________ (APPROXIMATE)

MILA MORTGAGE ACCEPTANCE, INC.

 COMPANY

MORTGAGE-BACKED NOTES, SERIES ____-___

 Prospectus Supplement

Dated _______ __, ____

 [NAME OF MASTER SERVICER]
 MASTER SERVICER

 [NAME OF UNDERWRITER]
 UNDERWRITER

YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED OR INCORPORATED BY REFERENCE  
IN THIS PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS. WE HAVE NOT      
AUTHORIZED ANYONE TO PROVIDE YOU WITH DIFFERENT INFORMATION.                    

WE ARE NOT OFFERING THE NOTES OFFERED BY THIS PROSPECTUS SUPPLEMENT IN ANY STATE
WHERE THE OFFER IS NOT PERMITTED.                                               

Dealers will be required to deliver a prospectus supplement and prospectus when 
acting as underwriters of the offered notes offered by this prospectus          
supplement and with respect to their unsold allotments or subscriptions. In     
addition, all dealers selling the offered notes, whether or not participating in
this offering, may be required to deliver a prospectus supplement and prospectus
until _______ __, ____.                                                         

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 PART II

INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 14.    OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION                         

        Estimated expenses in connection with the issuance and distribution of
the securities, other than underwriting discounts and commissions, are as       
follows:                                                                        

Registration Fee ( Securities and Exchange Commission..............$         *  
Printing and Engraving Fees........................................          *  
Accounting Fees and Expenses.......................................          *  
Legal Fees and Expenses............................................          *  
Trustee Fees and Expenses..........................................          *  
Rating Agency Fees.................................................          *  
Miscellaneous Expenses.............................................$         *  
                                                                 -----------
Total..............................................................             
* To be provided by admendment.                                                 

ITEM 15.    INDEMNIFICATION OF DIRECTORS AND OFFICERS                           

    The Pooling and Servicing Agreement with respect to each series of
Certificates, and the Servicing Agreement, Indenture and Trust Agreement with   
respect to each series of Notes will provide that no director, officer, employee
or agent of the Company is liable to the Trust Fund or the Securityholders,     
except for such person's own willful misfeasance, bad faith or gross negligence 
in the performance of duties or reckless disregard of obligations and duties.   
The Pooling and Servicing Agreement with respect to each series of Certificates,
and the Servicing Agreement, Indenture and Trust Agreement with respect to each 
series of Notes will further provide that, with the exceptions stated above, a  
director, officer, employee or agent of the Company is entitled to be           
indemnified against any loss, liability or expense incurred in connection with  
legal action relating to such Pooling and Servicing Agreement or such Servicing 
Agreement, Indenture and Trust Agreement and related Securities other than such 
expenses related to particular Mortgage Loans.                                  

    Any underwriters who execute an Underwriting Agreement in the form
filed as Exhibit 1.1 to this Registration Statement will agree to indemnify the 
officers and directors of MILA Mortgage Acceptance, Inc. (the "Company" or the  
"Registrant") who signed this Registration Statement, and certain controlling   
persons of the Company, against certain liabilities which might arise under the 
Securities Act of 1933, as amended and the Securities Exchange Act of 1934, as  
amended, from certain information furnished to the Registrant by or on behalf of
such indemnifying party.                                                        

 Subsection (a) of Section 145 of the General Corporation Law of
Delaware empowers a corporation to indemnify any person who was or is a party or
is threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative    
(other than an action by or in the right of the corporation) by reason of the   
fact that he is or was a director, employee or agent of the corporation or is or
was serving at the request of the corporation as a director, officer, employee  
or agent of another corporation, partnership, joint venture, trust or other     
enterprise, against expenses (including attorneys' fees), judgments, fines and  
amounts paid in settlement actually and reasonably incurred by him in connection
with such action, suit or proceeding if he acted in good faith and in a manner  
he reasonably believed to be in or not opposed to the best interests of the     
corporation, and, with respect to any criminal action or proceeding, had no     
cause to believe his conduct was unlawful.                                      

       Subsection (b) of Section 145 empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any         
threatened, pending or completed action or suit by or in the right of the       
corporation to procure a judgment in its favor by reason of the fact that such  
person acted in any of the capacities set forth above, against expenses         
(including attorneys' fees) actually and reasonably incurred by him in          
connection with the defense or settlement of such action or suit if he acted in 
good faith and in a manner he reasonably believed to be in or not opposed to the
best interests of the corporation and except that no indemnification may be made
in respect to any claim, issue or matter as to which such person shall have been
adjudged to be liable to the corporation unless and only to the extent that the 
Court of Chancery or the court in which such action or suit was brought shall   
determine that despite the adjudication of liability such person is fairly and  
reasonably entitled to indemnity for such expenses which the court shall deem   
proper.                                                                         

      Section 145 further provides that to the extent a director, officer,
employee or agent of a corporation has been successful in the defense of any    
action, suit or proceeding referred to in subsections (a) and (b) or in the     
defense of any claim, issue or matter therein, he shall be indemnified against  
expenses (including attorneys' fees) actually and reasonably incurred by him in 
connection therewith; that indemnification or advancement of expenses provided  
for by Section 145 shall not be deemed exclusive of any other rights to which   
the indemnified party may be entitled; and empowers the corporation to purchase 
and maintain insurance on behalf of a director, officer, employee or agent of   
the corporation against any liability asserted against him or incurred by him in
any such capacity or arising out of his status as such whether or not the       
corporation would have the power to indemnify him against such liabilities under
Section 145.                                                                    

         The Restated Certificate of Incorporation and By-Laws of the Registrant
provide that, to the fullest extent and under the circumstances permitted by    
Section 145 of the General Corporation Law of the State of Delaware, the        
Registrant shall indemnify any person who was or is a party or is threatened to 
be made a party to any action, suit or proceeding of the type described above by
reason of the fact that he or she is or was a director, officer, employee or    
agent of the Registrant or is or was serving at the request of the Registrant as
a director, officer, employee or agent of another corporation, partnership,     
joint venture, trust or other enterprise.                                       

ITEM 16.    EXHIBITS                                                            

Exhibit                                                                         
Number                                                                          
1.1         -     Form of Underwriting Agreement                                
3.1         -     Certificate of Incorporation of the Company                   
3.2         -     By-Laws of the Company                                        
4.1         -     Form Pooling and Servicing Agreement for alternate forms of   
credit support                              
4.2         -     Form of Servicing Agreement for an offering of Mortgage-      
Backed Notes                                
4.3         -     Form of Trust Agreement for an offering of Mortgage-          
Backed Notes                                
4.4         -     Form of Indenture for an offering of Mortgage-Backed Notes    
5.1         -     Opinion of Thacher  Proffitt & Wood LLP  regarding the        
legality of the  Certificates  and the      
Notes issued pursuant to the Base Prospectus
8.1         -     Opinion  of  Thacher  Proffitt  & Wood LLP  regarding         
certain tax  matters  related  to the       
          Certificates and the Notes issued pursuant to the Base
Prospectus (included with Exhibit 5.1)      
23.1        -     Consent of Thacher Proffitt & Wood LLP (included as part of   
Exhibit 5.1)                                
24.1        -     Power of Attorney                                             

----------                                                                      

ITEM 17.    UNDERTAKINGS                                                        

(a)      The undersigned Registrant hereby undertakes:        

                (1)      To file, during any period in which offers or sales
  are being made, a post- effective amendment to this Registration
       Statement: (i) to include any prospectus required by Section 10(a)(3)
       of the Securities Act of 1933 (the "Securities Act"); (ii) to reflect
        in the Prospectus any facts or events arising after the effective date
  of the Registration Statement (or the most recent post-effective
         amendment thereof) which, individually or in the aggregate, represent a
     fundamental change in the information set forth in the Registration
      Statement; (iii) to include any material information with respect to
       the plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the   
        Registration Statement; provided, however, that no such post-effective
        amendment shall be required if the information which would be required
       by clauses (i) and (ii) is contained in periodic reports filed by the
      Registrant pursuant to Section 13 or Section 15(d) of the Securities
    Exchange Act of 1934 (the "Exchange Act") that are incorporated by
reference in this Registration Statement.                     

               (2)      That, for the purpose of determining any liability
       under the Securities Act, each such post-effective amendment shall be
      deemed to be a new registration statement relating to the securities
         offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.       

      (3)      To remove from registration by means of a
       post-effective amendment any of the securities being registered which
remain unsold at the termination of the offering.             

 (b)      The undersigned Registrant hereby undertakes that, for
             purposes of determining any liability under the Act, each
                filing of the Registrant's annual report pursuant to Section
      13(a) or Section 15(d) of the Exchange Act that is
                  incorporated by reference in this registration statement shall
                be deemed to be a new registration statement relating to the
        securities offered therein, and the offering of such
                  securities at that time shall be deemed to be the initial bona
fide offering thereof.                      

       (c)      Insofar as indemnification for liabilities arising under the
              Securities Act may be permitted to directors, officers and
         controlling persons of the Registrant pursuant to the
            provisions described in Item 15 above, or otherwise, the
          Registrant has been advised that in the opinion of the
              Securities and Exchange Commission such indemnification is
                against public policy as expressed in the Securities Act and
               is, therefore, unenforceable. In the event that a claim for
            indemnification against such liabilities (other than the
               payment by the Registrant of expenses incurred or paid by a
                director, officer or controlling person of the Registrant in
                the successful defense of any action, suit or proceeding) is
               asserted by such director, officer or controlling person in
        connection with the securities being registered, the
             Registrant will, unless in the opinion of its counsel the
                 matter has been settled by controlling precedent, submit to a
                  court of appropriate jurisdiction the question of whether such
                  indemnification by it is against public policy as expressed in
        the Securities Act and will be governed by the final
adjudication of such issue.                 

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SIGNATURES

 Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3, reasonably believes that the        
security rating requirement contained in Transaction Requirement B.5 of Form S-3
will be met by the time of the sale of the securities registered hereunder, and 
has duly caused this Registration Statement to be signed on its behalf by the   
undersigned, thereunto duly authorized, in the City of Mountlake Terrace, State 
of Washington, on June 24, 2005.                                                

                                            MILA Mortgage Acceptance, Inc.

                                By: /s/ Layne Sapp
                                                   -----------------------------
                                Name:   Layne Sapp
                               Title:  President

  Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed below by the following persons in the    
capacities and on the dates indicated:                                          

                                                                [Download Table]


SIGNATURE                      TITLE                              DATE         

                                                                               
/s/ Layne Sapp                 Director and President (Principal  June 24, 2005
-----------------------------  Executive Officer)                              
Layne Sapp                                                                     

/s/ William Dougherty          Director and Treasurer (Principal  June 24, 2005
-----------------------------  Financial Officer and Principal                 
William Dougherty              Accounting Officer)                             

Dates Referenced Herein   and   Documents Incorporated by Reference

				Referenced-On Page
This ‘S-3’ Filing		Date		First		Last			Other Filings
Filed on:		6/27/05		8		24			None on these Dates
		6/24/05		4		43
		6/21/05		6
		6/30/03		38		39
		11/13/00		7
		2/4/00		6		21
		8/5/97		6
		8/20/96		7
		6/14/96		6
		10/1/95		6
		2/10/92		6
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