<DOCUMENT>                                                                                                                           
<TYPE>424B5                                                                                                                          
<SEQUENCE>1                                                                                                                          
<FILENAME>v92578b5e424b5.txt                                                                                                         
<DESCRIPTION>CWMBS, INC. 2003-44 424(B)(5)                                                                                           
<TEXT>                                                                                                                               
<PAGE>                                                                                                                               
                                                                                                                                     
                                                            As filed pursuant to                                                     
                                                        Rule 424(b)(5) under the                                                     
                                                          Securities Act of 1933                                                     
                                                     Registration No. 333-103821                                                     
                                                                                                                                     
PROSPECTUS SUPPLEMENT                                                                                                                
                                                                                                                                     
(TO PROSPECTUS DATED JUNE 24, 2003)                                                                                                  
                                                                                                                                     
                                  $497,249,999                                                                                       
                                 (APPROXIMATE)                                                                                       
                                                                                                                                     
                                  CWMBS, INC.                                                                                        
                                   DEPOSITOR                                                                                         

                         [COUNTRYWIDE HOME LOANS LOGO]                                                                               
                                     SELLER                                                                                          
                                                                                                                                     
                      COUNTRYWIDE HOME LOANS SERVICING LP                                                                            
                                MASTER SERVICER                                                                                      
                                                                                                                                     
                    CHL MORTGAGE PASS-THROUGH TRUST 2003-44                                                                          
                                     ISSUER                                                                                          
                                                                                                                                     
          DISTRIBUTIONS PAYABLE MONTHLY, BEGINNING SEPTEMBER 25, 2003                                                                
                            ------------------------                                                                                 
                                                                                                                                     
The following classes of certificates are being offered pursuant to this                                                             
prospectus supplement and the accompanying prospectus:                                                                               
                                                                                                                                     
<Table>                                                                                                                              
<Caption>                                                                                                                            
------------------------------------------------------------------------------------------------------------------------------       
                        INITIAL CLASS         PASS-THROUGH                              INITIAL CLASS         PASS-THROUGH           
                     CERTIFICATE BALANCE          RATE                               CERTIFICATE BALANCE          RATE               
------------------------------------------------------------------------------------------------------------------------------       
<S>                  <C>                   <C>                  <C>                  <C>                   <C>                       
 Class A-1            $     226,849,000           5.00%         Class A-9             $       3,609,765            N/A               
------------------------------------------------------------------------------------------------------------------------------       
 Class A-2            $      20,000,000           5.00%         Class A-10            $      49,388,000           5.00%              
------------------------------------------------------------------------------------------------------------------------------       
 Class A-3            $      30,959,000           5.00%         Class A-11            $         580,238           5.00%              
------------------------------------------------------------------------------------------------------------------------------       
 Class A-4            $     100,000,000           5.00%         Class PO              $         316,250            N/A               
------------------------------------------------------------------------------------------------------------------------------       
 Class A-5            $      16,363,636           5.50%         Class A-R             $             100           5.00%              
------------------------------------------------------------------------------------------------------------------------------       
 Class A-6            $       1,636,364            N/A          Class M               $       6,500,000           5.00%              
------------------------------------------------------------------------------------------------------------------------------       
 Class A-7            $         700,000           5.00%         Class B-1             $       2,750,000           5.00%              
------------------------------------------------------------------------------------------------------------------------------       
 Class A-8            $      36,097,646           5.50%         Class B-2             $       1,500,000           5.00%              
------------------------------------------------------------------------------------------------------------------------------       
</Table>                                                                                                                             
                                                                                                                                     
<Table>                                                                                                                              
<S>                             <C>                                                                                                  
                                The Class A-6, Class A-9 and Class PO Certificates are                                               
 CONSIDER CAREFULLY THE RISK    principal only certificates.                                                                         
 FACTORS BEGINNING ON PAGE                                                                                                           
 S-7 IN THIS PROSPECTUS         The assets of the trust will consist primarily of a pool of                                          
 SUPPLEMENT AND ON PAGE 5 IN    30-year conventional fixed-rate mortgage loans secured by                                            
 THE PROSPECTUS.                first liens on one- to four-family residential properties.                                           
</Table>                                                                                                                             
                                                                                                                                     
NEITHER THE SEC NOR ANY STATE SECURITIES COMMISSION HAS APPROVED THESE                                                               
SECURITIES OR DETERMINED THAT THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IS                                                        
ACCURATE OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.                                                      
                                                                                                                                     
Citigroup Global Markets Inc. will offer the Class A Certificates, and                                                               
Countrywide Securities Corporation will offer the Class M, Class B-1 and Class                                                       
B-2 Certificates to the public at varying prices to be determined at the time of                                                     
sale. Edward D. Jones & Co., L.P., as dealer, will also offer the Class A-3                                                          
Certificates to investors at varying prices to be determined at the time of                                                          
sale. The proceeds to the depositor from the sale of these classes of                                                                
certificates are expected to be approximately $493,651,192 plus accrued                                                              
interest, before deducting expenses. The Class PO Certificates will not be                                                           
purchased by Citigroup Global Markets Inc. or Countrywide Securities                                                                 
Corporation. They will be transferred to the seller on or about August 28, 2003                                                      
as partial consideration for the sale of the mortgage loans to the depositor.                                                        

See "Method of Distribution."                                                                                                        
                                                                                                                                     
CITIGROUP                                                                                                                            
                         COUNTRYWIDE SECURITIES CORPORATION                                                                          
                                              EDWARD D. JONES & CO., L.P.                                                            
August 22, 2003                                                                                                                      
<PAGE>                                                                                                                               
                                                                                                                                     
                                TABLE OF CONTENTS                                                                                    
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
PROSPECTUS SUPPLEMENT                                  PAGE                                                                          
---------------------                                  ----                                                                          
<S>                                                    <C>                                                                           
Summary..........................................       S-3                                                                          
Risk Factors.....................................       S-7                                                                          
The Mortgage Pool................................      S-13                                                                          
Servicing of Mortgage Loans......................      S-21                                                                          
Description of the Certificates..................      S-25                                                                          
Yield, Prepayment and Maturity                                                                                                       
  Considerations.................................      S-44                                                                          
Credit Enhancement...............................      S-55                                                                          
Subrogation of Insurer...........................      S-60                                                                          
Use of Proceeds..................................      S-60                                                                          
Material Federal Income Tax Consequences.........      S-61                                                                          
Other Taxes......................................      S-62                                                                          
ERISA Considerations.............................      S-62                                                                          
Method of Distribution...........................      S-64                                                                          
Legal Matters....................................      S-65                                                                          
Experts..........................................      S-65                                                                          
Ratings..........................................      S-65                                                                          
</TABLE>                                                                                                                             
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
PROSPECTUS                                             PAGE                                                                          
----------                                             ----                                                                          
<S>                                                    <C>                                                                           
Important Notice About Information in                                                                                                
    This Prospectus and Each Accompanying                                                                                            
    Prospectus Supplement.........................        4                                                                          
Risk Factors......................................        5                                                                          
The Trust Fund....................................       14                                                                          
Use of Proceeds...................................       27                                                                          
The Depositor ....................................       27                                                                          
Mortgage Loan Program.............................       27                                                                          
Description of the Certificates...................       30                                                                          
Credit Enhancement................................       46                                                                          
Yield and Prepayment Considerations...............       51                                                                          
The Pooling and Servicing Agreement...............       53                                                                          
Certain Legal Aspects of the Mortgage Loans.......       69                                                                          
Material Federal Income Tax Consequences..........       77                                                                          
Other Tax Considerations..........................      104                                                                          
ERISA Considerations..............................      104                                                                          
Legal Investment..................................      107                                                                          
Method of Distribution............................      109                                                                          
Legal Matters.....................................      109                                                                          
Financial Information.............................      109                                                                          
Rating............................................      110                                                                          
Index to Defined Terms............................      111                                                                          
</TABLE>                                                                                                                             
                                                                                                                                     
                                       S-2                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                                     SUMMARY                                                                                         
                                                                                                                                     
-    THIS SUMMARY HIGHLIGHTS SELECTED INFORMATION FROM THIS DOCUMENT AND DOES                                                        
     NOT CONTAIN ALL OF THE INFORMATION THAT YOU NEED TO CONSIDER IN MAKING YOUR                                                     
     INVESTMENT DECISION. TO UNDERSTAND ALL OF THE TERMS OF AN OFFERING OF THE                                                       
     CERTIFICATES, READ CAREFULLY THIS ENTIRE DOCUMENT AND THE ACCOMPANYING                                                          
     PROSPECTUS.                                                                                                                     
                                                                                                                                     
OFFERED CERTIFICATES                                                                                                                 
                                                                                                                                     
CHL Mortgage Pass-Through Trust 2003-44 will issue nineteen classes of                                                               
certificates, sixteen of which are being offered by this prospectus supplement                                                       
and the accompanying prospectus. The assets of the trust that will support both                                                      
the offered certificates and other classes of certificates will consist, on the                                                      
closing date, of a pool of mortgage loans with an aggregate stated principal                                                         
balance of not less than $375,689,000 as of August 1, 2003 and certain other                                                         
property and assets described in this prospectus supplement. The mortgage loans                                                      
will consist primarily of 30-year conventional fixed-rate mortgage loans secured                                                     
by first liens on one- to four-family residential properties.                                                                        
                                                                                                                                     
The following chart lists certain characteristics of the classes of the offered                                                      
certificates. The classes of certificates listed below will not be offered                                                           
unless they are assigned the following ratings by Fitch Ratings ("Fitch") and by                                                     
Moody's Investors Service, Inc. ("Moody's"):                                                                                         
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                  FITCH    MOODY'S                                                                                                   
  CLASS          RATINGS   RATINGS            TYPE                                                                                   
----------       -------   -------   -----------------------                                                                         
<S>              <C>       <C>       <C>                                                                                             
Class A-1          AAA       Aaa     Senior                                                                                          
Class A-2          AAA       Aaa     Senior/Super Senior                                                                             
Class A-3          AAA       Aaa     Senior                                                                                          
Class A-4          AAA       Aaa     Senior                                                                                          
Class A-5          AAA       Aaa     Senior                                                                                          
Class A-6          AAA       Aaa     Senior/Principal Only                                                                           
Class A-7          AAA       Aa1     Senior/Support                                                                                  
Class A-8          AAA       Aaa     Senior                                                                                          
Class A-9          AAA       Aaa     Senior/Principal Only                                                                           
Class A-10         AAA       Aaa     Senior/NAS/Super Senior                                                                         
Class A-11         AAA       Aa2     Senior/NAS/Support                                                                              
Class PO           AAA       Aaa     Senior/Principal Only                                                                           
Class A-R          AAA       Aaa     Senior/Residual                                                                                 
Class M            AA         *      Subordinate                                                                                     
Class B-1           A         *      Subordinate                                                                                     
Class B-2          BBB        *      Subordinate                                                                                     
</TABLE>                                                                                                                             
                                                                                                                                     
----------------                                                                                                                     
* Moody's was not asked to rate these certificates.                                                                                  
                                                                                                                                     
A rating is not a recommendation to buy, sell or hold securities. These ratings                                                      
may be lowered or withdrawn at any time by either of the rating agencies.                                                            
                                                                                                                                     
See "Ratings" in this prospectus supplement.                                                                                         
                                                                                                                                     
See "Description of the Certificates -- General" and "--Book-Entry Certificates"                                                     
in this prospectus supplement and "The Mortgage Pool" in this prospectus                                                             
supplement, and "The Trust Fund -- The Mortgage Loans -- General" in the                                                             
prospectus.                                                                                                                          
                                                                                                                                     
CUT-OFF DATE                                                                                                                         
                                                                                                                                     
For any mortgage loan included in the mortgage pool on the closing date, the                                                         
later of August 1, 2003 and the date of origination for that mortgage loan                                                           
(either of these dates is sometimes referred to in this prospectus supplement as                                                     
the initial cut-off date). For any mortgage loan conveyed to the trust fund                                                          
after the closing date, the later of the origination date for that mortgage loan                                                     
and the first day of the month of the conveyance to the trust fund.                                                                  
                                                                                                                                     
CLOSING DATE                                                                                                                         
                                                                                                                                     
On or about August 28, 2003.                                                                                                         
                                                                                                                                     
DEPOSITOR                                                                                                                            
                                                                                                                                     
CWMBS, Inc. is a limited purpose finance subsidiary of Countrywide Financial                                                         
Corporation (formerly known as Countrywide Credit Industries, Inc.). Its address                                                     
is 4500 Park Granada, Calabasas, California 91302, and its telephone number is                                                       
(818) 225-3000.                                                                                                                      
                                                                                                                                     
SELLER                                                                                                                               
                                                                                                                                     
Countrywide Home Loans, Inc.                                                                                                         
                                                                                                                                     
MASTER SERVICER                                                                                                                      
                                                                                                                                     
Countrywide Home Loans Servicing LP.                                                                                                 
                                                                                                                                     
TRUSTEE                                                                                                                              
                                                                                                                                     
The Bank of New York.                                                                                                                
                                                                                                                                     
DISTRIBUTION DATES                                                                                                                   
                                                                                                                                     
We will make distributions on the 25th day of each month. If the 25th day of a                                                       
month is not a business                                                                                                              
                                                                                                                                     
                                      S-3                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
day, then we will make distributions on the next business day. The first                                                             
distribution is scheduled for September 25, 2003.                                                                                    
                                                                                                                                     
INTEREST PAYMENTS                                                                                                                    
                                                                                                                                     
Interest will accrue at the rate specified on the cover page hereof on each                                                          
interest-bearing class of certificates on the basis of a 360-day year divided                                                        
into twelve 30-day months.                                                                                                           
                                                                                                                                     
The interest accrual period for the interest-bearing classes of certificates for                                                     
any distribution date will be the calendar month before the distribution date.                                                       
                                                                                                                                     
See "Description of the Certificates -- Interest" in this prospectus supplement.                                                     
                                                                                                                                     
PRINCIPAL PAYMENTS                                                                                                                   
                                                                                                                                     
Principal will be paid on each class of certificates entitled to receive                                                             
principal payments on each distribution date as described in this prospectus                                                         
supplement beginning at page S-30.                                                                                                   
                                                                                                                                     
See "Description of the Certificates -- Principal" in this prospectus                                                                
supplement.                                                                                                                          
                                                                                                                                     
The Class A-3 Certificates are subject to special rules and procedures regarding                                                     
the distribution of principal to the holders of such class of certificates.                                                          
                                                                                                                                     
See "Description of the Certificates -- Principal" and " -- Distributions in                                                         
Reduction of the Class A-3 Certificates" in this prospectus supplement.                                                              
                                                                                                                                     
OPTIONAL TERMINATION                                                                                                                 
                                                                                                                                     
The master servicer may, subject to certain limitations specified in the pooling                                                     
and servicing agreement, purchase all of the remaining assets of the trust fund                                                      
after the aggregate stated principal balance of the mortgage loans and real                                                          
estate owned by the trust fund is less than or equal to 10% of the sum of the                                                        
aggregate stated principal balance of the closing date mortgage loans as of the                                                      
initial cut-off date plus any amount deposited in the supplemental loan account                                                      
on the closing date.                                                                                                                 
                                                                                                                                     
See "Description of the Certificates -- Optional Termination" in this prospectus                                                     
supplement.                                                                                                                          
                                                                                                                                     
SUPPLEMENTAL LOAN AND CAPITALIZED INTEREST ACCOUNTS                                                                                  
                                                                                                                                     
If the aggregate stated principal balance of the mortgage loans transferred to                                                       
the trust fund on the closing date (these mortgage loans are referred to in this                                                     
prospectus supplement as the closing date mortgage loans) is less than                                                               
$500,000,000, an amount equal to the difference between that amount and the                                                          
aggregate stated principal balance of the closing date mortgage loans will be                                                        
deposited in a supplemental loan account to be used through September 30, 2003                                                       
to purchase supplemental mortgage loans. Any amounts not used for that purpose                                                       
will be paid to holders of the senior certificates as a prepayment of principal                                                      
no later than the October 2003 distribution date.                                                                                    
                                                                                                                                     
Because some of the mortgage loans may not be acquired by the trust fund until                                                       
after the closing date, there may not be sufficient interest collections from                                                        
mortgage loans to pay all the interest due on the certificates on the first and                                                      
possibly the second distribution dates. If a supplemental loan account is                                                            
funded, a capitalized interest account will be established and funded on the                                                         
closing date to cover those shortfalls.                                                                                              
                                                                                                                                     
See "The Mortgage Pool -- Conveyance of Supplemental Mortgage Loans" in this                                                         
prospectus supplement.                                                                                                               
                                                                                                                                     
COLLECTION ACCOUNT; PRIORITY OF DISTRIBUTIONS                                                                                        
                                                                                                                                     
On each distribution date, amounts available in the trust fund to make                                                               
distributions on the classes of certificates will be applied in the following                                                        
order of priority:                                                                                                                   
                                                                                                                                     
(1)  to interest on the interest-bearing classes of senior certificates;                                                             
                                                                                                                                     
(2)  to principal of the classes of senior certificates in the manner, order and                                                     
     priority described under "Description of the Certificates -- Principal" in                                                      
     this prospectus supplement;                                                                                                     
                                                                                                                                     
(3)  to any deferred amounts payable on the Class PO Certificates, as described                                                      
     under "Description of the Certificates -- Principal" in this prospectus                                                         
     supplement; and                                                                                                                 
                                                                                                                                     
(4)  to interest on and then principal of each class of subordinated                                                                 
     certificates, in the order of their numerical class designations, beginning                                                     
     with the                                                                                                                        
                                                                                                                                     
                                      S-4                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
     Class M Certificates, as described under "Description of the Certificates                                                       
     -- Interest" and " -- Principal" in this prospectus supplement.                                                                 
                                                                                                                                     
ADVANCES                                                                                                                             
                                                                                                                                     
The master servicer will make cash advances with respect to delinquent payments                                                      
of principal and interest on the mortgage loans to the extent the master                                                             
servicer reasonably believes that the cash advances can be repaid from future                                                        
payments on the mortgage loans. These cash advances are only intended to                                                             
maintain a regular flow of scheduled interest and principal payments on the                                                          
certificates and are not intended to guarantee or insure against losses.                                                             
                                                                                                                                     
See "Servicing of Mortgage Loans -- Advances" in this prospectus supplement.                                                         
                                                                                                                                     
CREDIT ENHANCEMENT                                                                                                                   
                                                                                                                                     
The issuance of senior certificates and subordinated certificates by the trust                                                       
is designed to increase the likelihood that senior certificateholders will                                                           
receive regular payments of interest and principal.                                                                                  
                                                                                                                                     
FINANCIAL GUARANTY INSURANCE POLICY                                                                                                  
                                                                                                                                     
The Class A-3 Certificates have the benefit of a financial guaranty insurance                                                        
policy (referred to in this prospectus supplement as the Class A-3 Policy),                                                          
pursuant to which MBIA Insurance Corporation will unconditionally and                                                                
irrevocably guarantee certain payments on the Class A-3 Certificates on each                                                         
distribution date.                                                                                                                   
                                                                                                                                     
See "Credit Enhancement -- The Financial Guaranty Insurance Policy" in this                                                          
prospectus supplement.                                                                                                               
                                                                                                                                     
SUBORDINATION                                                                                                                        
                                                                                                                                     
The senior certificates will have a payment priority over the subordinated                                                           
certificates. Within the classes of subordinated certificates offered by this                                                        
prospectus supplement, the Class M Certificates will have payment priority over                                                      
the Class B-1 and Class B-2 Certificates, and the Class B-1 Certificates will                                                        
have a payment priority over the Class B-2 Certificates. The Class B-3, Class                                                        
B-4 and Class B-5 Certificates, which are not being offered to the public, will                                                      
also be subordinated to all of the other certificates, in that order, with the                                                       
Class B-5 Certificates having the lowest priority of payment.                                                                        
                                                                                                                                     
Subordination is designed to provide the holders of certificates with a higher                                                       
payment priority with protection against most losses realized when the remaining                                                     
unpaid principal balance on a mortgage loan exceeds the amount of proceeds                                                           
recovered upon the liquidation of that mortgage loan. In general, this loss                                                          
protection is accomplished by allocating the realized losses among the                                                               
subordinated certificates, beginning with the subordinated certificates with the                                                     
lowest payment priority, before realized losses are allocated to the senior                                                          
certificates, except that any realized losses that would otherwise be allocated                                                      
to the Class A-2 and Class A-10 Certificates will instead be allocated to the                                                        
Class A-7 and Class A-11 Certificates, respectively. Any realized losses that                                                        
would otherwise be allocated to the Class A-3 Certificates will be covered by                                                        
the financial guaranty insurance policy. However, some losses such as special                                                        
hazard losses, bankruptcy losses, and fraud losses in excess of the amounts set                                                      
forth in this prospectus supplement, are, in general, allocated proportionately                                                      
to each class of certificates instead of first being allocated to the                                                                
subordinated certificates. Unlike realized losses, any excess losses will be                                                         
allocated proportionately among all classes of certificates, including the Class                                                     
A-2 and Class A-10 Certificates without any reallocation of excess losses on any                                                     
mortgage loans to the Class A-7 and Class A-11 Certificates, respectively. Any                                                       
excess losses that would otherwise be allocated to the Class A-3 Certificates                                                        
will be covered by the financial guaranty insurance policy.                                                                          
                                                                                                                                     
See "Description of the Certificates -- Allocation of Losses" in this prospectus                                                     
supplement and "Credit Enhancement -- Subordination" in this prospectus                                                              
supplement and in the prospectus.                                                                                                    
                                                                                                                                     
TAX STATUS                                                                                                                           
                                                                                                                                     
For federal income tax purposes, the trust fund (exclusive of the supplemental                                                       
loan account, the capitalized interest account, the rounding account and the                                                         
reserve fund) will elect to be treated as a real estate mortgage investment                                                          
conduit. The classes of certificates that are designated as the regular                                                              
certificates will constitute regular interests in the REMIC. The Class A-R                                                           
Certificates will represent the sole class of residual interest in the REMIC.                                                        
                                                                                                                                     
See "Material Federal Income Tax Consequences" in this prospectus supplement and                                                     
in the prospectus.                                                                                                                   
                                                                                                                                     
                                      S-5                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
ERISA CONSIDERATIONS                                                                                                                 
                                                                                                                                     
The offered certificates (other than the Class PO and Class A-R Certificates)                                                        
may be purchased by a pension or other employee benefit plan subject to the                                                          
Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of                                                      
the Internal Revenue Code of 1986, as amended, so long as certain conditions are                                                     
met.                                                                                                                                 
                                                                                                                                     
See "ERISA Considerations" in this prospectus supplement and in the prospectus.                                                      
                                                                                                                                     
LEGAL INVESTMENT                                                                                                                     
                                                                                                                                     
The senior certificates and the Class M Certificates will be mortgage related                                                        
securities for purposes of the Secondary Mortgage Market Enhancement Act of 1984                                                     
as long as they are rated in one of the two highest rating categories by at                                                          
least one nationally recognized statistical rating organization. The Class B-1                                                       
and Class B-2 Certificates will not be rated in one of the two highest rating                                                        
categories by a nationally recognized statistical rating organization, and                                                           
therefore, will not be mortgage related securities for purposes of that Act.                                                         
                                                                                                                                     
See "Legal Investment" in the prospectus.                                                                                            
                                                                                                                                     
                                       S-6                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                                  RISK FACTORS                                                                                       
                                                                                                                                     
THE FOLLOWING INFORMATION, WHICH YOU SHOULD CAREFULLY CONSIDER, IDENTIFIES                                                           
SIGNIFICANT SOURCES OF RISK ASSOCIATED WITH AN INVESTMENT IN THE CERTIFICATES.                                                       
YOU SHOULD ALSO CAREFULLY CONSIDER THE INFORMATION UNDER "RISK FACTORS"                                                              
BEGINNING ON PAGE 5 IN THE PROSPECTUS.                                                                                               
                                                                                                                                     
YOUR YIELD WILL BE AFFECTED   Borrowers may, at their option, prepay their                                                           
BY PREPAYMENTS                mortgage loans in whole or in part at any time. We                                                     
                              cannot predict the rate at which borrowers will                                                        
                              repay their mortgage loans. A prepayment of a                                                          
                              mortgage loan, however, will usually result in a                                                       
                              prepayment on the certificates.                                                                        
                                                                                                                                     
                              The rate and timing of prepayment of the mortgage                                                      
                              loans will affect the yields to maturity and                                                           
                              weighted average lives of the certificates. Any                                                        
                              reinvestment risks from faster or slower                                                               
                              prepayments of mortgage loans will be borne                                                            
                              entirely by the holders of the certificates.                                                           
                                                                                                                                     
                              -   If you purchase principal only certificates or                                                     
                                  you purchase your certificates at a discount                                                       
                                  and principal is repaid slower than you                                                            
                                  anticipate, then your yield may be lower than                                                      
                                  you anticipate.                                                                                    
                                                                                                                                     
                              -   If you purchase your certificates at a premium                                                     
                                  and principal is repaid faster than you                                                            
                                  anticipate, then your yield may be lower than                                                      
                                  you anticipate.                                                                                    
                                                                                                                                     
                              -   Approximately 0.58% of the initial mortgage                                                        
                                  loans by aggregate stated principal balance as                                                     
                                  of the initial cut-off date require (and                                                           
                                  certain of the other mortgage loans may                                                            
                                  require) the mortgagor to pay a penalty if the                                                     
                                  mortgagor prepays the mortgage loan during                                                         
                                  periods ranging from one year to five years                                                        
                                  after the mortgage loan was originated. A                                                          
                                  prepayment penalty may discourage a mortgagor                                                      
                                  from prepaying the mortgage loan during the                                                        
                                  applicable period. Prepayment penalties will                                                       
                                  not be available for distribution to the                                                           
                                  certificateholders.                                                                                
                                                                                                                                     
                              -   In addition, the yields to maturity and                                                            
                                  weighted average lives of the certificates                                                         
                                  will be affected by any prepayment resulting                                                       
                                  from the distribution of amounts (if any) on                                                       
                                  deposit in the supplemental loan account.                                                          
                                                                                                                                     
                              -   The Class PO Certificates will likely receive                                                      
                                  a prepayment of principal on either the first                                                      
                                  or second distribution date.                                                                       
                                                                                                                                     
                              See "Yield, Prepayment and Maturity                                                                    
                              Considerations" in this prospectus supplement for                                                      
                              a description of factors that may influence the                                                        
                              rate and timing of prepayments on the mortgage                                                         
                              loans.                                                                                                 
                                                                                                                                     
YOUR YIELD WILL BE AFFECTED   The timing of principal payments on the                                                                
BY HOW DISTRIBUTIONS ARE      certificates will be affected by a number of                                                           
ALLOCATED TO THE              factors, including:                                                                                    
CERTIFICATES                                                                                                                         
                                                                                                                                     
                              -   the extent of prepayments on the mortgage                                                          
                                  loans,                                                                                             
                                                                                                                                     
                                      S-7                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                              -   how payments of principal are allocated among                                                      
                                  the classes of certificates as specified on                                                        
                                  page S-30,                                                                                         
                                                                                                                                     
                              -   whether the master servicer exercises its                                                          
                                  right, in its sole discretion, to terminate                                                        
                                  the trust fund,                                                                                    
                                                                                                                                     
                              -   the rate and timing of payment defaults and                                                        
                                  losses on the mortgage loans,                                                                      
                                                                                                                                     
                              -   repurchases of mortgage loans for material                                                         
                                  breaches of representations and warranties,                                                        
                                  and                                                                                                
                                                                                                                                     
                              -   if funds are required to be deposited in the                                                       
                                  supplemental loan account on the closing date,                                                     
                                  by the availability of supplemental mortgage                                                       
                                  loans.                                                                                             
                                                                                                                                     
                              Since distributions on the certificates are                                                            
                              dependent upon the payments on the mortgage loans,                                                     
                              we cannot guarantee the amount of any particular                                                       
                              payment or the amount of time that will elapse                                                         
                              before the trust fund is terminated.                                                                   
                                                                                                                                     
                              See "Description of the Certificates --                                                                
                              Principal," and "-- Optional Termination" in this                                                      
                              prospectus supplement for a description of the                                                         
                              manner in which principal will be paid to the                                                          
                              certificates. See "The Mortgage Pool -- Assignment                                                     
                              of the Mortgage Loans" in this prospectus                                                              
                              supplement for more information regarding the                                                          
                              repurchase or substitution of mortgage loans.                                                          
                                                                                                                                     
CREDIT ENHANCEMENT MAY NOT    Except for the Class A-3 Certificates, the                                                             
BE SUFFICIENT TO PROTECT      certificates are not insured by any financial                                                          
SENIOR CERTIFICATES FROM      guaranty insurance policy. The subordination                                                           
LOSSES                        features are intended to enhance the likelihood                                                        
                              that senior certificateholders will receive                                                            
                              regular payments of interest and principal.                                                            
                                                                                                                                     
                              SUBORDINATION. Credit enhancement will be provided                                                     
                              for the certificates, first, by the right of the                                                       
                              holders of certificates to receive payments of                                                         
                              principal before the classes subordinated to them                                                      
                              and, second, by the allocation of realized losses,                                                     
                              other than excess losses, to subordinated classes                                                      
                              in the reverse order of their priority of payment.                                                     
                              This form of credit enhancement uses collections                                                       
                              on the mortgage loans otherwise payable to holders                                                     
                              of subordinated classes to pay amounts due on more                                                     
                              senior classes. Collections otherwise payable to                                                       
                              subordinated classes comprise the sole source of                                                       
                              funds from which this type of credit enhancement                                                       
                              is provided. Except as described below, realized                                                       
                              losses are allocated to the subordinated                                                               
                              certificates in the reverse order of their                                                             
                              priority of payment, beginning with the                                                                
                              subordinated certificates then outstanding with                                                        
                              the lowest payment priority, until the principal                                                       
                              amount of each class of subordinated certificates                                                      
                              has been reduced to zero. Accordingly, if the                                                          
                              aggregate principal balance of each subordinated                                                       
                              class were to be reduced to zero, delinquencies                                                        
                              and defaults on the mortgage loans would reduce                                                        
                              the amount of funds available for monthly                                                              
                              distributions to holders of the senior                                                                 
                              certificates. However, any realized losses that                                                        
                              would otherwise be allocated to the Class A-2 and                                                      
                              Class A-10 Certificates will instead be allocated                                                      
                              to the Class A-7 and Class A-11 Certificates,                                                          
                              respectively. Furthermore, the subordinated                                                            
                              classes will                                                                                           
                                                                                                                                     
                                      S-8                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                              provide only limited protection against some                                                           
                              categories of losses such as special hazard                                                            
                              losses, bankruptcy losses and fraud losses in                                                          
                              excess of the amounts specified in this prospectus                                                     
                              supplement. Any losses in excess of those amounts                                                      
                              will be allocated proportionately to each class of                                                     
                              certificates, even if the principal balance of                                                         
                              each subordinated class has not been reduced to                                                        
                              zero. Unlike realized losses, any excess losses                                                        
                              will be allocated proportionately among all                                                            
                              classes of certificates, including the Class A-2                                                       
                              and Class A-10 Certificates, without any                                                               
                              reallocation of excess losses to the Class A-7 and                                                     
                              Class A-11 Certificates, respectively. Among the                                                       
                              subordinated certificates, the Class M                                                                 
                              Certificates are the least subordinated, that is,                                                      
                              they have the highest payment priority. The                                                            
                              payment priority for the Class B-1, Class B-2,                                                         
                              Class B-3, Class B-4 and Class B-5 Certificates,                                                       
                              is in numerical order.                                                                                 
                                                                                                                                     
                              Any realized losses, including excess losses,                                                          
                              allocable to the Class A-3 Certificates will be                                                        
                              covered by the financial guaranty insurance                                                            
                              policy.                                                                                                
                                                                                                                                     
                              See "Description of the Certificates -- Allocation                                                     
                              of Losses" in this prospectus supplement, and                                                          
                              "Credit Enhancement -- Subordination" in the                                                           
                              prospectus and this prospectus supplement.                                                             
                                                                                                                                     
CERTAIN INTEREST SHORTFALLS   When a borrower makes a full or partial prepayment                                                     
WILL BE ALLOCATED TO THE      on a mortgage loan, the amount of interest which                                                       
CERTIFICATES                  the borrower is required to pay may be less than                                                       
                              the amount of interest certificateholders would                                                        
                              otherwise be entitled to receive with respect to                                                       
                              the mortgage loan. The master servicer is required                                                     
                              to reduce the basic master servicing fee (but not                                                      
                              the excess master servicing fee) to offset this                                                        
                              shortfall, but the reduction for any distribution                                                      
                              date is limited to an amount equal to the product                                                      
                              of one-twelfth of 0.125% and the aggregate stated                                                      
                              principal balance of the mortgage loans. If the                                                        
                              aggregate amount of interest shortfalls resulting                                                      
                              from prepayments on the mortgage loans exceeds the                                                     
                              amount of the reduction in the basic master                                                            
                              servicing fee, the interest entitlement for each                                                       
                              class of certificates will be reduced                                                                  
                              proportionately by the amount of this excess. As a                                                     
                              result, the proportion of any of these shortfalls                                                      
                              allocated to the certificates will be greater than                                                     
                              in those Countrywide transactions in which excess                                                      
                              interest is certificated.                                                                              
                                                                                                                                     
                              In addition, your certificates may be subject to                                                       
                              certain shortfalls in interest collections arising                                                     
                              from the application of the Soldiers' and Sailors'                                                     
                              Civil Relief Act of 1940, as amended (referred to                                                      
                              in this prospectus supplement as the Relief Act).                                                      
                              The Relief Act provides relief to borrowers who                                                        
                              enter active military service and to borrowers in                                                      
                              reserve status who are called to active duty after                                                     
                              the origination of their mortgage loan. The Relief                                                     
                              Act provides generally that these borrowers may                                                        
                              not be charged interest on a mortgage loan in                                                          
                              excess of 6% per annum during the period of the                                                        
                              borrower's active duty. These shortfalls are not                                                       
                              required to be paid by the borrower at any future                                                      
                              time, will not be offset by a reduction to the                                                         
                              basic master servicing fee or, unlike in those                                                         
                              Countrywide transactions in which excess interest                                                      
                              is certificated, to the excess master servicing                                                        
                              fee, and will reduce accrued interest on each                                                          
                              class of certificates on a pro rata basis. In                                                          
                              addition, the Relief Act imposes certain                                                               
                              limitations that would impair the master                                                               
                              servicer's ability to foreclose on an affected                                                         
                                                                                                                                     
                                      S-9                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                              mortgage loan during the borrower's period of                                                          
                              active service and, under some circumstances,                                                          
                              during an additional period thereafter.                                                                
                                                                                                                                     
                              Investors in the Class A-3 Certificates should be                                                      
                              aware that the Class A-3 Policy will not cover                                                         
                              interest shortfalls attributable to prepayments on                                                     
                              the mortgage loans or interest shortfalls related                                                      
                              to Relief Act reductions. Any reduction in the                                                         
                              interest entitlement for the Class A-3                                                                 
                              Certificates as a result of prepayment interest                                                        
                              shortfalls or Relief Act reductions will be                                                            
                              covered only to the extent of amounts on deposit                                                       
                              in the reserve fund.                                                                                   
                                                                                                                                     
POSSIBLE PREPAYMENT DUE TO    The ability of the trust fund to acquire                                                               
INABILITY TO ACQUIRE          supplemental mortgage loans depends on the ability                                                     
SUPPLEMENTAL MORTGAGE LOANS   of the seller to originate or acquire                                                                  
                              mortgage loans during the period ending no later                                                       
                              than September 30, 2003 that meet the eligibility                                                      
                              criteria for supplemental mortgage loans described                                                     
                              in this prospectus supplement. The ability of the                                                      
                              seller to originate or acquire eligible                                                                
                              supplemental mortgage loans will be affected by a                                                      
                              number of factors including prevailing interest                                                        
                              rates, employment levels and economic conditions                                                       
                              generally.                                                                                             
                                                                                                                                     
                              If any of the amounts on deposit in the                                                                
                              supplemental loan account allocated to purchase                                                        
                              supplemental mortgage loans cannot be used for                                                         
                              that purpose, those amounts will be distributed to                                                     
                              certificateholders as a prepayment of principal no                                                     
                              later than the second distribution date.                                                               
                                                                                                                                     
                              The ability of the trust fund to acquire                                                               
                              supplemental mortgage loans with particular                                                            
                              characteristics will also affect the size of the                                                       
                              principal prepayment to the Class PO Certificates.                                                     
                              It is expected that there will be some principal                                                       
                              prepayment on the Class PO Certificates on either                                                      
                              the first or second distribution date.                                                                 
                                                                                                                                     
                              See "Description of the Certificates -- Principal"                                                     
                              in this prospectus supplement.                                                                         
                                                                                                                                     
CERTIFICATES MAY NOT BE       The offered certificates may not be an appropriate                                                     
APPROPRIATE FOR SOME          investment for investors who do not have                                                               
INVESTORS                     sufficient resources or expertise to evaluate the                                                      
                              particular characteristics of each applicable                                                          
                              class of offered certificates. This may be the                                                         
                              case because, among other things:                                                                      
                                                                                                                                     
                              -   The yield to maturity of offered certificates                                                      
                                  purchased at a price other than par will be                                                        
                                  sensitive to the uncertain rate and timing of                                                      
                                  principal prepayments on the mortgage loans;                                                       
                                                                                                                                     
                              -   The rate of principal distributions on and the                                                     
                                  weighted average lives of the offered                                                              
                                  certificates will be sensitive to the                                                              
                                  uncertain rate and timing of principal                                                             
                                  prepayments on the mortgage loans and the                                                          
                                  priority of principal distributions among the                                                      
                                  classes of certificates. Accordingly, the                                                          
                                  offered certificates may be an inappropriate                                                       
                                  investment if you require a distribution of a                                                      
                                  particular amount of principal on a specific                                                       
                                  date or an otherwise predictable stream of                                                         
                                  distributions;                                                                                     
                                                                                                                                     
                              -   The Class A-3 Certificates are subject to                                                          
                                  special rules regarding the procedures,                                                            
                                  practices and limitations applicable to the                                                        
                                  distribution of principal to the holders of                                                        
                                  these certificates. The                                                                            
                                                                                                                                     
                                      S-10                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                                  Class A-3 Certificates may not be an                                                               
                                  appropriate investment for you if you require                                                      
                                  distribution of a particular amount of                                                             
                                  principal on a predetermined date or an                                                            
                                  otherwise predictable stream of principal                                                          
                                  distributions. If you purchase Class A-3                                                           
                                  Certificates, we cannot give you any assurance                                                     
                                  that you will receive a distribution in                                                            
                                  reduction of principal on any particular                                                           
                                  distribution date;                                                                                 
                                                                                                                                     
                                  See "Description of Certificates --                                                                
                                  Distributions in Reduction of the Class A-3                                                        
                                  Certificates" in this prospectus supplement.                                                       
                                                                                                                                     
                              -   You may not be able to reinvest distributions                                                      
                                  on an offered certificate (which, in general,                                                      
                                  are expected to be greater during periods of                                                       
                                  relatively low interest rates) at a rate at                                                        
                                  least as high as the pass-through rate                                                             
                                  applicable to your certificate; or                                                                 
                                                                                                                                     
                              -   A secondary market for the offered                                                                 
                                  certificates may not develop or provide                                                            
                                  certificateholders with liquidity of                                                               
                                  investment.                                                                                        
                                                                                                                                     
GEOGRAPHIC CONCENTRATION      Approximately 71.06% of the initial mortgage loans                                                     
INCREASES RISK THAT           by aggregate stated principal balance as of the                                                        
CERTIFICATE YIELDS COULD BE   initial cut-off date are, and, at the end of the                                                       
IMPAIRED                      conveyance period, not more than 50.00% of the                                                         
                              mortgage loans by aggregate stated principal                                                           
                              balance as of their respective cut-off dates will                                                      
                              be, secured by property in California. Property in                                                     
                              California may be more susceptible than homes                                                          
                              located in other parts of the country to some                                                          
                              types of uninsurable hazards, such as earthquakes,                                                     
                              floods, mudslides and other natural disasters. In                                                      
                              addition,                                                                                              
                                                                                                                                     
                              -   Economic conditions in California (which may                                                       
                                  or may not affect real property values) may                                                        
                                  affect the ability of borrowers to repay their                                                     
                                  loans on time;                                                                                     
                                                                                                                                     
                              -   Declines in the California residential real                                                        
                                  estate market may reduce the values of                                                             
                                  properties located in California, which would                                                      
                                  result in an increase in the loan-to-value                                                         
                                  ratios; and                                                                                        
                                                                                                                                     
                              -   Any increase in the market value of properties                                                     
                                  located in California would reduce the                                                             
                                  loan-to-value ratios and could, therefore,                                                         
                                  make alternative sources of financing                                                              
                                  available to the borrowers at lower interest                                                       
                                  rates, which could result in an increased rate                                                     
                                  of prepayment of the mortgage loans.                                                               
                                                                                                                                     
IMPACT OF WORLD EVENTS        The economic impact of the United States' military                                                     
                              operations in Iraq, as well as the possibility of                                                      
                              any terrorist attacks in response to these                                                             
                              operations, is uncertain, but could have a                                                             
                              material effect on general economic conditions,                                                        
                              consumer confidence, and market liquidity. No                                                          
                              assurance can be given as to the effect of these                                                       
                              events on consumer confidence and the performance                                                      
                              of the mortgage loans. Any adverse impact                                                              
                              resulting from these events would be borne by the                                                      
                              holders of the certificates. United States                                                             
                              military operations may also increase the                                                              
                              likelihood of shortfalls under the Relief Act.                                                         
                                                                                                                                     
                                      S-11                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
YOU MAY HAVE DIFFICULTY       No market for any of the certificates will exist                                                       
RESELLING CERTIFICATES        before they are issued. Each underwriter intends                                                       
                              to make a secondary market in the classes of                                                           
                              offered certificates purchased by it, but no                                                           
                              underwriter has any obligation to do so. We cannot                                                     
                              assure you that a secondary market will develop                                                        
                              or, if it develops, that it will continue.                                                             
                              Consequently, you may not be able to sell your                                                         
                              certificates readily or at prices that will enable                                                     
                              you to realize your desired yield. The market                                                          
                              values of the certificates are likely to                                                               
                              fluctuate; these fluctuations may be significant                                                       
                              and could result in significant losses to you.                                                         
                                                                                                                                     
                              The secondary markets for mortgage backed                                                              
                              securities have experienced periods of illiquidity                                                     
                              and can be expected to do so in the future.                                                            
                              Illiquidity can have a severely adverse effect on                                                      
                              the prices of securities that are especially                                                           
                              sensitive to prepayment, credit, or interest rate                                                      
                              risk, or that have been structured to meet the                                                         
                              investment requirements of limited categories of                                                       
                              investors.                                                                                             
                                                                                                                                     
                              See "Risk Factors -- Ability to Resell                                                                 
                              Certificates May Be Limited" in the prospectus.                                                        
                                                                                                                                     
SOME OF THE STATEMENTS CONTAINED IN OR INCORPORATED BY REFERENCE IN THIS                                                             
PROSPECTUS SUPPLEMENT AND THE ACCOMPANYING PROSPECTUS CONSIST OF FORWARD-LOOKING                                                     
STATEMENTS RELATING TO FUTURE ECONOMIC PERFORMANCE OR PROJECTIONS AND OTHER                                                          
FINANCIAL ITEMS. THESE STATEMENTS CAN BE IDENTIFIED BY THE USE OF                                                                    
FORWARD-LOOKING WORDS SUCH AS "MAY," "WILL," "SHOULD," "EXPECTS," "BELIEVES,"                                                        
"ANTICIPATES," "ESTIMATES," OR OTHER COMPARABLE WORDS. FORWARD-LOOKING                                                               
STATEMENTS ARE SUBJECT TO A VARIETY OF RISKS AND UNCERTAINTIES THAT COULD CAUSE                                                      
ACTUAL RESULTS TO DIFFER FROM THE PROJECTED RESULTS. THOSE RISKS AND                                                                 
UNCERTAINTIES INCLUDE, AMONG OTHERS, GENERAL ECONOMIC AND BUSINESS CONDITIONS,                                                       
REGULATORY INITIATIVES AND COMPLIANCE WITH GOVERNMENTAL REGULATIONS, CUSTOMER                                                        
PREFERENCES AND VARIOUS OTHER MATTERS, MANY OF WHICH ARE BEYOND OUR CONTROL.                                                         
BECAUSE WE CANNOT PREDICT THE FUTURE, WHAT ACTUALLY HAPPENS MAY BE VERY                                                              
DIFFERENT FROM WHAT WE PREDICT IN OUR FORWARD-LOOKING STATEMENTS.                                                                    
                                                                                                                                     
                                      S-12                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                                THE MORTGAGE POOL                                                                                    
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         Certain information with respect to the mortgage loans expected to be                                                       
included in the mortgage pool as of the date of this prospectus supplement                                                           
(these mortgage loans collectively will be referred to in this prospectus                                                            
supplement as the "Initial Mortgage Loans") and the mortgage loans that are                                                          
included in the mortgage pool on the closing date (these mortgage loans                                                              
collectively will be referred to in this prospectus supplement as the "Closing                                                       
Date Mortgage Loans") is set forth below. A detailed description on Form 8-K                                                         
(which is referred to as the "detailed description") of the Closing Date                                                             
Mortgage Loans actually delivered will be available to purchasers of the offered                                                     
certificates at or before, and will be filed with the Securities and Exchange                                                        
Commission within fifteen days after, the initial delivery of the offered                                                            
certificates. The detailed description will specify the aggregate of the Stated                                                      
Principal Balances of the Closing Date Mortgage Loans as of the initial cut-off                                                      
date and will also include the following information regarding the Closing Date                                                      
Mortgage Loans:                                                                                                                      
                                                                                                                                     
         -   the outstanding Stated Principal Balances of the Closing Date                                                           
             Mortgage Loans as of the initial cut-off date,                                                                          
                                                                                                                                     
         -   the mortgage rates borne by the Closing Date Mortgage Loans,                                                            
                                                                                                                                     
         -   the original loan-to-value ratios of the Closing Date Mortgage                                                          
             Loans,                                                                                                                  
                                                                                                                                     
         -   the remaining terms to stated maturity of the Closing Date Mortgage                                                     
             Loans,                                                                                                                  
                                                                                                                                     
         -   the type of properties securing the Closing Date Mortgage Loans,                                                        
                                                                                                                                     
         -   the geographical distribution of the Closing Date Mortgage Loans by                                                     
             state,                                                                                                                  
                                                                                                                                     
         -   the FICO Credit Score of the related mortgagor at the time of                                                           
             origination of the Closing Date Mortgage Loans,                                                                         
                                                                                                                                     
         -   the purpose for obtaining the Closing Date Mortgage Loans (i.e.                                                         
             purchase or refinance), and                                                                                             
                                                                                                                                     
         -   the occupancy type of the Closing Date Mortgage Loans (based upon                                                       
             representations of the mortgagors at the time of origination).                                                          
                                                                                                                                     
         The depositor, CWMBS, Inc., will purchase the mortgage loans in the                                                         
mortgage pool from Countrywide Home Loans, Inc. pursuant to a pooling and                                                            
servicing agreement dated as of August 1, 2003 among Countrywide Home Loans,                                                         
Inc., as seller, Countrywide Home Loans Servicing LP, as master servicer, the                                                        
depositor and The Bank of New York, as trustee, and will cause the mortgage                                                          
loans to be assigned to the trustee for the benefit of the holders of the                                                            
certificates.                                                                                                                        
                                                                                                                                     
         Under the pooling and servicing agreement, the seller will make certain                                                     
representations, warranties and covenants to the depositor relating to, among                                                        
other things, the due execution and enforceability of the pooling and servicing                                                      
agreement and certain characteristics of the mortgage loans and, subject to the                                                      
limitations described below under "-- Assignment of the Mortgage Loans," will be                                                     
obligated to repurchase or substitute a similar mortgage loan for any mortgage                                                       
loan as to which there exists deficient documentation or as to which there has                                                       
been an uncured breach of any representation or warranty relating to the                                                             
characteristics of the mortgage loans that materially and adversely affects the                                                      
interests of the certificateholders in that mortgage loan. The seller will                                                           
represent and warrant to the depositor in the pooling and servicing agreement                                                        
that the mortgage loans were selected from among the outstanding one- to                                                             
four-family mortgage loans in the seller's portfolio as to which the                                                                 
representations and warranties set forth in the pooling and servicing agreement                                                      
can be made and that the selection was not made in a manner intended to affect                                                       
the interests of the certificateholders adversely. See "Mortgage Loan Program --                                                     
Representations by Sellers; Repurchases" in the prospectus. Under the pooling                                                        
and servicing agreement, the                                                                                                         
                                                                                                                                     
                                      S-13                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
depositor will assign all its right, title and interest in the representations,                                                      
warranties and covenants (including the seller's repurchase or substitution                                                          
obligation) to the trustee for the benefit of the certificateholders. The                                                            
depositor will make no representations or warranties with respect to the                                                             
mortgage loans and will have no obligation to repurchase or substitute mortgage                                                      
loans with deficient documentation or which are otherwise defective. The seller                                                      
is selling the mortgage loans without recourse and will have no obligation with                                                      
respect to the certificates in its capacity as seller other than the repurchase                                                      
or substitution obligation described above. The obligations of the master                                                            
servicer, with respect to the certificates, are limited to the master servicer's                                                     
contractual servicing obligations under the pooling and servicing agreement.                                                         
                                                                                                                                     
         As of the initial cut-off date, the aggregate Stated Principal Balance                                                      
of the Closing Date Mortgage Loans will not be less than $375,689,000 (referred                                                      
to as the "Initial Cut-off Date Pool Principal Balance"). With the exception of                                                      
48 Initial Mortgage Loans representing approximately 7.16% of the aggregate                                                          
Stated Principal Balance of the Initial Mortgage Loans as of the initial cut-off                                                     
date, all of the mortgage loans provide for the amortization of the amount                                                           
financed over a series of substantially equal monthly payments. The terms of the                                                     
remaining Initial Mortgage Loans only require the related mortgagors to pay                                                          
interest on the principal balance of the mortgage loans for the first ten years                                                      
after their origination, but require that the entire principal balance or the                                                        
mortgage loan be fully amortized over the related remaining term of the mortgage                                                     
loan. All of the mortgage loans will provide that payments are due on the first                                                      
day of each month (the "Due Date"). At origination, substantially all of the                                                         
mortgage loans will have stated terms to maturity of 30 years. Scheduled monthly                                                     
payments made by the mortgagors on the mortgage loans (referred to as scheduled                                                      
payments) either earlier or later than their scheduled Due Dates will not affect                                                     
the amortization schedule or the relative application of the payments to                                                             
principal and interest. Except for 4 Initial Mortgage Loans constituting not                                                         
more than approximately 0.58% of the aggregate Stated Principal Balance of the                                                       
Initial Mortgage Loans as of the initial cut-off date, the mortgagors may prepay                                                     
their mortgage loans at any time without penalty. Any prepayment penalties                                                           
received on the mortgage loans will not be distributed to certificateholders. It                                                     
is expected that the Closing Date Mortgage Loans will be supplemented by the                                                         
purchase of additional mortgage loans (we refer to these additional mortgage                                                         
loans in this prospectus supplement as the Supplemental Mortgage Loans, and the                                                      
Supplemental Mortgage Loans, together with the Closing Date Mortgage Loans, are                                                      
referred to in this prospectus supplement as the mortgage loans) from amounts on                                                     
deposit in the Supplemental Loan Account. These purchases will occur between the                                                     
closing date and September 30, 2003 (this period may sometimes be referred to as                                                     
the Conveyance Period).                                                                                                              
                                                                                                                                     
         Each Initial Mortgage Loan was originated on or after May 8, 2003.                                                          
                                                                                                                                     
         The latest stated maturity date of any Initial Mortgage Loan will be                                                        
September 1, 2033. The earliest stated maturity date of any Initial Mortgage                                                         
Loan will be August 1, 2028.                                                                                                         
                                                                                                                                     
         As of the initial cut-off date, no Initial Mortgage Loan was delinquent                                                     
more than 30 days.                                                                                                                   
                                                                                                                                     
         As of the initial cut-off date, no Initial Mortgage Loan was subject to                                                     
a buydown agreement. No Initial Mortgage Loan provides for deferred interest or                                                      
negative amortization.                                                                                                               
                                                                                                                                     
         No Initial Mortgage Loan had a Loan-to-Value Ratio at origination of                                                        
more than 100.00%. Generally, each mortgage loan with a Loan-to-Value Ratio at                                                       
origination of greater than 80% will be covered by a primary mortgage guaranty                                                       
insurance policy issued by a mortgage insurance company acceptable to Fannie Mae                                                     
or Freddie Mac. The policy provides coverage in an amount equal to a specified                                                       
percentage times the sum of the remaining principal balance of the related                                                           
mortgage loan, the accrued interest thereon and the related foreclosure                                                              
expenses. The specified coverage percentage is 12% for Loan-to-Value Ratios                                                          
between 80.01% and 85.00%, 25% for Loan-to-Value Ratios between 85.01% and                                                           
90.00%, 30% for Loan-to-Value Ratios between 90.01% and 95.00% and 35% for                                                           
Loan-to-Value Ratios between 95.01% and 100%. However, under certain                                                                 
circumstances, the specified coverage level may vary from the foregoing. With                                                        
respect to 3 Initial Mortgage Loans that will be identified on the mortgage loan                                                     
schedule, the lender (rather than the borrower) acquired the primary mortgage                                                        
guaranty insurance and charged the related borrower an interest premium. Except                                                      
for these lender acquired mortgage insurance mortgage loans, no primary mortgage                                                     
guaranty insurance policy will be required with respect to any mortgage loan if                                                      
maintaining the policy is prohibited by applicable law or after the date on                                                          
which the related Loan-to-Value Ratio is 80% or less or, based on a new                                                              
appraisal, the principal balance of the mortgage loan represents 80% or less of                                                      
the new appraised                                                                                                                    
                                                                                                                                     
                                      S-14                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
value. The primary mortgage guaranty insurance policy will be maintained for the                                                     
life of the lender acquired mortgage insurance mortgage loans, unless otherwise                                                      
prohibited by law.                                                                                                                   
                                                                                                                                     
         The "Loan-to-Value Ratio" of a mortgage loan at any given time is a                                                         
fraction, expressed as a percentage, the numerator of which is the principal                                                         
balance of the related mortgage loan at the date of determination and the                                                            
denominator of which is,                                                                                                             
                                                                                                                                     
         -   in the case of a purchase, the lesser of the selling price of the                                                       
             mortgaged property or its appraised value at the time of sale, or                                                       
                                                                                                                                     
         -   in the case of a refinance, the appraised value of the mortgaged                                                        
             property at the time of the refinance, except as described in the                                                       
             following sentence.                                                                                                     
                                                                                                                                     
If the mortgagor is refinancing an existing mortgage loan that was originated or                                                     
acquired by the seller, and that existing mortgage loan meets the delinquency                                                        
criteria set forth in the pooling and servicing agreement, then with respect to                                                      
the refinanced mortgage loan,                                                                                                        
                                                                                                                                     
         -   if the loan-to-value ratio at the time of the origination of the                                                        
             mortgage loan being refinanced was 80% or less and the loan amount                                                      
             of the new loan being originated is $650,000 or less, then the                                                          
             "Loan-to-Value Ratio" will be the ratio of the principal amount of                                                      
             the new mortgage loan being originated divided by the appraised                                                         
             value of the related mortgaged property at the time of the                                                              
             origination of the mortgage loan being refinanced, or                                                                   
                                                                                                                                     
         -   if the loan-to-value ratio at the time of the origination of the                                                        
             mortgage loan being refinanced was greater than 80% or the loan                                                         
             amount of the new loan being originated is greater than $650,000,                                                       
             then the "Loan-to-Value Ratio" will be the ratio of the principal                                                       
             amount of the new mortgage loan being originated divided by the                                                         
             appraised value of the related mortgaged property as determined by                                                      
             a limited appraisal report at the time of the origination of the                                                        
             new mortgage loan.                                                                                                      
                                                                                                                                     
No assurance can be given that the value of any mortgaged property has remained                                                      
or will remain at the level that existed on the appraisal or sales date. If                                                          
residential real estate values generally or in a particular geographic area                                                          
decline, the Loan-to-Value Ratios might not be a reliable indicator of the rates                                                     
of delinquencies, foreclosures and losses that could occur with respect to the                                                       
mortgage loans.                                                                                                                      
                                                                                                                                     
         The following information sets forth certain characteristics of the                                                         
mortgage loans expected to be included in the final mortgage pool (the "Pool                                                         
Characteristics"). This information as well as other information in this                                                             
prospectus supplement describing the mortgage loans and the final mortgage pool                                                      
are approximate percentages based on the Stated Principal Balances of the                                                            
mortgage loans to be included in the final mortgage pool as of the relevant                                                          
cut-off date, with the characteristics for any Closing Date Mortgage Loan taken                                                      
as of the initial cut-off date and the characteristics for any Supplemental                                                          
Mortgage Loan taken as of the applicable Supplemental Cut-off Date (as defined                                                       
below).                                                                                                                              
                                                                                                                                     
                                      S-15                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
           CHARACTERISTICS OF THE MORTGAGE LOANS IN THE MORTGAGE POOL*                                                               

<TABLE>                                                                                                                              
<S>                                                                                        <C>                                       
Number of Mortgage Loans...........................................................               1,010                              
Aggregate Stated Principal Balance of the Mortgage Loans...........................            $500,000,000                          
Average Stated Principal Balance...................................................              $495,000                            
Weighted Average Original Term to Stated Maturity..................................             360 months                           
Weighted Average Remaining Term to Stated Maturity.................................             359 months                           
Mortgage Rate:                                                                                                                       
    Range..........................................................................          5.000% to 9.250%                        
    Weighted Average...............................................................               5.650%                             
Original Loan-to-Value Ratios:                                                                                                       
    Range..........................................................................          5.00% to 100.00%                        
    Weighted Average...............................................................               70.00%                             
Weighted Average FICO Credit Score.................................................                735                               
State Distribution of Mortgaged Properties:                                                                                          
    Located in California..........................................................        No more than 50.00%                       
    Located in New Jersey..........................................................         No more than 8.00%                       
    Located in New York............................................................         No more than 6.00%                       
    Located in Massachusetts.......................................................         No more than 6.00%                       
    (No other State or District of Columbia will be greater than 5.00% )                                                             
Occupancy Types:                                                                                                                     
    Primary Home...................................................................          At least 95.00%                         
    Second Home....................................................................         No more than 4.00%                       
    Investor Property..............................................................         No more than 1.00%                       
Types of Mortgaged Properties:                                                                                                       
    Single Family (includes PUDs) .................................................          At least 95.00%                         
    Condominiums...................................................................         No more than 4.00%                       
    Two- to Four-Family Units......................................................         No more than 1.00%                       
Purpose of Mortgage Loans:                                                                                                           
    Purchase and Refinance (rate/term).............................................          At least 75.00%                         
    Refinance (cash-out)...........................................................        No more than 25.00%                       
</TABLE>                                                                                                                             
                                                                                                                                     
-----------------                                                                                                                    
*    Approximate. Actual amounts and percentages may vary up to a maximum of 5%                                                      
     (other than with respect to the Average Stated Principal Balance of the                                                         
     mortgage loans, which may vary up to a maximum of 10%, Weighted Average                                                         
     Mortgage Rate, which will be between 5.35% and 5.85% per annum, Weighted                                                        
     Average FICO Credit Score, which may vary by up to a maximum of 5 points,                                                       
     and Weighted Average Remaining Term to Stated Maturity, which may vary by                                                       
     up to two months) depending on the actual mortgage loans included in the                                                        
     mortgage pool at the end of the conveyance period.                                                                              
                                                                                                                                     
ASSIGNMENT OF THE MORTGAGE LOANS                                                                                                     

         Pursuant to the pooling and servicing agreement, on the closing date,                                                       
the depositor will sell, transfer, assign, set over and otherwise convey without                                                     
recourse to the trustee in trust for the benefit of the certificateholders all                                                       
right, title and interest of the depositor in and to each Closing Date Mortgage                                                      
Loan and all right, title and interest in and to all other assets included in                                                        
CHL Mortgage Pass-Through Trust 2003-44, including all principal and interest                                                        
received on or with respect to the Closing Date Mortgage Loans, but not any                                                          
principal and interest due on or before the initial cut-off date, and amounts                                                        
deposited in the Supplemental Loan Account and the Capitalized Interest Account                                                      
on the closing date.                                                                                                                 
                                                                                                                                     
         In connection with the transfer and assignment of a mortgage loan, the                                                      
depositor will deliver or cause to be delivered to the trustee, or a custodian                                                       
for the trustee, the mortgage file, which contains among other things, the                                                           
original mortgage note (and any modification or amendment to it) endorsed in                                                         
blank without recourse, except that the depositor may deliver or cause to be                                                         
delivered a lost note affidavit in lieu of any original mortgage note that has                                                       
been lost, the original instrument creating a first lien on the related                                                              
mortgaged property with evidence of recording                                                                                        
                                                                                                                                     
                                      S-16                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
indicated thereon, an assignment in recordable form of the mortgage, the title                                                       
policy with respect to the related mortgaged property and, if applicable, all                                                        
recorded intervening assignments of the mortgage and any riders or modifications                                                     
to the mortgage note and mortgage (except for any documents not returned from                                                        
the public recording office, which will be delivered to the trustee as soon as                                                       
the same is available to the depositor). With respect to up to 50% of the                                                            
Closing Date Mortgage Loans, the depositor may deliver all or a portion of each                                                      
related mortgage file to the trustee not later than thirty days after the                                                            
closing date and not later than twenty days after the relevant Supplemental                                                          
Transfer Date (as defined below) with respect to up to 90% of the Supplemental                                                       
Mortgage Loans conveyed on such Supplemental Transfer Date. Assignments of the                                                       
mortgage loans to the trustee (or its nominee) will be recorded in the                                                               
appropriate public office for real property records, except in states such as                                                        
California where in the opinion of counsel 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 depositor or the seller.                                                           
                                                                                                                                     
         The trustee will review each mortgage file relating to the Closing Date                                                     
Mortgage Loans within 90 days of the closing date (or promptly after the                                                             
trustee's receipt of any document permitted to be delivered after the closing                                                        
date) and the documents relating to the Supplemental Mortgage Loans promptly                                                         
after the trustee's receipt thereof after the related Supplemental Transfer Date                                                     
as described above, and if any document in a mortgage file is found to be                                                            
missing or defective in a material respect and the seller does not cure the                                                          
defect within 90 days of notice of the defect from the trustee (or within such                                                       
longer period not to exceed 720 days after the closing date as provided in the                                                       
pooling and servicing agreement in the case of missing documents not returned                                                        
from the public recording office), the seller will be obligated to repurchase                                                        
the related mortgage loan from the trust fund. Rather than repurchase the                                                            
mortgage loan as provided above, the seller may remove the mortgage loan                                                             
(referred to as a deleted mortgage loan) from the trust fund and substitute in                                                       
its place another mortgage loan (referred to as a replacement mortgage loan);                                                        
however, such a substitution is permitted only within two years of the closing                                                       
date and may not be made unless an opinion of counsel is provided to the trustee                                                     
to the effect that such a substitution will not disqualify the REMIC or result                                                       
in a prohibited transaction tax under the Code. Any replacement mortgage loan                                                        
generally will, on the date of substitution, among other characteristics set                                                         
forth in the pooling and servicing agreement,                                                                                        
                                                                                                                                     
         -   have a principal balance, after deduction of all scheduled payments                                                     
             due in the month of substitution, not in excess of, and not more                                                        
             than 10% less than, the Stated Principal Balance of the deleted                                                         
             mortgage loan (the amount of any shortfall to be deposited by the                                                       
             seller in the Certificate Account and held for distribution to the                                                      
             certificateholders on the related Distribution Date (referred to as                                                     
             a "Substitution Adjustment Amount")),                                                                                   
                                                                                                                                     
         -   have a mortgage rate not lower than, and not more than 1% per annum                                                     
             higher than, that of the deleted mortgage loan,                                                                         
                                                                                                                                     
         -   have a Loan-to-Value Ratio not higher than that of the deleted                                                          
             mortgage loan,                                                                                                          
                                                                                                                                     
         -   have a remaining term to maturity not greater than (and not more                                                        
             than one year less than) that of the deleted mortgage loan, and                                                         
                                                                                                                                     
         -   comply with all of the representations and warranties set forth in                                                      
             the pooling and servicing agreement as of the date of substitution.                                                     
                                                                                                                                     
This cure, repurchase or substitution obligation constitutes the sole remedy                                                         
available to certificateholders or the trustee for omission of, or a material                                                        
defect in, a mortgage loan document.                                                                                                 
                                                                                                                                     
         Notwithstanding the foregoing, in lieu of providing the duly executed                                                       
assignment of the mortgage to the trustee and the original recorded assignment                                                       
or assignments of the mortgage together with all interim recorded assignments of                                                     
such mortgage, above, the depositor may at its discretion provide evidence that                                                      
the related mortgage is held through the MERS(R) System. In addition, the                                                            
mortgages for some or all of the mortgage loans in the trust fund that are not                                                       
already held through the MERS(R) System may, at the discretion of the master                                                         
servicer, in the future be held through the MERS(R) System. For any mortgage                                                         
held through the MERS(R) System, the mortgage is recorded in the name of                                                             
Mortgage Electronic Registration Systems, Inc., or MERS, as nominee for the                                                          
owner of the mortgage loan, and subsequent assignments of the mortgage were, or                                                      
in the future may be, at the discretion of the master                                                                                
                                                                                                                                     
                                      S-17                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
servicer, registered electronically through the MERS(R) System. For each of                                                          
these mortgage loans, MERS serves as mortgagee of record on the mortgage solely                                                      
as a nominee in an administrative capacity on behalf of the trustee, and does                                                        
not have any interest in the mortgage loan.                                                                                          
                                                                                                                                     
CONVEYANCE OF SUPPLEMENTAL MORTGAGE LOANS                                                                                            
                                                                                                                                     
         If the aggregate Stated Principal Balance of the Closing Date Mortgage                                                      
Loans as of the initial cut-off date, is less than $500,000,000, an account (the                                                     
"Supplemental Loan Account") will be established with the trustee on the closing                                                     
date and funded in an amount (the "Supplemental Amount") equal to the excess of                                                      
the aggregate of the Class Certificate Balances of the certificates over the                                                         
aggregate Stated Principal Balance of the Closing Date Mortgage Loans as of the                                                      
initial cut-off date. As of the date of this prospectus supplement, the                                                              
Supplemental Amount will not exceed $124,311,000, but the amount actually                                                            
deposited in the Supplemental Loan Account on the closing date will equal the                                                        
excess, if any, of the aggregate Class Certificate Balance of the certificates                                                       
as of the closing date over the aggregate Stated Principal Balance of the                                                            
Closing Date Mortgage Loans as of the initial cut-off date.                                                                          
                                                                                                                                     
         Any investment income earned from amounts in the Supplemental Loan                                                          
Account will be paid to the depositor and will not be available for payments on                                                      
the certificates. During the period from the closing date to the earlier of the                                                      
date on which the amount in the Supplemental Loan Account is less than $150,000                                                      
and September 30, 2003 (the "Conveyance Period"), the depositor is expected to                                                       
purchase Supplemental Mortgage Loans from the seller and sell those Supplemental                                                     
Mortgage Loans to the trust fund as described below. The purchase price for each                                                     
Supplemental Mortgage Loan purchased by the trust after the closing date will                                                        
equal the Stated Principal Balance of the Supplemental Mortgage Loan as of the                                                       
later of the first day of the month of the transfer to the trust fund and the                                                        
date of origination of that mortgage loan (the related "Supplemental Cut-off                                                         
Date") and will be paid from the Supplemental Loan Account. Accordingly, the                                                         
purchase of Supplemental Mortgage Loans will decrease the amount on deposit in                                                       
the Supplemental Loan Account and increase the Stated Principal Balance of the                                                       
mortgage pool.                                                                                                                       
                                                                                                                                     
         Because some of the mortgage loans may not be acquired by the trust                                                         
fund until after the closing date, there may not be sufficient interest                                                              
collections from the mortgage loans to pay all the interest due on the                                                               
certificates on the first and possibly the second Distribution Dates. A                                                              
capitalized interest account (the "Capitalized Interest Account") will be                                                            
established and funded on the closing date from which funds (together with any                                                       
investment earnings thereon) will be drawn upon to offset any interest shortfall                                                     
on the Distribution Date during and, if necessary, immediately following the                                                         
Conveyance Period as a result of the supplemental loan mechanism. Any amounts                                                        
remaining in the Capitalized Interest Account after making distributions of                                                          
interest on the first Distribution Date following the end of the Conveyance                                                          
Period will be paid to the seller and will not thereafter be available for                                                           
distribution to certificateholders.                                                                                                  
                                                                                                                                     
         Amounts on deposit in the Supplemental Loan Account and the Capitalized                                                     
Interest Account will be invested in Eligible Investments. The Supplemental Loan                                                     
Account and the Capitalized Interest Account will not be assets of the REMIC.                                                        
                                                                                                                                     
         Pursuant to the pooling and servicing agreement and a supplemental                                                          
transfer agreement (a "Supplemental Transfer Agreement") to be executed by the                                                       
seller, the depositor and the trustee, the conveyance of Supplemental Mortgage                                                       
Loans may be made on any business day during the Conveyance Period (a                                                                
"Supplemental Transfer Date"), subject to the fulfillment of certain conditions                                                      
in the pooling and servicing agreement, including that the Supplemental Mortgage                                                     
Loans conveyed on the related Supplemental Transfer Date satisfy the same                                                            
representations and warranties in the pooling and servicing agreement applicable                                                     
to all of the mortgage loans, and that, as of the Supplemental Cut-off Date:                                                         
                                                                                                                                     
         -   the Supplemental Mortgage Loans conveyed on that Supplemental                                                           
             Transfer Date were selected in a manner reasonably believed not to                                                      
             be adverse to the interests of the certificateholders,                                                                  
                                                                                                                                     
         -   the trustee receives an opinion of counsel with respect to the                                                          
             validity of the conveyance of the Supplemental Mortgage Loans                                                           
             conveyed on that Supplemental Transfer Date,                                                                            
                                                                                                                                     
                                      S-18                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -   the Supplemental Mortgage Loans conveyed on that Supplemental                                                           
             Transfer Date were originated in accordance with the underwriting                                                       
             standards described in this prospectus supplement,                                                                      
                                                                                                                                     
         -   the aggregate of the PO Percentages of the Stated Principal                                                             
             Balances of all Supplemental Mortgage Loans (also referred to as                                                        
             the Class PO Sublimit Amount) shall be no greater than                                                                  
             approximately $235,200,                                                                                                 
                                                                                                                                     
         -   the conveyance of the Supplemental Mortgage Loans on that                                                               
             Supplemental Transfer Date will not result in a reduction or                                                            
             withdrawal of any ratings assigned to the offered certificates                                                          
             (which, in the case of the Class A-3 Certificates, are determined                                                       
             without regard to the Class A-3 Policy), and                                                                            
                                                                                                                                     
         -   following the conveyance of the Supplemental Mortgage Loans on that                                                     
             Supplemental Transfer Date to the trust fund, the characteristics                                                       
             of the mortgage loans in the mortgage pool will conform to the                                                          
             "Characteristics of the Mortgage Loans in the Mortgage Pool" as set                                                     
             forth in this prospectus supplement.                                                                                    
                                                                                                                                     
UNDERWRITING PROCESS                                                                                                                 
                                                                                                                                     
General                                                                                                                              
                                                                                                                                     
         All mortgage loans originated by the seller must meet credit, appraisal                                                     
and underwriting standards acceptable to the seller. The seller's underwriting                                                       
standards are applied in accordance with applicable federal and state laws and                                                       
regulations. Except as otherwise provided in this prospectus supplement, the                                                         
underwriting procedures are consistent with those identified under "Mortgage                                                         
Loan Program -- Underwriting Process" in the prospectus.                                                                             
                                                                                                                                     
         As part of its evaluation of potential borrowers, the seller generally                                                      
requires a description of income. If required by its underwriting guidelines,                                                        
the seller obtains employment verification providing current and historical                                                          
income information and/or a telephonic employment confirmation. Such employment                                                      
verification may be obtained, either through analysis of the prospective                                                             
borrower's recent pay stub and/or W-2 forms for the most recent two years,                                                           
relevant portions of the most recent two years' tax returns, or from the                                                             
prospective borrower's employer, wherein the employer reports the length of                                                          
employment and current salary with that organization. Self-employed prospective                                                      
borrowers generally are required to submit relevant portions of their federal                                                        
tax returns for the past two years.                                                                                                  
                                                                                                                                     
         In assessing a prospective borrower's creditworthiness, the seller may                                                      
use FICO Credit Scores. "FICO Credit Scores" are statistical credit scores                                                           
designed to assess a borrower's creditworthiness and likelihood to default on a                                                      
consumer obligation over a two-year period based on a borrower's credit history.                                                     
FICO Credit Scores were not developed to predict the likelihood of default on                                                        
mortgage loans and, accordingly, may not be indicative of the ability of a                                                           
mortgagor to repay its mortgage loan. FICO Credit Scores range from                                                                  
approximately 250 to approximately 900, with higher scores indicating an                                                             
individual with a more favorable credit history compared to an individual with a                                                     
lower score. Under the seller's underwriting guidelines, borrowers possessing                                                        
higher FICO Credit Scores, which indicate a more favorable credit history, and                                                       
who give the seller the right to obtain the tax returns they filed for the                                                           
preceding two years may be eligible for the seller's processing program (the                                                         
"Preferred Processing Program"). Approximately 44.52% of the Initial Mortgage                                                        
Loans by aggregate Stated Principal Balance as of the initial cut-off date have                                                      
been underwritten pursuant to the seller's Preferred Processing Program. The                                                         
seller may waive some documentation requirements for mortgage loans originated                                                       
under the Preferred Processing Program.                                                                                              
                                                                                                                                     
         Periodically the data used by the seller to complete the underwriting                                                       
analysis may be obtained by a third party, particularly for mortgage loans                                                           
originated through a loan correspondent or mortgage broker. In those instances,                                                      
the initial determination as to whether a mortgage loan complies with the                                                            
seller's underwriting guidelines may be made by an independent company hired to                                                      
perform underwriting services on behalf of the seller, the loan correspondent or                                                     
mortgage broker. In addition, the seller may acquire mortgage loans from                                                             
approved correspondent lenders under a program pursuant to which the seller                                                          
delegates to the correspondent the obligation to underwrite the mortgage loans                                                       
to the seller's standards. Under these circumstances, the underwriting of a                                                          
mortgage loan may not have been reviewed by the seller before acquisition of the                                                     
mortgage loan and the correspondent represents that the seller's underwriting                                                        
standards have been met. After purchasing mortgage loans under those                                                                 
circumstances, the                                                                                                                   
                                                                                                                                     
                                      S-19                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
seller conducts a quality control review of a sample of the mortgage loans. The                                                      
number of loans reviewed in the quality control process varies based on a                                                            
variety of factors, including the seller's prior experience with the                                                                 
correspondent lender and the results of the quality control review process                                                           
itself.                                                                                                                              
                                                                                                                                     
         The seller's underwriting standards are applied by or on behalf of the                                                      
seller to evaluate the prospective borrower's credit standing and repayment                                                          
ability and the value and adequacy of the mortgaged property as collateral.                                                          
Under those standards, a prospective borrower must generally demonstrate that                                                        
the ratio of the borrower's monthly housing expenses (including principal and                                                        
interest on the proposed mortgage loan and, as applicable, the related monthly                                                       
portion of property taxes, hazard insurance and mortgage insurance) to the                                                           
borrower's monthly gross income and the ratio of total monthly debt to the                                                           
monthly gross income (the "debt-to-income" ratios) are within acceptable limits.                                                     
The maximum acceptable debt-to-income ratio, which is determined on a                                                                
loan-by-loan basis varies depending on a number of underwriting criteria,                                                            
including the Loan-to-Value Ratio, loan purpose, loan amount and credit history                                                      
of the borrower. In addition to meeting the debt-to-income ratio guidelines,                                                         
each prospective borrower is required to have sufficient cash resources to pay                                                       
the down payment and closing costs. Exceptions to the seller's underwriting                                                          
guidelines may be made if compensating factors are demonstrated by a prospective                                                     
borrower.                                                                                                                            
                                                                                                                                     
         The seller may provide secondary financing to a mortgagor                                                                   
contemporaneously with the origination of a mortgage loan, subject to the                                                            
following limitations: the Loan-to-Value Ratio of the senior (i.e., first) lien                                                      
may not exceed 80% and the combined Loan-to-Value Ratio may not exceed 100%. The                                                     
seller's underwriting guidelines do not prohibit or otherwise restrict a                                                             
mortgagor from obtaining secondary financing from lenders other than the seller,                                                     
whether at origination of the mortgage loan or thereafter.                                                                           
                                                                                                                                     
         For all mortgage loans originated or acquired by the seller, the seller                                                     
obtains a credit report relating to the applicant from a credit reporting                                                            
company. The credit report typically contains information relating to such                                                           
matters as credit history with local and national merchants and lenders,                                                             
installment debt payments and any record of defaults, bankruptcy, dispossession,                                                     
suits or judgments. All adverse information in the credit report is required to                                                      
be explained by the prospective borrower to the satisfaction of the lending                                                          
officer.                                                                                                                             
                                                                                                                                     
         Generally, the seller obtains appraisals from independent appraisers or                                                     
appraisal services for properties that are to secure mortgage loans, except with                                                     
respect to selected borrowers that are refinancing an existing mortgage loan                                                         
that was originated or acquired by the seller where, among other things, the                                                         
mortgage loan has not been more than 30 days delinquent in payment during the                                                        
previous twelve-month period. The appraisers inspect and appraise the proposed                                                       
mortgaged property and verify that the property is in acceptable condition.                                                          
Following each appraisal, the appraiser prepares a report which includes a                                                           
market data analysis based on recent sales of comparable homes in the area and,                                                      
when deemed appropriate, a replacement cost analysis based on the current cost                                                       
of constructing a similar home. All appraisals are required to conform to Fannie                                                     
Mae or Freddie Mac appraisal standards then in effect.                                                                               
                                                                                                                                     
         The seller requires title insurance on all of its mortgage loans                                                            
secured by first liens on real property. The seller also requires that fire and                                                      
extended coverage casualty insurance be maintained on the mortgaged property in                                                      
an amount at least equal to the principal balance of the related single-family                                                       
mortgage loan or the replacement cost of the mortgaged property, whichever is                                                        
less.                                                                                                                                
                                                                                                                                     
         The seller's underwriting guidelines generally allow Loan-to-Value                                                          
Ratios at origination of up to 95% for purchase money or rate and term refinance                                                     
mortgage loans with original principal balances of up to $400,000, up to 90% for                                                     
mortgage loans with original principal balances of up to $650,000, up to 80% for                                                     
mortgage loans with original principal balances of up to $1,000,000, up to 75%                                                       
for mortgage loans with original principal balances of up to $1,500,000, and up                                                      
to 70% for mortgage loans with original principal balances of up to $3,000,000.                                                      
Under certain circumstances, however, the seller's underwriting guidelines allow                                                     
for Loan-to-Value Ratios of up to 100% for purchase money mortgage loans with                                                        
original principal balances of up to $375,000.                                                                                       
                                                                                                                                     
         For cash-out refinance mortgage loans, the seller's underwriting                                                            
guidelines permit Loan-to-Value Ratios at origination of up to 90% for mortgage                                                      
loans with original principal balances of up to $1,500,000. The maximum                                                              
"cash-out" amount permitted is $400,000 and is based in part on the original                                                         
Loan-to-Value Ratio of the related mortgage loan. As used in this prospectus                                                         
supplement, a refinance mortgage loan is classified as a cash-out                                                                    
                                                                                                                                     
                                      S-20                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
refinance mortgage loan by the seller if the borrower retains an amount equal to                                                     
the lesser of 2% of the entire amount of the proceeds from the refinancing of                                                        
the existing loan, or $2,000.                                                                                                        
                                                                                                                                     
         Under its underwriting guidelines, the seller generally permits a                                                           
debt-to-income ratio based on the borrower's monthly housing expenses of up to                                                       
36% and a debt-to-income ratio based on the borrower's total monthly debt of up                                                      
to 40%; provided, however, that if the Loan-to-Value Ratio exceeds 80%, the                                                          
maximum permitted debt-to-income ratios are 33% and 38%, respectively.                                                               
                                                                                                                                     
         Under its underwriting guidelines, the seller may originate mortgage                                                        
loans to borrowers who are not U.S. citizens, including permanent and                                                                
non-permanent residents. The borrower is required to have a valid U.S. social                                                        
security number or a certificate of foreign status (IRS form W-8). The maximum                                                       
Loan-to-Value Ratio for these loans is 90%.                                                                                          
                                                                                                                                     
                           SERVICING OF MORTGAGE LOANS                                                                               
                                                                                                                                     
COUNTRYWIDE HOME LOANS SERVICING LP                                                                                                  
                                                                                                                                     
         Countrywide Home Loans Servicing LP ("Countrywide Servicing") will act                                                      
as master servicer. The principal executive offices of Countrywide Servicing are                                                     
located at 7105 Corporate Drive, Plano, TX 75024. Countrywide Servicing is a                                                         
Texas limited partnership directly owned by Countrywide GP, Inc. and Countrywide                                                     
LP, Inc., each a Nevada corporation and a direct wholly owned subsidiary of                                                          
Countrywide Home Loans, Inc., a New York corporation ("Countrywide Home Loans").                                                     
Countrywide Home Loans is a direct wholly owned subsidiary of Countrywide                                                            
Financial Corporation (formerly known as Countrywide Credit Industries, Inc.), a                                                     
Delaware corporation ("Countrywide Financial"). Countrywide GP, Inc. owns a 0.1%                                                     
interest in Countrywide Servicing and is the general partner. Countrywide LP,                                                        
Inc. owns a 99.9% interest in Countrywide Servicing and is a limited partner.                                                        
                                                                                                                                     
         Countrywide Home Loans established Countrywide Servicing in February                                                        
2000 to service Countrywide Home Loans originated mortgage loans that would                                                          
otherwise have been serviced by Countrywide Home Loans. In January and February                                                      
2001, Countrywide Home Loans transferred to Countrywide Servicing all of its                                                         
rights and obligations relating to mortgage loans serviced on behalf of Fannie                                                       
Mae and Freddie Mac, respectively. In October 2001, Countrywide Home Loans                                                           
transferred to Countrywide Servicing all of its rights and obligations to the                                                        
bulk of its non-agency loan servicing portfolio, including with respect to those                                                     
mortgage loans formerly serviced by Countrywide Home Loans and securitized by                                                        
CWMBS, Inc. While Countrywide Home Loans expects to continue to directly service                                                     
a portion of its loan portfolio, it is expected that the servicing rights for                                                        
most newly originated Countrywide Home Loans product will be transferred to                                                          
Countrywide Servicing upon sale or securitization of the related mortgage loans.                                                     
Countrywide Servicing is engaged in the business of servicing mortgage loans and                                                     
will not originate or acquire loans, an activity that will continue to be                                                            
performed by Countrywide Home Loans. In addition to acquiring mortgage servicing                                                     
rights from Countrywide Home Loans, it is expected that Countrywide Servicing                                                        
will service mortgage loans for non-Countrywide affiliated parties as well as                                                        
subservice mortgage loans on behalf of other master servicers.                                                                       
                                                                                                                                     
         In connection with the establishment of Countrywide Servicing, certain                                                      
employees of Countrywide Home Loans became employees of Countrywide Servicing.                                                       
Countrywide Servicing has engaged Countrywide Home Loans as a subservicer to                                                         
perform certain loan servicing activities on its behalf.                                                                             
                                                                                                                                     
         Countrywide Servicing is an approved mortgage loan servicer for Fannie                                                      
Mae, Freddie Mac, Ginnie Mae, HUD and VA and is licensed to service mortgage                                                         
loans in those states where a license is required. Its loan servicing activities                                                     
are guaranteed by Countrywide Financial and Countrywide Home Loans (when                                                             
required by the owner of the mortgage loans). As of June 30, 2003, Countrywide                                                       
Servicing had a net worth of approximately $7.2 billion.                                                                             
                                                                                                                                     
         In its capacity as master servicer, Countrywide Servicing will be                                                           
responsible for servicing the mortgage loans in accordance with the terms set                                                        
forth in the pooling and servicing agreement. Countrywide Servicing may perform                                                      
any of its obligations under the pooling and servicing agreement through one or                                                      
more subservicers, which may include Countrywide Home Loans. Notwithstanding any                                                     
subservicing arrangement, Countrywide Servicing will                                                                                 
                                                                                                                                     
                                      S-21                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
remain liable for its servicing duties and obligations under the pooling and                                                         
servicing agreement as if Countrywide Servicing alone were servicing the                                                             
mortgage loans.                                                                                                                      
                                                                                                                                     
COUNTRYWIDE HOME LOANS                                                                                                               
                                                                                                                                     
         Countrywide Home Loans is engaged primarily in the mortgage banking                                                         
business, and as such, originates, purchases, sells and services (either                                                             
directly or through subsidiaries) mortgage loans. Countrywide Home Loans                                                             
originates mortgage loans through a retail branch system and through mortgage                                                        
loan brokers and correspondents nationwide. Countrywide Home Loans' mortgage                                                         
loans are principally first-lien, fixed or adjustable rate mortgage loans                                                            
secured by single-family residences. References in the remainder of this                                                             
prospectus supplement to Countrywide Home Loans should be read to include                                                            
Countrywide Home Loans, and its consolidated subsidiaries, including Countrywide                                                     
Servicing.                                                                                                                           
                                                                                                                                     
         The principal executive offices of Countrywide Home Loans are located                                                       
at 4500 Park Granada, Calabasas, California 91302.                                                                                   
                                                                                                                                     
         Countrywide Home Loans services substantially all of the mortgage loans                                                     
it originates or acquires. In addition, Countrywide Home Loans has purchased in                                                      
bulk the rights to service mortgage loans originated by other lenders.                                                               
Countrywide Home Loans has in the past and may in the future sell to other                                                           
mortgage bankers a portion of its portfolio of loan servicing rights. As of June                                                     
30, 2003, Countrywide Home Loans provided servicing for approximately $559.124                                                       
billion aggregate principal amount of mortgage loans, substantially all of which                                                     
are being serviced for unaffiliated persons.                                                                                         
                                                                                                                                     
MORTGAGE LOAN PRODUCTION                                                                                                             
                                                                                                                                     
         The following table sets forth, by number and dollar amount of mortgage                                                     
loans, Countrywide Home Loans' residential mortgage loan production for the                                                          
periods indicated.                                                                                                                   

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                                             10 MONTH       YEAR         6 MONTH                     
                                        YEAR ENDED FEBRUARY 28(29),        PERIOD ENDED     ENDED      PERIOD ENDED                  
                                  --------------------------------------   DECEMBER 31,  DECEMBER 31,    JUNE 30,                    
                                     1999          2000          2001          2001          2002          2003                      
                                  ----------    ----------    ----------   ------------  ------------  ------------                  
                                       (DOLLAR AMOUNTS IN MILLIONS)                                                                  
<S>                               <C>           <C>           <C>          <C>           <C>           <C>                           
FHA VA Loans                                                                                                                         
   Number of Loans ............      190,898       131,684       118,673       118,734       157,628        60,343                   
   Volume of Loans ............   $   19,165    $   13,598    $   13,075    $   14,108    $   19,093    $   12,528                   
Conventional Loans                                                                                                                   
   Number of Loans ............      529,741       347,095       327,208       642,568     1,277,072     1,199,635                   
   Volume of Loans ............   $   69,018    $   45,341    $   45,828    $   98,625    $  211,737    $  204,649                   
Other Loans                                                                                                                          
   Number of Loans ............       90,400       149,464       170,751       207,862       379,244       256,915                   
   Volume of Loans ............   $    4,697    $    7,801    $   10,020    $   11,236    $   21,071    $   15,436                   
Total Loans                                                                                                                          
   Number of Loans ............      811,039       628,243       616,632       969,164     1,813,944     1,516,893                   
   Volume of Loans ............   $   92,880    $   66,740    $   68,923    $  123,969    $  251,900    $  232,613                   
</TABLE>                                                                                                                             

FORECLOSURE, DELINQUENCY AND LOSS EXPERIENCE                                                                                         
                                                                                                                                     
         Historically, a variety of factors, including the appreciation of real                                                      
estate values, have limited Countrywide Home Loans' loss and delinquency                                                             
experience on its portfolio of serviced mortgage loans. There can be no                                                              
assurance that factors beyond the control of Countrywide Home Loans, such as                                                         
national or local economic conditions or downturns in the real estate markets of                                                     
its lending areas, will not result in increased rates of delinquencies and                                                           
foreclosure losses in the future.                                                                                                    
                                                                                                                                     
                                      S-22                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         A general deterioration of the real estate market in regions where the                                                      
mortgaged properties are located may result in increases in delinquencies of                                                         
loans secured by real estate, slower absorption rates of real estate into the                                                        
market and lower sales prices for real estate. A general weakening of the                                                            
economy may result in decreases in the financial strength of borrowers and                                                           
decreases in the value of collateral serving as security for loans. If the real                                                      
estate market and economy were to decline, Countrywide Home Loans may experience                                                     
an increase in delinquencies on the loans it services and higher net losses on                                                       
liquidated loans.                                                                                                                    
                                                                                                                                     
         The following table summarizes the delinquency, foreclosure and loss                                                        
experience, respectively, on the dates indicated, of all mortgage loans                                                              
originated or acquired by Countrywide Home Loans, serviced or master serviced by                                                     
Countrywide Home Loans and securitized by the depositor. The delinquency,                                                            
foreclosure and loss percentages may be affected by the size and relative lack                                                       
of seasoning of the servicing portfolio which increased from approximately                                                           
$15.844 billion at February 28, 1999, to approximately $17.759 billion at                                                            
February 29, 2000, to approximately $21.251 billion at February 28, 2001, to                                                         
approximately $25.658 billion at December 31, 2001, to approximately $33.455                                                         
billion at December 31, 2002, and to approximately $42.595 billion at June 30,                                                       
2003. Accordingly, the information should not be considered as a basis for                                                           
assessing the likelihood, amount or severity of delinquency or losses on the                                                         
mortgage loans and no assurances can be given that the foreclosure, delinquency                                                      
and loss experience presented in the following table will be indicative of the                                                       
actual experience on the mortgage loans (totals may not add due to rounding):                                                        

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                AT FEBRUARY 28(29),                        AT DECEMBER 31,           AT JUNE 30,     
                                   ---------------------------------------------   ------------------------------   -------------    
                                       1999            2000            2001            2001             2002             2003        
                                   -------------   -------------   -------------   -------------   --------------   -------------    
<S>                                <C>             <C>             <C>             <C>             <C>              <C>              
Delinquent Mortgage Loans and                                                                                                        
  Pending Foreclosures at                                                                                                            
  Period End:                                                                                                                        
     30-59 days .................         1.03%           1.36%           1.61%           1.89%            2.11%            2.04%    
     60-89 days .................         0.18            0.22            0.28            0.39             0.53             0.52     
     90 days or more (excluding                                                                                                      
        pending foreclosures) ...         0.12            0.16            0.14            0.23             0.35             0.70     
                                   -----------     -----------     -----------     -----------     ------------     ------------     
          Total of delinquencies          1.32%           1.75%           2.03%           2.51%            2.99%            3.25%    
                                   ===========     ===========     ===========     ===========     ============     ============     
Foreclosures pending ............         0.14%           0.16%           0.27%           0.31%            0.31%            0.90%    
                                   ===========     ===========     ===========     ===========     ============     ============     
Total delinquencies and                                                                                                              
  foreclosures pending ..........         1.46%           1.91%           2.30%           2.82%            3.31%            4.15%    
                                   ===========     ===========     ===========     ===========     ============     ============     
                                                                                                                                     
Net Gains/(Losses) on liquidated                                                                                                     
  loans(1) ......................  $(2,882,524)    $(3,076,240)    $(2,988,604)    $(5,677,141)    $(10,788,657)    $(10,244,403)    
Percentage of Net Gains/(Losses)                                                                                                     
  on liquidated loans(1)(2) .....       (0.018)%        (0.017)%        (0.014)%        (0.022)%         (0.032)%         (0.024)%   
Percentage of Net Gains/(Losses)                                                                                                     
  on liquidated loans (based on                                                                                                      
  average outstanding principal                                                                                                      
  balance)(1) ...................       (0.021)%        (0.017)%        (0.015)%        (0.023)%         (0.033)%         (0.025)%   
</TABLE>                                                                                                                             
                                                                                                                                     
------------                                                                                                                         
(1) "Net Gains/(Losses)" are actual gains or losses incurred on liquidated                                                           
    properties that are calculated as net liquidation proceeds less book value                                                       
    (excluding loan purchase premium or discount).                                                                                   
                                                                                                                                     
(2) Based upon the total principal balance of the mortgage loans outstanding on                                                      
    the last day of the indicated period.                                                                                            
                                                                                                                                     
SERVICING COMPENSATION AND PAYMENT OF EXPENSES                                                                                       
                                                                                                                                     
         The Expense Fees with respect to the mortgage pool are payable out of                                                       

the interest payments on each mortgage loan. The Expense Fees (other than the                                                        
excess master servicing fee, which is calculated as described below) will be                                                         
0.209% per annum of the Stated Principal Balance of each mortgage loan. The                                                          
Expense Fees consist of (a) the basic master servicing fee payable to the master                                                     
servicer in respect of its master servicing activities, (b) the excess master                                                        
servicing fee payable to the master servicer and (c) fees payable to the trustee                                                     
in respect of its activities as trustee under the pooling and servicing                                                              
agreement. The master servicing fee will consist of the basic master servicing                                                       
fee and the excess master servicing fee. The basic master servicing fee will be                                                      
0.20% per annum of the Stated Principal Balance of each mortgage loan. The                                                           
excess master servicing fee will be an amount, with respect                                                                          
                                                                                                                                     
                                      S-23                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
to each Non-Discount mortgage loan equal to (x) the excess of (a) the net                                                            
mortgage rate of the Non-Discount mortgage loan over (b) 5.00%, multiplied by                                                        
(y) the Stated Principal Balance of such Non-Discount mortgage loan as of the                                                        
Due Date in the prior calendar month. The master servicer is obligated to pay                                                        
some but not all ongoing expenses associated with the trust fund and incurred by                                                     
the master servicer in connection with its responsibilities under the pooling                                                        
and servicing agreement and those amounts will be paid by the master servicer                                                        
out of the basic master servicing fee. The amount of the basic master servicing                                                      
fee is subject to adjustment with respect to prepaid mortgage loans, as                                                              
described under "-- Adjustment to Servicing Compensation in Connection with                                                          
Certain Prepaid Mortgage Loans." The excess master servicing fee is not subject                                                      
to a similar adjustment. The master servicer is also entitled to receive, as                                                         
additional servicing compensation, all late payment fees, prepayment penalties,                                                      
assumption fees and other similar charges and all reinvestment income earned on                                                      
amounts on deposit in the Certificate Account and Distribution Account.                                                              
                                                                                                                                     
         The net mortgage rate of a mortgage loan is its mortgage rate (net of                                                       
the interest premium charged by the related lenders for the lender acquired                                                          
mortgage insurance mortgage loans) less the sum of the basic master servicing                                                        
fee and the trustee fee on the mortgage loan (expressed as a per annum                                                               
percentage of its Stated Principal Balance).                                                                                         
                                                                                                                                     
ADJUSTMENT TO SERVICING COMPENSATION IN CONNECTION WITH CERTAIN PREPAID MORTGAGE                                                     
LOANS                                                                                                                                
                                                                                                                                     
         When a borrower prepays a mortgage loan between Due Dates, the borrower                                                     
is required to pay interest on the amount prepaid only to the date of prepayment                                                     
and not thereafter. Except with respect to the month of the initial cut-off                                                          
date, principal prepayments by borrowers received by the master servicer from                                                        
the first day through the fifteenth day of a calendar month will be distributed                                                      
to certificateholders on the Distribution Date in the same month in which the                                                        
prepayments are received and, accordingly, no shortfall in the amount of                                                             
interest to be distributed to certificateholders with respect to the prepaid                                                         
mortgage loans results. Conversely, principal prepayments by borrowers received                                                      
by the master servicer from the sixteenth day (or, in the case of the first                                                          
Distribution Date, from August 1, 2003) through the last day of a calendar month                                                     
will be distributed to certificateholders on the Distribution Date in the month                                                      
following the month of receipt and, accordingly, a shortfall in the amount of                                                        
interest to be distributed to certificateholders with respect to the prepaid                                                         
mortgage loans would result. Pursuant to the pooling and servicing agreement,                                                        
the basic master servicing fee for any month will be reduced, but not by more                                                        
than an amount equal to the product of one-twelfth of 0.125% and the aggregate                                                       
stated principal balance of the mortgage loans, by an amount sufficient to pass                                                      
through to certificateholders the full amount of interest to which they would be                                                     
entitled for each prepaid mortgage loan on the related Distribution Date.                                                            
                                                                                                                                     
         If shortfalls in interest as a result of prepayments in any Prepayment                                                      
Period exceed an amount equal to the product of one-twelfth of 0.125% and the                                                        
aggregate stated principal balance of the mortgage loans, the amount of interest                                                     
distributed to certificateholders will be reduced by the amount of the excess.                                                       
Any such reduction allocable to the Class A-3 Certificates on a Distribution                                                         
Date will be covered only to the extent of amounts on deposit in the reserve                                                         
fund. Any shortfalls in excess thereof will not be covered by the Class A-3                                                          
Policy and will be borne by the holders of the Class A-3 Certificates. See                                                           
"Description of the Certificates -- Interest" in this prospectus supplement.                                                         
                                                                                                                                     
ADVANCES                                                                                                                             
                                                                                                                                     
         Subject to the following limitations, the master servicer will be                                                           
required to advance before each Distribution Date, from its own funds or funds                                                       
in the Certificate Account that do not constitute Available Funds for that                                                           
Distribution Date, an amount equal to the aggregate of payments of principal and                                                     
interest on the mortgage loans (net of the basic master servicing fee and the                                                        
excess master servicing fee) which were due on the related Due Date and which                                                        
were delinquent on the related Determination Date, together with an amount                                                           
equivalent to interest on each mortgage loan as to which the related mortgaged                                                       
property has been acquired by the trust fund through foreclosure or deed-in-lieu                                                     
of foreclosure. The "Determination Date" is the 22nd day of each month or, if                                                        
that day is not a business day, the preceding business day; provided that the                                                        
Determination Date in each month will be at least two business days before the                                                       
related Distribution Date.                                                                                                           
                                                                                                                                     
         Advances are intended to maintain a regular flow of scheduled interest                                                      
and principal payments on the certificates rather than to guarantee or insure                                                        
against losses. The master servicer is obligated to make advances with                                                               
                                                                                                                                     
                                      S-24                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
respect to delinquent payments of principal of or interest on each mortgage loan                                                     
to the extent that the advances are, in its reasonable judgment, recoverable                                                         
from future payments and collections or insurance payments or proceeds of                                                            
liquidation of the related mortgage loan. If the master servicer determines on                                                       
any Determination Date to make an advance, the advance will be included with the                                                     
distribution to certificateholders on the related Distribution Date. Any failure                                                     
by the master servicer to make a deposit in the Certificate Account as required                                                      
under the pooling and servicing agreement, including any failure to make an                                                          
advance, will constitute an event of default under the pooling and servicing                                                         
agreement if the failure remains unremedied for five days after written notice                                                       
of it. If the master servicer is terminated as a result of the occurrence of an                                                      
event of default, the trustee or the successor master servicer will be obligated                                                     
to make any advance, in accordance with the terms of the pooling and servicing                                                       
agreement.                                                                                                                           
                                                                                                                                     
CERTAIN MODIFICATIONS AND REFINANCINGS                                                                                               
                                                                                                                                     
         The master servicer may modify any mortgage loan provided that the                                                          
master servicer purchases the mortgage loan from the trust fund immediately                                                          
following the modification. A mortgage loan may not be modified unless the                                                           
modification includes a change in the interest rate on the related mortgage loan                                                     
to approximately a prevailing market rate. Any purchase of a mortgage loan                                                           
subject to a modification will be for a price equal to 100% of the Stated                                                            
Principal Balance of that mortgage loan, plus accrued and unpaid interest on the                                                     
mortgage loan up to the next Due Date at the applicable net mortgage rate, net                                                       
of any unreimbursed advances of principal and interest on the mortgage loan made                                                     
by the master servicer. The master servicer will deposit the purchase price in                                                       
the Certificate Account within one business day of the purchase of that mortgage                                                     
loan. Purchases of mortgage loans may occur when prevailing interest rates are                                                       
below the interest rates on the mortgage loans and mortgagors request                                                                
modifications as an alternative to refinancings. The master servicer will                                                            
indemnify the trust fund against liability for any prohibited transactions taxes                                                     
and related interest, additions or penalties incurred by the REMIC as a result                                                       
of any modification or purchase.                                                                                                     
                                                                                                                                     
                         DESCRIPTION OF THE CERTIFICATES                                                                             
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         The certificates will be issued pursuant to the pooling and servicing                                                       
agreement. The following summaries of the material terms pursuant to which the                                                       
certificates will be issued do not purport to be complete and are subject to,                                                        
and are qualified in their entirety by reference to, the provisions of the                                                           
pooling and servicing agreement. When particular provisions or terms used in the                                                     
pooling and servicing agreement are referred to, the actual provisions                                                               
(including definitions of terms) are incorporated by reference. The certificates                                                     
represent obligations of the trust fund only and do not represent an interest in                                                     
or obligation of CWMBS, Inc., Countrywide Home Loans, Inc., Countrywide Home                                                         
Loans Servicing LP or any of their affiliates.                                                                                       
                                                                                                                                     
         The Mortgage Pass-Through Certificates, Series 2003-44, will consist of                                                     
the Class A-1, Class A-2, Class A-3, Class A-4, Class A-5, Class A-6, Class A-7,                                                     
Class A-8, Class A-9, Class A-10, Class A-11, Class PO and Class A-R                                                                 
Certificates (all of which are together referred to as senior certificates) and                                                      
the Class M, Class B-1, Class B-2, Class B-3, Class B-4 and Class B-5                                                                
Certificates (all of which are together referred to as subordinated                                                                  
certificates). Only the classes of certificates listed on the cover page are                                                         
offered by this prospectus supplement. The Class B-3, Class B-4 and Class B-5                                                        
Certificates are not offered by this prospectus supplement. Their initial Class                                                      
Certificate Balances are expected to be approximately $1,000,000, $750,000 and                                                       
$1,000,000 respectively, and their pass-through rates will be 5.00% per annum.                                                       
The classes of offered certificates will have the respective initial Class                                                           
Certificate Balances and pass-through rates set forth on the cover page hereof.                                                      
The initial Class Certificate Balances may vary in the aggregate by plus or                                                          
minus 5%.                                                                                                                            
                                                                                                                                     
         The "Class Certificate Balance" of any class of certificates as of any                                                      
Distribution Date is the initial Class Certificate Balance of the class reduced                                                      
by the sum of:                                                                                                                       
                                                                                                                                     
         -    all amounts previously distributed to holders of certificates of                                                       
              the class as payments of principal,                                                                                    
                                                                                                                                     
         -    the amount of Realized Losses (including Excess Losses) allocated                                                      
              to the class, and                                                                                                      
                                                                                                                                     
                                      S-25                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    in the case of any class of subordinated certificates, any amounts                                                     
              allocated to the class in reduction of its Class Certificate                                                           
              Balance in respect of payments of Class PO Deferred Amounts, as                                                        
              described under " -- Allocation of Losses;"                                                                            
                                                                                                                                     
provided, however, that the Class Certificate Balance of each class of                                                               
certificates to which Realized Losses have been allocated shall be increased,                                                        
sequentially in the order of payment priority, by the amount of Subsequent                                                           
Recoveries distributed as principal to any class of certificates, but not by                                                         
more than the amount of Realized Losses previously allocated to reduce the Class                                                     
Certificate Balance of such class of certificates. See "Application of                                                               
Liquidation Proceeds" in the prospectus.                                                                                             
                                                                                                                                     
In addition, the Class Certificate Balance of the class of subordinated                                                              
certificates then outstanding with the highest numerical class designation will                                                      
be reduced if and to the extent that the aggregate of the Class Certificate                                                          
Balances of all classes of certificates, following all distributions and the                                                         
allocation of Realized Losses on any Distribution Date after the first                                                               
Distribution Date following the Conveyance Period exceeds the pool principal                                                         
balance as of the Due Date occurring in the month of the Distribution Date.                                                          
                                                                                                                                     
         The senior certificates will have an initial aggregate principal                                                            
balance of approximately $486,499,999 and will evidence in the aggregate an                                                          
initial beneficial ownership interest of approximately 97.30% in the trust fund.                                                     
The Class Certificate Balance of the Class PO Certificates as of the closing                                                         
date is expected to be approximately $316,250 based on assumptions with respect                                                      
to the Supplemental Mortgage Loans. It is expected that there will be a                                                              
principal prepayment on the Class PO Certificates on the first Distribution Date                                                     
after the end of the Conveyance Period as a result of the actual characteristics                                                     
of the Supplemental Mortgage Loans. The Class M, Class B-1, Class B-2, Class                                                         
B-3, Class B-4 and Class B-5 Certificates will each evidence in the aggregate an                                                     
initial beneficial ownership interest of approximately 1.30%, 0.55%, 0.30%,                                                          
0.20%, 0.15% and 0.20%, respectively, in the trust fund.                                                                             
                                                                                                                                     
         The Class A-R, Class B-3, Class B-4 and Class B-5 Certificates will be                                                      
issued in fully registered certificated form. All of the remaining classes of                                                        
certificates will be represented by book-entry certificates. The book-entry                                                          
certificates will be issuable in book-entry form only. The Class A-R                                                                 
Certificates will be issued in a denomination of $100.                                                                               
                                                                                                                                     
BOOK-ENTRY CERTIFICATES                                                                                                              
                                                                                                                                     
         The offered certificates, other than the Class A-R Certificates, will                                                       
be issued as book-entry certificates. Each class of book-entry certificates will                                                     
be issued as one or more certificates which equal the aggregate initial Class                                                        
Certificate Balance of each class of certificates and which will be held by a                                                        
depository, initially a nominee of The Depository Trust Company. Beneficial                                                          
interests in the book entry certificates will be held indirectly by investors                                                        
through the book-entry facilities of the depository, as described in this                                                            
prospectus supplement. Investors may hold the beneficial interests in the book                                                       
entry certificates (other than the Class A-3, Class A-5 and Class A-8                                                                
Certificates) in minimum denominations representing an original principal amount                                                     
of $25,000 and integral multiples of $1,000 in excess thereof. Investors may                                                         
hold the beneficial interests in the Class A-3, Class A-5 and Class A-8                                                              
Certificates in minimum denominations representing an original principal amount                                                      
of $1,000 and integral multiples of $1,000 in excess thereof. One investor of                                                        
each class of book-entry certificates may hold a beneficial interest therein                                                         
that is not an integral multiple of $1,000. The depositor has been informed by                                                       
the depository that its nominee will be CEDE & Co. Accordingly, CEDE is expected                                                     
to be the holder of record of the book-entry certificates. Except as described                                                       
in the prospectus under "Description of the Certificates -- Book-Entry                                                               
Certificates," no beneficial owner acquiring a book-entry certificate will be                                                        
entitled to receive a physical certificate representing the certificate.                                                             
                                                                                                                                     
         Unless and until definitive certificates are issued, it is anticipated                                                      
that the only certificateholder of the book-entry certificates will be CEDE, as                                                      
nominee of the depository. Beneficial owners of the book-entry certificates will                                                     
not be certificateholders, as that term is used in the pooling and servicing                                                         
agreement. Beneficial owners are only permitted to exercise the rights of                                                            
certificateholders indirectly through financial intermediaries and the                                                               
depository. Monthly and annual reports on the trust fund provided to CEDE, as                                                        
nominee of the depository, may be made available to beneficial owners upon                                                           
request, in accordance with the rules, regulations and procedures creating and                                                       
affecting the depository, and to the financial intermediaries to whose                                                               
depository accounts the book-entry certificates of the beneficial owners are                                                         
credited.                                                                                                                            
                                                                                                                                     
                                      S-26                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         For a description of the procedures generally applicable to the                                                             
book-entry certificates, see "Description of the Certificates -- Book-Entry                                                          
Certificates" in the prospectus.                                                                                                     
                                                                                                                                     
         Although DTC has agreed to the foregoing procedures in order to                                                             
facilitate transfers of certificates among participants of DTC, they are under                                                       
no obligation to perform or continue to perform such procedures and such                                                             
procedures may be discontinued at any time.                                                                                          
                                                                                                                                     
PAYMENTS ON MORTGAGE LOANS; ACCOUNTS                                                                                                 
                                                                                                                                     
         On or before the closing date, the master servicer will establish an                                                        
account (the "Certificate Account"), which will be maintained in trust for the                                                       
benefit of the certificateholders. The master servicer will deposit or cause to                                                      
be deposited in the Certificate Account all amounts required to be deposited                                                         
therein, within two business days after receipt (or, on a daily basis, if the                                                        
long term credit rating of Countrywide Home Loans has been reduced below the                                                         
rating specified in the pooling and servicing agreement). Funds credited to the                                                      
Certificate Account may be invested for the benefit and at the risk of the                                                           
master servicer in permitted investments, as defined in the pooling and                                                              
servicing agreement, that are scheduled to mature on or before the business day                                                      
preceding the next Distribution Date. On or before the business day immediately                                                      
preceding each Distribution Date, the master servicer will withdraw from the                                                         
Certificate Account the amount of Available Funds and will deposit the Available                                                     
Funds in an account established and maintained with the trustee on behalf of the                                                     
certificateholders (the "Distribution Account"). Upon termination of the                                                             
Conveyance Period, the trustee will deposit into the Distribution Account any                                                        
amounts remaining in the Supplemental Loan Account, other than investment                                                            
earnings, for distribution to the certificateholders.                                                                                
                                                                                                                                     
DISTRIBUTIONS                                                                                                                        
                                                                                                                                     
         Distributions on the certificates will be made by the trustee on the                                                        
25th day of each month or, if that day is not a business day, on the first                                                           
business day thereafter, commencing in September 2003 (each, a "Distribution                                                         
Date"), to the persons in whose names the certificates are registered at the                                                         
close of business on the last business day of the month preceding the month of                                                       
the Distribution Date.                                                                                                               
                                                                                                                                     
         Distributions on each Distribution Date will be made by check mailed to                                                     
the address of the person entitled to it as it appears on the applicable                                                             
certificate register or, in the case of a certificateholder who holds 100% of a                                                      
class of certificates or who holds certificates with an aggregate initial                                                            
certificate balance of $1,000,000 or more and who has so notified the trustee in                                                     
writing in accordance with the pooling and servicing agreement, by wire transfer                                                     
in immediately available funds to the account of the certificateholder at a bank                                                     
or other depository institution having appropriate wire transfer facilities;                                                         
provided, however, that the final distribution in retirement of the certificates                                                     
will be made only upon presentment and surrender of the certificates at the                                                          
Corporate Trust Office of the trustee.                                                                                               
                                                                                                                                     
PRIORITY OF DISTRIBUTIONS AMONG CERTIFICATES                                                                                         
                                                                                                                                     
         As more fully described in this prospectus supplement, distributions                                                        
will be made on each Distribution Date from Available Funds in the following                                                         
order of priority:                                                                                                                   
                                                                                                                                     
         -    to interest on each interest-bearing class of senior certificates,                                                     
              pro rata, based on their respective interest distribution amounts;                                                     
                                                                                                                                     
         -    to principal of the classes of senior certificates then entitled                                                       
              to receive distributions of principal, in the order and subject to                                                     
              the priorities set forth under "Description of the Certificates --                                                     
              Principal" in this prospectus supplement in each case in an                                                            
              aggregate amount up to the maximum amount of principal to be                                                           
              distributed on the classes on the Distribution Date;                                                                   
                                                                                                                                     
         -    to any Class PO Deferred Amounts with respect to the Class PO                                                          
              Certificates, but only from amounts that would otherwise be                                                            
              distributed on the Distribution Date as principal of the                                                               
              subordinated certificates; and                                                                                         
                                                                                                                                     
                                      S-27                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    to interest on and then principal of each class of subordinated                                                        
              certificates, in the order of their numerical class designations,                                                      
              beginning with the Class M Certificates, in each case subject to                                                       
              the limitations set forth under "Description of the Certificates                                                       
              -- Interest" and " -- Principal" in this prospectus supplement.                                                        
                                                                                                                                     
         "Available Funds" for any Distribution Date will be equal to the sum                                                        
of:                                                                                                                                  
                                                                                                                                     
         -    all scheduled installments of interest (net of the related Expense                                                     
              Fees) and principal due on the Due Date in the month in which the                                                      
              Distribution Date occurs and received before the related                                                               
              Determination Date, together with any advances with respect to                                                         
              them;                                                                                                                  
                                                                                                                                     
         -    all proceeds of any primary mortgage guaranty insurance policies                                                       
              and any other insurance policies with respect to the mortgage                                                          
              loans, to the extent the proceeds are not applied to the                                                               
              restoration of the related mortgaged property or released to the                                                       
              mortgagor in accordance with the master servicer's normal                                                              
              servicing procedures and all other cash amounts received and                                                           
              retained in connection with (a) the liquidation of defaulted                                                           
              mortgage loans, by foreclosure or otherwise during the calendar                                                        
              month preceding the month of the Distribution Date (in each case,                                                      
              net of unreimbursed expenses incurred in connection with a                                                             
              liquidation or foreclosure and unreimbursed advances, if any) and                                                      
              (b) any Subsequent Recoveries;                                                                                         
                                                                                                                                     
         -    all partial or full prepayments received during the related                                                            
              Prepayment Period;                                                                                                     
                                                                                                                                     
         -    amounts received with respect to the Distribution Date as the                                                          
              Substitution Adjustment Amount or purchase price in respect of a                                                       
              deleted mortgage loan or a mortgage loan repurchased by the seller                                                     
              or the master servicer as of the Distribution Date;                                                                    
                                                                                                                                     
         -    for each Distribution Date during, and the Distribution Date                                                           
              immediately after the Conveyance Period, any amounts required                                                          
              pursuant to the pooling and servicing agreement to be deposited                                                        
              from the Capitalized Interest Account, and for the first                                                               
              Distribution Date following the Conveyance Period, any amounts                                                         
              remaining in the Supplemental Loan Account after the end of the                                                        
              Conveyance Period (net of any investment income thereon); and                                                          
                                                                                                                                     
         -    with respect to the Class A-3 Certificates only, any amounts                                                           
              withdrawn from the reserve fund and any payments made by the                                                           
              insurer under the Class A-3 Policy;                                                                                    
                                                                                                                                     
reduced by (other than with respect to payments made under the last bullet point                                                     
above) amounts in reimbursement for advances previously made and other amounts                                                       
as to which the master servicer is entitled to be reimbursed from the                                                                
Certificate Account pursuant to the pooling and servicing agreement.                                                                 
                                                                                                                                     
INTEREST                                                                                                                             
                                                                                                                                     
         The classes of offered certificates will have the respective                                                                
pass-through rates set forth on the cover page hereof.                                                                               
                                                                                                                                     
         On each Distribution Date, to the extent of funds available therefor,                                                       
each interest-bearing class of certificates will be entitled to receive an                                                           
amount allocable to interest for the related interest accrual period. This                                                           
interest distribution amount for any interest-bearing class will be equal to the                                                     
sum of (a) interest at the applicable pass-through rate on the related Class                                                         
Certificate Balance immediately prior to the applicable Distribution Date, and                                                       
(b) the sum of the amounts, if any, by which the amount described in clause (a)                                                      
above on each prior Distribution Date exceeded the amount actually distributed                                                       
as interest on the prior Distribution Dates and not subsequently distributed                                                         
(which are called unpaid interest amounts). The Class A-6, Class A-9 and Class                                                       
PO Certificates are principal only certificates and will not bear interest.                                                          
                                                                                                                                     
         With respect to each Distribution Date for all of the interest-bearing                                                      
certificates, the interest accrual period will be the calendar month preceding                                                       
the month of the Distribution Date. Each interest accrual period will be                                                             
                                                                                                                                     
                                      S-28                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
deemed to consist of 30 days. Interest will be calculated and payable on the                                                         
basis of a 360-day year divided into twelve 30-day months.                                                                           
                                                                                                                                     
         The interest entitlement described above for each class of certificates                                                     
for any Distribution Date will be reduced by the amount of "Net Interest                                                             
Shortfalls" for the Distribution Date. The excess master servicing fee will not                                                      
be similarly reduced. With respect to any Distribution Date, the "Net Interest                                                       
Shortfall" is equal to                                                                                                               
                                                                                                                                     
         -    any net prepayment interest shortfalls for the Distribution Date                                                       
              and                                                                                                                    
                                                                                                                                     
         -    the amount of interest that would otherwise have been received                                                         
              with respect to any mortgage loan that was the subject of a Relief                                                     
              Act Reduction or a Special Hazard Loss, Fraud Loss, Debt Service                                                       
              Reduction or Deficient Valuation, after the exhaustion of the                                                          
              respective amounts of coverage provided by the subordinated                                                            
              certificates for those types of losses.                                                                                
                                                                                                                                     
         A "Relief Act Reduction" is a reduction in the amount of the monthly                                                        
interest payment on a mortgage loan pursuant to the Soldiers' and Sailors' Civil                                                     
Relief Act of 1940, as amended. See "Certain Legal Aspects of the Mortgage Loans                                                     
-- Soldiers' and Sailors' Civil Relief Act" in the prospectus. With respect to                                                       
any Distribution Date, a net prepayment interest shortfall is the amount by                                                          
which the aggregate of prepayment interest shortfalls during the portion of the                                                      
Prepayment Period occurring in the calendar month preceding the month of the                                                         
Distribution Date exceeds the aggregate amount payable on the Distribution Date                                                      
by the master servicer as described under "Servicing of Mortgage Loans --                                                            
Adjustment to Servicing Compensation in Connection with Certain Prepaid Mortgage                                                     
Loans" in this prospectus supplement. A prepayment interest shortfall is the                                                         
amount by which interest paid by a borrower in connection with a prepayment of                                                       
principal on a mortgage loan is less than one month's interest at the related                                                        
mortgage rate on the Stated Principal Balance of the mortgage loan. Each class'                                                      
pro rata share of the Net Interest Shortfalls will be based on the amount of                                                         
interest the class otherwise would have been entitled to receive on the                                                              
Distribution Date.                                                                                                                   
                                                                                                                                     
         In order to provide protection to the holders of the Class A-3                                                              
Certificates against the allocation thereto of net prepayment interest                                                               
shortfalls and Relief Act Reductions, a reserve fund (the "Reserve Fund") will                                                       
be established for the benefit of the Class A-3 Certificates into which $5,000                                                       
will be deposited on the closing date. No additional amounts will be deposited                                                       
into the Reserve Fund after the closing date. If any net prepayment interest                                                         
shortfalls or Relief Act Reductions on the mortgage loans are allocated to the                                                       
Class A-3 Certificates on any Distribution Date, the amount of such shortfall                                                        
will be withdrawn from the Reserve Fund, to the extent funds are available, and                                                      
will be distributed on such Distribution Date to the holders of the Class A-3                                                        
Certificates. No assurance can be given that the amount on deposit in the                                                            
Reserve Fund will be sufficient to cover net prepayment interest shortfalls or                                                       
Relief Act Reductions on the mortgage loans allocated to the Class A-3                                                               
Certificates under all circumstances. The Class A-3 Policy does not cover net                                                        
prepayment interest shortfalls or Relief Act Reductions on the mortgage loans                                                        
allocated to the Class A-3 Certificates. After the amount on deposit in the                                                          
Reserve Fund is exhausted, the Class A-3 Certificates will bear their                                                                
proportionate share of the net prepayment interest shortfalls and Relief Act                                                         
Reductions on the mortgage loans. Any amounts remaining in the Reserve Fund on                                                       
the Distribution Date on which the Class Certificate Balance of the Class A-3                                                        
Certificates has been reduced to zero will be distributed to Citigroup Global                                                        
Markets Inc.                                                                                                                         
                                                                                                                                     
         If on a particular Distribution Date, Available Funds in the                                                                
Certificate Account applied in the order described above under "-- Priority of                                                       
Distributions Among Certificates" are not sufficient to make a full distribution                                                     
of the interest entitlement on the certificates, interest will be distributed on                                                     
each class of certificates of equal priority based on the amount of interest it                                                      
would otherwise have been entitled to receive in the absence of the shortfall.                                                       
Any unpaid interest amount will be carried forward and added to the amount                                                           
holders of each class of certificates will be entitled to receive on the next                                                        
Distribution Date. A shortfall could occur, for example, if losses realized on                                                       
the mortgage loans were exceptionally high or were concentrated in a particular                                                      
month. Any unpaid interest amount so carried forward will not bear interest.                                                         
                                                                                                                                     
                                      S-29                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
PRINCIPAL                                                                                                                            
                                                                                                                                     
         General. All payments and other amounts received in respect of                                                              
principal of the mortgage loans will be allocated between the Class PO                                                               
Certificates, on the one hand, and the senior certificates (other than the Class                                                     
PO Certificates) and the subordinated certificates, on the other hand, in each                                                       
case based on the applicable PO Percentage and the applicable Non-PO Percentage,                                                     
respectively, of those amounts.                                                                                                      
                                                                                                                                     
         The Non-PO Percentage with respect to any mortgage loan with a net                                                          
mortgage rate less than 5.00% (each a "Discount mortgage loan") will be equal to                                                     
the net mortgage rate divided by 5.00%. The Non-PO Percentage with respect to                                                        
any mortgage loan with a net mortgage rate equal to or greater than 5.00% (each                                                      
a "Non-Discount mortgage loan") will be 100%. The PO Percentage with respect to                                                      
any Discount mortgage loan will be equal to (5.00% minus the net mortgage rate)                                                      
divided by 5.00%. The PO Percentage with respect to any Non-Discount mortgage                                                        
loan will be 0%.                                                                                                                     
                                                                                                                                     
         Non-PO Formula Principal Amount. On each Distribution Date, the Non-PO                                                      
Formula Principal Amount will be distributed as principal of the senior                                                              
certificates (other than the Class PO Certificates) in an amount up to the                                                           
Senior Principal Distribution Amount and as principal of the subordinated                                                            
certificates, in an amount up to the Subordinated Principal Distribution Amount.                                                     
                                                                                                                                     
         The "Non-PO Formula Principal Amount" for any Distribution Date will                                                        
equal the sum of                                                                                                                     
                                                                                                                                     
         (i)   the sum of the applicable Non-PO Percentage of                                                                        
                                                                                                                                     
               (a) all monthly payments of principal due on each mortgage loan                                                       
                   on the related Due Date,                                                                                          
                                                                                                                                     
               (b) the principal portion of the purchase price of each mortgage                                                      
                   loan that was repurchased by the seller or another person                                                         
                   pursuant to the pooling and servicing agreement as of the                                                         
                   Distribution Date,                                                                                                
                                                                                                                                     
               (c) the Substitution Adjustment Amount in connection with any                                                         
                   deleted mortgage loan received with respect to the                                                                
                   Distribution Date,                                                                                                
                                                                                                                                     
               (d) any insurance proceeds or liquidation proceeds allocable to                                                       
                   recoveries of principal of mortgage loans that are not yet                                                        
                   Liquidated Mortgage Loans received during the calendar month                                                      
                   preceding the month of the Distribution Date,                                                                     
                                                                                                                                     
               (e) with respect to each mortgage loan that became a Liquidated                                                       
                   Mortgage Loan during the calendar month preceding the month                                                       
                   of the Distribution Date, the amount of the liquidation                                                           
                   proceeds allocable to principal received with respect to the                                                      
                   mortgage loan, and                                                                                                
                                                                                                                                     
               (f) all partial and full principal prepayments by borrowers                                                           
                   received during the related Prepayment Period,                                                                    
                                                                                                                                     
         (ii)  (A) any Subsequent Recoveries received during the calendar month                                                      
               preceding the month of the Distribution Date, or (B) with respect                                                     
               to Subsequent Recoveries attributable to a Discount mortgage loan                                                     
               which incurred (1) an Excess Loss or (2) a Realized Loss after                                                        
               the Senior Credit Support Depletion Date, the Non-PO Percentage                                                       
               of any Subsequent Recoveries received during the calendar month                                                       
               preceding the month of such Distribution Date; and                                                                    
                                                                                                                                     
         (iii) on the first Distribution Date after the Conveyance Period, any                                                       
               amounts remaining in the Supplemental Loan Account not allocated                                                      
               to the Class PO Certificates.                                                                                         
                                                                                                                                     
                  Senior Principal Distribution Amount. On each Distribution                                                         
         Date, the Non-PO Formula Principal Amount, up to the amount of the                                                          
         Senior Principal Distribution Amount for the Distribution Date, will be                                                     
                                                                                                                                     
                                      S-30                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         distributed as principal of the following classes of senior                                                                 
         certificates, sequentially in the following order of priority:                                                              
                                                                                                                                     
         1.    to the Class A-R Certificates, until its Class Certificate                                                            
               Balance is reduced to zero;                                                                                           
                                                                                                                                     
         2.    concurrently, to the Class A-10 and Class A-11 Certificates, pro                                                      
               rata, the Priority Amount, until their respective Class                                                               
               Certificate Balances are reduced to zero;                                                                             
                                                                                                                                     
         3.    concurrently, until the Class Certificate Balance of the Class                                                        
               A-4 Certificates is reduced to zero:                                                                                  
                                                                                                                                     
               a) 61.778218350347% to the Class A-1 Certificates;                                                                    
                                                                                                                                     
               b) 5.880790224953% to the Class A-2 Certificates;                                                                     
                                                                                                                                     
               c) 32.135163766827% to the Class A-4 Certificates; and                                                                
                                                                                                                                     
               d) 0.205827657873% to the Class A-7 Certificates;                                                                     
                                                                                                                                     
         4.    concurrently, until the respective Class Certificate Balances of                                                      
               the Class A-2 and Class A-7 Certificates are reduced to zero:                                                         
                                                                                                                                     
               a) 61.778218350347% to the Class A-1 Certificates;                                                                    
                                                                                                                                     
               b) 5.880790224953% to the Class A-2 Certificates;                                                                     
                                                                                                                                     
               c) 29.213784593375% to the Class A-5 Certificates;                                                                    
                                                                                                                                     
               d) 2.921379173452% to the Class A-6 Certificates; and                                                                 
                                                                                                                                     
               e) 0.205827657873% to the Class A-7 Certificates;                                                                     
                                                                                                                                     
         5.    concurrently, until the respective Class Certificate Balances of                                                      
               the Class A-1, Class A-5 and Class A-6 Certificates are reduced                                                       
               to zero:                                                                                                              
                                                                                                                                     
               a) 61.778218349277% to the Class A-1 Certificates;                                                                    
                                                                                                                                     
               b) 29.213784592868% to the Class A-5 Certificates;                                                                    
                                                                                                                                     
               c) 2.921379173402% to the Class A-6 Certificates;                                                                     
                                                                                                                                     
               d) 5.533288930126% to the Class A-8 Certificates; and                                                                 
                                                                                                                                     
               e) 0.553328954327% to the Class A-9 Certificates;                                                                     
                                                                                                                                     
         6.    concurrently, to the Class A-8 and Class A-9 Certificates, pro                                                        
               rata, until their respective Class Certificate Balances are                                                           
               reduced to zero;                                                                                                      
                                                                                                                                     
         7.    to the Class A-3 Certificates, until its Class Certificate                                                            
               Balance is reduced to zero; and                                                                                       
                                                                                                                                     
         8.    concurrently, to the Class A-10 and Class A-11 Certificates, pro                                                      
               rata, with out regard to the Priority Amount, until their                                                             
               respective Class Certificate Balances are reduced to zero.                                                            
                                                                                                                                     
         Notwithstanding the foregoing, on each Distribution Date on and after                                                       
the Senior Credit Support Depletion Date, the Non-PO Formula Principal Amount                                                        
will be distributed, concurrently, as principal of the classes of senior                                                             
                                                                                                                                     
                                      S-31                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
certificates (other than the Class PO Certificates), pro rata, in accordance                                                         
with their respective Class Certificate Balances immediately before that                                                             
Distribution Date.                                                                                                                   
                                                                                                                                     
         The capitalized terms used herein shall have the following meanings:                                                        
                                                                                                                                     
         "Priority Amount" for any Distribution Date will equal the sum of (i)                                                       
the product of (A) the Senior Percentage, (B) the Scheduled Principal                                                                
Distribution Amount, (C) the Shift Percentage and (D) the Priority Percentage                                                        
and (ii) the product of (A) the Senior Prepayment Percentage, (B) the                                                                
Unscheduled Principal Distribution Amount, (C) the Shift Percentage and (D) the                                                      
Priority Percentage.                                                                                                                 
                                                                                                                                     
         "Priority Percentage" for any Distribution Date will equal the                                                              
percentage equivalent of a fraction, the numerator of which is the aggregate                                                         
Class Certificate Balance of the Class A-10 and Class A-11 Certificates                                                              
immediately prior to such Distribution Date, and the denominator of which is the                                                     
aggregate Class Certificate Balance of the senior certificates (other than the                                                       
Class PO Certificates) immediately prior to such Distribution Date.                                                                  
                                                                                                                                     
         "Scheduled Principal Distribution Amount" for any Distribution Date                                                         
will equal the Non-PO Percentage of all amounts described in subclauses (a)                                                          
through (d) of clause (i) of the definition of Non-PO Formula Principal Amount                                                       
for such Distribution Date; provided, however, that if a Bankruptcy Loss that is                                                     
an Excess Loss is sustained with respect to a mortgage loan that is not a                                                            
Liquidated Mortgage Loan, the Scheduled Principal Distribution Amount will be                                                        
reduced on the related Distribution Date by the applicable Non-PO Percentage of                                                      
the principal portion of such Bankruptcy Loss.                                                                                       
                                                                                                                                     
         "Unscheduled Principal Distribution Amount" for any Distribution Date                                                       
will equal the sum of (i) with respect to each mortgage loan that became a                                                           
Liquidated Mortgage Loan during the calendar month preceding the month of such                                                       
Distribution Date, the applicable Non-PO Percentage of the Liquidation Proceeds                                                      
allocable to principal received with respect to such mortgage loan and (ii) the                                                      
applicable Non-PO Percentage of the amount described in subclause (f) of clause                                                      
(i) of the definition of Non-PO Formula Principal Amount for such Distribution                                                       
Date and (iii) any Subsequent Recoveries described in clause (ii) of the                                                             
definition of Non-PO Formula Principal Amount for such Distribution Date.                                                            
                                                                                                                                     
         "Shift Percentage" for any Distribution Date occurring during the five                                                      
years beginning on the first Distribution Date will equal 0%. Thereafter, the                                                        
Shift Percentage for any Distribution Date occurring on or after the fifth                                                           
anniversary of the first Distribution Date will be as follows: for any                                                               
Distribution Date in the first year thereafter, 30%; for any Distribution Date                                                       
in the second year thereafter, 40%; for any Distribution Date in the third year                                                      
thereafter, 60%; for any Distribution Date in the fourth year thereafter, 80%;                                                       
and for any Distribution Date thereafter, 100%.                                                                                      
                                                                                                                                     
         "Due Date" means, with respect to a mortgage loan, the day in the                                                           
calendar month on which scheduled payments are due on that mortgage loan. With                                                       
respect to any Distribution Date, the related Due Date is the first day of the                                                       
calendar month in which that Distribution Date occurs.                                                                               
                                                                                                                                     
         "Prepayment Period" means, with respect to any Distribution Date the                                                        
period from the sixteenth day of the calendar month immediately preceding the                                                        
month in which the Distribution Date occurs (or in the case of the first                                                             
Distribution Date, from August 1, 2003) through the fifteenth day of the                                                             
calendar month in which the Distribution Date occurs.                                                                                
                                                                                                                                     
         The "Senior Principal Distribution Amount" for any Distribution Date                                                        
will equal the sum of                                                                                                                
                                                                                                                                     
         -    the Senior Percentage of the applicable Non-PO Percentage of all                                                       
              amounts described in subclauses (a) through (d) of clause (i) of                                                       
              the definition of Non-PO Formula Principal Amount for the                                                              
              Distribution Date,                                                                                                     
                                                                                                                                     
         -    for each mortgage loan that became a Liquidated Mortgage Loan                                                          
              during the calendar month preceding the month of the Distribution                                                      
              Date, the lesser of                                                                                                    
                                                                                                                                     
                                      S-32                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
              -    the Senior Percentage of the applicable Non-PO Percentage of                                                      
                   the Stated Principal Balance of the mortgage loan and                                                             
                                                                                                                                     
         -    either                                                                                                                 
                                                                                                                                     
              -    the Senior Prepayment Percentage of the applicable Non-PO                                                         
                   Percentage of the amount of the liquidation proceeds                                                              
                   allocable to principal received on the mortgage loan or                                                           
                                                                                                                                     
              -    if an Excess Loss was sustained on the Liquidated Mortgage                                                        
                   Loan during the preceding calendar month, the Senior                                                              
                   Percentage of the applicable Non-PO Percentage of the amount                                                      
                   of the liquidation proceeds allocable to principal received                                                       
                   on the mortgage loan, and                                                                                         
                                                                                                                                     
         -    the sum of                                                                                                             
                                                                                                                                     
              -    the Senior Prepayment Percentage of the applicable Non-PO                                                         
                   Percentage of amounts described in subclause (f) of clause                                                        
                   (i) of the definition of Non-PO Formula Principal Amount for                                                      
                   the Distribution Date,                                                                                            
                                                                                                                                     
              -    the Senior Prepayment Percentage of any Subsequent Recoveries                                                     
                   described in clause (ii) of the definition of Non-PO Formula                                                      
                   Principal Amount for the Distribution Date, and                                                                   
                                                                                                                                     
              -    the amount, if any, on deposit in the Supplemental Loan                                                           
                   Account at the end of the Conveyance Period not allocable to                                                      
                   the Class PO Certificates;                                                                                        
                                                                                                                                     
provided, however, that if a Bankruptcy Loss that is an Excess Loss is sustained                                                     
on a mortgage loan that is not a Liquidated Mortgage Loan, the Senior Principal                                                      
Distribution Amount will be reduced on the related Distribution Date by the                                                          
Senior Percentage of the applicable Non-PO Percentage of the principal portion                                                       
of the Bankruptcy Loss.                                                                                                              
                                                                                                                                     
         "Stated Principal Balance" means for any mortgage loan and Due Date,                                                        
the unpaid principal balance of the mortgage loan as of that Due Date, as                                                            
specified in its amortization schedule at that time (before any adjustment to                                                        
the amortization schedule for any moratorium or similar waiver or grace period),                                                     
after giving effect to (i) the payment of principal due on that Due Date,                                                            
irrespective of any delinquency in payment by the related mortgagor, and (ii)                                                        
prepayments of principal and liquidation proceeds received with respect to that                                                      
mortgage loan through the last day of the related Prepayment Period. The pool                                                        
principal balance equals the aggregate of the Stated Principal Balances of the                                                       
mortgage loans.                                                                                                                      
                                                                                                                                     
         The "Senior Percentage" for any Distribution Date is the percentage                                                         
equivalent of a fraction, the numerator of which is the aggregate of the Class                                                       
Certificate Balances of each class of senior certificates (other than the Class                                                      
PO Certificates) immediately before the Distribution Date and the denominator of                                                     
which is the aggregate of the Class Certificate Balances of all classes of                                                           
certificates (other than the Class PO Certificates) immediately before the                                                           
Distribution Date. The "Subordinated Percentage" for any Distribution Date will                                                      
be calculated as the difference between 100% and the Senior Percentage for the                                                       
Distribution Date.                                                                                                                   
                                                                                                                                     
         The "Senior Prepayment Percentage" for any Distribution Date occurring                                                      
during the five years beginning on the first Distribution Date will equal 100%.                                                      
Thereafter, the Senior Prepayment Percentage will be subject to gradual                                                              
reduction as described in the following paragraph. This disproportionate                                                             
allocation of unscheduled payments of principal will have the effect of                                                              
accelerating the amortization of the senior certificates (other than the Class                                                       
PO Certificates) which receive these unscheduled payments of principal while, in                                                     
the absence of Realized Losses, increasing the interest in the pool principal                                                        
balance evidenced by the subordinated certificates. Increasing the respective                                                        
interest of the subordinated certificates relative to that of the senior                                                             
certificates is intended to preserve the availability of the subordination                                                           
provided by the subordinated certificates. The "Subordinated Prepayment                                                              
Percentage" as of any Distribution Date will be calculated as the difference                                                         
between 100% and the Senior Prepayment Percentage.                                                                                   
                                                                                                                                     
                                      S-33                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         The Senior Prepayment Percentage for any Distribution Date occurring on                                                     
or after the fifth anniversary of the first Distribution Date will be as                                                             
follows: for any Distribution Date in the first year thereafter, the Senior                                                          
Percentage plus 70% of the Subordinated Percentage for the Distribution Date;                                                        
for any Distribution Date in the second year thereafter, the Senior Percentage                                                       
plus 60% of the Subordinated Percentage for the Distribution Date; for any                                                           
Distribution Date in the third year thereafter, the Senior Percentage plus 40%                                                       
of the Subordinated Percentage for the Distribution Date; for any Distribution                                                       
Date in the fourth year thereafter, the Senior Percentage plus 20% of the                                                            
Subordinated Percentage for the Distribution Date; and for any Distribution Date                                                     
thereafter, the Senior Percentage for the Distribution Date (unless on any                                                           
Distribution Date the Senior Percentage exceeds the initial Senior Percentage,                                                       
in which case the Senior Prepayment Percentage for the Distribution Date will                                                        
once again equal 100%).                                                                                                              
                                                                                                                                     
         Notwithstanding the foregoing, no decrease in the Senior Prepayment                                                         
Percentage will occur unless both of the step down conditions listed below are                                                       
satisfied:                                                                                                                           
                                                                                                                                     
         -    the outstanding principal balance of all mortgage loans delinquent                                                     
              60 days or more (including mortgage loans in foreclosure, real                                                         
              estate owned by the trust fund and mortgage loans the mortgagors                                                       
              of which are in bankruptcy) (averaged over the preceding six month                                                     
              period), as a percentage of the aggregate Class Certificate                                                            
              Balance of the subordinated certificates on the Distribution Date,                                                     
              does not equal or exceed 50%, and                                                                                      
                                                                                                                                     
         -    cumulative Realized Losses on the mortgage loans do not exceed                                                         
                                                                                                                                     
              -    for the Distribution Date on the fifth anniversary of the                                                         
                   first Distribution Date, 30% of the aggregate Class                                                               
                   Certificate Balance of the subordinated certificates as of                                                        
                   the cut-off date,                                                                                                 
                                                                                                                                     
              -    for the Distribution Date on the sixth anniversary of the                                                         
                   first Distribution Date, 35% of the aggregate Class                                                               
                   Certificate Balance of the subordinated certificates as of                                                        
                   the cut-off date,                                                                                                 
                                                                                                                                     
              -    for the Distribution Date on the seventh anniversary of the                                                       
                   first Distribution Date, 40% of the aggregate Class                                                               
                   Certificate Balance of the subordinated certificates as of                                                        
                   the cut-off date,                                                                                                 
                                                                                                                                     
              -    for the Distribution Date on the eighth anniversary of the                                                        
                   first Distribution Date, 45% of the aggregate Class                                                               
                   Certificate Balance of the subordinated certificates as of                                                        
                   the cut-off date, and                                                                                             
                                                                                                                                     
              -    for the Distribution Date on the ninth anniversary of the                                                         
                   first Distribution Date, 50% of the aggregate Class                                                               
                   Certificate Balance of the subordinated certificates as of                                                        
                   the cut-off date.                                                                                                 
                                                                                                                                     
         If on any Distribution Date the allocation to the class or classes of                                                       
senior certificates (other than the Class PO Certificates) then entitled to                                                          
distributions of principal of full and partial principal prepayments and other                                                       
amounts in the percentage required above would reduce the outstanding Class                                                          
Certificate Balance of the class or classes below zero, the distribution to the                                                      
class or classes of certificates of the Senior Prepayment Percentage of those                                                        
amounts for the Distribution Date will be limited to the percentage necessary to                                                     
reduce the related Class Certificate Balance(s) to zero.                                                                             
                                                                                                                                     
         Subordinated Principal Distribution Amount. On each Distribution Date,                                                      
to the extent of Available Funds therefor, the Non-PO Formula Principal Amount,                                                      
up to the amount of the Subordinated Principal Distribution Amount for the                                                           
Distribution Date, will be distributed as principal of the subordinated                                                              
certificates. Except as provided in the next paragraph, each class of                                                                
subordinated certificates will be entitled to receive its pro rata share of the                                                      
Subordinated Principal Distribution Amount (based on its respective Class                                                            
Certificate Balance), in each case to the extent of the amount available from                                                        
Available Funds for distribution of principal. Distributions of principal of the                                                     
subordinated certificates will be made sequentially to the classes of                                                                
subordinated certificates in the order of their numerical class designations,                                                        
beginning with the Class M Certificates, until their respective Class                                                                
Certificate Balances are reduced to zero.                                                                                            
                                                                                                                                     
         With respect to each class of subordinated certificates (other than the                                                     
class of subordinated certificates then outstanding with the highest priority of                                                     
distribution), if on any Distribution Date the sum of the related Class                                                              
                                                                                                                                     
                                      S-34                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
Subordination Percentages of the class and all classes of subordinated                                                               
certificates which have higher numerical class designations than the class (the                                                      
"Applicable Credit Support Percentage") is less than the Applicable Credit                                                           
Support Percentage for such class on the date of issuance of the certificates                                                        
(the "Original Applicable Credit Support Percentage"), no distribution of                                                            
partial principal prepayments and principal prepayments in full will be made to                                                      
any of those classes (the "Restricted Classes") and the amount of partial                                                            
principal prepayments and principal prepayments in full otherwise distributable                                                      
to the Restricted Classes will be allocated among the remaining classes of                                                           
subordinated certificates, pro rata, based upon their respective Class                                                               
Certificate Balances, and distributed in the sequential order described above.                                                       
                                                                                                                                     
         The Class Subordination Percentage with respect to any Distribution                                                         
Date and each class of subordinated certificates, will equal the fraction                                                            
(expressed as a percentage) the numerator of which is the Class Certificate                                                          
Balance of the class of subordinated certificates immediately before the                                                             
Distribution Date and the denominator of which is the aggregate of the Class                                                         
Certificate Balances of all classes of certificates immediately before the                                                           
Distribution Date.                                                                                                                   
                                                                                                                                     
         The approximate Original Applicable Credit Support Percentages for the                                                      
subordinated certificates on the date of issuance of the certificates are                                                            
expected to be as follows:                                                                                                           
                                                                                                                                     
<TABLE>                                                                                                                              
<S>                                                             <C>                                                                  
Class M.................................................        2.70%                                                                
Class B-1...............................................        1.40%                                                                
Class B-2...............................................        0.85%                                                                
Class B-3...............................................        0.55%                                                                
Class B-4...............................................        0.35%                                                                
Class B-5...............................................        0.20%                                                                
</TABLE>                                                                                                                             
                                                                                                                                     
         For purposes of calculating the Applicable Credit Support Percentages                                                       
of the subordinated certificates, the Class M Certificates will be considered to                                                     
have a lower numerical class designation than each other class of subordinated                                                       
certificates.                                                                                                                        
                                                                                                                                     
         The Subordinated Principal Distribution Amount for any Distribution                                                         
Date will equal                                                                                                                      
                                                                                                                                     
         -    the sum of                                                                                                             
                                                                                                                                     
              -    the Subordinated Percentage of the applicable Non-PO                                                              
                   Percentage of all amounts described in subclauses (a) through                                                     
                   (d) of clause (i) of the definition of Non-PO Formula                                                             
                   Principal Amount for the Distribution Date,                                                                       
                                                                                                                                     
              -    for each mortgage loan that became a Liquidated Mortgage Loan                                                     
                   during the calendar month preceding the month of the                                                              
                   Distribution Date, the applicable Non-PO Percentage of the                                                        
                   remaining liquidation proceeds allocable to principal                                                             
                   received on the mortgage loan, after application of the                                                           
                   amounts pursuant to the second bulleted item of the                                                               
                   definition of Senior Principal Distribution Amount up to the                                                      
                   Subordinated Percentage of the applicable Non-PO Percentage                                                       
                   of the Stated Principal Balance of the mortgage loan,                                                             
                                                                                                                                     
              -    the Subordinated Prepayment Percentage of the applicable                                                          
                   Non-PO Percentage of the amounts described in subclause (f)                                                       
                   of clause (i) of the definition of Non-PO Formula Principal                                                       
                   Amount for the Distribution Date, and                                                                             
                                                                                                                                     
              -    the Subordinated Prepayment Percentage of any Subsequent                                                          
                   Recoveries described in clause (ii) of the definition of                                                          
                   Non-PO Formula Principal Amount for the Distribution Date,                                                        
                                                                                                                                     
         -    reduced by the amount of any payments in respect of Class PO                                                           
              Deferred Amounts on the related Distribution Date.                                                                     
                                                                                                                                     
                                      S-35                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         Residual Certificates. The Class A-R Certificates will remain                                                               
outstanding for so long as the trust fund shall exist, whether or not they are                                                       
receiving current distributions of principal or interest. In addition to                                                             
distributions of interest and principal as described above, on each Distribution                                                     
Date, the holders of the Class A-R Certificates will be entitled to receive any                                                      
Available Funds remaining after payment of interest on and principal of the                                                          
senior certificates and Class PO Deferred Amounts on the Class PO Certificates                                                       
and interest on and principal of the subordinated certificates, as described                                                         
above and after the final distribution has been made with respect to all of the                                                      
certificates and reimbursement to the insurer for draws made on the Class A-3                                                        
Policy. It is not anticipated that there will be any significant amounts                                                             
remaining for that distribution.                                                                                                     
                                                                                                                                     
         Class PO Principal Distribution Amount. On each Distribution Date,                                                          
distributions of principal of the Class PO Certificates will be made in an                                                           
amount equal to the lesser of (x) the PO Formula Principal Amount for the                                                            
Distribution Date and (y) the product of                                                                                             
                                                                                                                                     
         -    Available Funds remaining after distribution of interest on the                                                        
              senior certificates, and                                                                                               
                                                                                                                                     
         -    a fraction, the numerator of which is the PO Formula Principal                                                         
              Amount and the denominator of which is the sum of the PO Formula                                                       
              Principal Amount and the Senior Principal Distribution Amount.                                                         
                                                                                                                                     
         If the Class PO Principal Distribution Amount on a Distribution Date is                                                     
calculated as provided in clause (y) above, principal distributions to holders                                                       
of the senior certificates (other than the Class PO Certificates) will be in an                                                      
amount equal to the product of Available Funds remaining after distribution of                                                       
interest on the senior certificates, and a fraction, the numerator of which is                                                       
the Senior Principal Distribution Amount and the denominator of which is the sum                                                     
of the Senior Principal Distribution Amount and the PO Formula Principal Amount.                                                     
                                                                                                                                     
         The "PO Formula Principal Amount" for any Distribution Date will equal                                                      
the sum of                                                                                                                           
                                                                                                                                     
         -    the sum of the applicable PO Percentage of                                                                             
                                                                                                                                     
              -    all monthly payments of principal due on each mortgage loan                                                       
                   on the related Due Date,                                                                                          
                                                                                                                                     
              -    the principal portion of the purchase price of each mortgage                                                      
                   loan that was repurchased by the seller or another person                                                         
                   pursuant to the pooling and servicing agreement as of the                                                         
                   Distribution Date,                                                                                                
                                                                                                                                     
              -    the Substitution Adjustment Amount in connection with any                                                         
                   deleted mortgage loan received for the Distribution Date,                                                         
                                                                                                                                     
              -    any insurance proceeds or liquidation proceeds allocable to                                                       
                   recoveries of principal of mortgage loans that are not yet                                                        
                   Liquidated Mortgage Loans received during the calendar month                                                      
                   preceding the month of the Distribution Date,                                                                     
                                                                                                                                     
              -    for each mortgage loan that became a Liquidated Mortgage Loan                                                     
                   during the calendar month preceding the month of the                                                              
                   Distribution Date, the amount of liquidation proceeds                                                             
                   allocable to principal received on the mortgage loan, and                                                         
                                                                                                                                     
              -    all partial and full principal prepayments by borrowers                                                           
                   received during the related Prepayment Period, and                                                                
                                                                                                                                     
         -    with respect to Subsequent Recoveries attributable to a Discount                                                       
              mortgage loan which incurred (1) an Excess Loss or (2) a Realized                                                      
              Loss after the Senior Credit Support Depletion Date, the PO                                                            
              Percentage of any Subsequent Recoveries received during the                                                            
              calendar month preceding the month of such Distribution Date, and                                                      
                                                                                                                                     
         -    the amount, if any, on deposit in the Supplemental Loan Account at                                                     
              the end of the Conveyance Period that is allocable to the Class PO                                                     
              Certificates (as described below).                                                                                     
                                                                                                                                     
                                      S-36                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         On the first Distribution Date following the end of the Conveyance                                                          
Period, the Class PO Certificates will receive a prepayment in the amount equal                                                      
to the excess of (x) the Class PO Sublimit Amount over (y) the aggregate PO                                                          
Percentage of the Stated Principal Balance of the Supplemental Mortgage Loans                                                        
included in the trust fund at the end of the Conveyance Period. The "Class PO                                                        
Sublimit" is a portion of the amount deposited in the Supplemental Loan Account                                                      
on the closing date which is equal to approximately $235,200.                                                                        
                                                                                                                                     
DISTRIBUTIONS IN REDUCTION OF THE CLASS A-3 CERTIFICATES                                                                             
                                                                                                                                     
         General. As to distributions of principal among Class A-3                                                                   
Certificateholders, Class A-3 Deceased Holders (as defined below) will be                                                            
entitled to first priority, and beneficial owners other than Class A-3 Deceased                                                      
Holders ("Class A-3 Living Holders") will be entitled to a second priority.                                                          
Beneficial owners of the Class A-3 Certificates have the right to request that                                                       
distributions of principal be made with respect to their Class A-3 Certificates                                                      
on each Distribution Date on which distributions of principal are made with                                                          
respect to the Class A-3 Certificates. All such requested distributions are                                                          
subject to the priorities described below under "-- Priority of Requested                                                            
Distributions" and are further subject to the limitations that they be made (a)                                                      
only in lots equal to $1,000 of initial principal balance (each, an "Individual                                                      
Class A-3 Certificate") and (b) only to the extent that the portion of the                                                           
principal distributed in respect of the Certificates allocated to the Class A-3                                                      
Certificates on the applicable Distribution Date (plus any amounts available                                                         
from the Class A-3 Rounding Account (as defined below)) provides sufficient                                                          
funds for such requested distributions. To the extent that amounts available for                                                     
distributions of principal on the Class A-3 Certificates on any Distribution                                                         
Date exceed the aggregate requests by Class A-3 Deceased Holders and Class A-3                                                       
Living Holders for principal distributions applicable to such Distribution Date,                                                     
such excess amounts will be distributed to the beneficial owners of Class A-3                                                        
Certificates by random lot, as described below under "-- Mandatory                                                                   
Distributions of Principal on Class A-3 Certificates."                                                                               
                                                                                                                                     
         On each Distribution Date on which amounts are available for                                                                
distributions of principal on the Class A-3 Certificates, the aggregate amount                                                       
allocable to such distributions will be rounded, as necessary, to an amount                                                          
equal to an integral multiple of $1,000, except as provided below, in accordance                                                     
with the priorities and limitations set forth in this section. Such rounding                                                         
will be accomplished on the first Distribution Date on which distributions of                                                        
principal on the Class A-3 Certificates are made by withdrawing, from a                                                              
non-interest bearing account (the "Class A-3 Rounding Account" or the "Rounding                                                      
Account") to be established on the closing date with a $999.99 deposit by                                                            
Citigroup Global Markets Inc., as underwriter, the amount of funds, if any,                                                          
needed to round the amount otherwise available for such distribution upward to                                                       
the next higher integral multiple of $1,000. On each succeeding Distribution                                                         
Date on which distributions of principal on the Class A-3 Certificates are to be                                                     
made, the aggregate amount allocable to the Class A-3 Certificates will be                                                           
applied first to repay any funds withdrawn from the Class A-3 Rounding Account                                                       
for the Class A-3 Certificates on the prior Distribution Date, and then the                                                          
remainder of such allocable amount, if any, will be similarly rounded upward                                                         
through another withdrawal from the Class A-3 Rounding Account and distributed                                                       
as principal on the Class A-3 Certificates. This process will continue on                                                            
succeeding Distribution Dates until the outstanding principal balance of the                                                         
Class A-3 Certificates has been reduced to zero. Thus, the aggregate                                                                 
distribution made in reduction of the principal balance of the Class A-3                                                             
Certificates on each Distribution Date may be slightly more or less than would                                                       
be the case in the absence of such rounding procedures, but such difference will                                                     
be no more than $999.99 on such Distribution Date. Under no circumstances will                                                       
the sum of all distributions of principal on the Class A-3 Certificates through                                                      
any Distribution Date be less than the sum that would have resulted in the                                                           
absence of such rounding procedures.                                                                                                 
                                                                                                                                     
         There is no assurance that a beneficial owner of a Class A-3                                                                
Certificate who has submitted a request for a distribution will receive that                                                         
distribution at any particular time after that distribution is requested, since                                                      
there can be no assurance that funds will be available for making requested                                                          
distributions on any particular Distribution Date, or, even if funds are                                                             
available for making such distributions, that requested distributions with                                                           
respect to the Class A-3 Certificates owned by any particular beneficial owner                                                       
will be made. Also, due to the procedure for mandatory distributions described                                                       
below, there can be no assurance that on any Distribution Date on which the                                                          
funds available for distribution of principal on the Class A-3 Certificates                                                          
exceed the aggregate amount of distributions requested by beneficial owners of                                                       
the Class A-3 Certificates, any particular beneficial owner will receive a                                                           
principal distribution from such excess funds. Thus, the timing of distributions                                                     
of principal with respect to any particular Class A-3 Certificate is highly                                                          
uncertain, and such distributions may be made earlier or later than the date                                                         
that may be desired by a beneficial owner of a Class A-3 Certificate.                                                                
                                                                                                                                     
                                      S-37                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         Notwithstanding any provisions herein to the contrary, on each                                                              
Distribution Date on and after the Senior Credit Support Depletion Date,                                                             
distributions of principal on the Class A-3 Certificates will be made pro rata                                                       
among the holders of the Class A-3 Certificates and will not be made in integral                                                     
multiples of $1,000 or pursuant to requested distributions or mandatory                                                              
distributions by random lot.                                                                                                         
                                                                                                                                     
         Priority of Requested Distributions. Subject to the limitations                                                             
described herein, including the order of the receipt of the request for                                                              
distributions as described below under "-- Procedure for Requested                                                                   
Distributions," beneficial owners of the Class A-3 Certificates have the right                                                       
to request that distributions of principal on the Class A-3 Certificates be                                                          
made. On each Distribution Date on which distributions of principal on the Class                                                     
A-3 Certificates are made, such distributions will be made in the following                                                          
order of priority: (a) any request by a Class A-3 Deceased Holder, in an amount                                                      
up to but not exceeding an aggregate principal amount of $100,000 per request,                                                       
and (b) any request by a Class A-3 Living Holder, in an amount up to but not                                                         
exceeding an aggregate principal amount of $10,000 per request. Thereafter,                                                          
distributions will be made as provided in clause (a) and (b) above up to a                                                           
second $100,000 and $10,000, respectively. This sequence of priorities will be                                                       
repeated for each request for principal distributions made by the beneficial                                                         
owners of the Class A-3 Certificates until all such requests have been honored.                                                      
                                                                                                                                     
         Procedure for Requested Distributions. A beneficial owner may request                                                       
that distributions of principal on that beneficial owner's Class A-3                                                                 
Certificates be made on a Distribution Date by delivering a written request                                                          
therefor to the participant or indirect participant that maintains that                                                              
beneficial owner's account in the Class A-3 Certificates so that the request for                                                     
such distribution is received by the trustee on or before the Record Date for                                                        
such Distribution Date. In the case of a request on behalf of a Class A-3                                                            
Deceased Holder, a certified copy of the death certificate and any additional                                                        
appropriate evidence of death and any tax waivers are required to be forwarded                                                       
to the trustee under separate cover. Furthermore, distribution requests of Class                                                     
A-3 Deceased Holders that are incomplete may not be honored by the trustee and,                                                      
if not honored, will lose their priority and must be re-requested. The                                                               
participant should in turn make the request of the depository (or, in the case                                                       
of an indirect participant, such firm must notify the related participant of                                                         
such request, which participant should make the request of the depository) on a                                                      
form required by the depository and provided to the participant.                                                                     
                                                                                                                                     
         Upon receipt of such request, the depository will date and time stamp                                                       
such request and forward such request to the trustee. The depository may                                                             
establish procedures that it deems fair and equitable to establish the order of                                                      
receipt of requests for such distributions received by it on the same day.                                                           
Neither the depositor nor the trustee will be liable for any delay by the                                                            
depository, any participant or any indirect participant in the delivery of                                                           
requests for distributions to the trustee. Requests for distributions in                                                             
reduction of principal balance forwarded to the trustee from the depository                                                          
after the Record Date for such Distribution Date and requests for distributions                                                      
received in a timely manner but not accepted with respect to a given                                                                 
Distribution Date, will be treated as requests for distributions on the next                                                         
succeeding Distribution Date and each succeeding Distribution Date thereafter                                                        
until each request is accepted or is withdrawn as described below. Each request                                                      
for distributions of principal on a Class A-3 Certificate submitted by a                                                             
beneficial owner of a Class A-3 Certificate will be held by the trustee until                                                        
such request has been accepted or has been withdrawn in writing. Each Individual                                                     
Class A-3 Certificate covered by such request will continue to bear interest at                                                      
the related pass-through rate through the Record Date for such Distribution                                                          
Date.                                                                                                                                
                                                                                                                                     
         With respect to Class A-3 Certificates as to which beneficial owners                                                        
have requested distributions on a particular Distribution Date on which                                                              
distributions of principal on the Class A-3 Certificates are being made, the                                                         
trustee will notify the depository and its participants prior to such                                                                
Distribution Date whether, and the extent to which, such Class A-3 Certificates                                                      
have been accepted for distributions. Participants and indirect participants                                                         
holding Class A-3 Certificates are required to forward such notices to the                                                           
beneficial owners of such Certificates. Individual Class A-3 Certificates that                                                       
have been accepted for a distribution will be due and payable on the applicable                                                      
Distribution Date and will cease to bear interest after the Record Date for such                                                     
Distribution Date.                                                                                                                   
                                                                                                                                     
         Any beneficial owner of a Class A-3 Certificate that has requested a                                                        
distribution may withdraw such request by so notifying in writing the                                                                
participant or indirect participant that maintains such beneficial owner's                                                           
account. The participant should forward the withdrawal, on a form required by                                                        
the depository, to the trustee. In the event that such account is maintained by                                                      
an indirect participant, such indirect participant must notify the related                                                           
participant, which in turn must forward the withdrawal of such request on such                                                       
form to the trustee. If such notice of withdrawal of a request for distribution                                                      
has not been received by the trustee on or before the Record Date for such                                                           
                                                                                                                                     
                                      S-38                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
Distribution Date, the previously made request for distribution will be                                                              
irrevocable with respect to the making of distributions of principal on the                                                          
Class A-3 Certificates on the applicable Distribution Date.                                                                          
                                                                                                                                     
         For purposes of the foregoing discussion, an indirect participant is a                                                      
broker, dealer, bank, financial institution or other person that clears                                                              
securities transactions through or maintains a custodial relationship with a                                                         
participant either directly or indirectly and a participant is a broker, dealer,                                                     
bank, financial institution or other person that is a participating organization                                                     
of the depository.                                                                                                                   
                                                                                                                                     
         Mandatory Distributions of Principal on Class A-3 Certificates. To the                                                      
extent, if any, that distributions of principal on the Class A-3 Certificates on                                                     
a Distribution Date exceed the outstanding principal balance of the Individual                                                       
Class A-3 Certificates with respect to which distribution requests have been                                                         
received by the applicable date, additional Class A-3 Certificates in lots equal                                                     
to Individual Class A-3 Certificates will be selected to receive principal                                                           
distributions in accordance with the then-applicable established random lot                                                          
procedures of the depository, and the then-applicable established procedures of                                                      
the participants and indirect participants, which may or may not be by random                                                        
lot. Investors may ask such participants or indirect participants which                                                              
allocation procedures they use. Participants and indirect participants holding                                                       
Class A-3 Certificates selected for mandatory distributions of principal are                                                         
required to provide notice of such mandatory distributions to the affected                                                           
beneficial owners.                                                                                                                   
                                                                                                                                     
         Payments to Requesting Beneficial Owners. On any Distribution Date on                                                       
which principal distributions are made on the Class A-3 Certificates, priority                                                       
of payment on the Class A-3 Certificates will be given to beneficial owners for                                                      
whom Class A-3 Certificate principal payment requests are in effect. The                                                             
depository will honor requests in the following order of priority:                                                                   
                                                                                                                                     
                  First, the depository will honor requests submitted on behalf                                                      
         of Class A-3 Deceased Holders in the order of their receipt by the                                                          
         depository, until such requests have been honored in an amount up to                                                        
         $100,000 for such requesting Class A-3 Deceased Holder; and                                                                 
                                                                                                                                     
                  Second, the depository will honor requests submitted on behalf                                                     
         of Class A-3 Living Holders in the order of priority established by the                                                     
         depository, until such requests have been honored in an amount up to                                                        
         $10,000 for each requesting Class A-3 Living Holder.                                                                        
                                                                                                                                     
         Thereafter, the depository will honor requests submitted on behalf of                                                       
each Class A-3 Deceased Holder as provided in step First up to a second $100,000                                                     
and requests submitted on behalf of each Class A-3 Living Holder as provided in                                                      
step Second up to a second $10,000. This sequence of priorities will be repeated                                                     
until all Class A-3 Certificate principal payment requests have been honored to                                                      
the extent of amounts available in reduction of the Class A-3 Certificates.                                                          
                                                                                                                                     
         If the amount of principal available for payment on the Class A-3                                                           
Certificates on a given Distribution Date is insufficient to honor all requests,                                                     
such requests will be honored on succeeding Distribution Dates as principal                                                          
becomes available. In the case of requests on behalf of Class A-3 Living                                                             
Holders, the depository will establish a new order of priority for each                                                              
Distribution Date. This order will apply both to previously unsatisfied payment                                                      
requests and to newly submitted requests. A Class A-3 Certificate principal                                                          
payment request submitted on behalf of a Class A-3 Living Holder who later dies                                                      
will become entitled to the priority of a newly submitted request on behalf of a                                                     
Class A-3 Deceased Holder. Such priority will be effective for each subsequent                                                       
Distribution Date if the depository has received a certified copy of the death                                                       
certificate for such Class A-3 Deceased Holder and any additional appropriate                                                        
evidence of death and any requested tax waivers by the last business day of the                                                      
preceding calendar month immediately preceding such Distribution Date.                                                               
                                                                                                                                     
         Payments to Non-Requesting Beneficial Owners. If the amount of                                                              
principal available for payments on the Class A-3 Certificates on a given                                                            
Distribution Date exceeds the amount needed to honor all Class A-3 Certificate                                                       
principal payment requests, the depository will determine which Class A-3                                                            
Certificates will be paid, using its established random lot procedures. Each                                                         
participant receiving such payments, and each indirect participant in the chain                                                      
to the beneficial owners, will remit payments to their customers according to                                                        
their own procedures, which may or may not be by random lot. A participant or                                                        
indirect participant could decide to allot Class A-3 Certificate principal                                                           
payments to certain customers (which could include such participant or indirect                                                      
participant) without                                                                                                                 
                                                                                                                                     
                                      S-39                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
allotting payments to others. Investors should ask their brokers or other                                                            
intermediaries what allocation procedures they use.                                                                                  
                                                                                                                                     
         Definition of "Class A-3 Deceased Holder." A "Class A-3 Deceased                                                            
Holder" is a beneficial owner of a Class A-3 Certificate who was living at the                                                       
time such interest was acquired and whose executor or other authorized                                                               
representative causes to be furnished to the trustee a certified copy of the                                                         
death certificate for such Class A-3 Deceased Holder and any additional evidence                                                     
of death satisfactory to the trustee and any tax waivers requested by the                                                            
trustee. Class A-3 Certificates beneficially owned by tenants by the entirety,                                                       
joint tenants or tenants in common will be considered to be beneficially owned                                                       
by a single owner. The death of a tenant by the entirety, joint tenant or tenant                                                     
in common will be deemed to be the death of the beneficial owner, and the Class                                                      
A-3 Certificates so beneficially owned will be eligible for priority with                                                            
respect to distributions of principal, subject to the limitations stated above.                                                      
Class A-3 Certificates beneficially owned by a trust will be considered to be                                                        
beneficially owned by each beneficiary of the trust to the extent of such                                                            
beneficiary's beneficial interest therein, but in no event will a trust's                                                            
beneficiaries collectively be deemed to be beneficial owners of a number of                                                          
Individual Class A-3 Certificates greater than the number of Individual Class                                                        
A-3 Certificates of which such trust is the owner. The death of a beneficiary of                                                     
a trust will be deemed to be the death of a beneficial owner of the Class A-3                                                        
Certificates beneficially owned by the trust to the extent of such beneficiary's                                                     
beneficial interest in such trust. The death of an individual who was a tenant                                                       
by the entirety, joint tenant or tenant in common in a tenancy that is the                                                           
beneficiary of a trust will be deemed to be the death of the beneficiary of the                                                      
trust. The death of a person who, during his or her lifetime, was entitled to                                                        
substantially all of the beneficial ownership interest in a Class A-3                                                                
Certificate will be deemed to be the death of the beneficial owner of such Class                                                     
A-3 Certificates regardless of the registration of ownership, if such beneficial                                                     
ownership interest can be established to the satisfaction of the trustee;                                                            
expenses incurred by the trustee in an effort to determine the beneficial                                                            
ownership interest, including without limitation, attorney's fees, shall be paid                                                     
by the beneficial owner. Such beneficial interest will be deemed to exist in                                                         
typical cases of street name or nominee ownership, ownership by a trustee,                                                           
ownership under the Uniform Gifts to Minors Act and community property or other                                                      
joint ownership arrangements between a husband and wife. Beneficial interest                                                         
shall include the power to sell, transfer or otherwise dispose of a Class A-3                                                        
Certificate and the right to receive the proceeds therefrom, as well as interest                                                     
and distributions in reduction of the Class Certificate Balance payable with                                                         
respect thereto. As used in this prospectus supplement, a request for a                                                              
distribution of principal of a Class A-3 Certificate by a Class A-3 Deceased                                                         
Holder shall mean a request by the personal representative, surviving tenant by                                                      
the entirety, surviving joint tenant or surviving tenant in common of the Class                                                      
A-3 Deceased Holder.                                                                                                                 
                                                                                                                                     
ALLOCATION OF LOSSES                                                                                                                 
                                                                                                                                     
         On each Distribution Date, the applicable PO Percentage of any Realized                                                     
Loss, including any Excess Loss, on a Discount mortgage loan will be allocated                                                       
to the Class PO Certificates until their Class Certificate Balance is reduced to                                                     
zero. The amount of any Realized Loss, other than an Excess Loss, allocated to                                                       
the Class PO Certificates on or before the Senior Credit Support Depletion Date                                                      
will be treated as a Class PO Deferred Amount. To the extent funds are available                                                     
on the Distribution Date or on any future Distribution Date from amounts that                                                        
would otherwise be allocable to the Subordinated Principal Distribution Amount,                                                      
Class PO Deferred Amounts will be paid on the Class PO Certificates before                                                           
distributions of principal on the subordinated certificates. Any distribution of                                                     
Available Funds in respect of unpaid Class PO Deferred Amounts will not further                                                      
reduce the Class Certificate Balance of the Class PO Certificates. The Class PO                                                      
Deferred Amounts will not bear interest. The Class Certificate Balance of the                                                        
class of subordinated certificates then outstanding with the highest numerical                                                       
class designation will be reduced by the amount of any payments in respect of                                                        
Class PO Deferred Amounts. After the Senior Credit Support Depletion Date, no                                                        
new Class PO Deferred Amounts will be created.                                                                                       
                                                                                                                                     
         For purposes of allocating losses to the subordinated certificates, the                                                     
Class M Certificates will be considered to have a lower numerical class                                                              
designation than each other class of subordinated certificates.                                                                      
                                                                                                                                     
         The Senior Credit Support Depletion Date is the date on which the Class                                                     
Certificate Balance of each class of subordinated certificates has been reduced                                                      
to zero.                                                                                                                             
                                                                                                                                     
         On each Distribution Date, the applicable Non-PO Percentage of any                                                          
Realized Loss, other than any Excess Loss, will be allocated first to the                                                            
subordinated certificates, in the reverse order of their numerical class                                                             
designations (beginning with the class of subordinated certificates then                                                             
outstanding with the highest numerical class designation),                                                                           
                                                                                                                                     
                                      S-40                                                                                           
<PAGE>                                                                                                                               
                                                                                                                                     
in each case until the Class Certificate Balance of the respective class of                                                          
certificates has been reduced to zero, and then to the senior certificates                                                           
(other than the Class PO Certificates) pro rata, based upon their respective                                                         
Class Certificate Balances, except that the applicable Non-PO Percentage of any                                                      
Realized Losses that would otherwise be allocated to the Class A-2 and Class                                                         
A-10 Certificates will instead be allocated to the Class A-7 and Class A-11                                                          
Certificates, respectively, until its Class Certificate Balance is reduced to                                                        
zero.                                                                                                                                
                                                                                                                                     
         Any Realized Loss, including an Excess Loss, on the mortgage loans                                                          
allocable to the Class A-3 Certificates will be covered by the Class A-3 Policy.                                                     
See "Credit Enhancement ? the Financial Guaranty Insurance Policy" in this                                                           
prospectus supplement.                                                                                                               
                                                                                                                                     
         On each Distribution Date, the applicable Non-PO Percentage of Excess                                                       
Losses will be allocated pro rata among the classes of senior certificates                                                           
(other than the Class PO Certificates) and the subordinated certificates based                                                       
upon their respective Class Certificate Balances immediately prior to such                                                           
Distribution Date. Unlike Realized Losses, the Non-PO Percentage of any Excess                                                       
Losses will be allocated proportionately among all classes of certificates                                                           
(other than the Class PO Certificates), including the Class A-2 and Class A-10                                                       
Certificates, without any reallocation of Excess Losses to the Class A-7 and                                                         
Class A-11 Certificates.                                                                                                             
                                                                                                                                     
         Because principal distributions are paid to some classes of                                                                 
certificates (other than the Class PO Certificates) before other classes of                                                          
certificates, holders of the certificates that are entitled to receive principal                                                     
later bear a greater risk of being allocated Realized Losses on the mortgage                                                         
loans than holders of classes that are entitled to receive principal earlier.                                                        
                                                                                                                                     
         In general, a "Realized Loss" means, for a Liquidated Mortgage Loan,                                                        
the amount by which the remaining unpaid principal balance of the mortgage loan                                                      
exceeds the amount of liquidation proceeds applied to the principal balance of                                                       
the related mortgage loan. "Excess Losses" are Special Hazard Losses in excess                                                       
of the Special Hazard Loss Coverage Amount, Bankruptcy Losses in excess of the                                                       
Bankruptcy Loss Coverage Amount and Fraud Losses in excess of the Fraud Loss                                                         
Coverage Amount. "Bankruptcy Losses" are losses that are incurred as a result of                                                     
Debt Service Reductions and Deficient Valuations. "Special Hazard Losses" are                                                        
Realized Losses in respect of Special Hazard mortgage loans. "Fraud Losses" are                                                      
losses sustained on a Liquidated Mortgage Loan by reason of a default arising                                                        
from fraud, dishonesty or misrepresentation. See "Credit Enhancement --                                                              
Subordination" in this prospectus supplement and in the prospectus.                                                                  
                                                                                                                                     
         A "Liquidated Mortgage Loan" is a defaulted mortgage loan as to which                                                       
the master servicer has determined that all recoverable liquidation and                                                              
insurance proceeds have been received. A "Special Hazard mortgage loan" is a                                                         
Liquidated Mortgage Loan as to which the ability to recover the full amount due                                                      
thereunder was substantially impaired by a hazard not insured against under a                                                        
standard hazard insurance policy of the type described in the prospectus under                                                       
"Credit Enhancement -- Special Hazard Insurance Policies." See "Credit                                                               
Enhancement -- Subordination" in this prospectus supplement and in the                                                               
prospectus.                                                                                                                          
                                                                                                                                     
         "Subsequent Recoveries" are unexpected recoveries, net of reimbursable                                                      
expenses, with respect to a Liquidated Mortgage Loan that resulted in a Realized                                                     
Loss in a month prior to the month of receipt of such recoveries.                                                                    
                                                                                                                                     
REPORTS TO CERTIFICATEHOLDERS                                                                                                        
                                                                                                                                     
         The trustee may, at its option, make the information described in the                                                       
prospectus under "Description of the Certificates -- Reports to                                                                      
Certificateholders" available to certificateholders and to MBIA on the trustee's                                                     
website at http://www.mbsreporting.com.                                                                                              
                                                                                                                                     
STRUCTURING ASSUMPTIONS                                                                                                              
                                                                                                                                     
         Unless otherwise specified, the information in the tables in this                                                           
prospectus supplement has been prepared on the basis of the following assumed                                                        
characteristics of the mortgage loans and the following additional assumptions,                                                      
which combined are the structuring assumptions:                                                                                      
                                                                                                                                     
                                      S-41                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    the mortgage pool consists of five mortgage loans with the                                                             
              following characteristics:                                                                                             
                                                                                                                                     
INITIAL MORTGAGE LOANS                                                                                                               

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                                                                     REMAINING                       
                                                                                    REMAINING      INTEREST-ONLY                     
                                                                ORIGINAL TERM         TERM            TERM TO                        
                                                  NET            TO MATURITY       TO MATURITY       MATURITY                        
PRINCIPAL BALANCE         MORTGAGE RATE      MORTGAGE RATE       (IN MONTHS)       (IN MONTHS)      (IN MONTHS)                      
-----------------         -------------      -------------      -------------      -----------     -------------                     
<C>                      <C>                <C>                 <C>                <C>             <C>                               
$   4,824,410.14         5.1250000000%      4.9160000000%            360               360              N/A                          
$ 321,780,454.70         5.6328822935%      5.4224350454%            360               360              N/A                          
$  25,197,163.74         5.7370252723%      5.5190162227%            360               359              119                          
</TABLE>                                                                                                                             
                                                                                                                                     
 SUPPLEMENTAL MORTGAGE LOANS                                                                                                         
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                                                    REMAINING        REMAINING                       
                                                                ORIGINAL TERM         TERM         INTEREST-ONLY                     
                                                 NET             TO MATURITY       TO MATURITY    TERM TO MATURITY                   
PRINCIPAL BALANCE        MORTGAGE RATE      MORTGAGE RATE        (IN MONTHS)       (IN MONTHS)       (IN MONTHS)                     
-----------------        -------------      -------------       -------------      -----------    ----------------                   
<S>                      <C>                <C>                 <C>                <C>            <C>                                
$  14,000,000.00          5.1250000000%      4.9160000000%           360               360               N/A                         
$ 134,197,971.42          5.6314350454%      5.4224350454%           360               360               N/A                         
</TABLE>                                                                                                                             
                                                                                                                                     
         -    the mortgage loans prepay at the specified constant percentages of                                                     
              the Prepayment Assumption,                                                                                             
                                                                                                                                     
         -    no defaults in the payment by mortgagors of principal of and                                                           
              interest on the mortgage loans are experienced,                                                                        
                                                                                                                                     
         -    the scheduled monthly payment for each mortgage loan, except for                                                       
              the interest-only mortgage loans during their respective                                                               
              interest-only periods, has been calculated such that each mortgage                                                     
              loan will amortize in amounts sufficient to repay the current                                                          

              balance of the mortgage loan by its respective term to maturity,                                                       
                                                                                                                                     
         -    each mortgage loan with a remaining interest-only term greater                                                         
              than zero does not amortize during the remaining interest-only                                                         
              term. At the end of the remaining interest-only term, each such                                                        
              mortgage loan will amortize in amounts sufficient to repay the                                                         
              current balance of each mortgage loan over the remaining term to                                                       
              maturity calculated at the expiration of the remaining                                                                 
              interest-only term,                                                                                                    
                                                                                                                                     
         -    scheduled payments on the mortgage loans are received on the first                                                     
              day of each month commencing in the calendar month following the                                                       
              closing date and are computed before giving effect to prepayments                                                      
              received on the last day of the prior month,                                                                           
                                                                                                                                     
         -    the Net Mortgage Rate is equal to the Mortgage Rate minus the sum                                                      
              of the basic master servicing fee and the trustee fee, and, where                                                      
              applicable, amounts in respect of lender paid primary mortgage                                                         
              insurance on a mortgage loan,                                                                                          
                                                                                                                                     
         -    prepayments are allocated as described in this prospectus                                                              
              supplement without giving effect to loss and delinquency tests,                                                        
                                                                                                                                     
         -    there are no Net Interest Shortfalls and prepayments represent                                                         
              prepayments in full of individual mortgage loans and are received                                                      
              on the last day of each month, commencing in the calendar month of                                                     
              the closing date,                                                                                                      
                                                                                                                                     
         -    the initial Class Certificate Balance of each class of                                                                 
              certificates is as set forth on the cover page hereof or as                                                            
              described under "Description of the Certificates -- General" in                                                        
              this prospectus supplement,                                                                                            
                                                                                                                                     
                                      S-42                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    interest accrues on each interest-bearing class of certificates at                                                     
              the applicable interest rate set forth on the cover page hereof or                                                     
              as described in this prospectus supplement and the excess master                                                       
              servicing fee accrues on each Non-Discount mortgage loan as                                                            
              described in this prospectus supplement,                                                                               
                                                                                                                                     
         -    distributions in respect of the certificates are received in cash                                                      
              on the 25th day of each month commencing in the calendar month                                                         
              following the closing date,                                                                                            
                                                                                                                                     
         -    the closing date of the sale of the certificates is August 28,                                                         
              2003,                                                                                                                  
                                                                                                                                     
         -    the seller is not required to repurchase or substitute for any                                                         
              mortgage loan,                                                                                                         
                                                                                                                                     
         -    the master servicer does not exercise the option to repurchase the                                                     
              mortgage loans described under "-- Optional Purchase of Defaulted                                                      
              Loans" and "-- Optional Termination", and                                                                              
                                                                                                                                     
         -    no class of certificates becomes a Restricted Class.                                                                   
                                                                                                                                     
         Prepayments of mortgage loans commonly are measured relative to a                                                           
prepayment standard or model. The model used in this prospectus supplement is                                                        
the Standard Prepayment Assumption (the "Prepayment Assumption"), which                                                              
represents an assumed rate of prepayment each month of the then outstanding                                                          
principal balance of a pool of new mortgage loans. The Prepayment Assumption                                                         
does not purport to be either a historical description of the prepayment                                                             
experience of any pool of mortgage loans or a prediction of the anticipated rate                                                     
of any prepayment of any pool of mortgage loans, including the mortgage loans.                                                       
100% of the Prepayment Assumption assumes prepayment rates of 0.2% per annum of                                                      
the then outstanding principal balance of such mortgage loans in the first month                                                     
of the life of the mortgage loans and an additional 0.2% per annum in each month                                                     
thereafter (for example, 0.4% per annum in the second month) until the 30th                                                          
month. Beginning in the 30th month and in each month thereafter during the life                                                      
of the mortgage loans, 100% of the Prepayment Assumption assumes a constant                                                          
prepayment rate of 6% per annum. Multiples may be calculated from this                                                               
prepayment rate sequence. For example, 500% of the Prepayment Assumption assumes                                                     
prepayment rates will be 1.0% per annum in month one, 2.0% per annum in month                                                        
two, and increasing by 1.0% in each succeeding month until reaching a rate of                                                        
30% per annum in month 30 and remaining constant at 30% per annum thereafter. 0%                                                     
of the Prepayment Assumption assumes no prepayments. There is no assurance that                                                      
prepayments will occur at any of the Prepayment Assumption rate or at any other                                                      
constant rate.                                                                                                                       
                                                                                                                                     
         While it is assumed that each of the mortgage loans prepays at the                                                          
specified constant percentages of the Prepayment Assumption, this is not likely                                                      
to be the case. Moreover, discrepancies may exist between the characteristics of                                                     
the actual mortgage loans which will be delivered to the trustee and                                                                 
characteristics of the mortgage loans used in preparing the tables.                                                                  
                                                                                                                                     
OPTIONAL PURCHASE OF DEFAULTED LOANS                                                                                                 
                                                                                                                                     
         The master servicer may, at its option, but subject to the conditions                                                       
set forth in the pooling and servicing agreement, purchase from the trust fund                                                       
any mortgage loan which is delinquent in payment by 151 days or more. Any                                                            
purchase shall be at a price equal to 100% of the Stated Principal Balance of                                                        
the mortgage loan plus accrued interest on it at the applicable mortgage rate                                                        
from the date through which interest was last paid by the related mortgagor or                                                       
advanced (and not reimbursed) to the first day of the month in which the amount                                                      
is to be distributed.                                                                                                                
                                                                                                                                     
OPTIONAL TERMINATION                                                                                                                 
                                                                                                                                     
         The master servicer will, subject to certain limitations specified in                                                       
the pooling and servicing agreement, have the right to repurchase all remaining                                                      
mortgage loans and foreclosed or otherwise repossessed properties in the                                                             
mortgage pool and thereby effect early retirement of the certificates, subject                                                       
to the pool principal balance of the mortgage loans and foreclosed or otherwise                                                      
repossessed properties at the time of repurchase being less than or equal to 10%                                                     
of the sum of the aggregate Stated Principal Balance of the Closing Date                                                             
Mortgage Loans as of the initial cut-off date, plus any amount deposited in the                                                      
Supplemental Loan Account on the closing date. If the master servicer exercises                                                      
the option, the purchase price distributed with respect to each certificate will                                                     
be 100% of its then                                                                                                                  
                                                                                                                                     
                                      S-43                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
outstanding principal balance plus any Class PO Deferred Amounts in the case of                                                      
the Class PO Certificates and, in the case of an interest-bearing certificate,                                                       
any unpaid accrued interest thereon at the applicable pass-through rate, in each                                                     
case subject to reduction as provided in the pooling and servicing agreement if                                                      
the purchase price is based in part on the appraised value of any foreclosed or                                                      
otherwise repossessed properties and the appraised value is less than the Stated                                                     
Principal Balance of the related mortgage loans. Distributions on the                                                                
certificates in respect of any optional termination will first be paid to the                                                        
senior certificates and then to the subordinated certificates. The proceeds from                                                     
any optional termination distribution may not be sufficient to distribute the                                                        
full amount to which each class of certificates is entitled if the purchase                                                          
price is based in part on the appraised value of any foreclosed or otherwise                                                         
repossessed property and the appraised value is less than the Stated Principal                                                       
Balance of the related mortgage loan.                                                                                                
                                                                                                                                     
THE TRUSTEE                                                                                                                          
                                                                                                                                     
         The Bank of New York will be the trustee under the pooling and                                                              
servicing agreement. The depositor and the master servicer may maintain other                                                        
banking relationships in the ordinary course of business with The Bank of New                                                        
York. Offered certificates may be surrendered at the Corporate Trust Office of                                                       
the trustee located at 101 Barclay Street, 8W, New York, New York 10286,                                                             
Attention: Corporate Trust Administration or at any other address the trustee                                                        
designates from time to time.                                                                                                        
                                                                                                                                     
RESTRICTIONS ON TRANSFER OF THE CLASS A-R CERTIFICATES                                                                               
                                                                                                                                     
         The Class A-R Certificates will be subject to the restrictions on                                                           
transfer described in the prospectus under "Material Federal Income Tax                                                              
Consequences -- REMIC Certificates -- b. Residual Certificates -- Tax-Related                                                        
Restrictions on Transfers of Residual Certificates -- Disqualified                                                                   
Organizations", "-- Noneconomic Residual Certificates" and "-- Foreign                                                               
Investors". The pooling and servicing agreement provides that the Class A-R                                                          
Certificates (in addition to other ERISA restricted classes of certificates) may                                                     
not be acquired by an ERISA Plan. See "ERISA Considerations." Each Class A-R                                                         
Certificate will contain a legend describing the foregoing restrictions.                                                             
                                                                                                                                     
                  YIELD, PREPAYMENT AND MATURITY CONSIDERATIONS                                                                      
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         The effective yield to the holders of each interest-bearing class of                                                        
certificates will be lower than the yield otherwise produced by the applicable                                                       
rate at which interest is passed through to the holders and the purchase price                                                       
of the certificates because monthly distributions will not be payable to the                                                         
holders until the 25th day (or, if that day is not a business day, the following                                                     
business day) of the month following the month in which interest accrues on the                                                      
mortgage loans (without any additional distribution of interest or earnings on                                                       
them for the delay).                                                                                                                 
                                                                                                                                     
         Delinquencies on the mortgage loans that are not advanced by or on                                                          
behalf of the master servicer (because amounts, if advanced, would be                                                                
nonrecoverable), will adversely affect the yield on the certificates. Because of                                                     
the priority of distributions, shortfalls resulting from delinquencies not so                                                        
advanced will be borne first by the subordinated certificates, in the reverse                                                        
order of their numerical class designations, and then by the senior certificates                                                     
pro rata. If, as a result of the shortfalls, the aggregate of the Class                                                              
Certificate Balances of all classes of certificates exceeds the pool principal                                                       
balance, the Class Certificate Balance of the class of subordinated certificates                                                     
then outstanding with the highest numerical class designation will be reduced by                                                     
the amount of the excess.                                                                                                            
                                                                                                                                     
         Any net prepayment interest shortfalls and any Relief Act Reductions                                                        
that are allocable to the Class A-3 Certificates that are not covered by the                                                         
Reserve Fund will adversely affect the yield to investors in the Class A-3                                                           
Certificates. Net Interest Shortfalls will adversely affect the yields on the                                                        
other classes of offered certificates. In addition, although all losses                                                              
initially will be borne by the subordinated certificates, in the reverse order                                                       
of their numerical class designations (either directly or through distributions                                                      
in respect of Class PO Deferred Amounts on the Class PO Certificates), Excess                                                        
Losses will be borne by all classes of certificates on a pro rata basis.                                                             
Moreover, since the Subordinated Principal Distribution Amount for each                                                              
Distribution Date will be reduced by the amount of any distributions on the                                                          
Distribution Date in respect of Class PO Deferred Amounts, the amount                                                                
distributable as principal on each Distribution Date to each class of                                                                
subordinated certificates then entitled to a distribution of                                                                         
                                                                                                                                     
                                      S-44                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
principal will be less than it otherwise would be in the absence of the Class PO                                                     
Deferred Amounts. As a result, the yields on the offered certificates will                                                           
depend on the rate and timing of Realized Losses, including Excess Losses.                                                           
Excess Losses could occur at a time when one or more classes of subordinated                                                         
certificates are still outstanding and otherwise available to absorb other types                                                     
of Realized Losses.                                                                                                                  
                                                                                                                                     
         Notwithstanding the foregoing, any Realized Loss, including Excess                                                          
Losses, on the mortgage loans allocable to the Class A-3 Certificates will be                                                        
covered by the Class A-3 Policy. See "Credit Enhancement The Financial Guaranty                                                      
Insurance Policy" in this prospectus supplement.                                                                                     
                                                                                                                                     
         For purposes of allocating losses and shortfalls resulting from                                                             
delinquencies to the subordinated certificates, the Class M Certificates will be                                                     
considered to have a lower numerical class designation than each other class of                                                      
subordinated certificates.                                                                                                           
                                                                                                                                     
PREPAYMENT CONSIDERATIONS AND RISKS                                                                                                  
                                                                                                                                     
         The rate of principal payments on the offered certificates, the                                                             
aggregate amount of distributions on the offered certificates and the yield to                                                       
maturity of the 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, including for this                                                          
purpose, prepayments resulting from refinancing, liquidations of the mortgage                                                        
loans due to defaults, casualties, condemnations and repurchases by the seller                                                       
or master servicer. Except for certain of the mortgage loans, each of which has                                                      
a prepayment penalty, if the related mortgagor prepays such mortgage loan during                                                     
a period ranging from one year to five years after origination, the mortgage                                                         
loans may be prepaid by the mortgagors at any time without a prepayment penalty.                                                     
Because certain of the mortgage loans may contain prepayment penalties, the rate                                                     
of principal prepayments may be less than the rate of principal payments for                                                         
mortgage loans that did not have prepayment penalties. In addition, certain of                                                       
the mortgage loans do not provide for any payments of principal for the first                                                        
ten years following their origination. These mortgage loans may involve a                                                            
greater degree of risk because, if the related mortgagor defaults, the                                                               
outstanding principal balance of that mortgage loan will be higher than for an                                                       
amortizing mortgage loan. During their interest-only periods, these mortgage                                                         
loans may be less likely to prepay as the interest-only feature may reduce the                                                       
perceived benefits of refinancing due to the smaller monthly payment. However,                                                       
as an interest-only mortgage loan approaches the end of its interest-only                                                            
period, it may be more likely to be prepaid, even if market interest rates at                                                        
the time are only slightly higher or lower than the interest rate on the                                                             
interest-only mortgage loans as the related borrowers seek to avoid increases in                                                     
their respective monthly mortgage payment. The mortgage loans are subject to the                                                     
"due-on-sale" provisions included therein. See "The Mortgage Pool" in this                                                           
prospectus supplement.                                                                                                               
                                                                                                                                     
         Prepayments, liquidations and purchases of the mortgage loans will                                                          
result in distributions on the offered certificates of principal amounts which                                                       
would otherwise be distributed over the remaining terms of the mortgage loans.                                                       
This includes any optional purchase by the master servicer of a defaulted                                                            
mortgage loan and any optional repurchase of the remaining mortgage loans in                                                         
connection with the termination of the trust fund, in each case as described in                                                      
this prospectus supplement. Since the rate of payment of principal of the                                                            
mortgage loans will depend on future events and a variety of factors, no                                                             
assurance can be given as to the rate of payment of principal of the mortgage                                                        
loans or the rate of principal prepayments. The extent to which the yield to                                                         
maturity of a class of offered certificates may vary from the anticipated yield                                                      
will depend upon the degree to which the offered certificate is purchased at a                                                       
discount or premium, and the degree to which the timing of payments thereon is                                                       
sensitive to prepayments, liquidations and purchases of the mortgage loans.                                                          
Further, an investor should consider the risk that, in the case of the principal                                                     
only certificates and any other offered certificate purchased at a discount, a                                                       
slower than anticipated rate of principal payments (including prepayments) on                                                        
the mortgage loans could result in an actual yield to the investor that is lower                                                     
than the anticipated yield and, in the case of any offered certificate purchased                                                     
at a premium, a faster than anticipated rate of principal payments could result                                                      
in an actual yield to the investor that is lower than the anticipated yield.                                                         
                                                                                                                                     
         The rate of principal payments (including prepayments) on pools of                                                          
mortgage loans may vary significantly over time and may be influenced by a                                                           
variety of economic, geographic, social and other factors, including changes in                                                      
mortgagors' housing needs, job transfers, unemployment, mortgagors' net equity                                                       
in the mortgaged properties, servicing decisions, as well as the characteristics                                                     
of the mortgage loans included in the mortgage pool as described                                                                     
                                                                                                                                     
                                      S-45                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
under "The Mortgage Pool -- General" and "-- Underwriting Process" in this                                                           
prospectus supplement. In general, if prevailing interest rates were to fall                                                         
significantly below the mortgage rates on the mortgage loans, the mortgage loans                                                     
could be subject to higher prepayment rates than if prevailing interest rates                                                        
were to remain at or above the mortgage rates on the mortgage loans. Conversely,                                                     
if prevailing interest rates were to rise significantly, the rate of prepayments                                                     
on the mortgage loans would generally be expected to decrease. No assurances can                                                     
be given as to the rate of prepayments on the mortgage loans in stable or                                                            
changing interest rate environments. Furthermore, with respect to up to 50% of                                                       
the Closing Date Mortgage Loans and up to 90% of the Supplemental Mortgage                                                           
Loans, the depositor may deliver all or a portion of each related mortgage file                                                      
to the trustee after the closing date or the related Supplemental Transfer Date,                                                     
as applicable. Should the seller fail to deliver all or a portion of any                                                             
mortgage files to the depositor or other designee of the depositor or, at the                                                        
depositor's direction, to the trustee, within that period, the seller will be                                                        
required to use its best efforts to deliver a replacement mortgage loan for the                                                      
related delayed delivery mortgage loan or repurchase the related delayed                                                             
delivery mortgage loan. Any repurchases pursuant to this provision would also                                                        
have the effect of accelerating the rate of prepayments on the mortgage loans.                                                       
                                                                                                                                     
         As described under "Description of the Certificates -- Principal" in                                                        
this prospectus supplement, the Senior Prepayment Percentage of the applicable                                                       
Non-PO Percentage of all principal prepayments will be initially distributed to                                                      
the classes of senior certificates (other than the Class PO Certificates) then                                                       
entitled to receive principal prepayment distributions. This results in all (or                                                      
a disproportionate percentage) of the principal prepayments being distributed to                                                     
holders of the classes of senior certificates and none (or less than their pro                                                       
rata share) of the principal prepayments being distributed to holders of the                                                         
subordinated certificates during the periods of time described in the definition                                                     
of "Senior Prepayment Percentage." The Class A-10 and Class A-11 Certificates                                                        
generally will not receive principal distributions for the first five years                                                          
after the closing date.                                                                                                              
                                                                                                                                     
         The timing of changes in the rate of prepayments on the mortgage loans                                                      
may significantly affect an investor's actual yield to maturity, even if the                                                         
average rate of principal payments is consistent with an investor's expectation.                                                     
In general, the earlier a prepayment of principal on the mortgage loans, the                                                         
greater the effect on an investor's yield to maturity. The effect on an                                                              
investor's yield as a result 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 may not be offset                                                     
by a subsequent like decrease (or increase) in the rate of principal payments.                                                       
                                                                                                                                     
         The tables in this "Yield, Prepayment and Maturity Considerations"                                                          
section indicate the sensitivity of the pre-tax corporate bond equivalent yields                                                     
to maturity of the illustrated classes of certificates to various constant                                                           
percentages of the Prepayment Assumption. The yields set forth in the tables                                                         
were calculated by determining the monthly discount rates that, when applied to                                                      
the assumed streams of cash flows to be paid on the applicable classes of                                                            
certificates, would cause the discounted present value of the assumed streams of                                                     
cash flows to equal the assumed aggregate purchase prices of the applicable                                                          
classes and converting the monthly rates to corporate bond equivalent rates.                                                         
Those calculations do not take into account variations that may occur in the                                                         
interest rates at which investors may be able to reinvest funds received by them                                                     
as distributions on the certificates and consequently do not purport to reflect                                                      
the return on any investment in any class of certificates when the reinvestment                                                      
rates are considered.                                                                                                                
                                                                                                                                     
MANDATORY PREPAYMENT                                                                                                                 
                                                                                                                                     
         In the event that at the end of the Conveyance Period there are amounts                                                     
on deposit in the Supplemental Loan Account, the holders of the senior                                                               
certificates will receive an additional distribution allocable to principal in                                                       
an amount equal to that amount on deposit in the Supplemental Loan Account at                                                        
that time.                                                                                                                           
                                                                                                                                     
SENSITIVITY OF THE PRINCIPAL ONLY CERTIFICATES                                                                                       
                                                                                                                                     
         THE CLASS PO, CLASS A-6 AND CLASS A-9 CERTIFICATES WILL BE "PRINCIPAL                                                       
ONLY" CERTIFICATES AND WILL NOT BEAR INTEREST. AS INDICATED IN THE FOLLOWING                                                         
TABLES, A LOWER THAN ANTICIPATED RATE OF PRINCIPAL PAYMENTS (INCLUDING                                                               
PREPAYMENTS) ON THE DISCOUNT MORTGAGE LOANS, IN THE CASE OF THE CLASS PO                                                             
CERTIFICATES, AND ALL OF THE MORTGAGE LOANS, IN THE CASE OF THE CLASS A-6 AND                                                        
CLASS A-9 CERTIFICATES, WILL HAVE A NEGATIVE EFFECT ON THE YIELDS TO INVESTORS                                                       
IN THE CLASS PO, CLASS A-6 AND CLASS A-9 CERTIFICATES.                                                                               
                                                                                                                                     
                                      S-46                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         As described above under "Description of the Certificates -- Principal"                                                     
in this prospectus supplement, the Class PO Principal Distribution Amount is                                                         
calculated by reference to the principal payments (including prepayments) on the                                                     
Discount mortgage loans. The Discount mortgage loans will have lower net                                                             
mortgage rates (and lower mortgage rates) than the other mortgage loans. In                                                          
general, mortgage loans with higher mortgage rates tend to prepay at higher                                                          
rates than mortgage loans with relatively lower mortgage rates in response to a                                                      
given change in market interest rates. As a result, the Discount mortgage loans                                                      
may prepay at lower rates, thereby reducing the rate of payment of principal and                                                     
the resulting yield of the Class PO Certificates.                                                                                    
                                                                                                                                     
         The information set forth in the following tables has been prepared on                                                      
the basis of the structuring assumptions and on the assumption that the                                                              
respective purchase prices of the Class PO, Class A-6 and Class A-9 Certificates                                                     
(expressed as a percentage of their respective initial Class Certificate                                                             
Balances) are as follows:                                                                                                            
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
CLASS                                                                 PRICE                                                          
-----                                                                 -----                                                          
<S>                                                                   <C>                                                            
Class PO....................................................          60.0%                                                          
Class A-6...................................................          55.0%                                                          
Class A-9...................................................          47.0%                                                          
</TABLE>                                                                                                                             
                                                                                                                                     
          SENSITIVITY OF THE PRINCIPAL ONLY CERTIFICATES TO PREPAYMENTS                                                              
                          (PRE-TAX YIELDS TO MATURITY)                                                                               

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                      PERCENTAGE OF THE PREPAYMENT ASSUMPTION                                        
                                                ---------------------------------------------------                                  
CLASS                                            0%        300%        500%        700%       1000%                                  
-----                                           ----       ----        ----        ----       -----                                  
<S>                                             <C>        <C>        <C>         <C>         <C>                                    
Class PO..................................      2.9%       10.8%      15.7%       20.1%       25.9%                                  
Class A-6.................................      2.3%        9.0%      14.2%       18.6%       24.0%                                  
Class A-9.................................      2.7%        8.3%      14.7%       20.0%       26.9%                                  
</TABLE>                                                                                                                             
                                                                                                                                     
         It is unlikely that the Discount mortgage loans, in the case of the                                                         
Class PO Certificates, or all of the mortgage loans, in the case of the Class                                                        
A-6 and Class A-9 Certificates, will have the precise characteristics described                                                      
in this prospectus supplement or that the Discount mortgage loans or that all of                                                     
the mortgage loans will all prepay at the same rate until maturity or that the                                                       
Discount mortgage loans or all of the mortgage loans will prepay at the same                                                         
rate or time. As a result of these factors, the pre-tax yields on the Class PO,                                                      
Class A-6 and Class A-9 Certificates are likely to differ from those shown in                                                        
the tables above, even if the Discount mortgage loans, in the case of the Class                                                      
PO Certificates, or all of the mortgage loans, in the case of the Class A-6 and                                                      

Class A-9 Certificates, prepay at the indicated percentages of the Prepayment                                                        
Assumption. No representation is made as to the actual rate of principal                                                             
payments on all of the mortgage loans or the Discount mortgage loans for any                                                         
period or over the lives of the Class PO, Class A-6 and Class A-9 Certificates                                                       
or as to the yields on the Class PO, Class A-6 and Class A-9 Certificates.                                                           
Investors must make their own decisions as to the appropriate prepayment                                                             
assumptions to be used in deciding whether to purchase the Class PO, Class A-6                                                       
or Class A-9 Certificates.                                                                                                           
                                                                                                                                     
         In addition, the Class PO Certificates are likely to receive a                                                              
prepayment on the first Distribution Date after the end of the Conveyance Period                                                     
from the Supplemental Loan Account in respect of the excess Class PO Sublimit.                                                       
It is unlikely that the entire Class PO Sublimit will be utilized in obtaining                                                       
Supplemental Mortgage Loans. It is also possible that the entire Class PO                                                            
Sublimit will be distributed as a prepayment if none of the Supplemental                                                             
Mortgage Loans are Discount mortgage loans.                                                                                          
                                                                                                                                     
ADDITIONAL INFORMATION                                                                                                               
                                                                                                                                     
         The depositor intends to file additional yield tables and other                                                             
computational materials with respect to one or more classes of offered                                                               
certificates with the Securities and Exchange Commission in a report on Form                                                         
8-K. The tables and materials were prepared by one or more of the underwriters                                                       
at the request of prospective investors, based on assumptions provided by, and                                                       
satisfying their special requirements. The tables and assumptions may be based                                                       
on assumptions that differ from the structuring assumptions. Accordingly, the                                                        
tables and other materials may not be relevant to or appropriate for investors                                                       
other than those specifically requesting them.                                                                                       
                                                                                                                                     
                                      S-47                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
WEIGHTED AVERAGE LIVES OF THE OFFERED CERTIFICATES                                                                                   
                                                                                                                                     
         The weighted average life of an offered certificate is determined by                                                        
(a) multiplying the amount of the net reduction, if any, of the Class                                                                
Certificate Balance of the certificate on each Distribution Date by the number                                                       
of years from the date of issuance to the Distribution Date, (b) summing the                                                         
results and (c) dividing the sum by the aggregate amount of the net reductions                                                       
in Class Certificate Balance of the certificate referred to in clause (a).                                                           
                                                                                                                                     
         For a discussion of the factors which may influence the rate of                                                             
payments (including prepayments) of the mortgage loans, see "-- Prepayment                                                           
Considerations and Risks" in this prospectus supplement and "Yield and                                                               
Prepayment Considerations" in the prospectus.                                                                                        
                                                                                                                                     
         In general, the weighted average lives of the offered certificates will                                                     
be shortened if the level of prepayments of principal of the mortgage loans                                                          
increases. However, the weighted average lives of the offered certificates will                                                      
depend upon a variety of other factors, including the timing of changes in such                                                      
rate of principal payments, the priority sequence of distributions of principal                                                      
of the classes of certificates and the distribution of the amount available for                                                      
distribution of principal to the classes of senior certificates (other than the                                                      
Class PO Certificates) in accordance with the rules governing the priorities of                                                      
payment among the classes of senior certificates set forth in this prospectus                                                        
supplement. See "Description of the Certificates -- Principal" in this                                                               
prospectus supplement.                                                                                                               
                                                                                                                                     
         The interaction of the foregoing factors may have different effects on                                                      
various classes of offered certificates and the effects on any class may vary at                                                     
different times during the life of the class. Accordingly, no assurance can be                                                       
given as to the weighted average life of any class of offered certificates.                                                          
Further, to the extent the prices of the offered certificates represent                                                              
discounts or premiums to their respective original Class Certificate Balances,                                                       
variability in the weighted average lives of the classes of offered certificates                                                     
will result in variability in the related yields to maturity. For an example of                                                      
how the weighted average lives of the classes of offered certificates may be                                                         
affected at various constant percentages of the Prepayment Assumption, see the                                                       
Decrement Tables under the next heading.                                                                                             
                                                                                                                                     
DECREMENT TABLES                                                                                                                     
                                                                                                                                     
         The following tables indicate the percentages of the initial Class                                                          
Certificate Balances of the classes of offered certificates that would be                                                            
outstanding after each of the dates shown at various constant percentages of the                                                     
Prepayment Assumption and the corresponding weighted average lives of the                                                            
classes. The tables have been prepared on the basis of the structuring                                                               
assumptions. It is not likely that the mortgage loans will have the precise                                                          
characteristics described in this prospectus supplement or all of the mortgage                                                       
loans will prepay at the constant percentages of the Prepayment Assumption                                                           
specified in the tables or at any other constant rate. Moreover, the diverse                                                         
remaining terms to maturity of the mortgage loans could produce slower or faster                                                     
principal distributions than indicated in the tables, which have been prepared                                                       
using the specified constant percentages of the Prepayment Assumption, even if                                                       
the remaining term to maturity of the mortgage loans is consistent with the                                                          
remaining terms to maturity of the mortgage loans specified in the structuring                                                       
assumptions.                                                                                                                         
                                                                                                                                     
         The weighted average lives of the Class A-3 Certificates shown in the                                                       
table below apply to such class taken as a whole. Because principal                                                                  
distributions may be requested by the beneficial owners of the Class A-3                                                             
Certificates and because beneficial owners of the Class A-3 Certificates may                                                         
receive principal distributions by random lot, the weighted average life of any                                                      
Class A-3 Certificate beneficially owned by an individual investor may vary                                                          
significantly from the weighted average lives of the Class A-3 Certificates,                                                         
taken as a whole. There can be no assurance with respect to any particular                                                           
scenario of the rate of principal distributions on the Class A-3 Certificates,                                                       
any particular weighted average life for the Class A-3 Certificates or the date                                                      
or dates on which any particular beneficial owner will receive distributions in                                                      
reduction of the principal balance of its Class A-3 Certificate. Investors in                                                        
the Class A-3 Certificates should understand that they are assuming all risks                                                        
and benefits associated with the rate of principal distributions on such                                                             
certificates and variations in such rate from time to time.                                                                          
                                                                                                                                     
                                      S-48                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
           PERCENT OF INITIAL CLASS CERTIFICATE BALANCES OUTSTANDING*                                                                

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                     CLASS A-1                              CLASS A-2 AND CLASS A-7                  
                                                   PERCENTAGE OF                                 PERCENTAGE OF                       
                                             THE PREPAYMENT ASSUMPTION                     THE PREPAYMENT ASSUMPTION                 
                                     -----------------------------------------      --------------------------------------           
DISTRIBUTION DATE                     0%       300%     500%     700%     1000%      0%    300%     500%     700%     1000%          
-----------------                   -----      ----     ----     ----     -----     ----   ----     -----    ----     -----          
<S>                                 <C>        <C>      <C>      <C>      <C>       <C>    <C>      <C>      <C>      <C>            
Initial........................      100       100       100      100      100       100    100      100      100      100           
August 2004....................       98        93        89       86       80        98     92       89       85       79           
August 2005....................       97        77        65       53       36        96     75       62       49       31           
August 2006....................       95        56        35       16        0        94     53       30       10        0           
August 2007....................       93        39        13        0        0        92     34        6        0        0           
August 2008....................       91        24         0        0        0        90     18        0        0        0           
August 2009....................       89        14         0        0        0        88      7        0        0        0           
August 2010....................       86         6         0        0        0        85      0        0        0        0           
August 2011....................       84         0         0        0        0        83      0        0        0        0           
August 2012....................       82         0         0        0        0        80      0        0        0        0           
August 2013....................       79         0         0        0        0        78      0        0        0        0           
August 2014....................       77         0         0        0        0        75      0        0        0        0           
August 2015....................       74         0         0        0        0        72      0        0        0        0           
August 2016....................       71         0         0        0        0        68      0        0        0        0           
August 2017....................       67         0         0        0        0        65      0        0        0        0           
August 2018....................       64         0         0        0        0        61      0        0        0        0           
August 2019....................       60         0         0        0        0        57      0        0        0        0           
August 2020....................       56         0         0        0        0        53      0        0        0        0           
August 2021....................       52         0         0        0        0        49      0        0        0        0           
August 2022....................       48         0         0        0        0        44      0        0        0        0           
August 2023....................       44         0         0        0        0        39      0        0        0        0           
August 2024....................       39         0         0        0        0        34      0        0        0        0           
August 2025....................       34         0         0        0        0        28      0        0        0        0           
August 2026....................       28         0         0        0        0        23      0        0        0        0           
August 2027....................       23         0         0        0        0        17      0        0        0        0           
August 2028....................       17         0         0        0        0        10      0        0        0        0           
August 2029....................       10         0         0        0        0         3      0        0        0        0           
August 2030....................        4         0         0        0        0         0      0        0        0        0           
August 2031....................        0         0         0        0        0         0      0        0        0        0           
August 2032....................        0         0         0        0        0         0      0        0        0        0           
August 2033....................        0         0         0        0        0         0      0        0        0        0           
Weighted Average Life                                                                                                                
   (in years)**................     17.1       3.6       2.6      2.1      1.7      16.3    3.3      2.4      2.0      1.6           
</TABLE>                                                                                                                             

-------------                                                                                                                        
*   Rounded to the nearest whole percentage.                                                                                         
                                                                                                                                     
**  Determined as specified under "Weighted Average Lives of the Offered                                                             
    Certificates" herein.                                                                                                            
                                                                                                                                     
                                      S-49                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
           PERCENT OF INITIAL CLASS CERTIFICATE BALANCES OUTSTANDING*                                                                

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                    CLASS A-3                                     CLASS A-4                          
                                                  PERCENTAGE OF                                 PERCENTAGE OF                        
                                            THE PREPAYMENT ASSUMPTION                     THE PREPAYMENT ASSUMPTION                  
                                     ---------------------------------------       ---------------------------------------           
DISTRIBUTION DATE                     0%      300%     500%    700%     1000%       0%     300%     500%     700%     1000%          
-----------------                    ---      ----     ----    ----     -----      ---     ----     ----     ----     -----          
<S>                                 <C>       <C>      <C>     <C>      <C>       <C>      <C>      <C>      <C>      <C>            
Initial........................      100       100      100     100      100       100      100      100      100      100           
August 2004....................      100       100      100     100      100        98       92       88       83       77           
August 2005....................      100       100      100     100      100        96       73       58       44       24           
August 2006....................      100       100      100     100      100        94       48       23        1        0           
August 2007....................      100       100      100     100        0        91       28        0        0        0           
August 2008....................      100       100      100       0        0        89       11        0        0        0           
August 2009....................      100       100       95       0        0        87        0        0        0        0           
August 2010....................      100       100       36       0        0        84        0        0        0        0           
August 2011....................      100       100        9       0        0        81        0        0        0        0           
August 2012....................      100       100        1       0        0        78        0        0        0        0           
August 2013....................      100       100        1       0        0        76        0        0        0        0           
August 2014....................      100       100        0       0        0        72        0        0        0        0           
August 2015....................      100        87        0       0        0        69        0        0        0        0           
August 2016....................      100        69        0       0        0        65        0        0        0        0           
August 2017....................      100        55        0       0        0        61        0        0        0        0           
August 2018....................      100        43        0       0        0        57        0        0        0        0           
August 2019....................      100        34        0       0        0        53        0        0        0        0           
August 2020....................      100        26        0       0        0        49        0        0        0        0           
August 2021....................      100        20        0       0        0        44        0        0        0        0           
August 2022....................      100        16        0       0        0        39        0        0        0        0           
August 2023....................      100        12        0       0        0        33        0        0        0        0           
August 2024....................      100         9        0       0        0        28        0        0        0        0           
August 2025....................      100         7        0       0        0        22        0        0        0        0           
August 2026....................      100         5        0       0        0        16        0        0        0        0           
August 2027....................      100         4        0       0        0         9        0        0        0        0           
August 2028....................      100         3        0       0        0         2        0        0        0        0           
August 2029....................      100         2        0       0        0         0        0        0        0        0           
August 2030....................      100         1        0       0        0         0        0        0        0        0           
August 2031....................      100         1        0       0        0         0        0        0        0        0           
August 2032....................       94         0        0       0        0         0        0        0        0        0           
August 2033....................        0         0        0       0        0         0        0        0        0        0           
Weighted Average Life                                                                                                                
   (in years)**................     29.5      15.5      6.9     4.6      3.4      15.5      3.0      2.2      1.8      1.5           
</TABLE>                                                                                                                             

-------------                                                                                                                        
*   Rounded to the nearest whole percentage.                                                                                         
                                                                                                                                     
**  Determined as specified under "Weighted Average Lives of the Offered                                                             
    Certificates" herein.                                                                                                            
                                                                                                                                     
                                      S-50                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
           PERCENT OF INITIAL CLASS CERTIFICATE BALANCES OUTSTANDING*                                                                

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                              CLASS A-5 AND CLASS A-6                       CLASS A-8 AND CLASS A-9                  
                                                   PERCENTAGE OF                                 PERCENTAGE OF                       
                                             THE PREPAYMENT ASSUMPTION                     THE PREPAYMENT ASSUMPTION                 
                                     -----------------------------------------      --------------------------------------           
DISTRIBUTION DATE                     0%       300%     500%     700%     1000%     0%     300%     500%     700%     100%           
-----------------                    ---       ----     ----     ----     -----     ---    ----     ----     ----     ----           
<S>                                 <C>        <C>      <C>      <C>      <C>      <C>     <C>      <C>      <C>      <C>            
Initial........................      100       100       100      100      100      100     100      100      100      100           
August 2004....................      100       100       100      100      100      100     100      100      100      100           
August 2005....................      100       100       100      100      100      100     100      100      100      100           
August 2006....................      100       100       100      100        0      100     100      100      100       40           
August 2007....................      100       100        84        0        0      100     100      100       40        0           
August 2008....................      100       100         0        0        0      100     100       75        0        0           
August 2009....................      100        90         0        0        0      100     100        0        0        0           
August 2010....................      100        37         0        0        0      100      99        0        0        0           
August 2011....................      100         0         0        0        0      100      94        0        0        0           
August 2012....................      100         0         0        0        0      100      56        0        0        0           
August 2013....................      100         0         0        0        0      100      29        0        0        0           
August 2014....................      100         0         0        0        0      100       7        0        0        0           
August 2015....................      100         0         0        0        0      100       0        0        0        0           
August 2016....................      100         0         0        0        0      100       0        0        0        0           
August 2017....................      100         0         0        0        0      100       0        0        0        0           
August 2018....................      100         0         0        0        0      100       0        0        0        0           
August 2019....................      100         0         0        0        0      100       0        0        0        0           
August 2020....................      100         0         0        0        0      100       0        0        0        0           
August 2021....................      100         0         0        0        0      100       0        0        0        0           
August 2022....................      100         0         0        0        0      100       0        0        0        0           
August 2023....................      100         0         0        0        0      100       0        0        0        0           
August 2024....................      100         0         0        0        0      100       0        0        0        0           
August 2025....................      100         0         0        0        0      100       0        0        0        0           
August 2026....................      100         0         0        0        0      100       0        0        0        0           
August 2027....................      100         0         0        0        0      100       0        0        0        0           
August 2028....................      100         0         0        0        0      100       0        0        0        0           
August 2029....................       68         0         0        0        0      100       0        0        0        0           
August 2030....................       24         0         0        0        0       98       0        0        0        0           
August 2031....................        0         0         0        0        0       64       0        0        0        0           
August 2032....................        0         0         0        0        0        0       0        0        0        0           
August 2033....................        0         0         0        0        0        0       0        0        0        0           
Weighted Average Life                                                                                                                
   (in years)**................     26.4       6.8       4.4      3.4      2.6     28.2     9.4      5.3      4.0      3.0           
</TABLE>                                                                                                                             

-------------                                                                                                                        
*   Rounded to the nearest whole percentage.                                                                                         
                                                                                                                                     
**  Determined as specified under "Weighted Average Lives of the Offered                                                             
    Certificates" herein.                                                                                                            
                                                                                                                                     
                                      S-51                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
           PERCENT OF INITIAL CLASS CERTIFICATE BALANCES OUTSTANDING*                                                                

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                            CLASS A-10 AND CLASS A-11                             CLASS PO                           
                                                  PERCENTAGE OF                                 PERCENTAGE OF                        
                                            THE PREPAYMENT ASSUMPTION                     THE PREPAYMENT ASSUMPTION                  
                                     ---------------------------------------      ---------------------------------------            
DISTRIBUTION DATE                    0%       300%     500%     700%    1000%      0%      300%     500%     700%    1000%           
-----------------                    ---     -----     ----     ----    -----     ----     ----     ----     ----    -----           
<S>                                 <C>      <C>       <C>      <C>     <C>       <C>      <C>      <C>      <C>     <C>             
Initial........................      100      100       100      100     100       100      100      100      100     100            
August 2004....................      100      100       100      100     100        99       95       92       89      85            
August 2005....................      100      100       100      100     100        97       83       74       65      53            
August 2006....................      100      100       100      100     100        95       67       52       38      22            
August 2007....................      100      100       100      100      61        94       54       36       22       9            
August 2008....................      100      100       100      100       9        92       44       24       12       3            
August 2009....................       99       93        89       50       0        90       35       17        7       1            
August 2010....................       99       85        75       24       0        88       28       11        4       1            
August 2011....................       97       75        59       11       0        86       23        8        2       0            
August 2012....................       96       62        43        6       0        84       18        5        1       0            
August 2013....................       93       50        29        3       0        82       14        4        1       0            
August 2014....................       91       40        20        2       0        79       11        2        0       0            
August 2015....................       88       32        14        1       0        77        9        2        0       0            
August 2016....................       85       25         9        1       0        74        7        1        0       0            
August 2017....................       82       20         6        0       0        71        6        1        0       0            
August 2018....................       79       16         4        0       0        68        4        1        0       0            
August 2019....................       75       12         3        0       0        65        3        0        0       0            
August 2020....................       72       10         2        0       0        62        3        0        0       0            
August 2021....................       68        7         1        0       0        58        2        0        0       0            
August 2022....................       64        6         1        0       0        55        2        0        0       0            
August 2023....................       59        4         1        0       0        51        1        0        0       0            
August 2024....................       55        3         0        0       0        47        1        0        0       0            
August 2025....................       50        2         0        0       0        43        1        0        0       0            
August 2026....................       45        2         0        0       0        38        1        0        0       0            
August 2027....................       40        1         0        0       0        34        0        0        0       0            
August 2028....................       34        1         0        0       0        29        0        0        0       0            
August 2029....................       28        1         0        0       0        24        0        0        0       0            
August 2030....................       21        0         0        0       0        18        0        0        0       0            
August 2031....................       15        0         0        0       0        12        0        0        0       0            
August 2032....................        8        0         0        0       0         6        0        0        0       0            
August 2033....................        0        0         0        0       0         0        0        0        0       0            
Weighted Average Life                                                                                                                
   (in years)**................     21.0     11.0       9.1      6.5     4.3      18.7      5.7      3.8      3.0     2.3            
</TABLE>                                                                                                                             

-------------                                                                                                                        
*   Rounded to the nearest whole percentage.                                                                                         
                                                                                                                                     
**  Determined as specified under "Weighted Average Lives of the Offered                                                             
    Certificates" herein.                                                                                                            
                                                                                                                                     
                                      S-52                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
           PERCENT OF INITIAL CLASS CERTIFICATE BALANCES OUTSTANDING*                                                                

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                     CLASS A-R                         CLASS M, CLASS B-1 AND CLASS B-2              
                                                   PERCENTAGE OF                                 PERCENTAGE OF                       
                                             THE PREPAYMENT ASSUMPTION                     THE PREPAYMENT ASSUMPTION                 
                                     ----------------------------------------      ----------------------------------------          
DISTRIBUTION DATE                     0%      300%     500%     700%     1000%      0%      300%     500%    700%     1000%          
-----------------                    ---      ----     ----     ----     -----     ----     ----     ----    ----     -----          
<S>                                  <C>      <C>      <C>      <C>      <C>       <C>      <C>      <C>     <C>      <C>            
Initial........................      100       100      100      100      100       100      100      100     100      100           
August 2004....................        0         0        0        0        0        99       99       99      99       99           
August 2005....................        0         0        0        0        0        97       97       97      97       97           
August 2006....................        0         0        0        0        0        96       96       96      96       96           
August 2007....................        0         0        0        0        0        95       95       95      95       95           
August 2008....................        0         0        0        0        0        93       93       93      93       93           
August 2009....................        0         0        0        0        0        91       86       82      78       50           
August 2010....................        0         0        0        0        0        90       78       70      61       19           
August 2011....................        0         0        0        0        0        88       68       55      44        8           
August 2012....................        0         0        0        0        0        86       57       41      28        3           
August 2013....................        0         0        0        0        0        84       45       28      16        1           
August 2014....................        0         0        0        0        0        81       36       19       9        0           
August 2015....................        0         0        0        0        0        79       29       13       5        0           
August 2016....................        0         0        0        0        0        76       23        9       3        0           
August 2017....................        0         0        0        0        0        73       18        6       2        0           
August 2018....................        0         0        0        0        0        71       14        4       1        0           
August 2019....................        0         0        0        0        0        67       11        3       0        0           
August 2020....................        0         0        0        0        0        64        9        2       0        0           
August 2021....................        0         0        0        0        0        61        7        1       0        0           
August 2022....................        0         0        0        0        0        57        5        1       0        0           
August 2023....................        0         0        0        0        0        53        4        0       0        0           
August 2024....................        0         0        0        0        0        49        3        0       0        0           
August 2025....................        0         0        0        0        0        45        2        0       0        0           
August 2026....................        0         0        0        0        0        40        2        0       0        0           
August 2027....................        0         0        0        0        0        35        1        0       0        0           
August 2028....................        0         0        0        0        0        30        1        0       0        0           
August 2029....................        0         0        0        0        0        25        1        0       0        0           
August 2030....................        0         0        0        0        0        19        0        0       0        0           
August 2031....................        0         0        0        0        0        13        0        0       0        0           
August 2032....................        0         0        0        0        0         7        0        0       0        0           
August 2033....................        0         0        0        0        0         0        0        0       0        0           
Weighted Average Life                                                                                                                
   (in years)**................      0.1       0.1      0.1      0.1      0.1      19.2     10.3      8.6     7.8      6.1           
</TABLE>                                                                                                                             

-------------                                                                                                                        
*   Rounded to the nearest whole percentage.                                                                                         
                                                                                                                                     
**  Determined as specified under "Weighted Average Lives of the Offered                                                             
    Certificates" herein.                                                                                                            
                                                                                                                                     
                                      S-53                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
LAST SCHEDULED DISTRIBUTION DATE                                                                                                     
                                                                                                                                     
         The Last Scheduled Distribution Date for each class of offered                                                              
certificates is the Distribution Date in October 2033. Since the rate of                                                             
distributions in reduction of the Class Certificate Balance of each class of                                                         
offered certificates will depend on the rate of payment (including prepayments)                                                      
of the mortgage loans, the Class Certificate Balance of any class could be                                                           
reduced to zero significantly earlier or later than the Last Scheduled                                                               
Distribution Date. The rate of payments on the mortgage loans will depend on                                                         
their particular characteristics, as well as on prevailing interest rates from                                                       
time to time and other economic factors, and no assurance can be given as to the                                                     
actual payment experience of the mortgage loans. See "Yield, Prepayment and                                                          
Maturity Considerations -- Prepayment Considerations and Risks" and "--                                                              
Weighted Average Lives of the Offered Certificates" in this prospectus                                                               
supplement and "Yield and Prepayment Considerations" in the prospectus.                                                              
                                                                                                                                     
THE SUBORDINATED CERTIFICATES                                                                                                        
                                                                                                                                     
         The weighted average life of, and the yield to maturity on, the                                                             
subordinated certificates, in increasing order of their numerical class                                                              
designation, will be progressively more sensitive to the rate and timing of                                                          
mortgagor defaults and the severity of ensuing losses on the mortgage loans. In                                                      
particular, the rate and timing of mortgagor defaults and the severity of                                                            
ensuing losses on the mortgage loans may be affected by the characteristics of                                                       
the mortgage loans included in the mortgage pool as described under "The                                                             
Mortgage Pool -- General" and "-- Underwriting Process" in this prospectus                                                           
supplement. If the actual rate and severity of losses on the mortgage loans is                                                       
higher than those assumed by a holder of a subordinated certificate, the actual                                                      
yield to maturity of the certificate may be lower than the yield expected by the                                                     
holder based on the holder's assumptions. The timing of losses on 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. Realized                                                          
Losses on the mortgage loans will reduce the Class Certificate Balances of the                                                       
applicable class of subordinated certificates to the extent of any losses                                                            
allocated to it (as described under "Description of the Certificates --                                                              
Allocation of Losses" in this prospectus supplement), without the receipt of                                                         
cash attributable to the reduction. In addition, shortfalls in cash available                                                        
for distributions on the subordinated certificates will result in a reduction in                                                     
the Class Certificate Balance of the class of subordinated certificates then                                                         
outstanding with the highest numerical class designation if and to the extent                                                        
that the aggregate of the Class Certificate Balances of all classes of                                                               
certificates, following all distributions and the allocation of Realized Losses                                                      
on a Distribution Date, exceeds the pool principal balance as of the Due Date                                                        
occurring in the month of the Distribution Date. As a result of the reductions,                                                      
less interest will accrue on the class of subordinated certificates than                                                             
otherwise would be the case. The yield to maturity of the subordinated                                                               
certificates will also be affected by the disproportionate allocation of                                                             
principal prepayments to the senior certificates, Net Interest Shortfalls, other                                                     
cash shortfalls in Available Funds and distribution of funds to Class PO                                                             
certificateholders otherwise available for distribution on the subordinated                                                          
certificates to the extent of reimbursement for Class PO Deferred Amounts. See                                                       
"Description of the Certificates -- Allocation of Losses" in this prospectus                                                         
supplement.                                                                                                                          
                                                                                                                                     
         If on any Distribution Date, the Applicable Credit Support Percentage                                                       
for any class of subordinated certificates (other than the class of subordinated                                                     
certificates then outstanding with the highest priority of distribution) is less                                                     
than its Original Applicable Credit Support Percentage, all partial principal                                                        
prepayments and principal prepayments in full available for distribution on the                                                      
subordinated certificates will be allocated solely to that class and all other                                                       
classes of subordinated certificates with lower numerical class designations,                                                        
thereby accelerating their amortization relative to that of the Restricted                                                           
Classes and reducing the weighted average lives of the classes of subordinated                                                       
certificates receiving the distributions. Accelerating the amortization of the                                                       
classes of subordinated certificates with lower numerical class designations                                                         
relative to the other classes of subordinated certificates is intended to                                                            
preserve the availability of the subordination provided by the other classes.                                                        
                                                                                                                                     
         For purposes of allocating losses and prepayments to the subordinated                                                       
certificates, the Class M Certificates will be considered to have a lower                                                            
numerical class designation than each other class of subordinated certificates.                                                      
                                                                                                                                     
                                      S-54                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                               CREDIT ENHANCEMENT                                                                                    
                                                                                                                                     
SUBORDINATION                                                                                                                        
                                                                                                                                     
         Any Realized Losses, other than Excess Losses, on the mortgage loans                                                        
that would otherwise be allocated to the Class A-2 and Class A-10 Certificates,                                                      
will instead be allocated to the Class A-7 and Class A-11 Certificates,                                                              
respectively, until their respective Class Certificate Balances are reduced to                                                       
zero. See "Description of the Certificates - Allocation of Losses" in this                                                           
prospectus supplement.                                                                                                               
                                                                                                                                     
         The rights of the holders of the subordinated certificates to receive                                                       
distributions with respect to the mortgage loans will be subordinated to the                                                         
rights of the holders of the senior certificates and the rights of the holders                                                       
of each class of subordinated certificates (other than the Class M Certificates)                                                     
to receive the distributions will be further subordinated to the rights of the                                                       
class or classes of subordinated certificates with lower numerical class                                                             
designations, in each case only to the extent described in this prospectus                                                           
supplement. The subordination of the subordinated certificates to the senior                                                         
certificates and the subordination of the classes of subordinated certificates                                                       
with higher numerical class designations to those with lower numerical class                                                         
designations is intended to increase the likelihood of receipt, respectively, by                                                     
the senior certificateholders and the holders of subordinated certificates with                                                      
lower numerical class designations of the maximum amount to which they are                                                           
entitled on any Distribution Date and to provide the holders protection against                                                      
Realized Losses, other than Excess Losses. In addition, the subordinated                                                             
certificates will provide limited protection against Special Hazard Losses,                                                          
Bankruptcy Losses and Fraud Losses up to the Special Hazard Loss Coverage                                                            
Amount, Bankruptcy Loss Coverage Amount and Fraud Loss Coverage Amount,                                                              
respectively, as described in the following paragraphs. The applicable Non-PO                                                        
Percentage of Realized Losses, other than Excess Losses, will be allocated to                                                        
the class of subordinated certificates then outstanding with the highest                                                             
numerical class designation. In addition, the Class Certificate Balance of the                                                       
class of subordinated certificates will be reduced by the amount of                                                                  
distributions on the Class PO Certificates in reimbursement for Class PO                                                             
Deferred Amounts.                                                                                                                    
                                                                                                                                     
         For purposes of allocating losses to the subordinated certificates, the                                                     
Class M Certificates will be considered to have a lower numerical class                                                              
designation than each other class of subordinated certificates.                                                                      
                                                                                                                                     
         The subordinated certificates will provide limited protection to the                                                        
classes of certificates of higher relative priority against                                                                          
                                                                                                                                     
         -    Special Hazard Losses in an initial amount expected to be up to                                                        
              approximately $5,000,000 (the "Special Hazard Loss Coverage                                                            
              Amount"),                                                                                                              
                                                                                                                                     
         -    Bankruptcy Losses in an initial amount expected to be up to                                                            
              approximately $100,000 (the "Bankruptcy Loss Coverage Amount"),                                                        
              and                                                                                                                    
                                                                                                                                     
         -    Fraud Losses in an initial amount expected to be up to                                                                 
              approximately $5,000,000 (the "Fraud Loss Coverage Amount").                                                           
                                                                                                                                     
         The Special Hazard Loss Coverage Amount will be reduced, from time to                                                       
time, to be an amount equal on any Distribution Date to the lesser of                                                                
                                                                                                                                     
         -    the Special Hazard Loss Coverage Amount as of the closing date                                                         
              less the amount, if any, of losses attributable to Special Hazard                                                      
              mortgage loans incurred since the closing date, or                                                                     
                                                                                                                                     
         -    the greatest of                                                                                                        
                                                                                                                                     
              -   1% of the aggregate of the principal balances of the mortgage                                                      
                  loans,                                                                                                             
                                                                                                                                     
              -   twice the principal balance of the largest mortgage loan, and                                                      
                                                                                                                                     
                                      S-55                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
              -   the aggregate principal balances of the mortgage loans secured                                                     
                  by mortgaged properties located in the single California                                                           
                  postal zip code area having the highest aggregate principal                                                        
                  balance of any zip code area.                                                                                      
                                                                                                                                     
All principal balances for the purpose of this definition will be calculated as                                                      
of the first day of the month before the month in which the Distribution Date                                                        
occurs after giving effect to scheduled installments of principal and interest                                                       
on the mortgage loans then due, whether or not paid.                                                                                 
                                                                                                                                     
         The Fraud Loss Coverage Amount will be reduced, from time to time, by                                                       
the amount of Fraud Losses allocated to the certificates. In addition, the Fraud                                                     
Loss Coverage Amount will be reduced on the fifth anniversary of the cut-off                                                         
date, to zero and on the first, second, third and fourth anniversaries of the                                                        
cut-off date, to an amount equal to the lesser of (x) 1% of the then current                                                         
pool principal balance and (y) the excess of the Fraud Loss Coverage Amount as                                                       
of the preceding anniversary of the cut-off date over the cumulative amount of                                                       
Fraud Losses allocated to the certificates since the preceding anniversary.                                                          
                                                                                                                                     
         The Bankruptcy Loss Coverage Amount will be reduced, from time to time,                                                     
by the amount of Bankruptcy Losses allocated to the certificates.                                                                    
                                                                                                                                     
         The amount of coverage provided by the subordinated certificates for                                                        
Special Hazard Losses, Bankruptcy Losses and Fraud Losses may be cancelled or                                                        
reduced from time to time for each of the risks covered, provided that the then                                                      
current ratings of the certificates assigned by the rating agencies are not                                                          
adversely affected as a result (without regard to the Class A-3 Policy). In                                                          
addition, a reserve fund or other form of credit enhancement may be substituted                                                      
for the protection provided by the subordinated certificates for Special Hazard                                                      
Losses, Bankruptcy Losses and Fraud Losses.                                                                                          
                                                                                                                                     
         A "Deficient Valuation" is a bankruptcy proceeding whereby the                                                              
bankruptcy court may establish the value of the mortgaged property at an amount                                                      
less than the then outstanding principal balance of the mortgage loan secured by                                                     
the mortgaged property or may reduce the outstanding principal balance of a                                                          
mortgage loan. In the case of a reduction in that value of the related mortgaged                                                     
property, the amount of the secured debt could be reduced to that value, and the                                                     
holder of the mortgage loan thus would become an unsecured creditor to the                                                           
extent the outstanding principal balance of the mortgage loan exceeds the value                                                      
so assigned to the mortgaged property by the bankruptcy court. In addition,                                                          
other modifications of the terms of a mortgage loan can result from a bankruptcy                                                     
proceeding, including the reduction (a "Debt Service Reduction") of the amount                                                       
of the monthly payment on the related mortgage loan. However, none of these                                                          
shall be considered a Debt Service Reduction or Deficient Valuation so long as                                                       
the master servicer is pursuing any other remedies that may be available with                                                        
respect to the related mortgage loan and either the mortgage loan has not                                                            
incurred payment default or scheduled monthly payments of principal and interest                                                     
are being advanced by the master servicer without giving effect to any Debt                                                          
Service Reduction or Deficient Valuation.                                                                                            
                                                                                                                                     
THE FINANCIAL GUARANTY INSURANCE POLICY                                                                                              
                                                                                                                                     
         The following information has been supplied by MBIA Insurance                                                               
Corporation, the "insurer", for inclusion in this prospectus supplement. The                                                         
insurer does not accept any responsibility for the accuracy or completeness of                                                       
this prospectus supplement or any information or disclosure contained herein, or                                                     
omitted herefrom, other than with respect to the accuracy of the information                                                         
regarding the Class A-3 Policy and the insurer set forth under the headings                                                          
"Credit Enhancement -- The Financial Guaranty Insurance Policy" and "-- The                                                          
Insurer" herein. Additionally, the insurer makes no representation regarding the                                                     
Class A-3 Certificates or the advisability of investing in the Class A-3                                                             
Certificates.                                                                                                                        
                                                                                                                                     
         The insurer, in consideration of the payment of a premium and subject                                                       
to the terms of the financial guaranty insurance policy (the "Class A-3                                                              
Policy"), thereby unconditionally and irrevocably guarantees to any Class A-3                                                        
Certificateholder that an amount equal to each full and complete Insured Payment                                                     
will be received from the insurer by the trustee or its successors, as trustee                                                       
for the Class A-3 Certificateholders, on behalf of the Class A-3                                                                     
Certificateholders, for distribution by the trustee to each Class A-3                                                                
Certificateholder of that certificateholder's proportionate share of the Insured                                                     
Payment.                                                                                                                             
                                                                                                                                     
                                      S-56                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         The insurer's obligations under the Class A-3 Policy, with respect to a                                                     
particular Insured Payment, will be discharged to the extent funds equal to the                                                      
applicable Insured Payment are received by the trustee, whether or not those                                                         
funds are properly applied by the trustee. Insured Payments will be made only at                                                     
the time set forth in the Class A-3 Policy, and no accelerated Insured Payments                                                      
will be made regardless of any acceleration of the Class A-3 Certificates,                                                           
unless the acceleration is at the sole option of the insurer.                                                                        
                                                                                                                                     
         Notwithstanding the foregoing paragraph, the Class A-3 Policy does not                                                      
cover shortfalls, if any, attributable to the liability of the trust fund, any                                                       
REMIC or the trustee for withholding taxes, if any (including interest and                                                           
penalties in respect of any liability for withholding taxes). The Class A-3                                                          
Policy will not provide credit enhancement for any class of certificates other                                                       
than the Class A-3 Certificates.                                                                                                     
                                                                                                                                     
         The insurer will pay any Insured Payment that is a Preference Amount on                                                     
the business day following receipt on a business day by the insurer's fiscal                                                         
agent of the following:                                                                                                              
                                                                                                                                     
-   a certified copy of the order requiring the return of a preference payment;                                                      
                                                                                                                                     
-   an opinion of counsel satisfactory to the insurer that the order is final                                                        
    and not subject to appeal;                                                                                                       
                                                                                                                                     
-   an assignment in a form that is reasonably required by the insurer,                                                              
    irrevocably assigning to the insurer all rights and claims of the Class A-3                                                      
    Certificateholder relating to or arising under the Class A-3 Certificates                                                        
    against the debtor which made the preference payment or otherwise with                                                           
    respect to the preference payment; and                                                                                           
                                                                                                                                     
-   appropriate instruments to effect the appointment of the insurer as agent                                                        
    for the Class A-3 Certificateholder in any legal proceeding related to the                                                       
    preference payment, which instruments are in a form satisfactory to the                                                          
    insurer;                                                                                                                         
                                                                                                                                     
provided that if these documents are received after 12:00 p.m., New York time,                                                       
on that business day, they will be deemed to be received on the following                                                            
business day. Payments by the insurer will be disbursed to the receiver or the                                                       
trustee in bankruptcy named in the final order of the court exercising                                                               
jurisdiction on behalf of the Class A-3 Certificateholder and not to any Class                                                       
A-3 Certificateholder directly unless the Class A-3 Certificateholder has                                                            
returned principal or interest paid on the Class A-3 Certificates to the                                                             
receiver or trustee in bankruptcy, in which case that payment will be disbursed                                                      
to the Class A-3 Certificateholder.                                                                                                  
                                                                                                                                     
         The insurer will pay any other amount payable under the Class A-3                                                           
Policy no later than 12:00 p.m., New York time, on the later of the Distribution                                                     
Date on which the related Deficiency Amount is due or the third business day                                                         
following receipt in New York, New York on a business day by U.S. Bank Trust                                                         
National Association, as fiscal agent for the insurer or any successor fiscal                                                        
agent appointed by the insurer of a notice from the trustee specifying the                                                           
Insured Payment which is due and owing on the applicable Distribution Date,                                                          
provided that if the notice is received after 12:00 p.m., New York time, on that                                                     
business day, it will be deemed to be received on the following business day. If                                                     
any notice received by the insurer's fiscal agent is not in proper form or is                                                        
otherwise insufficient for the purpose of making a claim under the Class A-3                                                         
Policy, it will be deemed not to have been received by the insurer's fiscal                                                          
agent for the purposes of this paragraph, and the insurer or the fiscal agent,                                                       
as the case may be, will promptly so advise the trustee and the trustee may                                                          
submit an amended notice.                                                                                                            
                                                                                                                                     
         Insured Payments due under the Class A-3 Policy, unless otherwise                                                           
stated therein, will be disbursed by the insurer's fiscal agent to the trustee,                                                      
on behalf of the Class A-3 Certificateholders, by wire transfer of immediately                                                       
available funds in the amount of the Insured Payment less, in respect of Insured                                                     
Payments related to Preference Amounts, any amount held by the trustee for the                                                       
payment of the Insured Payment and legally available therefor.                                                                       
                                                                                                                                     
         The fiscal agent is the agent of the insurer only and the fiscal agent                                                      
will in no event be liable to Class A-3 Certificateholders for any acts of the                                                       
fiscal agent or any failure of the insurer to deposit or cause to be deposited                                                       
sufficient funds to make payments due under the Class A-3 Policy.                                                                    
                                                                                                                                     
                                      S-57                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         As used in the Class A-3 Policy, the following terms shall have the                                                         
following meanings:                                                                                                                  
                                                                                                                                     
         "Class A-3 Available Funds" means funds allocated from Available Funds                                                      
pursuant to the pooling and servicing agreement to make distributions on the                                                         
Class A-3 Certificates.                                                                                                              
                                                                                                                                     
         "Deficiency Amount" means the excess, if any, of Required Distributions                                                     
over Class A-3 Available Funds.                                                                                                      
                                                                                                                                     
         "Insured Payment" means (a) as of any Distribution Date, any Deficiency                                                     
Amount and (b) any Preference Amount.                                                                                                
                                                                                                                                     
         "Preference Amount" means any amount previously distributed to a Class                                                      
A-3 Certificateholder on the Class A-3 Certificates that is recoverable and                                                          
sought to be recovered as a voidable preference by a trustee in bankruptcy                                                           
pursuant to the United States Bankruptcy Code (11 U.S.C.), as amended from time                                                      
to time, in accordance with a final nonappealable order of a court having                                                            
competent jurisdiction.                                                                                                              
                                                                                                                                     
         "Required Distributions" means the sum, without duplication, of (i) the                                                     
interest distribution amount with respect to the Class A-3 Certificates, minus                                                       
any net prepayment interest shortfalls and any Relief Act Reductions allocated                                                       
to the Class A-3 Certificates and (ii) the amount of any Realized Loss,                                                              
including any Excess Loss, allocated to the Class A-3 Certificates.                                                                  
                                                                                                                                     
         Capitalized terms used in the Class A-3 Policy and not otherwise                                                            
defined in the Class A-3 Policy shall have the meanings set forth in the pooling                                                     
and servicing agreement as of the date of execution of the Class A-3 Policy,                                                         
without giving effect to any subsequent amendment or modification to the pooling                                                     
and servicing agreement unless such amendment or modification has been approved                                                      
in writing by the insurer.                                                                                                           
                                                                                                                                     
         The Class A-3 Policy is not cancelable for any reason. The premium on                                                       
the Class A-3 Policy is not refundable for any reason including payment, or                                                          
provision being made for payment, prior to the maturity of the Class A-3                                                             
Certificates.                                                                                                                        
                                                                                                                                     
         The Class A-3 Policy is being issued under and pursuant to, and will be                                                     
construed under, the laws of the State of New York, without giving effect to the                                                     
conflict of laws principles thereof.                                                                                                 
                                                                                                                                     
         THE INSURANCE PROVIDED BY THE CLASS A-3 POLICY IS NOT COVERED BY THE                                                        
PROPERTY/CASUALTY INSURANCE SECURITY FUND SPECIFIED IN ARTICLE 76 OF THE NEW                                                         
YORK INSURANCE LAW.                                                                                                                  
                                                                                                                                     
THE INSURER                                                                                                                          
                                                                                                                                     
         MBIA Insurance Corporation, the insurer, is the principal operating                                                         
subsidiary of MBIA Inc., a New York Stock Exchange listed company. MBIA Inc. is                                                      
not obligated to pay the debts of or claims against the insurer. The insurer is                                                      
domiciled in the State of New York and licensed to do business in and is subject                                                     
to regulation under the laws of all 50 states, the District of Columbia, the                                                         
Commonwealth of Puerto Rico, the Commonwealth of the Northern Mariana Islands,                                                       
the Virgin Islands of the United States and the Territory of Guam. The insurer                                                       
has three branches, one in the Republic of France, one in the Republic of                                                            
Singapore and the other in the Kingdom of Spain. New York has laws prescribing                                                       
minimum capital requirements, limiting classes and concentrations of investments                                                     
and requiring the approval of policy rates and forms. State laws also regulate                                                       
the amount of both the aggregate and individual risks that may be insured, the                                                       
payment of dividends by the insurer, changes in control and transactions among                                                       
affiliates. Additionally, the insurer is required to maintain contingency                                                            
reserves on its liabilities in specified amounts and for specified periods of                                                        
time.                                                                                                                                
                                                                                                                                     
         FINANCIAL INFORMATION ABOUT THE INSURER. The following documents filed                                                      
by MBIA Inc. with the Securities and Exchange Commission are incorporated herein                                                     
by reference:                                                                                                                        
                                                                                                                                     
-   MBIA Inc.'s Annual Report on Form 10-K for the year ended December 31, 2002;                                                     
    and                                                                                                                              
                                                                                                                                     
-   MBIA Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30,                                                         
    2003.                                                                                                                            
                                                                                                                                     
                                      S-58                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         Any documents filed by MBIA Inc. pursuant to Sections 13(a), 13(c), 14                                                      
or 15(d) of the Securities Exchange Act of 1934, as amended, after the date of                                                       
this prospectus supplement and prior to the termination of the offering of the                                                       
securities offered hereby shall be deemed to be incorporated by reference in                                                         
this prospectus supplement and to be a part hereof. Any statement contained in a                                                     
document incorporated or deemed to be incorporated by reference herein, or                                                           
contained in this prospectus supplement, shall be deemed to be modified or                                                           
superseded for purposes of this prospectus supplement to the extent that a                                                           
statement contained herein or in any other subsequently filed document which                                                         
also is or is deemed to be incorporated by reference herein modifies or                                                              
supersedes such statement. Any such statement so modified or superseded shall                                                        
not be deemed, except as so modified or superseded, to constitute a part of this                                                     
prospectus supplement.                                                                                                               
                                                                                                                                     
         The consolidated financial statements of the insurer, a wholly owned                                                        
subsidiary of MBIA Inc., and its subsidiaries as of December 31, 2002 and                                                            
December 31, 2001 and for each of the three years in the period ended December                                                       
31, 2002, prepared in accordance with generally accepted accounting principles,                                                      
included in the Annual Report on Form 10-K of MBIA Inc. for the year ended                                                           
December 31, 2002, and the consolidated financial statements of the insurer and                                                      
its subsidiaries as of June 30, 2003 and for the six month periods ended June                                                        
30, 2003 and June 30, 2002 included in the Quarterly Report on Form 10-Q of MBIA                                                     
Inc. for the period ended June 30, 2003, are hereby incorporated by reference                                                        
into this prospectus supplement and shall be deemed to be a part hereof.                                                             
                                                                                                                                     
         All financial statements of the insurer and its subsidiaries included                                                       
in documents filed by MBIA Inc. pursuant to Section 13(a), 13(c), 14 or 15(d) of                                                     
the Securities Exchange Act of 1934, as amended, subsequent to the date of this                                                      
prospectus supplement and prior to the termination of the offering of the                                                            
Certificates shall be deemed to be incorporated by reference into this                                                               
prospectus supplement and to be a part hereof from the respective dates of                                                           
filing those documents.                                                                                                              
                                                                                                                                     
         MBIA Inc. files annual, quarterly and special reports, information                                                          
statements and other information with the Securities and Exchange Commission                                                         
under File No. 1-9583. Copies of the Securities and Exchange Commission filings                                                      
including                                                                                                                            
                                                                                                                                     
-   MBIA Inc.'s Annual Report on Form 10-K for the year ended December 31, 2002,                                                     
    and                                                                                                                              
                                                                                                                                     
-   MBIA Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30,                                                         
    2003,                                                                                                                            
                                                                                                                                     
are available                                                                                                                        
                                                                                                                                     
-   over the Internet at the Securities and Exchange Commission's web site at                                                        
    http://www.sec.gov;                                                                                                              
                                                                                                                                     
-   at the Securities and Exchange Commission's public reference room in                                                             
    Washington, D.C.;                                                                                                                
                                                                                                                                     
-   over the Internet at MBIA Inc.'s web site at http://www.mbia.com; and                                                            
                                                                                                                                     
-   at no cost, upon request to MBIA Insurance Corporation, 113 King Street,                                                         
    Armonk, New York 10504. The telephone number of the insurer is (914)                                                             
    273-4545.                                                                                                                        
                                                                                                                                     
         The tables below present selected financial information of the insurer                                                      
determined in accordance with statutory accounting practices prescribed or                                                           
permitted by insurance regulatory authorities and generally accepted accounting                                                      
principles:                                                                                                                          

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                                      STATUTORY ACCOUNTING PRACTICES                                 
                                                                     --------------------------------                                
                                                                     DECEMBER 31,          JUNE 30,                                  
                                                                         2002                2003                                    
                                                                     ------------        ------------                                
                                                                      (AUDITED)          (UNAUDITED)                                 
                                                                              (IN MILLIONS)                                          
<S>                                                                  <C>                 <C>                                         
Admitted Assets...............................................          $9,212              $9,536                                   
Liabilities...................................................           6,054               6,155                                   
Capital and Surplus...........................................           3,158               3,381                                   
</TABLE>                                                                                                                             
                                                                                                                                     
                                      S-59                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                                      GENERALLY ACCEPTED ACCOUNTING                                  
                                                                                PRINCIPLES                                           
                                                                     -------------------------------                                 
                                                                     DECEMBER 31,          JUNE 30,                                  
                                                                         2002                2003                                    
                                                                     ------------         -----------                                
                                                                       (AUDITED)          (UNAUDITED)                                
                                                                              (IN MILLIONS)                                          
<S>                                                                  <C>                  <C>                                        
Assets........................................................           $10,588            $12,477                                  
Liabilities...................................................             4,679              6,110                                  
Shareholder's Equity..........................................             5,909              6,367                                  
</TABLE>                                                                                                                             
                                                                                                                                     
         FINANCIAL STRENGTH RATINGS OF THE INSURER                                                                                   
                                                                                                                                     
         Moody's Investors Service, Inc. rates the financial strength of the                                                         
insurer "Aaa."                                                                                                                       
                                                                                                                                     
         Standard & Poor's Ratings Services, a division of The McGraw-Hill                                                           

Companies, Inc., rates the financial strength of the insurer "AAA."                                                                  
                                                                                                                                     
         Fitch Ratings rates the financial strength of the insurer "AAA."                                                            
                                                                                                                                     
         Each rating of the insurer should be evaluated independently. The                                                           
ratings reflect each respective rating agency's current assessment of the                                                            
creditworthiness of the insurer and its ability to pay claims on its policies of                                                     
insurance. Any further explanation as to the significance of the above ratings                                                       
may be obtained only from the applicable rating agency.                                                                              
                                                                                                                                     
         The above ratings are not recommendations to buy, sell or hold the                                                          
Class A-3 Certificates, and the ratings may be subject to revision or withdrawal                                                     
at any time by the rating agencies. Any downward revision or withdrawal of any                                                       
of the above ratings may have an adverse effect on the market price of the Class                                                     
A-3 Certificates. The insurer does not guaranty the market price of the Class                                                        
A-3 Certificates nor does it guaranty that the ratings on the Class A-3                                                              
Certificates will not be revised or withdrawn.                                                                                       
                                                                                                                                     
                             SUBROGATION OF INSURER                                                                                  
                                                                                                                                     
         The insurer shall be subrogated to the rights of each holder of a Class                                                     
A-3 Certificate to receive distributions on those Class A-3 Certificates to the                                                      
extent of any payment by the insurer under the Class A-3 Policy.                                                                     
                                                                                                                                     
         Pursuant to the terms of the pooling and servicing agreement, unless                                                        
the insurer fails to make a required payment under the Class A-3 Policy, a                                                           
proceeding in bankruptcy shall have been instituted by the insurer or a decree                                                       
or order for relief shall have been issued in respect of a proceeding in                                                             
bankruptcy against the insurer and shall remain unstayed for a period of 60                                                          
consecutive days (together, a "MBIA Default"), the insurer will be entitled to                                                       
exercise the voting rights of the Class A-3 Certificateholders, without the                                                          
consent of the Class A-3 Certificateholders, and the Class A-3                                                                       
Certificateholders may exercise such rights only with the prior written consent                                                      
of the insurer.                                                                                                                      
                                                                                                                                     
                                 USE OF PROCEEDS                                                                                     
                                                                                                                                     
         We expect the proceeds to the depositor from the sale of the offered                                                        
certificates (other than the Class PO Certificates) to be approximately                                                              
$493,651,192 plus accrued interest, before deducting issuance expenses payable                                                       
by the depositor. The depositor will apply the net proceeds from the sale of                                                         
these classes of certificates against the purchase price of the Closing Date                                                         
Mortgage Loans and to fund the Supplemental Loan Account and the Capitalized                                                         
Interest Account.                                                                                                                    
                                                                                                                                     
                                      S-60                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                    MATERIAL FEDERAL INCOME TAX CONSEQUENCES                                                                         
                                                                                                                                     
         For federal income tax purposes, an election will be made to treat the                                                      
trust fund (other than the Supplemental Loan Account, the Capitalized Interest                                                       
Account, the Rounding Account and the Reserve Fund) as a REMIC. The Class A-R                                                        
Certificates (also the "Residual Certificates") will constitute the sole class                                                       
of residual interests in the REMIC.                                                                                                  
                                                                                                                                     
         All classes of certificates other than the Residual Certificates (the                                                       
"Regular Certificates") will be treated as debt instruments issued by the REMIC                                                      
for all federal income tax purposes. Income on the Regular Certificates must be                                                      
reported under an accrual method of accounting. Under the accrual method of                                                          
accounting, interest income may be required to be included in a holder's gross                                                       
income in advance of the holder's actual receipt of that interest income.                                                            
                                                                                                                                     
         The Class PO, Class A-6 and Class A-9 Certificates will be treated for                                                      
federal income tax purposes as having been issued with an amount of Original                                                         
Issue Discount ("OID") equal to the difference between their principal balance                                                       
and their issue price. Certain other classes of Regular Certificates may be                                                          
treated as having been issued with OID. For purposes of determining the amount                                                       
and rate of accrual of OID and market discount, the trust fund intends to assume                                                     
that there will be prepayments on the mortgage loans at a rate equal to 500% of                                                      
the Prepayment Assumption. No representation is made that the mortgage loans                                                         
will prepay at the foregoing rate or any other rate. See "Yield, Prepayment and                                                      
Maturity Considerations" and "Material Federal Income Tax Consequences" in the                                                       
prospectus. Computing accruals of OID in the manner described in the prospectus                                                      
may (depending on the actual rate of prepayments during the accrual period)                                                          
result in the accrual of negative amounts of OID on the certificates issued with                                                     
OID in an accrual period. Holders will be entitled to offset negative accruals                                                       
of OID only against future OID accruals on their certificates.                                                                       
                                                                                                                                     
         If the holders of any Regular Certificates are treated as holding their                                                     
certificates at a premium, the holders are encouraged to consult their tax                                                           
advisors regarding the election to amortize bond premium and the method to be                                                        
employed. See "Material Federal Income Tax Consequences -- REMIC Certificates --                                                     
a. Regular Certificates" in the prospectus.                                                                                          
                                                                                                                                     
         As described more fully under "Material Federal Income Tax                                                                  
Consequences" in the prospectus, the offered certificates will represent "real                                                       
estate assets" under Section 856(c)(5)(B) of the Internal Revenue Code of 1986,                                                      
as amended (the "Code") and qualifying assets under Section 7701(a)(19)(C) of                                                        
the Code in the same (or greater) proportion that the assets of the trust fund                                                       
will be so treated, and income on the offered certificates will represent                                                            
"interest on obligations secured by mortgages on real property or on interests                                                       
in real property" under Section 856(c)(3)(B) of the Code in the same (or                                                             
greater) proportion that the income on the assets of the trust fund will be so                                                       
treated. The Regular Certificates will represent qualifying assets under Section                                                     
860G(a)(3) if acquired by a REMIC within the prescribed time periods of the                                                          
Code.                                                                                                                                
                                                                                                                                     
         The holders of the Residual Certificates must include the taxable                                                           
income of the REMIC in their federal taxable income. The resulting tax liability                                                     
of the holders may exceed cash distributions to them during certain periods. All                                                     
or a portion of the taxable income from a Residual Certificate recognized by a                                                       
holder may be treated as "excess inclusion" income, which, with limited                                                              
exceptions, cannot be reduced by deductions (including net operating losses) and                                                     
in all cases, is subject to U.S. federal income tax.                                                                                 
                                                                                                                                     
         In computing alternative minimum taxable income, the special rule                                                           
providing that taxable income cannot be less than the sum of the taxpayer's                                                          
excess inclusions for the year does not apply. However, a taxpayer's alternative                                                     
minimum taxable income cannot be less than the sum of the taxpayer's excess                                                          
inclusions for the year. In addition, the amount of any alternative minimum tax                                                      
net operating loss is determined without regard to any excess inclusions.                                                            
                                                                                                                                     
         Under proposed regulations issued in July 2003, an inducement fee (that                                                     
is, a payment made by a transferor to induce a transferee to acquire a                                                               
noneconomic residual interest) must be taken into income over a period that is                                                       
"reasonably related" to the period during which the related REMIC is expected to                                                     
generate income or loss allocable to the transferee. Although the proposed                                                           
regulations do not specify the facts and circumstances that should be considered                                                     
in determining whether any particular period is "reasonably related," they do                                                        
provide a general rule and two safe harbor methods for making this                                                                   
determination. The proposed regulations also "clarify" that an inducement                                                            
                                                                                                                                     
                                      S-61                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
fee is U.S. sourced income. If finalized as proposed, the regulations would be                                                       
effective for taxable years ending on or after the publication of the final                                                          
regulations in the Federal Register, and consequently could apply to the                                                             
purchase of the Class A-R Certificates.                                                                                              
                                                                                                                                     
         PURCHASERS OF A RESIDUAL CERTIFICATE (THAT IS, ONE OF THE CLASS A-R                                                         
CERTIFICATES) ARE ENCOURAGED TO CONSIDER CAREFULLY THE TAX CONSEQUENCES OF AN                                                        
INVESTMENT IN RESIDUAL CERTIFICATES DISCUSSED IN THE PROSPECTUS AND CONSULT                                                          
THEIR OWN TAX ADVISORS WITH RESPECT TO THOSE CONSEQUENCES. See "Material Federal                                                     
Income Tax Consequences -- REMIC Certificates -- b. Residual Certificates" in                                                        
the prospectus. Specifically, prospective holders of Residual Certificates                                                           
should consult their tax advisors regarding whether, at the time of acquisition,                                                     
a Residual Certificate will be treated as a "noneconomic" residual interest, as                                                      
a "tax avoidance potential" residual interest or as both. Among other things,                                                        
holders of Noneconomic Residual Certificates should be aware of REMIC                                                                
regulations that may affect their ability to transfer their Residual                                                                 
Certificates. See "Material Federal Income Tax Consequences -- Tax-Related                                                           
Restrictions on Transfers of Residual Certificates -- Noneconomic Residual                                                           
Certificates", "Material Federal Income Tax Consequences -- b. Residual                                                              
Certificates -- Mark to Market Rules", "-- Excess Inclusions" and "Material                                                          
Federal Income Tax Consequences -- Tax Related Restrictions on Transfers of                                                          
Residual Certificates -- Foreign Investors" in the prospectus.                                                                       
                                                                                                                                     
         Additionally, for information regarding Prohibited Transactions and                                                         
Treatment of Realized Losses, see "Material Federal Income Tax Consequences --                                                       
Prohibited Transactions and Other Taxes" and "-- REMIC Certificates -- a.                                                            
Regular Certificates -- Treatment of Realized Losses" in the prospectus.                                                             
                                                                                                                                     
         As a result of the Economic Growth and Tax Relief Reconciliation Act of                                                     
2001 (the "2001 Act"), limitations imposed by section 68 of the Code on claiming                                                     
itemized deductions will be phased-out commencing in 2006, which will affect                                                         
individuals holding Residual Certificates. In addition, as a result of the Jobs                                                      
and Growth Tax Relief Reconciliation Act of 2003 (the "2003 Act"), the backup                                                        
withholding rate has been reduced to 28%. Unless they are amended, these                                                             
provisions of the 2001 Act and the 2003 Act will no longer apply for taxable                                                         
years beginning on or after December 31, 2010. See "Material Federal Income Tax                                                      
Consequences" in the prospectus. Investors are encouraged to consult their own                                                       
tax advisors with respect to both statutes.                                                                                          
                                                                                                                                     
                                   OTHER TAXES                                                                                       
                                                                                                                                     
         No representations are made regarding the tax consequences of the                                                           
purchase, ownership or disposition of the certificates under any state, local or                                                     
foreign tax law.                                                                                                                     
                                                                                                                                     
         ALL INVESTORS SHOULD CONSULT THEIR OWN TAX ADVISERS REGARDING THE                                                           
FEDERAL, STATE, LOCAL OR FOREIGN TAX CONSEQUENCES OF PURCHASING, OWNING OR                                                           
DISPOSING OF THE CERTIFICATES.                                                                                                       
                                                                                                                                     
                              ERISA CONSIDERATIONS                                                                                   
                                                                                                                                     
         Any fiduciary of an employee benefit or other plan or arrangement (such                                                     
as an individual retirement plan or Keogh plan) that is subject to the Employee                                                      
Retirement Income Security Act of 1974, as amended, or to Section 4975 of the                                                        
Code (a "Plan"), that proposes to cause the Plan to acquire any of the offered                                                       
certificates (directly or indirectly through investment by an entity or account                                                      
holding assets of the Plan) is encouraged to consult with its counsel with                                                           
respect to the potential consequences of the Plan's acquisition and ownership of                                                     
the certificates under ERISA and Section 4975 of the Code. See "ERISA                                                                
Considerations" in the prospectus. Section 406 of ERISA prohibits "parties in                                                        
interest" with respect to an employee benefit plan subject to ERISA from                                                             
engaging in various different types of transactions involving the Plan and its                                                       
assets unless a statutory, regulatory or administrative exemption applies to the                                                     
transaction. Section 4975 of the Code imposes excise taxes on prohibited                                                             
transactions involving "disqualified persons" and Plans described under that                                                         
Section. ERISA authorizes the imposition of civil penalties for prohibited                                                           
transactions involving Plans not subject to the requirements of Section 4975 of                                                      
the Code.                                                                                                                            
                                                                                                                                     
         Some employee benefit plans, including governmental plans and some                                                          
church plans, are not subject to ERISA's requirements. Accordingly, assets of                                                        
those plans may be invested in the offered certificates without regard                                                               
                                                                                                                                     
                                      S-62                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
to the ERISA considerations described in this prospectus supplement and in the                                                       
prospectus, subject to the provisions of other applicable federal and state law.                                                     
However, any of those plans that is qualified and exempt from taxation under                                                         
Sections 401(a) and 501(a) of the Code may be subject to the prohibited                                                              
transaction rules set forth in Section 503 of the Code.                                                                              
                                                                                                                                     
         Investments by Plans or with assets of Plans that are subject to ERISA                                                      
must satisfy ERISA's general fiduciary requirements, including the requirement                                                       
of investment prudence and diversification and the requirement that a Plan's                                                         
investments be made in accordance with the documents governing the Plan. A                                                           
fiduciary that decides to invest the assets of a Plan in the offered                                                                 
certificates should consider, among other factors, the extreme sensitivity of                                                        
the investment to the rate of principal payments (including prepayments) on the                                                      
mortgage loans. It is anticipated that the certificates will constitute "equity                                                      
interests" for the purpose of the Plan Assets Regulation.                                                                            
                                                                                                                                     
         The U.S. Department of Labor has granted to the underwriters                                                                
substantially identical administrative exemptions (together, the "Exemption")                                                        
from some of the prohibited transaction rules of ERISA and the related excise                                                        
tax provisions of Section 4975 of the Code with respect to the initial purchase,                                                     
the holding and the subsequent resale by Plans of securities, including                                                              
certificates, in pass-through trusts that consist of specified receivables,                                                          
loans and other obligations that meet the conditions and requirements of the                                                         
Exemption. The Exemption applies to mortgage loans such as the mortgage loans in                                                     
the trust fund. The Exemption extends exemptive relief to certificates,                                                              
including subordinated certificates, rated in the four highest generic rating                                                        
categories in certain designated transactions when the conditions of the                                                             
Exemption, including the requirement that an investing Plan be an "accredited                                                        
investor" as defined in Rule 501(a)(1) of Regulation D under the Securities Act                                                      
of 1933, as amended, are met.                                                                                                        
                                                                                                                                     
         For a general description of the Exemption and the conditions that must                                                     
be satisfied for the Exemption to apply, see "ERISA Considerations" in the                                                           
prospectus.                                                                                                                          
                                                                                                                                     
         It is expected that the Exemption will apply to the acquisition and                                                         
holding by Plans of the offered certificates (other than the Class PO and Class                                                      
A-R Certificates) and that all conditions of the Exemption other than those                                                          
within the control of the investors will be met. In addition, as of the date                                                         
hereof, there is no single mortgagor that is the obligor on five percent (5%) of                                                     
the mortgage loans included in the trust fund by aggregate unamortized principal                                                     
balance of the assets of the trust fund.                                                                                             
                                                                                                                                     
         The rating of a certificate may change. If a class of certificates no                                                       
longer has a rating of at least BBB- from S&P or Fitch, or Baa3 from Moody's,                                                        
certificates of that class will no longer be eligible for relief under the                                                           
Exemption (although a Plan that had purchased the certificate when it had an                                                         
investment-grade rating would not be required by the Exemption to dispose of                                                         
it).                                                                                                                                 
                                                                                                                                     
         BECAUSE THE CLASS PO CERTIFICATES ARE NOT BEING PURCHASED BY ANY                                                            
UNDERWRITER TO WHOM AN EXEMPTION SIMILAR TO THE EXEMPTION HAS BEEN GRANTED, THE                                                      
CLASS PO CERTIFICATES DO NOT CURRENTLY MEET THE REQUIREMENTS OF THE EXEMPTION OR                                                     
ANY COMPARABLE INDIVIDUAL ADMINISTRATIVE EXEMPTION GRANTED TO ANY UNDERWRITER.                                                       
CONSEQUENTLY, THE CLASS PO CERTIFICATES MAY BE TRANSFERRED ONLY IF THE                                                               
CONDITIONS IN THE FIRST OR THIRD BULLET POINTS IN THE NEXT PARAGRAPH ARE MET.                                                        
                                                                                                                                     
         BECAUSE THE CHARACTERISTICS OF THE CLASS A-R CERTIFICATES MAY NOT MEET                                                      
THE REQUIREMENTS OF THE EXEMPTION, OR ANY OTHER ISSUED EXEMPTION UNDER ERISA, A                                                      
PLAN MAY HAVE ENGAGED IN A PROHIBITED TRANSACTION OR INCUR EXCISE TAXES OR CIVIL                                                     
PENALTIES IF IT PURCHASES AND HOLDS CLASS A-R CERTIFICATES. CONSEQUENTLY,                                                            
TRANSFERS OF THE CLASS A-R CERTIFICATES (AND OF CERTIFICATES OF ANY CLASS THAT,                                                      
BECAUSE OF A CHANGE OF RATING, NO LONGER SATISFY THE RATING REQUIREMENT OF THE                                                       
EXEMPTION) WILL NOT BE REGISTERED BY THE TRUSTEE UNLESS THE TRUSTEE RECEIVES:                                                        
                                                                                                                                     
         -    A REPRESENTATION FROM THE TRANSFEREE OF THE CERTIFICATE,                                                               
              ACCEPTABLE TO AND IN FORM AND SUBSTANCE SATISFACTORY TO THE                                                            
              TRUSTEE, THAT THE TRANSFEREE IS NOT A PLAN, OR A PERSON ACTING ON                                                      
              BEHALF OF A PLAN OR USING A PLAN'S ASSETS TO EFFECT THE TRANSFER;                                                      
                                                                                                                                     
                                      S-63                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    IF THE PURCHASER IS AN INSURANCE COMPANY, A REPRESENTATION THAT                                                        
              THE PURCHASER IS AN INSURANCE COMPANY WHICH IS PURCHASING THE                                                          
              CERTIFICATE WITH FUNDS CONTAINED IN AN "INSURANCE COMPANY GENERAL                                                      
              ACCOUNT" (AS DEFINED IN SECTION V(e) OF PROHIBITED TRANSACTION                                                         
              CLASS EXEMPTION 95-60 ("PTE 95-60")) AND THAT THE PURCHASE AND                                                         
              HOLDING OF THE CERTIFICATE ARE COVERED UNDER SECTIONS I AND III OF                                                     
              PTE 95-60; OR                                                                                                          
                                                                                                                                     
         -    AN OPINION OF COUNSEL SATISFACTORY TO THE TRUSTEE THAT THE                                                             
              PURCHASE AND HOLDING OF THE CERTIFICATE BY A PLAN, OR ANY PERSON                                                       
              ACTING ON BEHALF OF A PLAN OR USING A PLAN'S ASSETS, WILL NOT                                                          
              RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR THE                                                       
              CODE AND WILL NOT SUBJECT THE TRUSTEE TO ANY OBLIGATION IN                                                             
              ADDITION TO THOSE UNDERTAKEN IN THE POOLING AND SERVICING                                                              
              AGREEMENT.                                                                                                             
                                                                                                                                     
THE FIRST REPRESENTATION WILL BE DEEMED TO HAVE BEEN MADE BY THE TRANSFEREE'S                                                        
ACCEPTANCE OF A CLASS PO CERTIFICATE. IF THE REPRESENTATION IS NOT TRUE, OR ANY                                                      
ATTEMPT TO TRANSFER TO A PLAN OR PERSON ACTING ON BEHALF OF A PLAN OR USING A                                                        
PLAN'S ASSETS IS INITIATED WITHOUT THE REQUIRED OPINION OF COUNSEL, THE                                                              
ATTEMPTED TRANSFER OR ACQUISITION SHALL BE VOID.                                                                                     
                                                                                                                                     
         Prospective Plan investors are encouraged to consult with their legal                                                       
advisors concerning the impact of ERISA and the Code, the effect of the Plan                                                         
Assets Regulation and the applicability of the Exemption described in the                                                            
prospectus, and the potential consequences in their specific circumstances,                                                          
before making an investment in any of the offered certificates. Moreover, each                                                       
Plan fiduciary is encouraged to determine whether, under the general fiduciary                                                       
standards of investment prudence and diversification, an investment in any of                                                        
the offered certificates is appropriate for the Plan, taking into account the                                                        
overall investment policy of the Plan and the composition of the Plan's                                                              
investment portfolio.                                                                                                                
                                                                                                                                     
                             METHOD OF DISTRIBUTION                                                                                  
                                                                                                                                     
         Subject to the terms and conditions set forth in the underwriting                                                           
agreement between the depositor, Citigroup Global Markets Inc. ("Citigroup") and                                                     
Countrywide Securities Corporation, an affiliate of the depositor, the seller                                                        
and the master servicer ("CSC" and, together with Citigroup, the                                                                     
"underwriters"), the depositor has agreed to sell the offered certificates,                                                          
other than the Class PO Certificates, to the underwriters, Citigroup has agreed                                                      
to purchase from the depositor the senior certificates other than the Class PO                                                       
Certificates (the "Citigroup Underwritten Certificates"), and CSC has agreed to                                                      
purchase from the depositor the Class M, Class B-1 and Class B-2 Certificates                                                        
(the "CSC Underwritten Certificates" and, together with the Citigroup                                                                
Underwritten Certificates, the "Underwritten Certificates").                                                                         
                                                                                                                                     
         Distribution of the Underwritten Certificates will be made by the                                                           
underwriter purchasing those classes from time to time in negotiated                                                                 
transactions or otherwise at varying prices to be determined at the time of                                                          
sale. Edward D. Jones & Co., L.P., as dealer, will also offer the Class A-3                                                          
Certificates to investors at varying prices to be determined at the time of                                                          
sale. The underwriters may effect such transactions by selling the Underwritten                                                      
Certificates to or through dealers and such dealers may receive from the                                                             
underwriters, for which they act as agent, compensation in the form of                                                               
underwriting discounts, concessions or commissions. The underwriters and any                                                         
dealers that participate with the underwriters in the distribution of the                                                            
Underwritten Certificates may be deemed to be underwriters, and any discounts,                                                       
commissions or concessions received by them, and any profits on resale of the                                                        
Underwritten Certificates purchased by them, may be deemed to be underwriting                                                        
discounts and commissions under the Securities Act of 1933, as amended.                                                              
                                                                                                                                     
         The depositor has been advised by each underwriter that it intends to                                                       
make a market in the Underwritten Certificates purchased by it but no                                                                
underwriter has any obligation to do so. There can be no assurance that a                                                            
secondary market for the Underwritten Certificates will develop or, if it does                                                       
develop, that it will continue or that it will provide certificateholders with a                                                     
sufficient level of liquidity of investment. The depositor has agreed to                                                             
indemnify the underwriters against, or make contributions to the underwriter                                                         
with respect to, liabilities, customarily indemnified against, including                                                             
liabilities under the Securities Act of 1933, as amended.                                                                            
                                                                                                                                     
                                      S-64                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         The Class PO Certificates may be offered by the seller or the depositor                                                     
from time to time directly or through underwriters or agents (either of which                                                        
may include CSC) in one or more negotiated transactions, or otherwise, at                                                            
varying prices to be determined at the time of sale, in one or more separate                                                         
transactions at prices to be negotiated at the time of each sale. Any                                                                
underwriters or agents that participate in the distribution of the Class PO                                                          
Certificates may be deemed to be "underwriters" within the meaning of the                                                            
Securities Act of 1933 and any profit on the sale of those certificates by them                                                      
and any discounts, commissions, concessions or other compensation received by                                                        
any of them may be deemed to be underwriting discounts and commissions under the                                                     
Securities Act.                                                                                                                      
                                                                                                                                     
                                  LEGAL MATTERS                                                                                      
                                                                                                                                     
         The validity of the certificates, including their material federal                                                          
income tax consequences, will be passed upon for the depositor by Sidley Austin                                                      
Brown &Wood LLP, New York, New York. McKee Nelson LLP will pass upon certain                                                         
legal matters on behalf of the underwriters.                                                                                         
                                                                                                                                     
                                     EXPERTS                                                                                         
                                                                                                                                     
         The consolidated balance sheets of MBIA Inc. and subsidiaries and MBIA                                                      
Insurance Corporation and subsidiaries as of December 31, 2002 and December 31,                                                      
2001 and the related consolidated statements of income, changes in shareholder's                                                     
equity, and cash flows for each of the three years in the period ended December                                                      
31, 2002, incorporated by reference in this prospectus supplement, have been                                                         
incorporated herein in reliance on the report of PricewaterhouseCoopers LLP,                                                         
independent accountants, given on the authority of that firm as experts in                                                           
accounting and auditing.                                                                                                             
                                                                                                                                     
                                     RATINGS                                                                                         
                                                                                                                                     
         It is a condition to the issuance of the senior certificates, other                                                         
than the Class A-7 and Class A-11 Certificates, that they be rated AAA by Fitch                                                      
Ratings ("Fitch") and Aaa by Moody's Investors Service, Inc. ("Moody's"). It is                                                      
a condition to the issuance of the Class A-7 Certificates that they be rated AAA                                                     
by Fitch and Aa1 by Moody's. It is a condition to the issuance of the Class A-11                                                     
Certificates that they be rated AAA by Fitch and Aa2 by Moody's. It is a                                                             
condition to the issuance of the Class M, Class B-1 and Class B-2 Certificates                                                       
that they be rated at least AA, A, and BBB, respectively, by Fitch. The ratings                                                      
of the Class A-3 Certificates are without regard to the Class A-3 Policy.                                                            
                                                                                                                                     
         The ratings assigned by Fitch to mortgage pass-through certificates                                                         
address the likelihood of the receipt of all distributions on the mortgage loans                                                     
by the related certificateholders under the agreements pursuant to which the                                                         
certificates are issued. Fitch's ratings take into consideration the credit                                                          
quality of the related mortgage pool, including any credit support providers,                                                        
structural and legal aspects associated with the certificates, and the extent to                                                     
which the payment stream on the mortgage pool is adequate to make the payments                                                       
required by the certificates. The ratings assigned by Fitch to the principal                                                         
only certificates only address the return of their respective Class Certificate                                                      
Balances. The rating assigned by Fitch to the Class A-R Certificates only                                                            
addresses the return of its Class Certificate Balance and interest thereon at                                                        
its pass-through rate.                                                                                                               
                                                                                                                                     
         The ratings assigned by Moody's to mortgage pass-through certificates                                                       
address the likelihood of the receipt of all distributions on the mortgage loans                                                     
by the related certificateholders under the agreements pursuant to which the                                                         
certificates are issued. Moody's ratings take into consideration the credit                                                          
quality of the related mortgage pool, including any credit support providers,                                                        
structural and legal aspects associated with the certificates, and the extent to                                                     
which the payment stream on the mortgage pool is adequate to make the payments                                                       
required by the certificates. The ratings assigned by Moody's to the principal                                                       
only certificates only address the return of their respective Class Certificate                                                      
Balances. The rating assigned by Moody's to the Class A-R Certificates only                                                          
addresses the return of its Class Certificate Balance and interest thereon at                                                        
its pass-through rate.                                                                                                               
                                                                                                                                     
                                      S-65                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         The ratings of the rating agencies listed above do not address the                                                          
possibility that, as a result of principal prepayments, certificateholders may                                                       
receive a lower than anticipated yield. The security ratings assigned to the                                                         
offered certificates should be evaluated independently from similar ratings on                                                       
other types of securities. 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 rating agencies.                                                                                                              
                                                                                                                                     
         The depositor has not requested a rating of the offered certificates by                                                     
any rating agency other than the rating agencies listed above; there can be no                                                       
assurance, however, as to whether any other rating agency will rate the offered                                                      
certificates or, if it does, what rating would be assigned by the other rating                                                       
agency. The ratings assigned by the other rating agency to the offered                                                               
certificates could be lower than the respective ratings assigned by the rating                                                       
agencies listed above.                                                                                                               
                                                                                                                                     
                                      S-66                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
PROSPECTUS                                                                                                                           
                                                                                                                                     
                                   CWMBS, INC.                                                                                       
                                                                                                                                     
                                    DEPOSITOR                                                                                        
                                                                                                                                     
                       MORTGAGE PASS-THROUGH CERTIFICATES                                                                            
                              (ISSUABLE IN SERIES)                                                                                   
                                                                                                                                     
PLEASE CAREFULLY CONSIDER OUR DISCUSSION OF SOME OF THE RISKS OF                                                                     
INVESTING IN THE CERTIFICATES UNDER "RISK FACTORS" BEGINNING ON PAGE 5.                                                              
                                                                                                                                     
THE TRUSTS                                                                                                                           
                                                                                                                                     
Each trust will be established to hold assets in its trust fund transferred to                                                       
it by CWMBS, Inc. The assets in each trust fund will be specified in the                                                             
prospectus supplement for the particular trust and will generally consist of:                                                        
                                                                                                                                     
-    first lien mortgage loans secured by one- to four-family residential                                                            
     properties or participations in that type of loan,                                                                              
                                                                                                                                     
-    mortgage pass-through securities issued or guaranteed by Ginnie Mae, Fannie                                                     
     Mae, or Freddie Mac, or                                                                                                         
                                                                                                                                     
-    private mortgage-backed securities backed by first lien mortgage loans                                                          
     secured by one- to four-family residential properties or participations in                                                      
     that type of loan.                                                                                                              
                                                                                                                                     
THE CERTIFICATES                                                                                                                     
                                                                                                                                     
CWMBS, Inc. will sell the certificates pursuant to a prospectus supplement. The                                                      
certificates will be grouped into one or more series, each having its own                                                            
distinct designation. Each series will be issued in one or more classes and each                                                     
class will evidence beneficial ownership of a specified portion of future                                                            
payments on the assets in the trust fund that the series relates to. A                                                               
prospectus supplement for a series will specify all of the terms of the series                                                       
and of each of the classes in the series.                                                                                            
                                                                                                                                     
OFFERS OF CERTIFICATES                                                                                                               
                                                                                                                                     
The certificates may be offered through several different methods, including                                                         
offerings through underwriters.                                                                                                      
                                                                                                                                     
                               _________________                                                                                     
                                                                                                                                     
THE SEC AND STATE SECURITIES REGULATORS HAVE NOT APPROVED OR DISAPPROVED THESE                                                       
SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY                                                             
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.                                                                                
                                                                                                                                     
June 24, 2003                                                                                                                        
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                                TABLE OF CONTENTS                                                                                    

<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                                                  PAGE                                               
                                                                                  ----                                               
<S>                                                                               <C>                                                
Important Notice About Information in this Prospectus and Each                                                                       
  Accompanying Prospectus Supplement..........................................     4                                                 
Risk Factors..................................................................     5                                                 
     Limited Source Of Payments - No Recourse To Sellers, Depositor Or                                                               
       Servicer...............................................................     5                                                 
     Credit Enhancement May Not Be Sufficient To Protect You From Losses......     6                                                 
     Losses On Balloon Payment Mortgages Are Borne By You.....................     6                                                 
     Nature Of Mortgages......................................................     7                                                 
     You Could Be Adversely Affected By Violations Of Environmental Laws......     9                                                 
     Ratings Of The Certificates Do Not Assure Their Payment..................    10                                                 
     Book-Entry Registration..................................................    11                                                 
     Bankruptcy Or Insolvency May Affect The Timing And Amount Of                                                                    
       Distributions On The Certificates......................................    11                                                 
The Trust Fund................................................................    14                                                 
     The Mortgage Loans - General.............................................    15                                                 
     Agency Securities........................................................    18                                                 
     Private Mortgage-Backed Securities.......................................    23                                                 
     Pre-Funding..............................................................    25                                                 
     Substitution of Mortgage Assets .........................................    26                                                 
     Available Information....................................................    26                                                 
     Incorporation of Certain Documents by Reference..........................    26                                                 
Use of Proceeds...............................................................    27                                                 
The Depositor.................................................................    27                                                 
Mortgage Loan Program.........................................................    27                                                 
     Underwriting Process.....................................................    27                                                 
     Qualifications of Sellers................................................    28                                                 
     Representations by Sellers; Repurchases..................................    28                                                 
Description of the Certificates...............................................    30                                                 
     General..................................................................    31                                                 
     Distributions on Certificates............................................    33                                                 
     Advances.................................................................    35                                                 
     Reports to Certificateholders............................................    35                                                 
     Categories of Classes of Certificates....................................    37                                                 
     Indices Applicable to Floating Rate and Inverse Floating Rate Classes....    40                                                 
     Book-Entry Certificates..................................................    44                                                 
Credit Enhancement............................................................    46                                                 
     General..................................................................    46                                                 
     Subordination............................................................    46                                                 
     Mortgage Pool Insurance Policies.........................................    47                                                 
     Special Hazard Insurance Policies........................................    48                                                 
     Bankruptcy Bonds.........................................................    49                                                 
     Reserve Fund.............................................................    49                                                 
     Cross Support............................................................    50                                                 
     Insurance Policies, Surety Bonds and Guaranties..........................    50                                                 
     Over-Collateralization...................................................    51                                                 
     Financial Instruments....................................................    51                                                 
Yield and Prepayment Considerations...........................................    51                                                 
The Pooling and Servicing Agreement...........................................    53                                                 
     Assignment of Mortgage Assets............................................    53                                                 
     Payments on Mortgage Assets; Deposits to Certificate Account.............    55                                                 
     Collection Procedures....................................................    57                                                 
     Hazard Insurance.........................................................    58                                                 
     Realization Upon Defaulted Mortgage Loans................................    60                                                 
     Servicing and Other Compensation and Payment of Expenses.................    64                                                 
     Evidence as to Compliance................................................    64                                                 
     List of Certificateholders...............................................    65                                                 
     Certain Matters Regarding the Master Servicer and the Depositor..........    65                                                 
     Events of Default........................................................    66                                                 
</TABLE>                                                                                                                             
                                                                                                                                     
                                        2                                                                                            

<PAGE>                                                                                                                               

<TABLE>                                                                                                                              
<S>                                                                               <C>                                                
     Rights Upon Event of Default.............................................     66                                                
     Amendment................................................................     67                                                
     Termination; Optional Termination........................................     68                                                
     The Trustee..............................................................     69                                                
Certain Legal Aspects of the Mortgage Loans...................................     69                                                
     General..................................................................     69                                                
     Foreclosure and Repossession.............................................     70                                                
     Rights of Redemption.....................................................     72                                                
     Anti-Deficiency Legislation and Other Limitations on Lenders.............     73                                                
     Environmental Risks......................................................     74                                                
     Due-on-Sale Clauses......................................................     75                                                
     Prepayment Charges.......................................................     75                                                
     Applicability of Usury Laws..............................................     75                                                
     Soldiers' and Sailors' Civil Relief Act..................................     76                                                
     Consumer Protection Laws.................................................     76                                                
Material Federal Income Tax Consequences......................................     77                                                
     General..................................................................     77                                                
     Non-REMIC Certificates...................................................     78                                                
     REMIC Certificates.......................................................     85                                                
     Prohibited Transactions and Other Taxes..................................     99                                                
     Liquidation and Termination..............................................    100                                                
     Administrative Matters...................................................    100                                                
     Tax-Exempt Investors.....................................................    100                                                
     Non-U.S. Persons.........................................................    100                                                
     Tax-Related Restrictions on Transfers of Residual Certificates...........    101                                                
Other Tax Considerations......................................................    104                                                
ERISA Considerations..........................................................    104                                                
Legal Investment..............................................................    107                                                
Method of Distribution........................................................    109                                                
Legal Matters.................................................................    109                                                
Financial Information.........................................................    109                                                
Rating........................................................................    110                                                
Index to Defined Terms........................................................    111                                                
</TABLE>                                                                                                                             
                                                                                                                                     
                                       3                                                                                             
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
   IMPORTANT NOTICE ABOUT INFORMATION IN THIS PROSPECTUS AND EACH ACCOMPANYING                                                       
                             PROSPECTUS SUPPLEMENT                                                                                   

         Information about each series of certificates is contained in two                                                           
separate documents:                                                                                                                  
                                                                                                                                     
-    this prospectus, which provides general information, some of which may not                                                      
     apply to a particular series; and                                                                                               
                                                                                                                                     
-    the accompanying prospectus supplement for a particular series, which                                                           
     describes the specific terms of the certificates of that series.                                                                
                                                                                                                                     
The prospectus supplement will contain information about a particular series                                                         
that supplements the information contained in this prospectus, and you should                                                        
rely on that supplementary information in the prospectus supplement.                                                                 
                                                                                                                                     
         You should rely only on the information in this prospectus and the                                                          
accompanying prospectus supplement. We have not authorized anyone to provide you                                                     
with information that is different from that contained in this prospectus and                                                        
the accompanying prospectus supplement.                                                                                              
                                                                                                                                     
                               ------------------                                                                                    
                                                                                                                                     
         If you require additional information, the mailing address of our                                                           
principal executive offices is CWMBS, Inc., 4500 Park Granada, Calabasas,                                                            
California 91302 and the telephone number is (818) 225-3000. For other means of                                                      
acquiring additional information about us or a series of securities, see "The                                                        
Trust Fund -- Incorporation of Certain Documents by Reference" beginning on page                                                     
26.                                                                                                                                  
                                                                                                                                     
                                       4                                                                                             
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                                  RISK FACTORS                                                                                       
                                                                                                                                     
         You should carefully consider the following information since it                                                            
identifies significant risks associated with an investment in the certificates.                                                      
                                                                                                                                     
LIMITED SOURCE OF PAYMENTS - NO RECOURSE TO SELLERS, DEPOSITOR OR SERVICER                                                           
                                                                                                                                     
The applicable prospectus supplement may provide that certificates will be                                                           
payable from other trust funds in addition to their associated trust fund, but                                                       
if it does not, they will be payable solely from their associated trust fund. If                                                     
the trust fund does not have sufficient assets to distribute the full amount due                                                     
to you as a certificateholder, your yield will be impaired, and perhaps even the                                                     
return of your principal may be impaired, without your having recourse to anyone                                                     
else. Furthermore, at the times specified in the applicable prospectus                                                               
supplement, certain assets of the trust fund may be released and paid out to                                                         
other people, such as the depositor, a servicer, a credit enhancement provider,                                                      
or any other person entitled to payments from the trust fund. Those assets will                                                      
no longer be available to make payments to you. Those payments are generally                                                         
made after other specified payments that may be set forth in the applicable                                                          
prospectus supplement have been made.                                                                                                
                                                                                                                                     
You will not have any recourse against the depositor or any servicer if you do                                                       
not receive a required distribution on the certificates. Nor will you have                                                           
recourse against the assets of the trust fund of any other series of                                                                 
certificates.                                                                                                                        
                                                                                                                                     
The certificates will not represent an interest in the depositor, any servicer,                                                      
any seller to the depositor, or anyone else except the trust fund. The only                                                          
obligation of the depositor to a trust fund comes from certain representations                                                       
and warranties made by it about assets transferred to the trust fund. If these                                                       
representations and warranties turn out to be untrue, the depositor may be                                                           
required to repurchase some of the transferred assets. CWMBS, Inc., which is the                                                     
depositor, does not have significant assets and is unlikely to have significant                                                      
assets in the future. So if the depositor were required to repurchase a loan                                                         
because of a breach of a representation, its only sources of funds for the                                                           
repurchase would be:                                                                                                                 
                                                                                                                                     
-    funds obtained from enforcing a corresponding obligation of a seller or                                                         
     originator of the loan, or                                                                                                      
                                                                                                                                     
-    funds from a reserve fund or similar credit enhancement established to pay                                                      
     for loan repurchases.                                                                                                           
                                                                                                                                     
                                       5                                                                                             
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
The only obligations of the master servicer to a trust fund consist of its                                                           
obligations to service the related mortgage loans in accordance with the terms                                                       
of the related pooling and servicing agreement.                                                                                      
                                                                                                                                     
The only obligations to a trust fund of a seller of loans to the depositor comes                                                     
from certain representations and warranties made by it in connection with its                                                        
sale of the loans and certain document delivery requirements. If these                                                               
representations and warranties turn out to be untrue, or the seller fails to                                                         
deliver required documents, it may be required to repurchase some of the loans.                                                      
However, the seller may not have the financial ability to make the required                                                          
repurchase.                                                                                                                          
                                                                                                                                     
CREDIT ENHANCEMENT MAY NOT BE SUFFICIENT TO PROTECT YOU FROM LOSSES                                                                  
                                                                                                                                     
Credit enhancement is intended to reduce the effect of loan losses. But credit                                                       
enhancements may benefit only some classes of a series of certificates and the                                                       
amount of any credit enhancement will be limited as described in the applicable                                                      
prospectus supplement. Furthermore, the amount of a credit enhancement may                                                           
decline over time pursuant to a schedule or formula or otherwise, and could be                                                       
depleted from payments or for other reasons before the certificates covered by                                                       
the credit enhancement are paid in full. In addition, a credit enhancement may                                                       
not cover all potential sources of loss. For example, a credit enhancement may                                                       
or may not cover fraud or negligence by a loan originator or other parties.                                                          
Also, the trustee may be permitted to reduce, substitute for, or even eliminate                                                      
all or a portion of a credit enhancement so long as the rating agencies that                                                         
have rated the certificates at the request of the depositor indicate that that                                                       
would not cause them to change adversely their rating of the certificates.                                                           
Consequently, certificateholders may suffer losses even though a credit                                                              
enhancement exists and its provider does not default.                                                                                
                                                                                                                                     
LOSSES ON BALLOON PAYMENT MORTGAGES ARE BORNE BY YOU                                                                                 
                                                                                                                                     
Some of the underlying loans may not be fully amortizing over their terms to                                                         
maturity and, thus, will require substantial principal payments (that is,                                                            
balloon payments) at their stated maturity. Loans with balloon payments involve                                                      
a greater degree of risk than fully amortizing loans because typically the                                                           
borrower must be able to refinance the loan or sell the property to make the                                                         
balloon payment at maturity. The ability of a borrower to do this will depend on                                                     
such factors as mortgage rates at the time of sale or refinancing, the                                                               
borrower's equity in the property, the relative strength of the local housing                                                        
market, the financial condition of the borrower, and tax laws. Losses on these                                                       
loans that are not otherwise covered by a credit                                                                                     
                                                                                                                                     
                                       6                                                                                             
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
enhancement will be borne by the holders of one or more classes of certificates.                                                     
                                                                                                                                     
   Your Risk Of Loss May Be Higher Than You Expect If your Certificates Are                                                          
   Backed By Partially Unsecured Loans                                                                                               
                                                                                                                                     
The trust fund may include loans that were originated with loan-to-value ratios                                                      
in excess of the value of the related mortgaged property. Under these                                                                
circumstances, the trust fund could be treated as a general unsecured creditor                                                       
as to the unsecured portion of any related loan. In the event of a default under                                                     
a loan that is unsecured in part, the trust fund will have recourse only against                                                     
the borrower's assets generally for the unsecured portion of the loan, along                                                         
with all other general unsecured creditors of the borrower.                                                                          
                                                                                                                                     
NATURE OF MORTGAGES                                                                                                                  
                                                                                                                                     
   Declines in Property Values May Adversely Affect You                                                                              
                                                                                                                                     
The value of the properties underlying the loans held in the trust fund may                                                          
decline over time. Among the factors that could adversely affect the value of                                                        
the properties are:                                                                                                                  
                                                                                                                                     
-    an overall decline in the residential real estate market in the areas in                                                        
     which they are located,                                                                                                         
                                                                                                                                     
-    a decline in their general condition from the failure of borrowers to                                                           
     maintain their property adequately, and                                                                                         
                                                                                                                                     
-    natural disasters that are not covered by insurance, such as earthquakes                                                        
     and floods.                                                                                                                     
                                                                                                                                     
If property values decline, the actual rates of delinquencies, foreclosures, and                                                     
losses on all underlying loans could be higher than those currently experienced                                                      
in the mortgage lending industry in general. These losses, to the extent not                                                         
otherwise covered by a credit enhancement, will be borne by the holder of one or                                                     
more classes of certificates.                                                                                                        
                                                                                                                                     
   Delays in Liquidation May Adversely Affect You                                                                                    
                                                                                                                                     
Even if the properties underlying the loans held in the trust fund provide                                                           
adequate security for the loans, substantial delays could occur before defaulted                                                     
loans are liquidated and their proceeds are forwarded to investors. Property                                                         
foreclosure actions are regulated by state statutes and rules and are subject to                                                     
many of the delays and expenses of other lawsuits if defenses or counterclaims                                                       
are made, sometimes requiring several years to complete. Furthermore, in some                                                        
states if the proceeds of the foreclosure are insufficient to repay the loan,                                                        
the borrower is not liable for the deficit. Thus, if a borrower defaults, these                                                      
restrictions may impede the trust's ability to dispose of the property and                                                           
obtain sufficient proceeds to repay the loan in full. In addition, the servicer                                                      
will be entitled to deduct from liquidation proceeds all expenses reasonably                                                         
incurred in attempting to recover on the defaulted loan,                                                                             
                                                                                                                                     
                                       7                                                                                             
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
including legal fees and costs, real estate taxes, and property maintenance and                                                      
preservation expenses.                                                                                                               
                                                                                                                                     
   Disproportionate Effect of Liquidation Expenses May Adversely Affect You                                                          
                                                                                                                                     
Liquidation expenses of defaulted loans generally do not vary directly with the                                                      
outstanding principal balance of the loan at the time of default. Therefore, if                                                      
a servicer takes the same steps for a defaulted loan having a small remaining                                                        
principal balance as it does for a defaulted loan having a large remaining                                                           
principal balance, the amount realized after expenses is smaller as a percentage                                                     
of the outstanding principal balance of the small loan than it is for the                                                            
defaulted loan having a large remaining principal balance.                                                                           
                                                                                                                                     
   Consumer Protection Laws May Adversely Affect You                                                                                 
                                                                                                                                     
Federal, state and local laws extensively regulate various aspects of brokering,                                                     
originating, servicing and collecting mortgage loans. Among other things, these                                                      
laws may regulate interest rates and other charges, require disclosures, impose                                                      
financial privacy requirements, mandate specific business practices, and                                                             
prohibit unfair and deceptive trade practices. In addition, licensing                                                                
requirements may be imposed on persons that broker, originate, service or                                                            
collect mortgage loans.                                                                                                              
                                                                                                                                     
Additional requirements may be imposed under federal, state or local laws on                                                         
so-called "high cost" mortgage loans, which typically are defined as loans that                                                      
have interest rates or origination costs in excess of prescribed levels. These                                                       
laws may limit certain loan terms, such as prepayment penalties, or the ability                                                      
of a creditor to refinance a loan unless it is in the borrower's interest. In                                                        
addition, certain of these laws may allow claims against loan brokers or                                                             
mortgage originators, including claims based on fraud or misrepresentations, to                                                      
be asserted against persons acquiring the mortgage loans, such as the trust                                                          
fund.                                                                                                                                
                                                                                                                                     
The federal laws that may apply to loans held in the trust fund include the                                                          
following:                                                                                                                           
                                                                                                                                     
-    the Truth in Lending Act and its regulations, which (among other things)                                                        
     require disclosures to borrowers regarding the terms of mortgage loans and                                                      
     provide property owners in non-purchase money transactions with a right of                                                      
     rescission that generally extends for three days after proper disclosures                                                       
     are given (but in no event more than three years);                                                                              
                                                                                                                                     
-    the Home Ownership and Equity Protection Act and its regulations, which                                                         
     (among other things) impose additional disclosure requirements and                                                              
     limitations on                                                                                                                  
                                                                                                                                     
                                       8                                                                                             
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
     loan terms with respect to non-purchase money mortgage loans with interest                                                      
     rates or origination costs in excess of prescribed levels;                                                                      
                                                                                                                                     
-    the Real Estate Settlement Procedures Act and its regulations, which (among                                                     
     other things) prohibit the payment of referral fees for real estate                                                             
     settlement services and regulate escrow accounts for taxes and insurance                                                        
     and billing inquiries made by borrowers;                                                                                        
                                                                                                                                     
-    the Equal Credit Opportunity Act and its regulations, which (among other                                                        
     things) generally prohibit discrimination in any aspect of a credit                                                             
     transaction on certain enumerated basis, such as age, race, color, sex,                                                         
     religion, marital status, national origin or receipt of public assistance;                                                      
     and                                                                                                                             
                                                                                                                                     
-    the Fair Credit Reporting Act, which (among other things) regulates the use                                                     
     of consumer reports obtained from consumer reporting agencies and the                                                           
     reporting of payment histories to consumer reporting agencies.                                                                  
                                                                                                                                     
The penalties for violating these federal, state, or local laws vary depending                                                       
on the applicable law and the particular facts of the situation. However,                                                            
private plaintiffs typically may assert claims for actual damages and, in some                                                       
cases, also may recover civil money penalties or exercise a right to rescind the                                                     
mortgage loan. Violations of certain laws may limit the ability to collect all                                                       
or part of the principal or interest on a mortgage loan and, in some cases,                                                          
borrowers even may be entitled to a refund of amounts previously paid. Federal,                                                      
state and local administrative or law enforcement agencies also may be entitled                                                      
to bring legal actions, including actions for civil money penalties or                                                               
restitution, for violations of certain of these laws.                                                                                
                                                                                                                                     
Depending on the particular alleged misconduct, it is possible that claims may                                                       
be asserted against various participants in the secondary mortgage market,                                                           
including assignees that hold the mortgage loan, such as the trust. Losses on                                                        
loans from the application of these federal, state and local laws that are not                                                       
otherwise covered by one or more forms of credit enhancement will be borne by                                                        
the holders of one or more classes of certificates.                                                                                  
                                                                                                                                     
YOU COULD BE ADVERSELY AFFECTED BY VIOLATIONS OF ENVIRONMENTAL LAWS                                                                  
                                                                                                                                     
Federal, state, and local laws and regulations impose a wide range of                                                                
requirements on activities that may affect the environment, health, and safety.                                                      
In certain circumstances, these laws and regulations impose                                                                          
                                                                                                                                     
                                       9                                                                                             
<PAGE>                                                                                                                               
                                                                                                                                     
obligations on owners or operators of residential properties such as those that                                                      
secure the loans held in the trust fund. Failure to comply with these laws and                                                       
regulations can result in fines and penalties that could be assessed against the                                                     
trust as owner of the related property.                                                                                              
                                                                                                                                     
In some states, a lien on the property due to contamination has priority over                                                        
the lien of an existing mortgage. Also, a mortgage lender may be held liable as                                                      
an "owner" or "operator" for costs associated with the release of petroleum from                                                     
an underground storage tank under certain circumstances. If the trust is                                                             
considered the owner or operator of a property, it will suffer losses as a                                                           
result of any liability imposed for environmental hazards on the property.                                                           
                                                                                                                                     
RATINGS OF THE CERTIFICATES DO NOT ASSURE THEIR PAYMENT                                                                              
                                                                                                                                     
Any class of certificates issued under this prospectus and the accompanying                                                          
prospectus supplement will be rated in one of the four highest rating categories                                                     
of at least one nationally recognized rating agency. A rating is based on the                                                        
adequacy of the value of the trust assets and any credit enhancement for that                                                        
class, and reflects the rating agency's assessment of how likely it is that                                                          
holders of the class of certificates will receive the payments to which they are                                                     
entitled. A rating does not constitute an assessment of how likely it is that                                                        
principal prepayments on the underlying loans will be made, the degree to which                                                      
the rate of prepayments might differ from that originally anticipated, or the                                                        
likelihood that the certificates will be redeemed early. A rating is not a                                                           
recommendation to purchase, hold, or sell certificates because it does not                                                           
address the market price of the certificates or the suitability of the                                                               
certificates for any particular investor.                                                                                            
                                                                                                                                     
A rating may not remain in effect for any given period of time and the rating                                                        
agency could lower or withdraw the rating entirely in the future. For example,                                                       
the rating agency could lower or withdraw its rating due to:                                                                         
                                                                                                                                     
-    decrease in the adequacy of the value of the trust assets or any related                                                        
     credit enhancement,                                                                                                             
                                                                                                                                     
-    an adverse change in the financial or other condition of a credit                                                               
     enhancement provider, or                                                                                                        
                                                                                                                                     
-    a change in the rating of the credit enhancement provider's long-term debt.                                                     
                                                                                                                                     
The amount, type, and nature of credit enhancement established for a class of                                                        
certificates will be determined on the basis of criteria established by each                                                         
rating agency                                                                                                                        
                                                                                                                                     
                                       10                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
rating classes of the certificates. These criteria are sometimes based upon an                                                       
actuarial analysis of the behavior of similar loans in a larger group. That                                                          
analysis is often the basis upon which each rating agency determines the amount                                                      
of credit enhancement required for a class. The historical data supporting any                                                       
actuarial analysis may not accurately reflect future experience, and the data                                                        
derived from a large pool of similar loans may not accurately predict the                                                            
delinquency, foreclosure, or loss experience of any particular pool of mortgage                                                      
loans. Mortgaged properties may not retain their values. If residential real                                                         
estate markets experience an overall decline in property values such that the                                                        
outstanding principal balances of the loans held in a particular trust fund and                                                      
any secondary financing on the related mortgaged properties become equal to or                                                       
greater than the value of the mortgaged properties, the rates of delinquencies,                                                      
foreclosures, and losses could be higher than those now generally experienced in                                                     
the mortgage lending industry. In addition, adverse economic conditions may                                                          
affect timely payment by mortgagors on their loans whether or not the conditions                                                     
affect real property values and, accordingly, the rates of delinquencies,                                                            
foreclosures, and losses in any trust fund. Losses from this that are not                                                            
covered by a credit enhancement will be borne, at least in part, by the holders                                                      
of one or more classes of certificates.                                                                                              
                                                                                                                                     
BOOK-ENTRY REGISTRATION                                                                                                              
                                                                                                                                     
   Limit on Liquidity                                                                                                                
                                                                                                                                     
Certificates issued in book-entry form may have only limited liquidity in the                                                        
resale market, since investors may be unwilling to purchase certificates for                                                         
which they cannot obtain physical instruments.                                                                                       
                                                                                                                                     
   Limit on Ability to Transfer or Pledge                                                                                            
                                                                                                                                     
Transactions in book-entry certificates can be effected only through The                                                             
Depository Trust Company, its participating organizations, its indirect                                                              
participants, and certain banks. Therefore, your ability to transfer or pledge                                                       
certificates issued in book-entry form may be limited.                                                                               
                                                                                                                                     
   Delays in Distributions                                                                                                           
                                                                                                                                     
You may experience some delay in the receipt of distributions on book-entry                                                          
certificates since the distributions will be forwarded by the trustee to The                                                         
Depository Trust Company for it to credit the accounts of its participants. In                                                       
turn, these participants will then credit the distributions to your account                                                          
either directly or indirectly through indirect participants.                                                                         
                                                                                                                                     
BANKRUPTCY OR INSOLVENCY MAY AFFECT THE TIMING AND AMOUNT OF DISTRIBUTIONS ON                                                        
THE CERTIFICATES                                                                                                                     
                                                                                                                                     
The seller and the depositor will treat the transfer of the loans held in the                                                        
trust fund by the seller to the depositor as a sale for accounting purposes. The                                                     
depositor and the trust fund will treat the transfer of the loans from the                                                           
                                                                                                                                     
                                       11                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
depositor to the trust fund as a sale for accounting purposes. If these                                                              
characterizations are correct, then if the seller were to become bankrupt, the                                                       
loans would not be part of the seller's bankruptcy estate and would not be                                                           
available to the seller's creditors. On the other hand, if the seller becomes                                                        
bankrupt, its bankruptcy trustee or one of its creditors may attempt to                                                              
recharacterize the sale of the loans as a borrowing by the seller, secured by a                                                      
pledge of the loans. Presenting this position to a bankruptcy court could                                                            
prevent timely payments on the certificates and even reduce the payments on the                                                      
certificates. Similarly, if the characterizations of the transfers as sales are                                                      
correct, then if the depositor were to become bankrupt, the loans would not be                                                       
part of the depositor's bankruptcy estate and would not be available to the                                                          
depositor's creditors. On the other hand, if the depositor becomes bankrupt, its                                                     
bankruptcy trustee or one of its creditors may attempt to recharacterize the                                                         
sale of the loans as a borrowing by the depositor, secured by a pledge of the                                                        
loans. Presenting this position to a bankruptcy court could prevent timely                                                           
payments on the certificates and even reduce the payments on the certificates.                                                       
                                                                                                                                     
If the master servicer becomes bankrupt, the bankruptcy trustee may have the                                                         
power to prevent the appointment of a successor master servicer. The period                                                          
during which cash collections may be commingled with the master servicer's own                                                       
funds before each distribution date for certificates will be specified in the                                                        
applicable prospectus supplement. If the master servicer becomes bankrupt and                                                        
cash collections have been commingled with the master servicer's own funds, the                                                      
trust fund may not have a perfected interest in those collections. In this case                                                      
the trust might be an unsecured creditor of the master servicer as to the                                                            
commingled funds and could recover only its share as a general creditor, which                                                       
might be nothing. Collections that are not commingled but still in an account of                                                     
the master servicer might also be included in the bankruptcy estate of the                                                           
master servicer even though the trust may have a perfected security interest in                                                      
them. Their inclusion in the bankruptcy estate of the master servicer may result                                                     
in delays in payment and failure to pay amounts due on the certificates.                                                             
                                                                                                                                     
Federal and state statutory provisions affording protection or relief to                                                             
distressed borrowers may affect the ability of the secured mortgage lender to                                                        
realize upon its security in other situations as well. For example, in a                                                             
proceeding under the federal Bankruptcy Code, a lender may not foreclose on a                                                        
mortgaged property without the permission of the bankruptcy court. And in                                                            
certain instances a                                                                                                                  
                                                                                                                                     
                                       12                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
bankruptcy court may allow a borrower to reduce the monthly payments, change the                                                     
rate of interest, and alter the mortgage loan repayment schedule for under                                                           
collateralized mortgage loans. The effect of these types of proceedings can be                                                       
to cause delays in receiving payments on the loans underlying certificates and                                                       
even to reduce the aggregate amount of payments on the loans underlying                                                              
certificates.                                                                                                                        
                                                                                                                                     
Certain capitalized terms are used in this prospectus to assist you in                                                               
understanding the terms of the certificates. The capitalized terms used in this                                                      
prospectus are defined on the pages indicated under the caption "Index to                                                            
Defined Terms" on page 111.                                                                                                          
                                                                                                                                     
                                       13                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
                                THE TRUST FUND*                                                                                      
                                                                                                                                     
         This prospectus relates to Mortgage Pass-Through Certificates, which                                                        
may be sold from time to time in one or more series by the depositor, CWMBS,                                                         
Inc., on terms determined at the time of sale and described in this prospectus                                                       
and the related prospectus supplement. Each series will be issued under a                                                            
separate pooling and servicing agreement to be entered into with respect to each                                                     
series. The certificates of a series will evidence beneficial ownership of a                                                         
trust fund. The trust fund for a series of certificates will include certain                                                         
mortgage related assets (the "Mortgage Assets") consisting of                                                                        
                                                                                                                                     
-    a pool of first lien mortgage loans (or participation interests in them)                                                        
     secured by one- to four-family residential properties,                                                                          
                                                                                                                                     
-    mortgage pass-through securities (the "Agency Securities") issued or                                                            
     guaranteed by Ginnie Mae, Fannie Mae or Freddie Mac or                                                                          
                                                                                                                                     
-    other mortgage pass-through certificates or collateralized mortgage                                                             
     obligations (the "Private Mortgage-Backed Securities") evidencing an                                                            
     interest in, or secured by, mortgage loans of the type that would otherwise                                                     
     be eligible to be mortgage loans.                                                                                               
                                                                                                                                     
The Mortgage Assets will be acquired by the depositor, either directly or                                                            
indirectly, from one or more institutions, which may be affiliates of the                                                            
depositor, and conveyed by the depositor to the related trust fund. The trustee                                                      
for each series of certificates will be specified in the related prospectus                                                          
supplement. See "The Pooling and Servicing Agreement" for a description of the                                                       
trustee's rights and obligations. The entity or entities named as master                                                             
servicer in the related prospectus supplement, which may be an affiliate of the                                                      
depositor. See "The Pooling and Servicing Agreement -- Certain Matters Regarding                                                     
the Master Servicer and the Depositor." The mortgage loans will be secured by                                                        
first mortgage liens on one- to four-family residential properties and, if so                                                        
specified in the related prospectus supplement, may include cooperative                                                              
apartment loans secured by security interests in shares issued by private,                                                           
nonprofit, cooperative housing corporations and in the related proprietary                                                           
leases or occupancy agreements granting exclusive rights to occupy specific                                                          
dwelling units in the cooperatives' buildings. In addition, the Mortgage Assets                                                      
of the related trust fund may include mortgage participation certificates                                                            
evidencing interests in mortgage loans. The mortgage loans may be conventional                                                       
loans (i.e., loans that are not insured or guaranteed by any governmental                                                            
agency), insured by the FHA or partially guaranteed by the VA as specified in                                                        
the related prospectus supplement. All or a portion of the mortgage loans in a                                                       
mortgage pool may be insured by FHA insurance and may be partially guaranteed by                                                     
the VA.                                                                                                                              
                                                                                                                                     
         The certificates will be entitled to payment from the assets of the                                                         
related trust fund or other assets pledged for the benefit of the holders of the                                                     
certificates as specified in the related prospectus supplement and will not be                                                       
entitled to payments in respect of the assets of any other trust fund                                                                
established by the depositor. The applicable prospectus supplement may specify                                                       
the Mortgage Assets that a trust fund will consist of, but if it does not, the                                                       
Mortgage Assets of any trust fund will consist of mortgage loans, Agency                                                             
Securities or Private Mortgage-Backed Securities but not a combination of them.                                                      
Mortgage loans acquired by the depositor will have been originated in accordance                                                     
with the underwriting criteria specified                                                                                             
                                                                                                                                     
-------------------                                                                                                                  
                                                                                                                                     
*   Whenever the terms mortgage pool and certificates are used in this                                                               
    prospectus, those terms will be considered to apply, unless the context                                                          
    indicates otherwise, to one specific mortgage pool and the certificates                                                          
    representing certain undivided interests in a single trust fund consisting                                                       
    primarily of the Mortgage Assets in the mortgage pool. Similarly, the term                                                       
    pass-through rate will refer to the pass-through rate borne by the                                                               
    certificate of one specific series and the term trust fund will refer to one                                                     
    specific trust fund.                                                                                                             
                                                                                                                                     
                                       14                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
below under "Mortgage Loan Program -- Underwriting Standards" or as otherwise                                                        
described in a related prospectus supplement.                                                                                        
                                                                                                                                     
         The following is a brief description of the Mortgage Assets expected to                                                     
be included in the trust funds. If specific information about the Mortgage                                                           
Assets is not known at the time the related series of certificates initially is                                                      
offered, more general information of the nature described below will be provided                                                     
in the related prospectus supplement, and specific information will be set forth                                                     
in a report on Form 8-K to be filed with the SEC within fifteen days after the                                                       
initial issuance of the certificates. A maximum of 5% of the Mortgage Assets as                                                      
they will be constituted at the time that the applicable detailed description of                                                     
Mortgage Assets is filed will deviate in any material respect from the Mortgage                                                      
Asset pool characteristics described in the related prospectus supplement, other                                                     
than the aggregate number or amount of mortgage loans. A schedule of the                                                             
Mortgage Assets relating to the series will be attached to the pooling and                                                           
servicing agreement delivered to the trustee upon delivery of the certificates.                                                      
                                                                                                                                     
THE MORTGAGE LOANS -- GENERAL                                                                                                        
                                                                                                                                     
         The real property that secures repayment of the mortgage loans is                                                           
referred to collectively as mortgaged properties. The mortgaged properties will                                                      
be located in any one of the fifty states, the District of Columbia, Guam,                                                           
Puerto Rico or any other territory of the United States. Mortgage loans with                                                         
certain Loan-to-Value Ratios or certain principal balances or both may be                                                            
covered wholly or partially by primary mortgage guaranty insurance policies. The                                                     
existence, extent and duration of coverage will be described in the applicable                                                       
prospectus supplement.                                                                                                               
                                                                                                                                     
         The applicable prospectus supplement may specify the day on which                                                           
monthly payments on the mortgage loans in a mortgage pool will be due, but if it                                                     
does not, all of the mortgage loans in a mortgage pool will have monthly                                                             
payments due on the first day of each month. The payment terms of the mortgage                                                       
loans to be included in a trust fund will be described in the related prospectus                                                     
supplement and may include any of the following features or combination thereof                                                      
or other features described in the related prospectus supplement:                                                                    
                                                                                                                                     
-    Interest may be payable at a fixed rate, a rate adjustable from time to                                                         
     time in relation to an index (which will be specified in the related                                                            
     prospectus supplement), a rate that is fixed for a period of time or under                                                      
     certain circumstances and is followed by an adjustable rate, a rate that                                                        
     otherwise varies from time to time, or a rate that is convertible from an                                                       
     adjustable rate to a fixed rate. Changes to an adjustable rate may be                                                           
     subject to periodic limitations, maximum rates, minimum rates or a                                                              
     combination of the limitations. Accrued interest may be deferred and added                                                      
     to the principal of a loan for the periods and under the circumstances as                                                       
     may be specified in the related prospectus supplement.                                                                          
                                                                                                                                     
-    Principal may be payable on a level debt service basis to fully amortize                                                        
     the mortgage loan over its term, may be calculated on the basis of an                                                           
     assumed amortization schedule that is significantly longer than the                                                             
     original term to maturity or on an interest rate that is different from the                                                     
     interest rate specified in its mortgage note or may not be amortized during                                                     
     all or a portion of the original term. Payment of all or a substantial                                                          
     portion of the principal may be due on maturity, called balloon payments.                                                       
     Principal may include interest that has been deferred and added to the                                                          
     principal balance of the mortgage loan.                                                                                         
                                                                                                                                     
-    Monthly payments of principal and interest may be fixed for the life of the                                                     
     mortgage loan, may increase over a specified period of time or may change                                                       
     from period to period. The terms of a mortgage loan may include limits on                                                       
     periodic increases or decreases in the amount of monthly payments and may                                                       
     include maximum or minimum amounts of monthly payments.                                                                         
                                                                                                                                     
                                       15                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
-    The mortgage loans generally may be prepaid at any time without the payment                                                     
     of any prepayment fee. If so specified in the related prospectus                                                                
     supplement, some prepayments of principal may be subject to a prepayment                                                        
     fee, which may be fixed for the life of the mortgage loan or may decline                                                        
     over time, and may be prohibited for the life of the mortgage loan or for                                                       
     certain periods, which are called lockout periods. Certain mortgage loans                                                       
     may permit prepayments after expiration of the applicable lockout period                                                        
     and may require the payment of a prepayment fee in connection with any                                                          
     subsequent prepayment. Other mortgage loans may permit prepayments without                                                      
     payment of a fee unless the prepayment occurs during specified time                                                             
     periods. The loans may include "due-on-sale" clauses that permit the                                                            
     mortgagee to demand payment of the entire mortgage loan in connection with                                                      
     the sale or certain transfers of the related mortgaged property. Other                                                          
     mortgage loans may be assumable by persons meeting the then applicable                                                          
     underwriting standards of the seller.                                                                                           
                                                                                                                                     
         A trust fund may contain buydown loans that include provisions whereby                                                      
a third party partially subsidizes the monthly payments of the obligors on the                                                       
mortgage loans during the early years of the mortgage loans, the difference to                                                       
be made up from a buydown fund contributed by the third party at the time of                                                         
origination of the mortgage loan. A buydown fund will be in an amount equal                                                          
either to the discounted value or full aggregate amount of future payment                                                            
subsidies. Thereafter, buydown funds are applied to the applicable mortgage loan                                                     
upon receipt by the master servicer of the mortgagor's portion of the monthly                                                        
payment on the mortgage loan. The master servicer administers the buydown fund                                                       
to ensure that the monthly allocation from the buydown fund combined with the                                                        
monthly payment received from the mortgagor equals the scheduled monthly payment                                                     
on the applicable mortgage loan. The underlying assumption of buydown plans is                                                       
that the income of the mortgagor will increase during the buydown period as a                                                        
result of normal increases in compensation and inflation, so that the mortgagor                                                      
will be able to meet the full mortgage payments at the end of the buydown                                                            
period. To the extent that this assumption as to increased income is not                                                             
fulfilled, the possibility of defaults on buydown loans is increased.                                                                
                                                                                                                                     
         Each prospectus supplement will contain information, as of the date of                                                      
the prospectus supplement and to the extent then specifically known to the                                                           
depositor, with respect to the mortgage loans contained in the related mortgage                                                      
pool, including                                                                                                                      
                                                                                                                                     
-    the aggregate outstanding principal balance and the average outstanding                                                         
     principal balance of the mortgage loans as of the first day of the month of                                                     
     issuance of the related series of certificates or another date specified in                                                     
     the related prospectus supplement called a cut-off date,                                                                        
                                                                                                                                     
-    the type of property securing the mortgage loans (e.g., separate                                                                
     residential properties, individual units in condominium apartment buildings                                                     
     or in buildings owned by cooperatives, vacation and second homes),                                                              
                                                                                                                                     
-    the original terms to maturity of the mortgage loans,                                                                           
                                                                                                                                     
-    the largest principal balance and the smallest principal balance of any of                                                      
     the mortgage loans,                                                                                                             
                                                                                                                                     
-    the earliest origination date and latest maturity date of any of the                                                            
     mortgage loans,                                                                                                                 
                                                                                                                                     
-    the aggregate principal balance of mortgage loans having Loan-to-Value                                                          
     Ratios at origination exceeding 80%,                                                                                            
                                                                                                                                     
-    the maximum and minimum per annum mortgage rates and                                                                            
                                                                                                                                     
-    the geographical distribution of the mortgage loans.                                                                            
                                                                                                                                     
                                       16                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         If specific information respecting the mortgage loans is not known to                                                       
the depositor at the time the related certificates are initially offered, more                                                       
general information of the nature described above will be provided in the                                                            
detailed description of Mortgage Assets.                                                                                             
                                                                                                                                     
         The "Loan-to-Value Ratio" of a mortgage loan at any given time is the                                                       
fraction, expressed as a percentage, the numerator of which is the original                                                          
principal balance of the related mortgage loan and the denominator of which is                                                       
the collateral value of the related mortgaged property. The applicable                                                               
prospectus supplement may specify how the collateral value of a mortgaged                                                            
property will be calculated, but if it does not, the collateral value of a                                                           
mortgaged property is the lesser of the sales price for the property and the                                                         
appraised value determined in an appraisal obtained by the originator at                                                             
origination of the mortgage loan.                                                                                                    
                                                                                                                                     
         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 such that the outstanding principal                                                            
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 addition, adverse economic conditions and                                                          
other factors (which may or may not affect real property values) 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,                                                              
foreclosures and losses with respect to any mortgage pool. To the extent that                                                        
the losses are not covered by subordination provisions or alternative                                                                
arrangements, the losses will be borne, at least in part, by the holders of the                                                      
certificates of the related series.                                                                                                  
                                                                                                                                     
         The depositor will cause the mortgage loans comprising each mortgage                                                        
pool to be assigned to the trustee named in the related prospectus supplement                                                        
for the benefit of the certificateholders of the related series. The master                                                          
servicer named in the related prospectus supplement will service the mortgage                                                        
loans, either directly or through sub-servicers, pursuant to the pooling and                                                         
servicing agreement, and will receive a fee for its services. See "Mortgage Loan                                                     
Program" and "The Pooling and Servicing Agreement." With respect to mortgage                                                         
loans serviced by the master servicer through a sub-servicer, the master                                                             
servicer will remain liable for its servicing obligations under the related                                                          
pooling and servicing agreement as if the master servicer alone were servicing                                                       
the mortgage loans.                                                                                                                  
                                                                                                                                     
         The applicable prospectus supplement may provide for additional                                                             
obligations of the depositor, but if it does not, the only obligations of the                                                        
depositor with respect to a series of certificates will be to obtain certain                                                         
representations and warranties from the sellers and to assign to the trustee for                                                     
the series of certificates the depositor's rights with respect to the                                                                
representations and warranties. See "The Pooling and Servicing Agreement --                                                          
Assignment of Mortgage Assets." The obligations of the master servicer with                                                          
respect to the mortgage loans will consist principally of its contractual                                                            
servicing obligations under the related pooling and servicing agreement                                                              
(including its obligation to enforce the obligations of the sub-servicers or                                                         
sellers, or both, as more fully described under "Mortgage Loan Program --                                                            
Representations by Sellers; Repurchases") and its obligation to make cash                                                            
advances upon delinquencies in payments on or with respect to the mortgage loans                                                     
in the amounts described under "Description of the Certificates -- Advances."                                                        
The obligations of the master servicer to make advances may be subject to                                                            
limitations, to the extent provided in this prospectus and in the related                                                            
prospectus supplement. The master servicer may also be a seller in which case a                                                      
breach of its obligations in one capacity will not constitute a breach of its                                                        
obligations in the other capacity.                                                                                                   
                                                                                                                                     
         The mortgage loans will consist of mortgage loans, deeds of trust or                                                        
participations or other beneficial interests therein, secured by first liens on                                                      
one- to four-family residential properties and, if so specified in the related                                                       
prospectus supplement, may include cooperative apartment loans secured by                                                            
                                                                                                                                     
                                       17                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
security interests in shares issued by private, non-profit, cooperative housing                                                      
corporations and in the related proprietary leases or occupancy agreements                                                           
granting exclusive rights to occupy specific dwelling units in the cooperatives'                                                     
buildings. In addition, Mortgage Assets of the related trust fund may include                                                        
mortgage participation certificates evidencing interests in mortgage loans.                                                          
These loans may be conventional loans (i.e., loans that are not insured or                                                           
guaranteed by any governmental agency) or loans insured by the FHA or partially                                                      
guaranteed by the VA, as specified in the related prospectus supplement. The                                                         
mortgaged properties relating to mortgage loans will consist of detached or                                                          
semi-detached one-family dwelling units, two- to four-family dwelling units,                                                         
townhouses, rowhouses, individual condominium units, individual units in planned                                                     
unit developments and certain other dwelling units. The mortgaged properties may                                                     
include vacation and second homes, investment properties and leasehold                                                               
interests. In the case of leasehold interests, the applicable prospectus                                                             
supplement may specify that the term of the leasehold may be less than five                                                          
years beyond the scheduled maturity of the mortgage loan, but if it does not,                                                        
the term of the leasehold will exceed the scheduled maturity of the mortgage                                                         
loan by at least five years.                                                                                                         
                                                                                                                                     
AGENCY SECURITIES                                                                                                                    
                                                                                                                                     
         Government National Mortgage Association. Ginnie Mae is a wholly-owned                                                      
corporate instrumentality of the United States with the United States Department                                                     
of Housing and Urban Development. Section 306(g) of Title II of the National                                                         
Housing Act of 1934, as amended, authorizes Ginnie Mae to guarantee the timely                                                       
payment of the principal of and interest on certificates that represent an                                                           
interest in a pool of mortgage loans insured by the FHA under the National                                                           
Housing Act of 1934 or Title V of the Housing Act of 1949, or partially                                                              
guaranteed by the VA under the Servicemen's Readjustment Act of 1944, as                                                             
amended, or Chapter 37 of Title 38, United States Code.                                                                              
                                                                                                                                     
         Section 306(g) of the National Housing Act of 1934 provides that "the                                                       
full faith and credit of the United States is pledged to the payment of all                                                          
amounts which may be required to be paid under any guaranty under this                                                               
subsection." In order to meet its obligations under that guaranty, Ginnie Mae                                                        
may, under Section 306(d) of the National Housing Act of 1934, borrow from the                                                       
United States Treasury in an unlimited amount which is at any time sufficient to                                                     
enable Ginnie Mae to perform its obligations under its guarantee.                                                                    
                                                                                                                                     
         Ginnie Mae Certificates. Each Ginnie Mae certificate held in a trust                                                        
fund will be a "fully modified pass-through" mortgage backed certificate issued                                                      
and serviced by a Ginnie Mae issuer approved by Ginnie Mae or by Fannie Mae as a                                                     
seller-servicer of FHA loans or VA loans. The Ginnie Mae certificates may be                                                         
issued under either the Ginnie Mae I program or the Ginnie Mae II program. The                                                       
mortgage loans underlying the Ginnie Mae certificates will consist of FHA loans                                                      
or VA loans. Each mortgage loan is secured by a one-to four-family or                                                                
multifamily residential property. Ginnie Mae will approve the issuance of each                                                       
Ginnie Mae certificate in accordance with a guaranty agreement between Ginnie                                                        
Mae and the Ginnie Mae issuer. Pursuant to its guaranty agreement, a Ginnie Mae                                                      
issuer will be required to advance its own funds in order to make timely                                                             
payments of all amounts due on each Ginnie Mae certificate if the payments                                                           
received by the Ginnie Mae issuer on the FHA loans or VA loans underlying each                                                       
Ginnie Mae certificate are less than the amounts due on each Ginnie Mae                                                              
certificate.                                                                                                                         
                                                                                                                                     
         The full and timely payment of principal of and interest on each Ginnie                                                     
Mae certificate will be guaranteed by Ginnie Mae, which obligation is backed by                                                      
the full faith and credit of the United States. Each Ginnie Mae certificate will                                                     
have an original maturity of not more than 30 years (but may have original                                                           
maturities of substantially less than 30 years). Each Ginnie Mae certificate                                                         
will be based on and backed by a pool of FHA loans or VA loans secured by one to                                                     
four-family residential properties and will provide for the payment by or on                                                         
behalf of the Ginnie Mae issuer to the registered holder of the Ginnie Mae                                                           
certificate of scheduled monthly payments of principal and interest equal to the                                                     
registered holder's                                                                                                                  
                                                                                                                                     
                                       18                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
proportionate interest in the aggregate amount of the monthly principal and                                                          
interest payment on each FHA loan or VA loan underlying the Ginnie Mae                                                               
certificate, less the applicable servicing and guaranty fee, which together                                                          
equal the difference between the interest on the FHA loan or VA loan and the                                                         
pass-through rate on the Ginnie Mae certificate. In addition, each payment will                                                      
include proportionate pass-through payments of any prepayments of principal on                                                       
the FHA loans or VA loans underlying the Ginnie Mae certificate and liquidation                                                      
proceeds upon a foreclosure or other disposition of the FHA loans or VA loans.                                                       
                                                                                                                                     
         If a Ginnie Mae issuer is unable to make the payments on a Ginnie Mae                                                       
certificate as it becomes due, it must promptly notify Ginnie Mae and request                                                        
Ginnie Mae to make the payment. Upon notification and request, Ginnie Mae will                                                       
make the payments directly to the registered holder of the Ginnie Mae                                                                
certificate. If no payment is made by a Ginnie Mae issuer and the Ginnie Mae                                                         
issuer fails to notify and request Ginnie Mae to make the payment, the holder of                                                     
the Ginnie Mae certificate will have recourse only against Ginnie Mae to obtain                                                      
the payment. The trustee or its nominee, as registered holder of the Ginnie Mae                                                      
certificates held in a trust fund, will have the right to proceed directly                                                           
against Ginnie Mae under the terms of the guaranty agreements relating to the                                                        
Ginnie Mae certificates for any amounts that are not paid when due.                                                                  
                                                                                                                                     
         All mortgage loans underlying a particular Ginnie Mae I certificate                                                         
must have the same interest rate over the term of the loan, except in pools of                                                       
mortgage loans secured by manufactured homes. The interest rate on the Ginnie                                                        
Mae I certificate will equal the interest rate on the mortgage loans included in                                                     
the pool of mortgage loans underlying the Ginnie Mae I certificate, less                                                             
one-half percentage point per annum of the unpaid principal balance of the                                                           
mortgage loans.                                                                                                                      
                                                                                                                                     
         Mortgage loans underlying a particular Ginnie Mae II certificate may                                                        
have per annum interest rates that vary from each other by up to one percentage                                                      
point. The interest rate on each Ginnie Mae II certificate will be between one                                                       
half percentage point and one and one-half percentage points lower than the                                                          
highest interest rate on the mortgage loans included in the pool of mortgage                                                         
loans underlying the Ginnie Mae II certificate, except for pools of mortgage                                                         
loans secured by manufactured homes.                                                                                                 
                                                                                                                                     
         Regular monthly installment payments on each Ginnie Mae certificate                                                         
held in a trust fund will be comprised of interest due as specified on the                                                           
Ginnie Mae certificate plus the scheduled principal payments on the FHA loans or                                                     
VA loans underlying the Ginnie Mae certificate due on the first day of the month                                                     
in which the scheduled monthly installments on the Ginnie Mae certificate are                                                        
due. The regular monthly installments on each Ginnie Mae certificate are                                                             
required to be paid to the trustee as registered holder by the 15th day of each                                                      
month in the case of a Ginnie Mae I certificate and are required to be mailed to                                                     
the trustee by the 20th day of each month in the case of a Ginnie Mae II                                                             
certificate. Any principal prepayments on any FHA loans or VA loans underlying a                                                     
Ginnie Mae certificate held in a trust fund or any other early recovery of                                                           
principal on the loans will be passed through to the trustee as the registered                                                       
holder of the Ginnie Mae certificate.                                                                                                
                                                                                                                                     
         Ginnie Mae certificates may be backed by graduated payment mortgage                                                         
loans or by buydown loans for which funds will have been provided (and deposited                                                     
into escrow accounts) for application to the payment of a portion of the                                                             
borrowers' monthly payments during the early years of the mortgage loan.                                                             
Payments due the registered holders of Ginnie Mae certificates backed by pools                                                       
containing buydown loans will be computed in the same manner as payments derived                                                     
from other Ginnie Mae certificates and will include amounts to be collected from                                                     
both the borrower and the related escrow account. The graduated payment mortgage                                                     
loans will provide for graduated interest payments that, during the early years                                                      
of the mortgage loans, will be less than the amount of stated interest on the                                                        
mortgage loans. The interest not so paid will be added to the principal of the                                                       
graduated payment mortgage loans and, together with interest on them, will be                                                        
paid in subsequent years. The obligations of Ginnie Mae and of a Ginnie                                                              
                                                                                                                                     
                                       19                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
Mae issuer will be the same irrespective of whether the Ginnie Mae certificates                                                      
are backed by graduated payment mortgage loans or buydown loans. No statistics                                                       
comparable to the FHA's prepayment experience on level payment, non-buydown                                                          
mortgage loans are available for graduated payment or buydown loans. Ginnie Mae                                                      
certificates related to a series of certificates may be held in book-entry form.                                                     
                                                                                                                                     
         The Ginnie Mae certificates included in a trust fund, and the related                                                       
underlying mortgage loans, may have characteristics and terms different from                                                         
those described above. Any different characteristics and terms will be described                                                     
in the related prospectus supplement.                                                                                                
                                                                                                                                     
         Federal Home Loan Mortgage Corporation. Freddie Mac is a corporate                                                          
instrumentality of the United States created pursuant to Title III of the                                                            
Emergency Home Finance Act of 1970, as amended. The common stock of Freddie Mac                                                      
is owned by the Federal Home Loan Banks and its preferred stock is owned by                                                          
stockholders of the Federal Home Loan Banks. Freddie Mac was established                                                             
primarily to increase the availability of mortgage credit to finance urgently                                                        
needed housing. It seeks to provide an enhanced degree of liquidity for                                                              
residential mortgage investments primarily by assisting in the development of                                                        
secondary markets for conventional mortgages. The principal activity of Freddie                                                      
Mac currently consists of the purchase of first lien conventional mortgage loans                                                     
or participation interests in mortgage loans and the sale of the mortgage loans                                                      
or participations so purchased in the form of mortgage securities, primarily                                                         
mortgage participation certificates issued and either guaranteed as to timely                                                        
payment of interest or guaranteed as to timely payment of interest and ultimate                                                      
payment of principal by Freddie Mac. Freddie Mac is confined to purchasing, so                                                       
far as practicable, mortgage loans that it deems to be of such quality, type and                                                     
class as to meet generally the purchase standards imposed by private                                                                 
institutional mortgage investors.                                                                                                    
                                                                                                                                     
         Freddie Mac Certificates. Each Freddie Mac certificate represents an                                                        
undivided interest in a pool of mortgage loans that may consist of first lien                                                        
conventional loans, FHA loans or VA loans. Freddie Mac certificates are sold                                                         
under the terms of a Mortgage Participation Certificate Agreement. A Freddie Mac                                                     
certificate may be issued under either Freddie Mac's Cash Program or Guarantor                                                       
Program.                                                                                                                             
                                                                                                                                     
         Mortgage loans underlying the Freddie Mac certificates held by a trust                                                      
fund will consist of mortgage loans with original terms to maturity of between                                                       
10 and 40 years. Each mortgage loan must meet the applicable standards set forth                                                     
in the Emergency Home Finance Act of 1970. A Freddie Mac certificate group may                                                       
include whole loans, participation interests in whole loans and undivided                                                            
interests in whole loans and participations comprising another Freddie Mac                                                           
certificate group. Under the Guarantor Program, a Freddie Mac certificate group                                                      
may include only whole loans or participation interests in whole loans.                                                              
                                                                                                                                     
         Freddie Mac guarantees to each registered holder of a Freddie Mac                                                           
certificate the timely payment of interest on the underlying mortgage loans to                                                       
the extent of the applicable certificate interest rate on the registered                                                             
holder's pro rata share of the unpaid principal balance outstanding on the                                                           
underlying mortgage loans in the Freddie Mac certificate group represented by                                                        
the Freddie Mac certificate, whether or not received. Freddie Mac also                                                               
guarantees to each registered holder of a Freddie Mac certificate collection by                                                      
the holder of all principal on the underlying mortgage loans, without any offset                                                     
or deduction, to the extent of the holder's pro rata share of it, but does not,                                                      
except if and to the extent specified in the related prospectus supplement for a                                                     
series of certificates, guarantee the timely payment of scheduled principal.                                                         
Under Freddie Mac's Gold PC Program, Freddie Mac guarantees the timely payment                                                       
of principal based on the difference between the pool factor published in the                                                        
month preceding the month of distribution and the pool factor published in the                                                       
month of distribution. Pursuant to its guaranties, Freddie Mac indemnifies                                                           
holders of Freddie Mac certificates against any diminution in principal from                                                         
charges for property repairs, maintenance and foreclosure. Freddie Mac may remit                                                     
the amount due on account of its guaranty of collection of principal at any time                                                     
after default on an underlying mortgage loan, but not later                                                                          
                                                                                                                                     
                                       20                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
than 30 days following foreclosure sale, 30 days following payment of the claim                                                      
by any mortgage insurer or 30 days following the expiration of any right of                                                          
redemption, whichever occurs later, but in any event no later than one year                                                          
after demand has been made upon the mortgagor for accelerated payment of                                                             
principal. In taking actions regarding the collection of principal after default                                                     
on the mortgage loans underlying Freddie Mac certificates, including the timing                                                      
of demand for acceleration, Freddie Mac reserves the right to exercise its                                                           
judgment with respect to the mortgage loans in the same manner as for mortgage                                                       
loans that it has purchased but not sold. The length of time necessary for                                                           
Freddie Mac to determine that a mortgage loan should be accelerated varies with                                                      
the particular circumstances of each mortgagor, and Freddie Mac has not adopted                                                      
standards which require that the demand be made within any specified period.                                                         
                                                                                                                                     
         Freddie Mac certificates are not guaranteed by the United States or by                                                      
any Federal Home Loan Bank and do not constitute debts or obligations of the                                                         
United States or any Federal Home Loan Bank. The obligations of Freddie Mac                                                          
under its guaranty are obligations solely of Freddie Mac and are not backed by,                                                      
or entitled to, the full faith and credit of the United States. If Freddie Mac                                                       
were unable to satisfy its obligations, distributions to holders of Freddie Mac                                                      
certificates would consist solely of payments and other recoveries on the                                                            
underlying mortgage loans and, accordingly, monthly distributions to holders of                                                      
Freddie Mac certificates would be affected by delinquent payments and defaults                                                       
on the mortgage loans.                                                                                                               
                                                                                                                                     
         Registered holders of Freddie Mac certificates are entitled to receive                                                      
their monthly pro rata share of all principal payments on the underlying                                                             
mortgage loans received by Freddie Mac, including any scheduled principal                                                            
payments, full and partial prepayments of principal and principal received by                                                        
Freddie Mac by virtue of condemnation, insurance, liquidation or foreclosure,                                                        
and repurchases of the mortgage loans by Freddie Mac or their seller. Freddie                                                        
Mac is required to remit each registered Freddie Mac certificateholder's pro                                                         
rata share of principal payments on the underlying mortgage loans, interest at                                                       
the Freddie Mac pass-through rate and any other sums such as prepayment fees,                                                        
within 60 days of the date on which the payments are deemed to have been                                                             
received by Freddie Mac.                                                                                                             
                                                                                                                                     
         Under Freddie Mac's Cash Program, there is no limitation on the amount                                                      
by which interest rates on the mortgage loans underlying a Freddie Mac                                                               
certificate may exceed the pass-through rate on the Freddie Mac certificate.                                                         
Under that program, Freddie Mac purchases groups of whole mortgage loans from                                                        
sellers at specified percentages of their unpaid principal balances, adjusted                                                        
for accrued or prepaid interest, which when applied to the interest rate of the                                                      
mortgage loans and participations purchased results in the yield required by                                                         
Freddie Mac. The required yield, which includes a minimum servicing fee retained                                                     
by the servicer, is calculated using the outstanding principal balance. The                                                          
range of interest rates on the mortgage loans and participations in a Freddie                                                        
Mac certificate group under the Cash Program will vary since mortgage loans and                                                      
participations are purchased and assigned to a Freddie Mac certificate group                                                         
based upon their yield to Freddie Mac rather than on the interest rate on the                                                        
underlying mortgage loans. Under Freddie Mac's Guarantor Program, the                                                                
pass-through rate on a Freddie Mac certificate is established based upon the                                                         
lowest interest rate on the underlying mortgage loans, minus a minimum servicing                                                     
fee and the amount of Freddie Mac's management and guaranty income as agreed                                                         
upon between the seller and Freddie Mac.                                                                                             
                                                                                                                                     
         Freddie Mac certificates duly presented for registration of ownership                                                       
on or before the last business day of a month are registered effective as of the                                                     
first day of the month. The first remittance to a registered holder of a Freddie                                                     
Mac certificate will be distributed so as to be received normally by the 15th                                                        
day of the second month following the month in which the purchaser became a                                                          
registered holder of the Freddie Mac certificate. Thereafter, the remittance                                                         
will be distributed monthly to the registered holder so as to be received                                                            
normally by the 15th day of each month. The Federal Reserve Bank of New York                                                         
maintains book-entry accounts for Freddie Mac certificates sold by Freddie Mac                                                       
on or after January 2,                                                                                                               
                                                                                                                                     
                                       21                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
1985, and makes payments of principal and interest each month to their                                                               
registered holders in accordance with the holders' instructions.                                                                     
                                                                                                                                     
         Federal National Mortgage Association. Fannie Mae is a federally                                                            
chartered and privately owned corporation organized and existing under the                                                           
Federal National Mortgage Association Charter Act, as amended. Fannie Mae was                                                        
originally established in 1938 as a United States government agency to provide                                                       
supplemental liquidity to the mortgage market and was transformed into a                                                             
stockholder owned and privately-managed corporation by legislation enacted in                                                        
1968.                                                                                                                                
                                                                                                                                     
         Fannie Mae provides funds to the mortgage market primarily by                                                               
purchasing mortgage loans from lenders, thereby replenishing their funds for                                                         
additional lending. Fannie Mae acquires funds to purchase mortgage loans from                                                        
many capital market investors that may not ordinarily invest in mortgages,                                                           
thereby expanding the total amount of funds available for housing. Operating                                                         
nationwide, Fannie Mae helps to redistribute mortgage funds from capital-surplus                                                     
to capital-short areas.                                                                                                              
                                                                                                                                     
         Fannie Mae Certificates. These are guaranteed mortgage pass-through                                                         
certificates issued and guaranteed as to timely payment of principal and                                                             
interest by Fannie Mae representing fractional undivided interests in a pool of                                                      
mortgage loans formed by Fannie Mae. Each mortgage loan must meet the applicable                                                     
standards of the Fannie Mae purchase program. Mortgage loans comprising a pool                                                       
are either provided by Fannie Mae from its own portfolio or purchased pursuant                                                       
to the criteria of the Fannie Mae purchase program.                                                                                  
                                                                                                                                     
         Mortgage loans underlying Fannie Mae certificates held by a trust fund                                                      
will consist of conventional mortgage loans, FHA loans or VA loans. Original                                                         
maturities of substantially all of the conventional, level payment mortgage                                                          
loans underlying a Fannie Mae certificate are expected to be between either 8 to                                                     
15 years or 20 to 40 years. The original maturities of substantially all of the                                                      
fixed rate, level payment FHA loans or VA loans are expected to be 30 years.                                                         
Mortgage loans underlying a Fannie Mae certificate may have annual interest                                                          
rates that vary by as much as two percentage points from each other. The rate of                                                     
interest payable on a Fannie Mae certificate is equal to the lowest interest                                                         
rate of any mortgage loan in the related pool, less a specified minimum annual                                                       
percentage representing servicing compensation and Fannie Mae's guaranty fee.                                                        
Under a regular servicing option, the annual interest rates on the mortgage                                                          
loans underlying a Fannie Mae certificate will be between 50 basis points and                                                        
250 basis points greater than is its annual pass through rate. Under this option                                                     
the mortgagee or each other servicer assumes the entire risk of foreclosure                                                          
losses. Under a special servicing option, the annual interest rates on the                                                           
mortgage loans underlying a Fannie Mae certificate will generally be between 55                                                      
basis points and 255 basis points greater than the annual Fannie Mae certificate                                                     
pass-through rate. Under this option Fannie Mae assumes the entire risk for                                                          
foreclosure losses. If specified in the related prospectus supplement, Fannie                                                        
Mae certificates may be backed by adjustable rate mortgages.                                                                         
                                                                                                                                     
         Fannie Mae guarantees to each registered holder of a Fannie Mae                                                             
certificate that it will distribute amounts representing the holder's                                                                
proportionate share of scheduled principal and interest payments at the                                                              
applicable pass through rate provided for by the Fannie Mae certificate on the                                                       
underlying mortgage loans, whether or not received, and the holder's                                                                 
proportionate share of the full principal amount of any foreclosed or other                                                          
finally liquidated mortgage loan, whether or not the principal amount is                                                             
actually recovered. The obligations of Fannie Mae under its guaranties are                                                           
obligations solely of Fannie Mae and are not backed by, or entitled to, the full                                                     
faith and credit of the United States. Although the Secretary of the Treasury of                                                     
the United States has discretionary authority to lend Fannie Mae up to $2.25                                                         
billion outstanding at any time, neither the United States nor any of its                                                            
agencies is obligated to finance Fannie Mae's operations or to assist Fannie Mae                                                     
in any other manner. If Fannie Mae were unable to satisfy its obligations,                                                           
distributions to holders of Fannie Mae certificates would consist solely of                                                          
payments and other                                                                                                                   
                                                                                                                                     
                                       22                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
recoveries on the underlying mortgage loans and, accordingly, monthly                                                                
distributions to holders of Fannie Mae certificates would be affected by                                                             
delinquent payments and defaults on the mortgage loans.                                                                              
                                                                                                                                     
         Except for Fannie Mae certificates backed by pools containing graduated                                                     
payment mortgage loans or mortgage loans secured by multifamily projects, Fannie                                                     
Mae certificates evidencing interests in pools of mortgage loans formed on or                                                        
after May 1, 1985 are available in book-entry form only. Distributions of                                                            
principal and interest on each Fannie Mae certificate will be made by Fannie Mae                                                     
on the 25th day of each month to the persons in whose name the Fannie Mae                                                            
certificate is entered in the books of the Federal Reserve Banks or registered                                                       
on the Fannie Mae certificate register as of the close of business on the last                                                       
day of the preceding month. Distributions on Fannie Mae certificates issued in                                                       
book-entry form will be made by wire. Distributions on fully registered Fannie                                                       
Mae certificates will be made by check.                                                                                              
                                                                                                                                     
         The Fannie Mae certificates included in a trust fund, and the related                                                       
underlying mortgage loans, may have characteristics and terms different from                                                         
those described above. Any different characteristics and terms will be described                                                     
in the related prospectus supplement.                                                                                                
                                                                                                                                     
         Stripped Mortgage-Backed Securities. Agency Securities may consist of                                                       
one or more stripped mortgage-backed securities, each as described in this                                                           
prospectus and in the related prospectus supplement. Each Agency Security will                                                       
represent an undivided interest in all or part of either the principal                                                               
distributions (but not the interest distributions) or the interest distributions                                                     
(but not the principal distributions), or in some specified portion of the                                                           
principal and interest distributions (but not all the distributions) on certain                                                      
Freddie Mac, Fannie Mae or Ginnie Mae certificates. The underlying securities                                                        
will be held under a trust agreement by Freddie Mac, Fannie Mae or Ginnie Mae,                                                       
each as trustee, or by another trustee named in the related prospectus                                                               
supplement. The applicable prospectus supplement may specify that Freddie Mac,                                                       
Fannie Mae or Ginnie Mae will not guarantee each stripped Agency Security to the                                                     
same extent it guarantees the underlying securities backing the stripped Agency                                                      
Security, but if it does not, then Freddie Mac, Fannie Mae or Ginnie Mae will                                                        
guarantee each stripped Agency Security to the same extent it guarantees the                                                         
underlying securities backing the stripped Agency Security.                                                                          
                                                                                                                                     
         Other Agency Securities. If specified in the related prospectus                                                             
supplement, a trust fund may include other mortgage pass-through certificates                                                        
issued or guaranteed by Ginnie Mae, Fannie Mae or Freddie Mac. The                                                                   
characteristics of those mortgage pass-through certificates will be described in                                                     
the prospectus supplement. If so specified, a combination of different types of                                                      
Agency Securities may be held in a trust fund.                                                                                       
                                                                                                                                     
PRIVATE MORTGAGE-BACKED SECURITIES                                                                                                   
                                                                                                                                     
         Private Mortgage-Backed Securities may consist of mortgage pass-through                                                     
certificates or participation certificates evidencing an undivided interest in a                                                     
pool of mortgage loans or collateralized mortgage obligations secured by                                                             
mortgage loans. Private Mortgage-Backed Securities may include stripped                                                              
mortgage-backed securities representing an undivided interest in all or a part                                                       
of either the principal distributions (but not the interest distributions) or                                                        
the interest distributions (but not the principal distributions) or in some                                                          
specified portion of the principal and interest distributions (but not all the                                                       
distributions) on certain mortgage loans. Private Mortgage-Backed Securities                                                         
will have been issued pursuant to a pooling and servicing agreement, an                                                              
indenture or similar agreement. The applicable prospectus supplement may provide                                                     
that the seller/servicer of the underlying mortgage loans will not have entered                                                      
into a pooling and servicing agreement with a private trustee, but if it does                                                        
not, the seller/servicer of the underlying mortgage loans will have entered into                                                     
the pooling and servicing agreement with a private trustee. The private trustee                                                      
or its agent, or a custodian, will possess the mortgage loans underlying the                                                         
Private Mortgage-Backed Security. Mortgage loans underlying a Private                                                                
Mortgage-Backed Security                                                                                                             
                                                                                                                                     
                                       23                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
will be serviced by a private servicer directly or by one or more subservicers                                                       
who may be subject to the supervision of the private servicer.                                                                       
                                                                                                                                     
         The issuer of the Private Mortgage-Backed Securities will be a                                                              
financial institution or other entity engaged generally in the business of                                                           
mortgage lending, a public agency or instrumentality of a state, local or                                                            
federal government, or a limited purpose corporation organized for the purpose                                                       
of, among other things, establishing trusts and acquiring and selling housing                                                        
loans to the trusts and selling beneficial interests in the trusts. If so                                                            
specified in the related prospectus supplement, the issuer of Private                                                                
Mortgage-Backed Securities may be an affiliate of the depositor. The obligations                                                     
of the issuer of Private Mortgage-Backed Securities will generally be limited to                                                     
certain representations and warranties with respect to the assets conveyed by it                                                     
to the related trust fund. The issuer of Private Mortgage-Backed Securities will                                                     
not have guaranteed any of the assets conveyed to the related trust fund or any                                                      
of the Private Mortgage-Backed Securities issued under the pooling and servicing                                                     
agreement. Additionally, although the mortgage loans underlying the Private                                                          
Mortgage-Backed Securities may be guaranteed by an agency or instrumentality of                                                      
the United States, the Private Mortgage-Backed Securities themselves will not be                                                     
so guaranteed.                                                                                                                       
                                                                                                                                     
         Distributions of principal and interest will be made on the Private                                                         
Mortgage-Backed Securities on the dates specified in the related prospectus                                                          
supplement. The Private Mortgage-Backed Securities may be entitled to receive                                                        
nominal or no principal distributions or nominal or no interest distributions.                                                       
Principal and interest distributions will be made on the Private Mortgage-Backed                                                     
Securities by the private trustee or the private servicer. The issuer of Private                                                     
Mortgage-Backed Securities or the private servicer may have the right to                                                             
repurchase assets underlying the Private Mortgage-Backed Securities after a                                                          
certain date or under other circumstances specified in the related prospectus                                                        
supplement.                                                                                                                          
                                                                                                                                     
         The mortgage loans underlying the Private Mortgage-Backed Securities                                                        
may consist of fixed rate, level payment, fully amortizing loans or graduated                                                        
payment mortgage loans, buydown loans, adjustable rate mortgage loans or loans                                                       
having balloon or other special payment features. The mortgage loans may be                                                          
secured by single family property or multifamily property or by an assignment of                                                     
the proprietary lease or occupancy agreement relating to a specific dwelling                                                         
within a cooperative and the related shares issued by the cooperative.                                                               
                                                                                                                                     
         The prospectus supplement for a series for which the trust fund                                                             
includes Private Mortgage-Backed Securities will specify                                                                             
                                                                                                                                     
-    the aggregate approximate principal amount and type of the Private                                                              
     Mortgage-Backed Securities to be included in the trust fund;                                                                    
                                                                                                                                     
-    certain characteristics of the mortgage loans that comprise the underlying                                                      
     assets for the Private Mortgage-Backed Securities including                                                                     
                                                                                                                                     
     -    the payment features of the mortgage loans,                                                                                
                                                                                                                                     
     -    the approximate aggregate principal balance, if known, of underlying                                                       
          mortgage loans insured or guaranteed by a governmental entity,                                                             
                                                                                                                                     
     -    the servicing fee or range of servicing fees with respect to the                                                           
          mortgage loans and                                                                                                         
                                                                                                                                     
     -    the minimum and maximum stated maturities of the underlying mortgage                                                       
          loans at origination;                                                                                                      
                                                                                                                                     
-    the maximum original term-to-stated maturity of the Private Mortgage-Backed                                                     
     Securities;                                                                                                                     
                                                                                                                                     
                                       24                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
-    the weighted average term-to stated maturity of the Private Mortgage-Backed                                                     
     Securities;                                                                                                                     
                                                                                                                                     
-    the pass-through or certificate rate of the Private Mortgage-Backed                                                             
     Securities;                                                                                                                     
                                                                                                                                     
-    the weighted average pass-through or certificate rate of the Private                                                            
     Mortgage-Backed Securities;                                                                                                     
                                                                                                                                     
-    the issuer of Private Mortgage-Backed Securities, the private servicer (if                                                      
     other than the issuer of Private Mortgage-Backed Securities) and the                                                            
     private trustee for the Private Mortgage-Backed Securities;                                                                     
                                                                                                                                     
-    certain characteristics of credit support, if any, the as reserve funds,                                                        
     insurance policies, surety bonds, letters of credit or guaranties relating                                                      
     to the mortgage loans underlying the Private Mortgage-Backed Securities or                                                      
     to the Private Mortgage-Backed Securities themselves;                                                                           
                                                                                                                                     
-    the terms on which the underlying mortgage loans for the Private                                                                
     Mortgage-Backed Securities may, or are required to, be purchased before                                                         
     their stated maturity or the stated maturity of the Private Mortgage-Backed                                                     
     Securities; and                                                                                                                 
                                                                                                                                     
-    the terms on which mortgage loans may be substituted for those originally                                                       
     underlying the Private Mortgage-Backed Securities.                                                                              
                                                                                                                                     
         Private Mortgage-Backed Securities included in the trust fund for a                                                         
series of certificates that were issued by an issuer of Private Mortgage-Backed                                                      
Securities that is not affiliated with the depositor must be acquired in bona                                                        
fide secondary market transactions or either have been previously registered                                                         
under the Securities Act of 1933 or have been held for at least the holding                                                          
period required to be eligible for sale under Rule 144(k) under the Securities                                                       
Act of 1933.                                                                                                                         
                                                                                                                                     
PRE-FUNDING                                                                                                                          
                                                                                                                                     
         If stated in the related prospectus supplement, a portion of the                                                            
issuance proceeds of the certificates of a particular series will be deposited                                                       
in a pre-funding account to be established with the trustee, which will be used                                                      
to acquire additional mortgage assets from time to time during the time period                                                       
specified in the related prospectus supplement. Prior to the investment of                                                           
amounts on deposit in the related pre-funding account in additional mortgage                                                         
assets, those amounts may be invested in one or more permitted investments, or                                                       
other investments that may be specified in the related prospectus supplement.                                                        
Additional mortgage assets that are purchased with amounts on deposit in a                                                           
pre-funding account will be required to satisfy certain eligibility criteria                                                         
more fully set forth in the related prospectus supplement. The eligibility                                                           
criteria for additional mortgage assets will be consistent with the eligibility                                                      
criteria of the mortgage assets included in the related trust fund as of the                                                         
related closing date, subject to the exceptions that are stated in the related                                                       
prospectus supplement. Although the specific parameters of a pre-funding account                                                     
with respect to any issuance of certificates will be specified in the related                                                        
prospectus supplement, it is anticipated that:                                                                                       
                                                                                                                                     
-    the period during which additional mortgage assets may be purchased from                                                        
     amounts on deposit in the related pre-funding account will not exceed 90                                                        
     days from the related closing date; and                                                                                         
                                                                                                                                     
                                       25                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
-    the additional mortgage assets to be acquired by the related trust fund                                                         
     will be subject to the same representations and warranties as the mortgage                                                      
     assets included in the related trust fund on the related closing date,                                                          
     although additional criteria may also be required to be satisfied, as                                                           
     described in the related prospectus supplement.                                                                                 
                                                                                                                                     
SUBSTITUTION OF MORTGAGE ASSETS                                                                                                      
                                                                                                                                     
         Substitution of Mortgage Assets will be permitted upon breaches of                                                          
representations and warranties with respect to any original Mortgage Asset or if                                                     
the documentation with respect to any Mortgage Asset is determined by the                                                            
trustee to be incomplete. The period during which the substitution will be                                                           
permitted generally will be indicated in the related prospectus supplement. The                                                      
related prospectus supplement will describe any other conditions upon which                                                          
Mortgage Assets may be substituted for Mortgage Assets initially included in the                                                     
trust fund.                                                                                                                          
                                                                                                                                     
AVAILABLE INFORMATION                                                                                                                
                                                                                                                                     
         The depositor has filed with the SEC a Registration Statement under the                                                     
Securities Act of 1933, as amended, covering the certificates. This prospectus,                                                      
which forms a part of the Registration Statement, and the prospectus supplement                                                      
relating to each series of certificates contain summaries of the material terms                                                      
of the documents referred to in this prospectus and in the prospectus                                                                
supplement, but do not contain all of the information in the Registration                                                            
Statement pursuant to the rules and regulations of the SEC. For further                                                              
information, reference is made to the Registration Statement and its exhibits.                                                       
The Registration Statement and exhibits can be inspected and copied at                                                               
prescribed rates at the public reference facilities maintained by the SEC at its                                                     
Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549, and at                                                      
its Regional Offices located as follows: Chicago Regional Office, 500 West                                                           
Madison Street, Chicago, Illinois 60661; and New York Regional Office, 233                                                           
Broadway, New York, New York 10279. You may obtain information on the operation                                                      
of the Public Reference Room by calling the SEC at 1-800-SEC-0330. The SEC                                                           
maintains an Internet Web site that contains reports, information statements and                                                     
other information regarding the registrants that file electronically with the                                                        
SEC, including the depositor. The address of that Internet Web site is                                                               
http://www.sec.gov.                                                                                                                  
                                                                                                                                     
         This prospectus and any applicable prospectus supplement do not                                                             
constitute an offer to sell or a solicitation of an offer to buy any securities                                                      
other than the certificates offered by this prospectus and the prospectus                                                            
supplement nor an offer of the certificates to any person in any state or other                                                      
jurisdiction in which the offer would be unlawful.                                                                                   
                                                                                                                                     
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE                                                                                      
                                                                                                                                     
         All documents filed for the trust fund referred to in the accompanying                                                      
prospectus supplement after the date of this prospectus and before the end of                                                        
the related offering with the SEC pursuant to Section 13(a), 13(c), 14 or 15(d)                                                      
of the Securities Exchange Act of 1934, as amended, are incorporated by                                                              
reference in this prospectus and are a part of this prospectus from the date of                                                      
their filing. Any statement contained in a document incorporated by reference in                                                     
this prospectus is modified or superseded for all purposes of this prospectus to                                                     
the extent that a statement contained in this prospectus (or in the accompanying                                                     
prospectus supplement) or in any other subsequently filed document that also is                                                      
incorporated by reference differs from that statement. Any statement so modified                                                     
or superseded shall not, except as so modified or superseded, constitute a part                                                      
of this prospectus.                                                                                                                  
                                                                                                                                     
         The trustee on behalf of any trust fund will provide without charge to                                                      
each person to whom this prospectus is delivered, on the person's written or                                                         
oral request, a copy of any or all of the documents referred to above that have                                                      
been or may be incorporated by reference in this prospectus (not including                                                           
                                                                                                                                     
                                       26                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
exhibits to the information that is incorporated by reference unless the                                                             
exhibits are specifically incorporated by reference into the information that                                                        
this prospectus incorporates). Requests should be directed to the corporate                                                          
trust office of the trustee specified in the accompanying prospectus supplement.                                                     
                                                                                                                                     
                                 USE OF PROCEEDS                                                                                     
                                                                                                                                     
         The net proceeds to be received from the sale of the certificates will                                                      
be applied by the depositor to the purchase of Mortgage Assets or will be used                                                       
by the depositor for general corporate purposes. The depositor expects to sell                                                       
certificates in series from time to time, but the timing and amount of offerings                                                     
of certificates will depend on a number of factors, including the volume of                                                          
Mortgage Assets acquired by the depositor, prevailing interest rates,                                                                
availability of funds and general market conditions.                                                                                 
                                                                                                                                     
         The depositor will not receive any proceeds from the sale of any of the                                                     
certificates in any market making transaction by Countrywide Securities                                                              
Corporation, an affiliate of the depositor.                                                                                          
                                                                                                                                     
                                  THE DEPOSITOR                                                                                      
                                                                                                                                     
         CWMBS, Inc., a Delaware corporation, was organized on May 27, 1993 for                                                      
the limited purpose of acquiring, owning and transferring Mortgage Assets and                                                        
selling interests in them or bonds secured by them. The depositor is a                                                               
subsidiary of Countrywide Financial Corporation, a Delaware corporation. On                                                          
November 7, 2002, Countrywide Credit Industries, Inc., the parent of Countrywide                                                     
Home Loans, Inc., changed its name to Countrywide Financial Corporation. The                                                         
depositor maintains its principal office at 4500 Park Granada, Calabasas,                                                            
California 91302. Its telephone number is (818) 225-3000.                                                                            
                                                                                                                                     
         Neither the depositor nor any of the depositor's affiliates will ensure                                                     
or guarantee distributions on the certificates of any series.                                                                        
                                                                                                                                     
                              MORTGAGE LOAN PROGRAM                                                                                  
                                                                                                                                     
         The mortgage loans will have been purchased by the depositor, either                                                        
directly or through affiliates, from one or more mortgage loan sellers. The                                                          
applicable prospectus supplement will specify the underwriting criteria pursuant                                                     
to which the mortgage loans were originated or will indicate that the mortgage                                                       
loans were originated pursuant to the underwriting criteria specified under                                                          
"Underwriting Process."                                                                                                              
                                                                                                                                     
UNDERWRITING PROCESS                                                                                                                 
                                                                                                                                     
         Underwriting standards are applied by or on behalf of a lender to                                                           
evaluate the borrower's credit standing and repayment ability, and the value and                                                     
adequacy of the mortgaged property as collateral. In general, a prospective                                                          
borrower applying for a mortgage loan is required to fill out a detailed                                                             
application designed to provide to the underwriting officer pertinent credit                                                         
information. As part of the description of the borrower's financial condition,                                                       
the borrower generally is required to provide a current list of assets and                                                           
liabilities and a statement of income and expenses, as well as an authorization                                                      
to apply for a credit report which summarizes the borrower's credit history with                                                     
local merchants and lenders and any record of bankruptcy. In most cases, an                                                          
employment verification is obtained from an independent source, typically the                                                        
borrower's employer. The verification reports the length of employment with that                                                     
organization, the borrower's current salary and whether it is expected that the                                                      
borrower will continue employment in the future. If a prospective borrower is                                                        
self-employed, the borrower may be required to submit copies of signed tax                                                           
returns. The borrower may also be required to authorize verification of deposits                                                     
at financial institutions where the borrower has demand or savings accounts.                                                         
                                                                                                                                     
                                       27                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         In determining the adequacy of the mortgaged property as collateral, an                                                     
appraisal may be made of each property considered for financing. In instances                                                        
where an appraisal is required, the appraiser is required to inspect the                                                             
property and verify that it is in good repair and that construction, if new, has                                                     
been completed. The appraisal is based on the market value of comparable homes,                                                      
the estimated rental income (if considered applicable by the appraiser) and the                                                      
cost of replacing the home.                                                                                                          
                                                                                                                                     
         Once all applicable employment, credit and property information is                                                          
received, a determination generally is made as to whether the prospective                                                            
borrower has sufficient monthly income available to meet monthly housing                                                             
expenses and other financial obligations and monthly living expenses and to meet                                                     
the borrower'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 mortgaged property such as property taxes and                                                      
hazard insurance). The underwriting standards applied by sellers, particularly                                                       
with respect to the level of loan documentation and the mortgagor's income and                                                       
credit history, may be varied in appropriate cases where factors as low                                                              
Loan-to-Value Ratios or other favorable credit factors exist.                                                                        
                                                                                                                                     
         In the case of a mortgage loan secured by a leasehold interest in real                                                      
property, the title to which is held by a third party lessor, the seller will                                                        
represent and warrant, among other things, that the remaining term of the lease                                                      
and any sublease is at least as long as the remaining term on the loan agreement                                                     
or promissory note for the mortgage loan.                                                                                            
                                                                                                                                     
         Certain of the types of mortgage loans that may be included in a trust                                                      
fund are recently developed and may involve additional uncertainties not present                                                     
in traditional types of loans. For example, certain of the mortgage loans may                                                        
provide for escalating or variable payments by the mortgagor. These types of                                                         
mortgage loans are underwritten on the basis of a judgment that the mortgagors                                                       
have the ability to make the monthly payments required initially. In some                                                            
instances, however, a mortgagor's income may not be sufficient to permit                                                             
continued loan payments as the payments increase. These types of mortgage loans                                                      
may also be underwritten primarily on the basis of Loan-to-Value Ratios or other                                                     
favorable credit factors.                                                                                                            
                                                                                                                                     
QUALIFICATIONS OF SELLERS                                                                                                            
                                                                                                                                     
         Each seller must be an institution experienced in originating and                                                           
servicing mortgage loans of the type contained in the related mortgage pool and                                                      
must maintain satisfactory facilities to originate and service (either directly                                                      
or through qualified subservicers) those mortgage loans.                                                                             
                                                                                                                                     
REPRESENTATIONS BY SELLERS; REPURCHASES                                                                                              
                                                                                                                                     
         Each seller will have made representations and warranties in respect of                                                     
the mortgage loans sold by it and evidenced by a series of certificates. The                                                         
applicable prospectus supplement may specify the different representations and                                                       
warranties, but if it does not, the representations and warranties will                                                              
generally include, among other things:                                                                                               
                                                                                                                                     
-    that title insurance (or in the case of mortgaged properties located in                                                         
     areas where title insurance policies are generally not available, an                                                            
     attorney's certificate of title) and any required hazard insurance policy                                                       
     and primary mortgage insurance policy were effective at the origination of                                                      
     each mortgage loan other than cooperative loans, and that each policy (or                                                       
     certificate of title as applicable) remained in effect on the date of                                                           
     purchase of the mortgage loan from the seller by or on behalf of the                                                            
     depositor;                                                                                                                      
                                                                                                                                     
-    that the seller had good title to each mortgage loan and the mortgage loan                                                      
     was subject to no valid offsets, defenses, counterclaims;                                                                       
                                                                                                                                     
                                       28                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
-    that each mortgage loan constituted a valid first lien on, or a first                                                           
     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 pooling and servicing agreement);                                                     
                                                                                                                                     
-    that there were no delinquent tax or assessment liens against the mortgaged                                                     
     property; and                                                                                                                   
                                                                                                                                     
-    that each mortgage loan was made in compliance with, and is enforceable                                                         
     under, all applicable state and federal laws and regulations in all                                                             
     material respects.                                                                                                              
                                                                                                                                     
         In addition, if any required payment on a mortgage loan was more than                                                       
31 days delinquent at any time during the twelve months before the cut-off date,                                                     
the related prospectus supplement shall so indicate.                                                                                 
                                                                                                                                     
         As to any mortgage loan insured by the FHA or partially guaranteed by                                                       
the VA, the seller will represent that it has complied with underwriting                                                             
policies of the FHA or the VA, as the case may be.                                                                                   
                                                                                                                                     
         As indicated in the related pooling and servicing agreement, the                                                            
representations and warranties of a seller in respect of a mortgage loan will be                                                     
made as of the date of initial issuance of the series of certificates, the                                                           
related cut-off date, the date on which the seller sold the mortgage loan to the                                                     
depositor or one of its affiliates, or the date of origination of the related                                                        
mortgage loan, as the case may be. If representations and warranties are made as                                                     
of a date other than the closing date or cut-off date, a substantial period of                                                       
time may have elapsed between the other date and the date of initial issuance of                                                     
the series of certificates evidencing an interest in the mortgage loan. Since                                                        
the representations and warranties of a seller do not address events that may                                                        
occur following the sale of a mortgage loan by the seller or following the                                                           
origination of the mortgage loan, as the case may be, its repurchase obligation                                                      
will not arise if the relevant event that would otherwise have given rise to a                                                       
repurchase obligation with respect to a mortgage loan occurs after the date of                                                       
sale of the mortgage loan by the seller to the depositor or its affiliates or                                                        
after the origination of the mortgage loan, as the case may be. In addition,                                                         
certain representations, including the condition of the related mortgaged                                                            
property, will be limited to the extent the seller has knowledge and the seller                                                      
will be under no obligation to investigate the substance of the representation.                                                      
However, the depositor will not include any mortgage loan in the trust fund for                                                      
any series of certificates if anything has come to the depositor's attention                                                         
that would cause it to believe that the representations and warranties of a                                                          
seller will not be accurate and complete in all material respects in respect of                                                      
the mortgage loan as of the date of initial issuance of the related series of                                                        
certificates. If the master servicer is also a seller of mortgage loans with                                                         
respect to a particular series, the representations will be in addition to the                                                       
representations and warranties made by the master servicer in its capacity as                                                        
the master servicer.                                                                                                                 
                                                                                                                                     
         The trustee, if the master servicer is the seller, or the master                                                            
servicer will promptly notify the relevant seller of any breach of any                                                               
representation or warranty made by it in respect of a mortgage loan that                                                             
materially and adversely affects the interests of the certificateholders in the                                                      
mortgage loan. The applicable prospectus supplement may specify that the seller                                                      
has a different repurchase obligation, but if it does not, then if the seller                                                        
cannot cure the breach within 90 days after notice from the master servicer or                                                       
the trustee, as the case may be, then the seller will be obligated to repurchase                                                     
the mortgage loan from the trust fund at a price equal to 100% of the                                                                
outstanding principal balance of the mortgage as of the date of the repurchase                                                       
plus accrued interest on it to the first day of the month in which the purchase                                                      
price is to be distributed at the mortgage rate, less any unreimbursed advances                                                      
or amount payable as related servicing compensation if the seller is the master                                                      
servicer with respect to the mortgage loan. If an election is made to treat a                                                        
trust fund or designated portions of it as one or more "real estate mortgage                                                         
investment conduits" (or "REMICs") as defined in the Internal Revenue Code of                                                        
1986, as amended (the "Code"), the master servicer or a holder of the related                                                        
residual certificates will be obligated to pay any prohibited transaction tax                                                        
that may arise in connection with the repurchase. The applicable prospectus                                                          
supplement may contain                                                                                                               
                                                                                                                                     
                                       29                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
different reimbursement options, but if it does not, the master servicer will be                                                     
entitled to reimbursement for that payment from the assets of the related trust                                                      
fund or from any holder of the related residual certificate. See "Description of                                                     
the Certificates -- General" and in the related prospectus supplement. Except in                                                     
those cases in which the master servicer is the seller, the master servicer will                                                     
be required under the applicable pooling and servicing agreement to enforce this                                                     
obligation for the benefit of the trustee and the certificateholders, following                                                      
the practices it would employ in its good faith business judgment were it the                                                        
owner of the mortgage loan. This repurchase obligation will constitute the sole                                                      
remedy available to certificateholders or the trustee for a breach of                                                                
representation by a seller.                                                                                                          
                                                                                                                                     
         Neither the depositor nor the master servicer will be obligated to                                                          
purchase a mortgage loan if a seller defaults on its obligation to do so, and no                                                     
assurance can be given that sellers will carry out their respective repurchase                                                       
obligations with respect to mortgage loans. However, to the extent that a breach                                                     
of a representation and warranty of a seller may also constitute a breach of a                                                       
representation made by the master servicer, the master servicer may have a                                                           
repurchase obligation as described under "The Pooling and Servicing Agreement --                                                     
Assignment of Mortgage Assets."                                                                                                      
                                                                                                                                     
                         DESCRIPTION OF THE CERTIFICATES                                                                             
                                                                                                                                     
         The prospectus supplement relating to the certificates of each series                                                       
to be offered under this prospectus will, among other things, set forth for the                                                      
certificates, as appropriate:                                                                                                        
                                                                                                                                     
-    a description of the class or classes of certificates and the rate at which                                                     
     interest will be passed through to holders of each class of certificates                                                        
     entitled to interest or the method of determining the amount of interest,                                                       
     if any, to be passed through to each class;                                                                                     
                                                                                                                                     
-    the initial aggregate certificate balance of each class of certificates                                                         
     included in the series, the dates on which distributions on the                                                                 
     certificates will be made and, if applicable, the initial and final                                                             
     scheduled distribution dates for each class;                                                                                    
                                                                                                                                     
-    information as to the assets comprising the trust fund, including the                                                           
     general characteristics of the Mortgage Assets included in the trust fund                                                       
     and, if applicable, the insurance, surety bonds, guaranties, letters of                                                         
     credit or other instruments or agreements included in the trust fund, and                                                       
     the amount and source of any reserve fund;                                                                                      
                                                                                                                                     
-    the circumstances, if any, under which the trust fund may be subject to                                                         
     early termination;                                                                                                              
                                                                                                                                     
-    the method used to calculate the amount of principal to be distributed with                                                     
     respect to each class of certificates;                                                                                          
                                                                                                                                     
-    the order of application of distributions to each of the classes within the                                                     
     series, whether sequential, pro rata, or otherwise;                                                                             
                                                                                                                                     
-    the distribution dates with respect to the series;                                                                              
                                                                                                                                     
-    additional information with respect to the plan of distribution of the                                                          
     certificates;                                                                                                                   
                                                                                                                                     
-    whether one or more REMIC elections will be made and designation of the                                                         
     regular interests and residual interests;                                                                                       
                                                                                                                                     
-    the aggregate original percentage ownership interest in the trust fund to                                                       
     be evidenced by each class of certificates;                                                                                     
                                                                                                                                     
                                       30                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
-    information as to the nature and extent of subordination with respect to                                                        
     any class of certificates that is subordinate in right of payment to any                                                        
     other class; and                                                                                                                
                                                                                                                                     
-    information as to the seller, the master servicer and the trustee.                                                              
                                                                                                                                     
         Each series of certificates will be issued pursuant to a pooling and                                                        
servicing agreement, dated as of the related cut-off date, among the depositor,                                                      
the master servicer and the trustee for the benefit of the holders of the                                                            
certificates of the series. The provisions of each pooling and servicing                                                             
agreement will vary depending upon the nature of the certificates to be issued                                                       
thereunder and the nature of the related trust fund. A form of a pooling and                                                         
servicing agreement is an exhibit to the Registration Statement of which this                                                        
prospectus is a part.                                                                                                                
                                                                                                                                     
         The prospectus supplement for a series of certificates will describe                                                        
any provision of the pooling and servicing agreement relating to the series that                                                     
materially differs from its description contained in this prospectus. The                                                            
summaries do not purport to be complete and are subject to, and are qualified in                                                     
their entirety by reference to, all of the provisions of the pooling and                                                             
servicing agreement for each series of certificates and the applicable                                                               
prospectus supplement. The depositor will provide a copy of the pooling and                                                          
servicing agreement (without exhibits) relating to any series without charge                                                         
upon written request of a holder of record of a certificate of the series                                                            
addressed to CWMBS, Inc., 4500 Park Granada, Calabasas, California 91302,                                                            
Attention: Secretary. The following summaries describe material provisions that                                                      
may appear in each pooling and servicing agreement.                                                                                  
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         The certificates of each series will be issued in either fully                                                              
registered or book-entry form in the authorized denominations specified in the                                                       
related prospectus supplement, will evidence specified beneficial ownership                                                          
interests in the related trust fund created pursuant to the related pooling and                                                      
servicing agreement and will not be entitled to payments in respect of the                                                           
assets included in any other trust fund established by the depositor. The                                                            
applicable prospectus supplement may provide for guarantees by a governmental                                                        
entity or other person, but if it does not, the Mortgage Assets will not be                                                          
insured or guaranteed by any governmental entity or other person. Each trust                                                         
fund will consist of, to the extent provided in the related pooling and                                                              
servicing agreement,                                                                                                                 
                                                                                                                                     
-    the Mortgage Assets that from time to time are subject to the related                                                           
     pooling and servicing agreement (exclusive of any amount specified in the                                                       
     related prospectus supplement as a retained interest);                                                                          
                                                                                                                                     
-    the assets required to be deposited in the related Certificate Account or                                                       
     Distribution Account from time to time;                                                                                         
                                                                                                                                     
-    property that secured a mortgage loan and that is acquired on behalf of the                                                     
     certificateholders by foreclosure or deed in lieu of foreclosure; and                                                           
                                                                                                                                     
-    any primary mortgage insurance policies, FHA insurance and VA guaranties,                                                       
     and any other insurance policies or other forms of credit enhancement                                                           
     required to be maintained pursuant to the related pooling and servicing                                                         
     agreement.                                                                                                                      
                                                                                                                                     
         If so specified in the related prospectus supplement, a trust fund may                                                      
also include one or more of the following: reinvestment income on payments                                                           
received on the Mortgage Assets, a reserve fund, a mortgage pool insurance                                                           
policy, a special hazard insurance policy, a bankruptcy bond, one or more                                                            
letters of credit, a surety bond, guaranties or similar instruments or other                                                         
agreements.                                                                                                                          
                                                                                                                                     
                                       31                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         Each series of certificates will be issued in one or more classes. Each                                                     
class of certificates of a series will evidence beneficial ownership of a                                                            
specified percentage or portion of future interest payments and a specified                                                          
percentage or portion of future principal payments on the Mortgage Assets in the                                                     
related trust fund. These specified percentages may be 0%. A series of                                                               
certificates may include one or more classes that are senior in right to payment                                                     
to one or more other classes of certificates of the series. Certain series or                                                        
classes of certificates may be covered by insurance policies, surety bonds or                                                        
other forms of credit enhancement, in each case as described in this prospectus                                                      
and in the related prospectus supplement. One or more classes of certificates of                                                     
a series may be entitled to receive distributions of principal, interest or any                                                      
combination of principal and interest. Distributions on one or more classes of a                                                     
series of certificates may be made before one or more other classes, after the                                                       
occurrence of specified events, in accordance with a schedule or formula, on the                                                     
basis of collections from designated portions of the Mortgage Assets in the                                                          
related trust fund, or on a different basis, in each case as specified in the                                                        
related prospectus supplement. The timing and amounts of the distributions may                                                       
vary among classes or over time as specified in the related prospectus                                                               
supplement.                                                                                                                          
                                                                                                                                     
         Distributions of either or both of principal and interest on the                                                            
related certificates will be made by the trustee on each distribution date                                                           
(i.e., monthly, quarterly, semi-annually or at other intervals and on the dates                                                      
specified in the prospectus supplement) in proportion to the percentages                                                             
specified in the related prospectus supplement. Distributions will be made to                                                        
the persons in whose names the certificates are registered at the close of                                                           
business on the dates specified in the related prospectus supplement.                                                                
Distributions will be made by check or money order mailed to the persons                                                             
entitled to them at the address appearing in the certificates register                                                               
maintained for holders of certificates or, if specified in the related                                                               
prospectus supplement, in the case of certificates that are of a certain minimum                                                     
denomination, upon written request by the certificateholder, by wire transfer or                                                     
by another means described in the prospectus supplement; provided, however, that                                                     
the final distribution in retirement of the certificates will be made only upon                                                      
presentation and surrender of the certificates at the office or agency of the                                                        
trustee or other person specified in the notice to certificateholders of the                                                         
final distribution.                                                                                                                  
                                                                                                                                     
         The certificates will be freely transferable and exchangeable at the                                                        
corporate trust office of the trustee as set forth in the related prospectus                                                         
supplement. No service charge will be made for any registration of exchange or                                                       
transfer of certificates of any series, but the trustee may require payment of a                                                     
sum sufficient to cover any related tax or other governmental charge.                                                                
                                                                                                                                     
         Under current law the purchase and holding by or on behalf of any                                                           
employee benefit plan or other retirement arrangement subject to provisions of                                                       
the Employee Retirement Income Security Act of 1974, as amended, or the Code of                                                      
certain classes of certificates may result in "prohibited transactions" within                                                       
the meaning of ERISA and the Code. See "ERISA Considerations." Retirement                                                            
arrangements subject to these provisions include individual retirement accounts                                                      
and annuities, Keogh plans and collective investment funds in which the plans,                                                       
accounts or arrangements are invested. The applicable prospectus supplement may                                                      
specify other conditions under which transfers of this type would be permitted,                                                      
but if it does not, transfer of the certificates will not be registered unless                                                       
the transferee represents that it is not, and is not purchasing on behalf of, a                                                      
plan, account or other retirement arrangement or provides an opinion of counsel                                                      
satisfactory to the trustee and the depositor that the purchase of the                                                               
certificates by or on behalf of a plan, account or other retirement arrangement                                                      
is permissible under applicable law and will not subject the trustee, the master                                                     
servicer or the depositor to any obligation or liability in addition to those                                                        
undertaken in the pooling and servicing agreement.                                                                                   
                                                                                                                                     
         As to each series, an election may be made to treat the related trust                                                       
fund or designated portions of it as one or more real estate mortgage investment                                                     
conduits or (REMICs) as defined in the Code. The related prospectus supplement                                                       
will specify whether one or more REMIC elections are to be made. Alternatively,                                                      
the pooling and servicing agreement for a series may provide that one or more                                                        
REMIC                                                                                                                                
                                                                                                                                     
                                       32                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
elections may be made at the discretion of the depositor or the master servicer                                                      
and may be made only if certain conditions are satisfied. The terms applicable                                                       
to the making of a REMIC election, as well as any material federal income tax                                                        
consequences to certificateholders not described in this prospectus, will be set                                                     
forth in the related prospectus supplement. If one or more REMIC elections are                                                       
made with respect to a series, one of the classes will be designated as                                                              
evidencing the sole class of residual interests in the related REMIC (or in each                                                     
related REMIC in the case of two or more REMICs). All other classes of                                                               
certificates in the series will constitute regular interests in the related                                                          
REMIC or REMICs, as applicable, as defined in the Code. As to each series with                                                       
respect to which one or more REMIC elections are to be made, the master servicer                                                     
or a holder of the related residual certificate will be obligated to take all                                                        
actions required to comply with applicable laws and regulations and will be                                                          
obligated to pay any prohibited transaction taxes. The applicable prospectus                                                         
supplement may restrict the master servicer's reimbursement rights, but if it                                                        
does not, the master servicer will be entitled to reimbursement for that payment                                                     
from the assets of the trust fund or from any holder of the related residual                                                         
certificate.                                                                                                                         
                                                                                                                                     
DISTRIBUTIONS ON CERTIFICATES                                                                                                        
                                                                                                                                     
         General. In general, the method of determining the amount of                                                                
distributions on a particular series of certificates will depend on the type of                                                      
credit support, if any, that is used with respect to the series. See "Credit                                                         
Enhancement" and in the related prospectus supplement. Various methods that may                                                      
be used to determine the amount of distributions on the certificates of a                                                            
particular series. The prospectus supplement for each series of certificates                                                         
will describe the method to be used in determining the amount of distributions                                                       
on the certificates of its series.                                                                                                   
                                                                                                                                     
         Distributions allocable to principal of and interest on the                                                                 
certificates will be made by the trustee out of, and only to the extent of,                                                          
funds in the related Certificate Account, including any funds transferred from                                                       
any reserve fund or prefunding account. As between certificates of different                                                         
classes and as between distributions of principal (and, if applicable, between                                                       
distributions of principal prepayments and scheduled payments of principal) and                                                      
interest, distributions made on any distribution date will be applied as                                                             
specified in the related prospectus supplement. The applicable prospectus                                                            
supplement may provide for payment distinctions within classes, but if it does                                                       
not, distributions to any class of certificates will be made pro rata to all                                                         
certificateholders of that class.                                                                                                    
                                                                                                                                     
         Available Funds. All distributions on the certificates of each series                                                       
on each distribution date will be made from the Available Funds, in accordance                                                       
with the terms described in the related prospectus supplement and specified in                                                       
the pooling and servicing agreement. The applicable prospectus supplement may                                                        
define Available Funds with reference to different accounts or different                                                             
amounts, but if it does not, "Available Funds" for each distribution date will                                                       
generally equal the amount on deposit in the related Certificate Account on the                                                      
distribution date (net of related fees and expenses payable by the related trust                                                     
fund) other than amounts to be held in the Certificate Account for distribution                                                      
on future distribution dates.                                                                                                        
                                                                                                                                     
         Distributions of Interest. Interest will accrue on the aggregate                                                            
original balance of the certificates (or, in the case of certificates entitled                                                       
only to distributions allocable to interest, the aggregate notional amount) of                                                       
each class of certificates (the initial "Class Certificate Balance") entitled to                                                     
interest at the pass-through rate (which may be a fixed rate or a rate that is                                                       
adjustable as specified in the prospectus supplement) from the date and for the                                                      
periods specified in the prospectus supplement. To the extent funds are                                                              
available therefor, interest accrued during each specified period on each class                                                      
of certificates entitled to interest (other than a class of certificates that                                                        
provides for interest that accrues, but is not currently payable) will be                                                            
distributable on the distribution dates specified in the related prospectus                                                          
supplement until the Class Certificate Balance of the class has been distributed                                                     
in full or, in the case of certificates entitled only to distributions allocable                                                     
to interest, until the aggregate notional amount of the certificates is reduced                                                      
to zero or for the period of time designated in the related prospectus                                                               
supplement. The original certificate                                                                                                 
                                                                                                                                     
                                       33                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
balance of each certificate will equal the aggregate distributions allocable to                                                      
principal to which the certificate is entitled. The applicable prospectus                                                            
supplement may specify some other basis for these distributions, but if it does                                                      
not, distributions allocable to interest on each certificate that is not                                                             
entitled to distributions allocable to principal will be calculated based on the                                                     
notional amount of the certificate. The notional amount of a certificate will                                                        
not evidence an interest in or entitlement to distributions allocable to                                                             
principal but will be used for convenience in expressing the calculation of                                                          
interest and for certain other purposes.                                                                                             
                                                                                                                                     
         With respect to any class of accrual certificates, any interest that                                                        
has accrued but is not paid on a given distribution date will be added to the                                                        
Class Certificate Balance of the class of certificates on that distribution                                                          
date. The applicable prospectus supplement may specify some other basis for                                                          
these distributions, but if it does not, distributions of interest on each class                                                     
of accrual certificates will commence only after the occurrence of the events                                                        
specified in the prospectus supplement and, before that time, the beneficial                                                         
ownership interest of the class of accrual certificates in the trust fund, as                                                        
reflected in the Class Certificate Balance of the class of accrual certificates,                                                     
will increase on each distribution date by the amount of interest that accrued                                                       
on the class of accrual certificates during the preceding interest accrual                                                           
period but that was not required to be distributed to the class on the                                                               
distribution date. The class of accrual certificates will thereafter accrue                                                          
interest on its outstanding Class Certificate Balance as so adjusted.                                                                
                                                                                                                                     
         Distributions of Principal. The related prospectus supplement will                                                          
specify the method by which the amount of principal to be distributed on the                                                         
certificates on each distribution date will be calculated and the manner in                                                          
which that amount will be allocated among the classes of certificates entitled                                                       
to distributions of principal. The Class Certificate Balance of any class of                                                         
certificates entitled to distributions of principal will be the original Class                                                       
Certificate Balance of the class of certificates specified in the prospectus                                                         
supplement, reduced by all distributions reported to the holders of the                                                              
certificates as allocable to principal and in the case of accrual certificates,                                                      
unless otherwise specified in the related prospectus supplement, increased by                                                        
all interest accrued but not then distributable on the accrual certificates and                                                      
in the case of adjustable rate certificates, unless otherwise specified in the                                                       
related prospectus supplement, subject to the effect of negative amortization.                                                       
The related prospectus supplement will specify the method by which the amount of                                                     
principal to be distributed on the certificates on each distribution date will                                                       
be calculated and the manner in which that amount will be allocated among the                                                        
classes of certificates entitled to distributions of principal.                                                                      
                                                                                                                                     
         A series of certificates may include one or more classes of senior                                                          
certificates and one or more classes of subordinate certificates. If so provided                                                     
in the related prospectus supplement, one or more classes of senior certificates                                                     
will be entitled to receive all or a disproportionate percentage of the payments                                                     
of principal that are received from borrowers in advance of their scheduled due                                                      
dates and are not accompanied by amounts representing scheduled interest due                                                         
after the month of the payments in the percentages and under the circumstances                                                       
or for the periods specified in the prospectus supplement. Any disproportionate                                                      
allocation of these principal prepayments to senior certificates will have the                                                       
effect of accelerating the amortization of the senior certificates while                                                             
increasing the interests evidenced by the subordinated certificates in the trust                                                     
fund. Increasing the interests of the subordinated certificates relative to that                                                     
of the senior certificates is intended to preserve the availability of the                                                           
subordination provided by the subordinated certificates. See "Credit Enhancement                                                     
-- Subordination" and "Credit Enhancement -- Subordination of the Subordinated                                                       
Certificates" in the related prospectus supplement.                                                                                  
                                                                                                                                     
         Unscheduled Distributions. If specified in the related prospectus                                                           
supplement, the certificates will be subject to receipt of distributions before                                                      
the next scheduled distribution date. If applicable, the trustee will be                                                             
required to make unscheduled distributions on the day and in the amount                                                              
specified in the related prospectus supplement if, due to substantial payments                                                       
of principal (including principal prepayments) on the Mortgage Assets, the                                                           
trustee or the master servicer determines that the funds available or                                                                
anticipated                                                                                                                          
                                                                                                                                     
                                       34                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
to be available from the Certificate Account and, if applicable, any reserve                                                         
fund, may be insufficient to make required distributions on the certificates on                                                      
the distribution date. The applicable prospectus supplement may specify some                                                         
other basis for these distributions, but if it does not, the amount of the                                                           
unscheduled distribution that is allocable to principal will not exceed the                                                          
amount that would otherwise have been required to be distributed as principal on                                                     
the certificates on the next distribution date. The applicable prospectus                                                            
supplement may provide that unscheduled distributions will not include interest                                                      
or that interest will be computed on a different basis, but if it does not, all                                                      
unscheduled distributions will include interest at the applicable pass-through                                                       
rate on the amount of the unscheduled distribution allocable to principal for                                                        
the period and to the date specified in the prospectus supplement.                                                                   
                                                                                                                                     
ADVANCES                                                                                                                             
                                                                                                                                     
         To the extent provided in the related prospectus supplement, the master                                                     
servicer will be required to advance on or before each distribution date (from                                                       
its own funds, funds advanced by sub-servicers or funds held in the Certificate                                                      
Account for future distributions to certificateholders), an amount equal to the                                                      
aggregate of payments of principal and interest that were delinquent on the                                                          
related Determination Date, subject to the master servicer's determination that                                                      
the advances will be recoverable out of late payments by obligors on the                                                             
Mortgage Assets, liquidation proceeds, insurance proceeds not used to restore                                                        
the property or otherwise. In the case of cooperative loans, the master servicer                                                     
also will be required to advance any unpaid maintenance fees and other charges                                                       
under the related proprietary leases as specified in the related prospectus                                                          
supplement.                                                                                                                          
                                                                                                                                     
         In making advances, the master servicer will endeavor to maintain a                                                         
regular flow of scheduled interest and principal payments to certificateholders,                                                     
rather than to guarantee or insure against losses. If advances are made by the                                                       
master servicer from cash being held for future distribution to                                                                      
certificateholders, the master servicer will replace the funds on or before any                                                      
future distribution date to the extent that funds in the applicable Certificate                                                      
Account on the distribution date would be less than the amount required to be                                                        
available for distributions to certificateholders on the Distribution Date. Any                                                      
advances will be reimbursable to the master servicer out of recoveries on the                                                        
specific Mortgage Assets with respect to which the advances were made (e.g.,                                                         
late payments made by the related obligors, any related insurance proceeds,                                                          
liquidation proceeds or proceeds of any mortgage loan repurchased by the                                                             
depositor, a sub-servicer or a seller pursuant to the related pooling and                                                            
servicing agreement). In addition, advances by the master servicer or                                                                
sub-servicer also will be reimbursable to the master servicer or a sub-servicer                                                      
from cash otherwise distributable to certificateholders to the extent that the                                                       
master servicer determines that the advances previously made are not ultimately                                                      
recoverable as described in the preceding sentence. The master servicer also                                                         
will be obligated to make advances, to the extent recoverable out of insurance                                                       
proceeds not used to restore the property, liquidation proceeds or otherwise,                                                        
for certain taxes and insurance premiums not paid by mortgagors on a timely                                                          
basis. Funds so advanced are reimbursable to the master servicer to the extent                                                       
permitted by the pooling and servicing agreement. If specified in the related                                                        
prospectus supplement, the obligations of the master servicer to make advances                                                       
may be supported by a cash advance reserve fund, a surety bond or other                                                              
arrangement, in each case as described in the prospectus supplement.                                                                 
                                                                                                                                     
REPORTS TO CERTIFICATEHOLDERS                                                                                                        
                                                                                                                                     
         The applicable prospectus supplement may specify different items to be                                                      
reported, but if it does not, before or concurrently with each distribution on a                                                     
distribution date the master servicer or the trustee will furnish to each                                                            
certificateholder of record of the related series a statement setting forth, to                                                      
the extent applicable to the series of certificates, among other things:                                                             
                                                                                                                                     
                                       35                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
-    the amount of the distribution allocable to principal, separately                                                               
     identifying the aggregate amount of any principal prepayments and, if so                                                        
     specified in the related prospectus supplement, prepayment penalties;                                                           
                                                                                                                                     
-    the amount of the distribution allocable to interest;                                                                           
                                                                                                                                     
-    the amount of any advance;                                                                                                      
                                                                                                                                     
-    the aggregate amount otherwise allocable to the subordinated                                                                    
     certificateholders on the distribution date and the aggregate amount                                                            
     withdrawn from the reserve fund or prefunding account, if any, that is                                                          
     included in the amounts distributed to the certificateholders;                                                                  
                                                                                                                                     
-    the Class Certificate Balance or notional amount of each class of the                                                           
     related series after giving effect to the distribution of principal on the                                                      
     distribution date;                                                                                                              
                                                                                                                                     
-    the percentage of principal payments on the Mortgage Assets (excluding                                                          
     prepayments), if any, which each class will be entitled to receive on the                                                       
     following distribution date;                                                                                                    
                                                                                                                                     
-    the percentage of principal prepayments with respect to the Mortgage                                                            
     Assets, if any, which each class will be entitled to receive on the                                                             
     following distribution date;                                                                                                    
                                                                                                                                     
-    the related amount of the servicing compensation retained or withdrawn from                                                     
     the Certificate Account by the master servicer, and the amount of                                                               
     additional servicing compensation received by the master servicer                                                               
     attributable to penalties, fees, excess liquidation proceeds and other                                                          
     similar charges and items;                                                                                                      
                                                                                                                                     
-    the number and aggregate principal balances of mortgage loans (A)                                                               
     delinquent exclusive of mortgage loans in foreclosure) 1 to 30 days, 31 to                                                      
     60 days, 61 to 90 days and 91 or more days and (B) in foreclosure and                                                           
     delinquent 1 to 30 days, 31 to 60 days, 61 to 90 days and 91 or more days,                                                      
     as of the close of business on the last day of the calendar month preceding                                                     
     the distribution date;                                                                                                          
                                                                                                                                     
-    the book value of any real estate acquired through foreclosure or grant of                                                      
     a deed in lieu of foreclosure;                                                                                                  
                                                                                                                                     
-    the pass-through rate, if adjusted from the date of the last statement, of                                                      
     a class expected to be applicable to the next distribution to the class;                                                        
                                                                                                                                     
-    if applicable, the amount remaining in the reserve fund or prefunding                                                           
     account at the close of business on the distribution date;                                                                      
                                                                                                                                     
-    the pass-through rate as of the day before the preceding distribution date;                                                     
     and                                                                                                                             
                                                                                                                                     
-    any amounts remaining under letters of credit, pool policies or other forms                                                     
     of credit enhancement.                                                                                                          
                                                                                                                                     
         Where applicable, any amount set forth above may be expressed as a                                                          
dollar amount per single certificate of the relevant class having the percentage                                                     
interest specified in the related prospectus supplement. The report to                                                               
certificateholders for any series of certificates may include additional or                                                          
other information of a similar nature to that specified above.                                                                       
                                                                                                                                     
         In addition, within a reasonable period of time after the end of each                                                       
calendar year, the master servicer or the trustee will mail to each                                                                  
certificateholder of record at any time during the calendar year a                                                                   
                                                                                                                                     
                                       36                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
report as to the aggregate of amounts reported pursuant to the first two items                                                       
for the calendar year or, if the person was a certificateholder of record during                                                     
a portion of the calendar year, for the applicable portion of the year and other                                                     
customary information deemed appropriate for certificateholders to prepare their                                                     
tax returns.                                                                                                                         
                                                                                                                                     
CATEGORIES OF CLASSES OF CERTIFICATES                                                                                                
                                                                                                                                     
         In general, classes of pass-through certificates fall into different                                                        
categories. The following chart identifies and generally defines the more                                                            
typical categories. The prospectus supplement for a series of certificates may                                                       
identify the classes which comprise the series by reference to the following                                                         
categories.                                                                                                                          
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
CATEGORIES OF CLASSES                               DEFINITION                                                                       
                                                                                                                                     
                                                  PRINCIPAL TYPES                                                                    
<S>                                 <C>                                                                                              
Accretion Directed................  A class that receives principal payments                                                         
                                    from the accreted interest from specified                                                        
                                    accrual classes. An accretion directed class                                                     
                                    also may receive principal payments from                                                         
                                    principal paid on the underlying Mortgage                                                        
                                    Assets or other assets of the trust fund for                                                     
                                    the related series.                                                                              
                                                                                                                                     
Companion Class...................  A class that receives principal payments on                                                      
                                    any distribution date only if scheduled                                                          
                                    payments have been made on specified planned                                                     
                                    principal classes, targeted principal                                                            
                                    classes or scheduled principal classes.                                                          
                                                                                                                                     
Component Certificates............  A class consisting of "components." The                                                          
                                    components of a class of component                                                               
                                    certificates may have different principal                                                        
                                    and interest payment characteristics but                                                         
                                    together constitute a single class. Each                                                         
                                    component of a class of component                                                                
                                    certificates may be identified as falling                                                        
                                    into one or more of the categories in this                                                       
                                    chart.                                                                                           
                                                                                                                                     
Non-Accelerated Senior or NAS.....  A class that, for the period of time                                                             
                                    specified in the related prospectus                                                              
                                    supplement, generally will not receive (in                                                       
                                    other words, is locked out of) (1) principal                                                     
                                    prepayments on the underlying Mortgage                                                           
                                    Assets that are allocated disproportionately                                                     
                                    to the senior certificates because of the                                                        
                                    shifting interest structure of the                                                               
                                    certificates in the trust and/or (2)                                                             
                                    scheduled principal payments on the                                                              
                                    underlying Mortgage Assets, as specified in                                                      
                                    the related prospectus supplement. During                                                        
                                    the lock-out period, the portion of the                                                          
                                    principal distributions on the underlying                                                        
                                    Mortgage Assets that the NAS class is locked                                                     
                                    out of will be distributed to the other                                                          
                                    classes of senior certificates.                                                                  
</TABLE>                                                                                                                             
                                                                                                                                     
                                       37                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
<TABLE>                                                                                                                              
<S>                                 <C>                                                                                              
Notional Amount Certificates......  A class having no principal balance and                                                          
                                    bearing interest on the related notional                                                         
                                    amount. The notional amount is used for                                                          
                                    purposes of the determination of interest                                                        
                                    distributions.                                                                                   
                                                                                                                                     
Planned Principal Class or PACs...  A class that is designed to receive                                                              
                                    principal payments using a predetermined                                                         
                                    principal balance schedule derived by                                                            
                                    assuming two constant prepayment rates for                                                       
                                    the underlying Mortgage Assets. These two                                                        
                                    rates are the endpoints for the "structuring                                                     
                                    range" for the planned principal class. The                                                      
                                    planned principal classes in any series of                                                       
                                    certificates may be subdivided into                                                              
                                    different categories (e.g., primary planned                                                      
                                    principal classes, secondary planned                                                             
                                    principal classes and so forth) having                                                           
                                    different effective structuring ranges and                                                       
                                    different principal payment priorities. The                                                      
                                    structuring range for the secondary planned                                                      
                                    principal class of a series of certificates                                                      
                                    will be narrower than that for the primary                                                       
                                    planned principal class of the series.                                                           
                                                                                                                                     
Scheduled Principal Class.........  A class that is designed to receive                                                              
                                    principal payments using a predetermined                                                         
                                    principal balance schedule but is not                                                            
                                    designated as a planned principal class or                                                       
                                    targeted principal class. In many cases, the                                                     
                                    schedule is derived by assuming two constant                                                     
                                    prepayment rates for the underlying Mortgage                                                     
                                    Assets. These two rates are the endpoints                                                        
                                    for the "structuring range" for the                                                              
                                    scheduled principal class.                                                                       
                                                                                                                                     
Sequential Pay....................  Classes that receive principal payments in a                                                     
                                    prescribed sequence, that do not have                                                            
                                    predetermined principal balance schedules                                                        
                                    and that under all circumstances receive                                                         
                                    payments of principal continuously from the                                                      
                                    first distribution date on which they                                                            
                                    receive principal until they are retired. A                                                      
                                    single class that receives principal                                                             
                                    payments before or after all other classes                                                       
                                    in the same series of certificates may be                                                        
                                    identified as a sequential pay class.                                                            
                                                                                                                                     
Strip.............................  A class that receives a constant proportion,                                                     
                                    or "strip," of the principal payments on the                                                     
                                    underlying Mortgage Assets or other assets                                                       
                                    of the trust fund.                                                                               
</TABLE>                                                                                                                             
                                                                                                                                     
                                       38                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
<TABLE>                                                                                                                              
<S>                                 <C>                                                                                              
Super Senior......................  A class that will not bear its proportionate                                                     
                                    share of realized losses (other than excess                                                      
                                    losses) as its share is directed to another                                                      
                                    class, referred to as the "support class"                                                        
                                    until the class certificate balance of the                                                       
                                    support class is reduced to zero.                                                                
                                                                                                                                     
Support Class.....................  A class that absorbs the realized losses                                                         
                                    other than excess losses that would                                                              
                                    otherwise be allocated to a Super Senior                                                         
                                    class after the related classes of                                                               
                                    subordinated certificates are no longer                                                          
                                    outstanding.                                                                                     
                                                                                                                                     
Targeted Principal Class or TACs..  A class that is designed to receive                                                              
                                    principal payments using a predetermined                                                         
                                    principal balance schedule derived by                                                            
                                    assuming a single constant prepayment rate                                                       
                                    for the underlying Mortgage Assets.                                                              
</TABLE>                                                                                                                             
                                                                                                                                     
<TABLE>                                                                                                                              
<CAPTION>                                                                                                                            
                                                  INTEREST TYPES                                                                     
<S>                                 <C>                                                                                              
Fixed Rate........................  A class with an interest rate that is fixed                                                      
                                    throughout the life of the class.                                                                
                                                                                                                                     
Floating Rate.....................  A class with an interest rate that resets                                                        
                                    periodically based upon a designated index                                                       
                                    and that varies directly with changes in the                                                     
                                    index.                                                                                           
                                                                                                                                     
Inverse Floating Rate.............  A class with an interest rate that resets                                                        
                                    periodically based upon a designated index                                                       
                                    and that varies inversely with changes in                                                        
                                    the index.                                                                                       
                                                                                                                                     
Variable Rate.....................  A class with an interest rate that resets                                                        
                                    periodically and is calculated by reference                                                      
                                    to the rate or rates of interest applicable                                                      
                                    to specified assets or instruments (e.g.,                                                        
                                    the mortgage rates borne by the underlying                                                       
                                    mortgage loans).                                                                                 
                                                                                                                                     
Interest Only.....................  A class that receives some or all of the                                                         
                                    interest payments made on the underlying                                                         
                                    Mortgage Assets or other assets of the trust                                                     
                                    fund and little or no principal. Interest                                                        
                                    only classes have either a nominal principal                                                     
                                    balance or a notional amount. A nominal                                                          
                                    principal balance represents actual                                                              
                                    principal that will be paid on the class. It                                                     
                                    is referred to as nominal since it is                                                            
                                    extremely small compared to other classes. A                                                     
                                    notional amount is the amount used as a                                                          
                                    reference to calculate the amount of                                                             
                                    interest due on an interest only class that                                                      
                                    is not entitled to any distributions of                                                          
                                    principal.                                                                                       
</TABLE>                                                                                                                             
                                                                                                                                     
                                       39                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
<TABLE>                                                                                                                              
<S>                                 <C>                                                                                              
Principal Only....................  A class that does not bear interest and is                                                       
                                    entitled to receive only distributions of                                                        
                                    principal.                                                                                       
                                                                                                                                     
Partial Accrual...................  A class that accretes a portion of the                                                           
                                    amount of accrued interest on it, which                                                          
                                    amount will be added to the principal                                                            
                                    balance of the class on each applicable                                                          
                                    distribution date, with the remainder of the                                                     
                                    accrued interest to be distributed currently                                                     
                                    as interest on the class. The accretion may                                                      
                                    continue until a specified event has                                                             
                                    occurred or until the partial accrual class                                                      
                                    is retired.                                                                                      
                                                                                                                                     
Accrual...........................  A class that accretes the amount of accrued                                                      
                                    interest otherwise distributable on the                                                          
                                    class, which amount will be added as                                                             
                                    principal to the principal balance of the                                                        
                                    class on each applicable distribution date.                                                      
                                    The accretion may continue until some                                                            
                                    specified event has occurred or until the                                                        
                                    accrual class is retired.                                                                        
</TABLE>                                                                                                                             
                                                                                                                                     
INDICES APPLICABLE TO FLOATING RATE AND INVERSE FLOATING RATE CLASSES                                                                
                                                                                                                                     
LIBOR                                                                                                                                
                                                                                                                                     
         The applicable prospectus supplement may specify some other basis for                                                       
determining LIBOR, but if it does not, on the LIBOR determination date (as                                                           
defined in the related prospectus supplement) for each class of certificates of                                                      
a series for which the applicable interest rate is determined by reference to an                                                     
index denominated as LIBOR, the person designated in the related pooling and                                                         
servicing agreement as the calculation agent will determine LIBOR in accordance                                                      
with one of the two methods described below (which method will be specified in                                                       
the related prospectus supplement):                                                                                                  
                                                                                                                                     
LIBO Method                                                                                                                          
                                                                                                                                     
         If using this method to calculate LIBOR, the calculation agent will                                                         
determine LIBOR by reference to the quotations, as set forth on Telerate page                                                        
3750 of the Moneyline Telerate Service, offered by the principal London office                                                       
of each of the designated reference banks meeting the criteria set forth in this                                                     
prospectus for making one-month United States dollar deposits in leading banks                                                       
in the London Interbank market, as of 11:00 a.m. (London time) on the LIBOR                                                          
determination date. In lieu of relying on the quotations for those reference                                                         
banks that appear at the time on Telerate page 3750 of the Moneyline Telerate                                                        
Service, the calculation agent will request each of the reference banks to                                                           
provide the offered quotations at the time.                                                                                          
                                                                                                                                     
         Under this method LIBOR will be established by the calculation agent on                                                     
each LIBOR determination date as follows:                                                                                            
                                                                                                                                     
                  (a)      If on any LIBOR determination date two or more                                                            
         reference banks provide offered quotations, LIBOR for the next interest                                                     
         accrual period shall be the arithmetic mean of the offered quotations                                                       
         (rounded upwards if necessary to the nearest whole multiple of 1/32%).                                                      
                                                                                                                                     
                                       40                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
                  (b)      If on any LIBOR determination date only one or none                                                       
         of the reference banks provides offered quotations, LIBOR for the next                                                      
         interest accrual period shall be whichever is the higher of                                                                 
                                                                                                                                     
                  -        LIBOR as determined on the previous LIBOR                                                                 
                           determination date or                                                                                     
                                                                                                                                     
                  -        the reserve interest rate.                                                                                
                                                                                                                                     
         The reserve interest rate shall be the rate per annum which the                                                             
         calculation agent determines to be either                                                                                   
                                                                                                                                     
                  -        the arithmetic mean (rounded upwards if necessary to                                                      
                           the nearest whole multiple of 1/32%) of the one-month                                                     
                           United States dollar lending rates that New York City                                                     
                           banks selected by the calculation agent are quoting,                                                      
                           on the relevant LIBOR determination date, to the                                                          
                           principal London offices of at least two of the                                                           
                           reference banks to which the quotations are, in the                                                       
                           opinion of the calculation agent being so made, or                                                        
                                                                                                                                     
                  -        if the calculation agent cannot determine the                                                             
                           arithmetic mean, the lowest one-month United States                                                       
                           dollar lending rate which New York City banks                                                             
                           selected by the calculation agent are quoting on the                                                      
                           LIBOR determination date to leading European banks.                                                       
                                                                                                                                     
                  (c)      If on any LIBOR determination date for a class                                                            
         specified in the related prospectus supplement, the calculation agent                                                       
         is required but is unable to determine the reserve interest rate in the                                                     
         manner provided in paragraph (b) above, LIBOR for the next interest                                                         
         accrual period shall be LIBOR as determined on the preceding LIBOR                                                          
         determination date, or, in the case of the first LIBOR determination                                                        
         date, LIBOR shall be considered to be the per annum rate specified as                                                       
         such in the related prospectus supplement.                                                                                  
                                                                                                                                     
         Each reference bank shall be a leading bank engaged in transactions in                                                      
Eurodollar deposits in the international Eurocurrency market; shall not control,                                                     
be controlled by, or be under common control with the calculation agent; and                                                         
shall have an established place of business in London. If reference bank should                                                      
be unwilling or unable to act as such or if appointment of a reference bank is                                                       
terminated, another leading bank meeting the criteria specified above will be                                                        
appointed.                                                                                                                           
                                                                                                                                     
BBA Method                                                                                                                           
                                                                                                                                     
         If using this method of determining LIBOR, the calculation agent will                                                       
determine LIBOR on the basis of the British Bankers' Association "Interest                                                           
Settlement Rate" for one-month deposits in United States dollars as found on                                                         
Telerate page 3750 as of 11:00 a.m. London time on each LIBOR determination                                                          
date. Interest Settlement Rates currently are based on rates quoted by eight                                                         
British Bankers' Association designated banks as being, in the view of the                                                           
banks, the offered rate at which deposits are being quoted to prime banks in the                                                     
London interbank market. The Interest Settlement Rates are calculated by                                                             
eliminating the two highest rates and the two lowest rates, averaging the four                                                       
remaining rates, carrying the result (expressed as a percentage) out to six                                                          
decimal places, and rounding to five decimal places.                                                                                 
                                                                                                                                     
         If on any LIBOR determination date, the calculation agent is unable to                                                      
calculate LIBOR in accordance with the method set forth in the immediately                                                           
preceding paragraph, LIBOR for the next interest                                                                                     
                                                                                                                                     
                                       41                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
accrual period shall be calculated in accordance with the LIBOR method described                                                     
under "LIBO Method."                                                                                                                 
                                                                                                                                     
         The establishment of LIBOR on each LIBOR determination date by the                                                          
calculation agent and its calculation of the rate of interest for the applicable                                                     
classes for the related interest accrual period shall (in the absence of                                                             
manifest error) be final and binding.                                                                                                
                                                                                                                                     
COFI                                                                                                                                 
                                                                                                                                     
         The Eleventh District Cost of Funds Index is designed to represent the                                                      
monthly weighted average cost of funds for savings institutions in Arizona,                                                          
California and Nevada that are member institutions of the Eleventh Federal Home                                                      
Loan Bank District (the "Eleventh District"). The Eleventh District Cost of                                                          
Funds Index for a particular month reflects the interest costs paid on all types                                                     
of funds held by Eleventh District member institutions and is calculated by                                                          
dividing the cost of funds by the average of the total amount of those funds                                                         
outstanding at the end of that month and of the prior month and annualizing and                                                      
adjusting the result to reflect the actual number of days in the particular                                                          
month. If necessary, before these calculations are made, the component figures                                                       
are adjusted by the Federal Home Loan Bank of San Francisco ("FHLBSF") to                                                            
neutralize the effect of events such as member institutions leaving the Eleventh                                                     
District or acquiring institutions outside the Eleventh District. The Eleventh                                                       
District Cost of Funds Index is weighted to reflect the relative amount of each                                                      
type of funds held at the end of the relevant month. The major components of                                                         
funds of Eleventh District member institutions are: savings deposits, time                                                           
deposits, FHLBSF advances, repurchase agreements and all other borrowings.                                                           
Because the component funds represent a variety of maturities whose costs may                                                        
react in different ways to changing conditions, the Eleventh District Cost of                                                        
Funds Index does not necessarily reflect current market rates.                                                                       
                                                                                                                                     
         A number of factors affect the performance of the Eleventh District                                                         
Cost of Funds Index, which may cause it to move in a manner different from                                                           
indices tied to specific interest rates, such as United States Treasury Bills or                                                     
LIBOR. Because the liabilities upon which the Eleventh District Cost of Funds                                                        
Index is based were issued at various times under various market conditions and                                                      
with various maturities, the Eleventh District Cost of Funds Index may not                                                           
necessarily reflect the prevailing market interest rates on new liabilities of                                                       
similar maturities. Moreover, as stated above, the Eleventh District Cost of                                                         
Funds Index is designed to represent the average cost of funds for Eleventh                                                          
District savings institutions for the month before the month in which it is due                                                      
to be published. Additionally, the Eleventh District Cost of Funds Index may not                                                     
necessarily move in the same direction as market interest rates at all times,                                                        
since as longer term deposits or borrowings mature and are renewed at prevailing                                                     
market interest rates, the Eleventh District Cost of Funds Index is influenced                                                       
by the differential between the prior and the new rates on those deposits or                                                         
borrowings. In addition, movements of the Eleventh District Cost of Funds Index,                                                     
as compared to other indices tied to specific interest rates, may be affected by                                                     
changes instituted by the FHLBSF in the method used to calculate the Eleventh                                                        
District Cost of Funds Index.                                                                                                        
                                                                                                                                     
         The FHLBSF publishes the Eleventh District Cost of Funds Index in its                                                       
monthly Information Bulletin. Any individual may request regular receipt by mail                                                     
of Information Bulletins by writing the Federal Home Loan Bank of San Francisco,                                                     
P.O. Box 7948, 600 California Street, San Francisco, California 94120, or by                                                         
calling (415) 616-1000. The Eleventh District Cost of Funds Index may also be                                                        
obtained by calling the FHLBSF at (415) 616-2600.                                                                                    
                                                                                                                                     
         The FHLBSF has stated in its Information Bulletin that the Eleventh                                                         
District Cost of Funds Index for a month "will be announced on or near the last                                                      
working day" of the following month and also has stated that it "cannot                                                              
guarantee the announcement" of the index on an exact date. So long as the index                                                      
for a month is announced on or before the tenth day of the second following                                                          
month, the interest rate for each class of certificates of a series for which                                                        
the applicable interest rate is determined by reference to an index                                                                  
                                                                                                                                     
                                       42                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
denominated as COFI for the interest accrual period commencing in the second                                                         
following month will be based on the Eleventh District Cost of Funds Index for                                                       
the second preceding month. If publication is delayed beyond the tenth day, the                                                      
interest rate will be based on the Eleventh District Cost of Funds Index for the                                                     
third preceding month.                                                                                                               
                                                                                                                                     
         The applicable prospectus supplement may specify some other basis for                                                       
determining COFI, but if it does not, then if on the tenth day of the month in                                                       
which any interest accrual period commences for a class of COFI certificates the                                                     
most recently published Eleventh District Cost of Funds Index relates to a month                                                     
before the third preceding month, the index for the current interest accrual                                                         
period and for each succeeding interest accrual period will, except as described                                                     
in the next to last sentence of this paragraph, be based on the National Monthly                                                     
Median Cost of Funds Ratio to SAIF-Insured Institutions (the "National Cost of                                                       
Funds Index") published by the Office of Thrift Supervision (the "OTS") for the                                                      
third preceding month (or the fourth preceding month if the National Cost of                                                         
Funds Index for the third preceding month has not been published on the tenth                                                        
day of an interest accrual period). Information on the National Cost of Funds                                                        
Index may be obtained by writing the OTS at 1700 G Street, N.W., Washington,                                                         
D.C. 20552 or calling (202) 906-6677, and the current National Cost of Funds                                                         
Index may be obtained by calling (202) 906-6988. If on the tenth day of the                                                          
month in which an interest accrual period commences the most recently published                                                      
National Cost of Funds Index relates to a month before the fourth preceding                                                          
month, the applicable index for the interest accrual period and each succeeding                                                      
interest accrual period will be based on LIBOR, as determined by the calculation                                                     
agent in accordance with the pooling and servicing agreement relating to the                                                         
series of certificates. A change of index from the Eleventh District Cost of                                                         
Funds Index to an alternative index will result in a change in the index level                                                       
and could increase its volatility, particularly if LIBOR is the alternative                                                          
index.                                                                                                                               
                                                                                                                                     
         The establishment of COFI by the calculation agent and its calculation                                                      
of the rates of interest for the applicable classes for the related interest                                                         
accrual period shall (in the absence of manifest error) be final and binding.                                                        
                                                                                                                                     
Treasury Index                                                                                                                       
                                                                                                                                     
         The applicable prospectus supplement may specify some other basis for                                                       
determining and defining the Treasury index, but if it does not, on the Treasury                                                     
index determination date for each class of certificates of a series for which                                                        
the applicable interest rate is determined by reference to an index denominated                                                      
as a Treasury index, the calculation agent will ascertain the Treasury index for                                                     
Treasury securities of the maturity and for the period (or, if applicable, date)                                                     
specified in the related prospectus supplement. The Treasury index for any                                                           
period means the average of the yield for each business day during the specified                                                     
period (and for any date means the yield for the date), expressed as a per annum                                                     
percentage rate, on U.S. Treasury securities adjusted to the "constant maturity"                                                     
specified in the prospectus supplement or if no "constant maturity" is so                                                            
specified, U.S. Treasury securities trading on the secondary market having the                                                       
maturity specified in the prospectus supplement, in each case as published by                                                        
the Federal Reserve Board in its Statistical Release No. H.15 (519). Statistical                                                     
Release No. H.15 (519) is published on Monday or Tuesday of each week and may be                                                     
obtained by writing or calling the Publications Department at the Board of                                                           
Governors of the Federal Reserve System, 21st and C Streets, Washington, D.C.                                                        
20551 (202) 452-3244. If the calculation agent has not yet received Statistical                                                      
Release No. H.15 (519) for a week, then it will use the Statistical Release from                                                     
the preceding week.                                                                                                                  
                                                                                                                                     
         Yields on U.S. Treasury securities at "constant maturity" are derived                                                       
from the U.S. Treasury's daily yield curve. This curve, which relates the yield                                                      
on a security to its time to maturity, is based on the closing market bid yields                                                     
on actively traded Treasury securities in the over-the-counter market. These                                                         
market yields are calculated from composites of quotations reported by five                                                          
leading U.S. Government securities dealers to the Federal Reserve Bank of New                                                        
York. This method provides a yield for a given                                                                                       
                                                                                                                                     
                                       43                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
maturity even if no security with that exact maturity is outstanding. If the                                                         
Treasury index is no longer published, a new index based upon comparable data                                                        
and methodology will be designated in accordance with the pooling and servicing                                                      
agreement relating to the particular series of certificates. The calculation                                                         
agent's determination of the Treasury index, and its calculation of the rates of                                                     
interest for the applicable classes for the related interest accrual period                                                          
shall (in the absence of manifest error) be final and binding.                                                                       
                                                                                                                                     
Prime Rate                                                                                                                           
                                                                                                                                     
         The applicable prospectus supplement may specify some other basis for                                                       
determining and defining the prime rate, but if it does not, on the prime rate                                                       
determination date for each class of certificates of a series for which the                                                          
applicable interest rate is determined by reference to an index denominated as                                                       
the prime rate, the calculation agent will ascertain the prime rate for the                                                          
related interest accrual period. The prime rate for an interest accrual period                                                       
will be the "prime rate" as published in the "Money Rates" section of The Wall                                                       
Street Journal on the related prime rate determination date, or if not so                                                            
published, the "prime rate" as published in a newspaper of general circulation                                                       
selected by the calculation agent in its sole discretion. If a prime rate range                                                      
is given, then the average of the range will be used. If the prime rate is no                                                        
longer published, a new index based upon comparable data and methodology will be                                                     
designated in accordance with the pooling and servicing agreement relating to                                                        
the particular series of certificates. The calculation agent's determination of                                                      
the prime rate and its calculation of the rates of interest for the related                                                          
interest accrual period shall (in the absence of manifest error) be final and                                                        
binding.                                                                                                                             
                                                                                                                                     
BOOK-ENTRY CERTIFICATES                                                                                                              
                                                                                                                                     
         If so specified in the related prospectus supplement, one or more                                                           
classes of the certificates of any series may be initially issued through the                                                        
book-entry facilities of The Depository Trust Company. Each class of book-entry                                                      
certificates of a series will be issued in one or more certificates which equal                                                      
the aggregate initial Class Certificate Balance of each class and which will be                                                      
held by a nominee of the depository. The applicable prospectus supplement may                                                        
specify other procedures for book-entry certificates, but if it does not, the                                                        
following generally describes the procedures that will be applicable to any                                                          
class of book-entry certificates.                                                                                                    
                                                                                                                                     
         Beneficial interests in the book-entry certificates of a series will be                                                     
held indirectly by investors through the book-entry facilities of the                                                                
depository, as described in this prospectus. Accordingly, the depository or its                                                      
nominee is expected to be the holder of record of the book-entry certificates.                                                       
Except as described below, no person acquiring a beneficial interest in a                                                            
book-entry certificate will be entitled to receive a physical certificate                                                            
representing the certificate.                                                                                                        
                                                                                                                                     
         The beneficial owner's ownership of a book-entry certificate will be                                                        
recorded on the records of the brokerage firm, bank, thrift institution or other                                                     
financial intermediary that maintains the beneficial owner's account for that                                                        
purpose. In turn, the financial intermediary's ownership of a book-entry                                                             
certificate will be recorded on the records of the depository (or of a                                                               
participating firm that acts as agent for the financial intermediary, whose                                                          
interest will in true be recorded on the records of the depository, if the                                                           
beneficial owner's financial intermediary is not a depository participant).                                                          
Therefore, the beneficial owner must rely on the foregoing procedures to                                                             
evidence its beneficial ownership of a book-entry certificate. Beneficial                                                            
ownership of a book-entry certificate may only be transferred by compliance with                                                     
the procedures of the financial intermediaries and depository participants.                                                          
                                                                                                                                     
         In accordance with its normal procedures, the depository is expected to                                                     
record the positions held by each depository participant in the book-entry                                                           
certificates, whether held for its own account or as a nominee for another                                                           
person. In general, beneficial ownership of book-entry certificates will be                                                          
subject to                                                                                                                           
                                                                                                                                     
                                       44                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
the rules, regulations and procedures governing the depository and depository                                                        
participants as in effect from time to time.                                                                                         
                                                                                                                                     
         Distributions on the book-entry certificates will be made on each                                                           
distribution date by the trustee to the depository. The depository will be                                                           
responsible for crediting the amount of the payments to the accounts of the                                                          
applicable depository participants in accordance with the depository's normal                                                        
procedures. Each depository participant will be responsible for disbursing the                                                       
payments to the beneficial owners of the book-entry certificates that it                                                             
represents and to each financial intermediary for which it acts as agent. Each                                                       
financial intermediary will be responsible for disbursing funds to the                                                               
beneficial owners of the book-entry certificates that it represents.                                                                 
                                                                                                                                     
         Under a book-entry format, beneficial owners of the book-entry                                                              
certificates may experience some delay in their receipt of payments, since                                                           
payments will be forwarded by the trustee to the depository or its nominee, as                                                       
the case may be, as holder of record of the book-entry certificates. Because the                                                     
depository can act only on behalf of financial intermediaries, the ability of a                                                      
beneficial owner to pledge book-entry certificates to persons or entities that                                                       
do not participate in the depository system, or otherwise take actions in                                                            
respect of the book-entry certificates, may be limited due to the lack of                                                            
physical certificates for the book-entry certificates. In addition, issuance of                                                      
the book-entry certificates in book-entry form may reduce the liquidity of the                                                       
certificates in the secondary market since some potential investors may be                                                           
unwilling to purchase certificates for which they cannot obtain physical                                                             
certificates.                                                                                                                        
                                                                                                                                     
         Until definitive certificates are issued, it is anticipated that the                                                        
only "certificateholder" of the book-entry certificates will be the depository                                                       
or its nominee. Beneficial owners of the book-entry certificates will not be                                                         
certificateholders, as that term will be used in the pooling and servicing                                                           
agreement relating to the series of certificates. Beneficial owners are only                                                         
permitted to exercise the rights of certificateholders indirectly through                                                            
financial intermediaries and the depository. Monthly and annual reports on the                                                       
related trust fund provided to the depository or its nominee, as the case may                                                        
be, as holder of record of the book-entry certificates, may be made available to                                                     
beneficial owners upon request, in accordance with the rules, regulations and                                                        
procedures creating and affecting the depository, and to the financial                                                               
intermediaries to whose depository accounts the book-entry certificates of the                                                       
beneficial owners are credited.                                                                                                      
                                                                                                                                     
         Until definitive certificates are issued, the depository will take any                                                      
action permitted to be taken by the holders of the book-entry certificates of a                                                      
particular series under the related pooling and servicing agreement only at the                                                      
direction of one or more financial intermediaries to whose depository accounts                                                       
the book-entry certificates are credited to the extent that the actions are                                                          
taken on behalf of financial intermediaries whose holdings include the                                                               
book-entry certificates.                                                                                                             
                                                                                                                                     
         The applicable prospectus supplement may specify when and for what                                                          
reasons definitive certificates may be issued, but if it does not, definitive                                                        
certificates will be issued to beneficial owners of book-entry certificates, or                                                      
their nominees, rather than to the depository, only if the depository or the                                                         
depositor advises the trustee in writing that the depository is no longer                                                            
willing, qualified or able to discharge properly its responsibilities as nominee                                                     
and depository with respect to the book-entry certificates and the depositor or                                                      
the trustee is unable to locate a qualified successor, the depositor, at its                                                         
sole option, elects to terminate the book-entry system through the depository;                                                       
or after the occurrence of an event of default, beneficial owners of                                                                 
certificates representing not less than 51% of the aggregate percentage                                                              
interests evidenced by each class of certificates of the related series issued                                                       
as book-entry certificates advise the trustee and the depository through the                                                         
financial intermediaries in writing that the continuation of a book-entry system                                                     
through the depository (or a successor to it) is no longer in the best interests                                                     
of the beneficial owners.                                                                                                            
                                                                                                                                     
                                       45                                                                                            
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         Upon the occurrence of any of the events described in the preceding                                                         
paragraph, the trustee will be required to notify all beneficial owners of the                                                       
occurrence of the event and the availability of definitive certificates. Upon                                                        
surrender by the depository of the global certificate or certificates                                                                
representing the book-entry certificates and instructions for re-registration,                                                       
the trustee will issue the definitive certificates, and thereafter the trustee                                                       
will recognize the holders of the definitive certificates as certificateholders                                                      
under the pooling and servicing agreement relating to the series of                                                                  
certificates.                                                                                                                        
                                                                                                                                     
                               CREDIT ENHANCEMENT                                                                                    
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         Credit enhancement may be provided for one or more classes of a series                                                      
of certificates or with respect to the Mortgage Assets in the related trust                                                          
fund. Credit enhancement may be in the form of a limited financial guaranty                                                          
policy issued by an entity named in the related prospectus supplement, the                                                           
subordination of one or more classes of the certificates of the series, the                                                          
establishment of one or more reserve funds, the use of a cross-support feature,                                                      
use of a mortgage pool insurance policy, bankruptcy bond, special hazard                                                             
insurance policy, surety bond, letter of credit, guaranteed investment contract                                                      
or other method of credit enhancement described in the related prospectus                                                            
supplement, or any combination of them. Credit enhancement may not provide                                                           
protection against all risks of loss or guarantee repayment of the entire                                                            
principal balance of the certificates and interest on them. If losses occur                                                          
which exceed the amount covered by credit enhancement or which are not covered                                                       
by the credit enhancement, certificateholders will bear their allocable share of                                                     
any deficiencies.                                                                                                                    
                                                                                                                                     
SUBORDINATION                                                                                                                        
                                                                                                                                     
         If so specified in the related prospectus supplement, the rights of                                                         
holders of one or more classes of subordinated certificates will be subordinate                                                      
to the rights of holders of one or more other classes of senior certificates of                                                      
the series to distributions of scheduled principal, principal prepayments,                                                           
interest or any combination of them that otherwise would have been payable to                                                        
holders of subordinated certificates under the circumstances and to the extent                                                       
specified in the related prospectus supplement. If specified in the related                                                          
prospectus supplement, delays in receipt of scheduled payments on the Mortgage                                                       
Assets and losses with respect to the Mortgage Assets will be borne first by the                                                     
various classes of subordinated certificates and thereafter by the various                                                           
classes of senior certificates, in each case under the circumstances and subject                                                     
to the limitations specified in the related prospectus supplement. The aggregate                                                     
distributions of delinquent payments on the Mortgage Assets over the lives of                                                        
the certificates or at any time, the aggregate losses on Mortgage Assets which                                                       
must be borne by the subordinated certificates by virtue of subordination and                                                        
the amount of the distributions otherwise distributable to the subordinated                                                          
certificateholders that will be distributable to senior certificateholders on                                                        
any distribution date may be limited as specified in the related prospectus                                                          
supplement. If aggregate distributions of delinquent payments on the Mortgage                                                        
Assets or aggregate losses on the Mortgage Assets were to exceed the amount                                                          
specified in the related prospectus supplement, senior certificateholders would                                                      
experience losses on the certificates.                                                                                               
                                                                                                                                     
         If specified in the related prospectus supplement, various classes of                                                       
senior certificates and subordinated certificates may themselves be subordinate                                                      
in their right to receive certain distributions to other classes of senior and                                                       
subordinated certificates, respectively, through a cross support mechanism or                                                        
otherwise.                                                                                                                           
                                                                                                                                     
         As between classes of senior certificates and as between classes of                                                         
subordinated certificates, distributions may be allocated among the classes in                                                       
the order of their scheduled final distribution dates, in accordance with a                                                          
schedule or formula, in relation to the occurrence of events, or otherwise, in                                                       
each case                                                                                                                            
                                                                                                                                     
                                       46                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
as specified in the related prospectus supplement. As between classes of                                                             
subordinated certificates, payments to senior certificateholders on account of                                                       
delinquencies or losses and payments to the reserve fund will be allocated as                                                        
specified in the related prospectus supplement.                                                                                      
                                                                                                                                     
MORTGAGE POOL INSURANCE POLICIES                                                                                                     
                                                                                                                                     
         If specified in the related prospectus supplement relating to a                                                             
mortgage pool, a separate mortgage pool insurance policy will be obtained for                                                        
the mortgage pool and issued by the insurer named in the prospectus supplement.                                                      
Each mortgage pool insurance policy will, subject to policy limitations, cover                                                       
loss from default in payment on mortgage loans in the mortgage pool in an amount                                                     
equal to a percentage specified in the prospectus supplement of the aggregate                                                        
principal balance of the mortgage loans on the cut-off date that are not covered                                                     
as to their entire outstanding principal balances by primary mortgage insurance                                                      
policies. As more fully described below, the master servicer will present claims                                                     
under the insurance to the pool insurer on behalf of itself, the trustee and the                                                     
certificateholders. The mortgage pool insurance policies, however, are not                                                           
blanket policies against loss, since claims under them may be made only for                                                          
particular defaulted mortgage loans and only upon satisfaction of conditions                                                         
precedent in the policy. The applicable prospectus supplement may specify that                                                       
mortgage pool insurance will cover the failure to pay or the denial of a claim                                                       
under a primary mortgage insurance policy, but if it does not, the mortgage pool                                                     
insurance policies will not cover losses due to a failure to pay or denial of a                                                      
claim under a primary mortgage insurance policy.                                                                                     
                                                                                                                                     
         In general, each mortgage pool insurance policy will provide that no                                                        
claims may be validly presented unless                                                                                               
                                                                                                                                     
         -        any required primary mortgage insurance policy is in effect                                                        
                  for the defaulted mortgage loan and a claim under it has been                                                      
                  submitted and settled;                                                                                             
                                                                                                                                     
         -        hazard insurance on the related mortgaged property has been                                                        
                  kept in force and real estate taxes and other protection and                                                       
                  preservation expenses have been paid;                                                                              
                                                                                                                                     
         -        if there has been physical loss or damage to the mortgaged                                                         
                  property, it has been restored to its physical condition                                                           
                  (reasonable wear and tear excepted) at the time of issuance of                                                     
                  the policy; and                                                                                                    
                                                                                                                                     
         -        the insured has acquired good and merchantable title to the                                                        
                  mortgaged property free and clear of liens except certain                                                          
                  permitted encumbrances.                                                                                            
                                                                                                                                     
         Upon satisfaction of these conditions, the pool insurer will have the                                                       
option either to purchase the mortgaged property at a price equal to the                                                             
principal balance of the related mortgage loan plus accrued and unpaid interest                                                      
at the mortgage rate to the date of the purchase and certain expenses incurred                                                       
by the master servicer on behalf of the trustee and certificateholders or to pay                                                     
the amount by which the sum of the principal balance of the defaulted mortgage                                                       
loan plus accrued and unpaid interest at the mortgage rate to the date of                                                            
payment of the claim and the aforementioned expenses exceeds the proceeds                                                            
received from an approved sale of the mortgaged property, in either case net of                                                      
certain amounts paid or assumed to have been paid under the related primary                                                          
mortgage insurance policy. If any mortgaged property is damaged, and proceeds,                                                       
if any, from the related hazard insurance policy or a special hazard insurance                                                       
policy or policies maintained for a series are insufficient to restore the                                                           
damaged property to a condition sufficient to permit recovery under the mortgage                                                     
pool insurance policy, the master servicer will not be required to expend its                                                        
own funds to restore the damaged property unless it determines that the                                                              
restoration will increase the proceeds to certificateholders on liquidation of                                                       
the mortgage loan after reimbursement of the master servicer for its expenses                                                        
and the expenses will be recoverable by it through proceeds of the sale of                                                           
                                                                                                                                     
                                       47                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
the mortgaged property or proceeds of the related mortgage pool insurance policy                                                     
or any related primary mortgage insurance policy.                                                                                    
                                                                                                                                     
         The applicable prospectus supplement may specify that mortgage pool                                                         
insurance will cover various origination and servicing defaults, but if it does                                                      
not, then no mortgage pool insurance policy will insure (and many primary                                                            
mortgage insurance policies do not insure) against loss sustained from a default                                                     
arising from, among other things, fraud or negligence in the origination or                                                          
servicing of a mortgage loan, including misrepresentation by the mortgagor, the                                                      
originator or persons involved in its origination, or failure to construct a                                                         
mortgaged property in accordance with plans and specifications. A failure of                                                         
coverage for one of these reasons might result in a breach of the related                                                            
seller's representations and, in that case, might result in an obligation on the                                                     
part of the seller to repurchase the defaulted mortgage loan if the breach                                                           
cannot be cured by the seller. No mortgage pool insurance policy will cover (and                                                     
many primary mortgage insurance policies do not cover) a claim with respect to a                                                     
defaulted mortgage loan occurring when the servicer of the mortgage loan, at the                                                     
time of default or thereafter, was not approved by the applicable insurer.                                                           
                                                                                                                                     
         The original amount of coverage under each mortgage pool insurance                                                          
policy will be maintained to the extent provided in the related prospectus                                                           
supplement and may be reduced over the life of the related certificates by the                                                       
aggregate dollar amount of claims paid less the aggregate of the net amounts                                                         
realized by the pool insurer upon disposition of all foreclosed properties. The                                                      
applicable prospectus supplement may provide that the claims paid will be net of                                                     
master servicer expenses and accrued interest, but if it does not, then the                                                          
amount of claims paid will include certain expenses incurred by the master                                                           
servicer as well as accrued interest on delinquent mortgage loans to the date of                                                     
payment of the claim. Accordingly, if aggregate net claims paid under any                                                            
mortgage pool insurance policy reach the original policy limit, coverage under                                                       
that mortgage pool insurance policy will be exhausted and any further losses                                                         
will be borne by the certificateholders.                                                                                             
                                                                                                                                     
SPECIAL HAZARD INSURANCE POLICIES                                                                                                    
                                                                                                                                     
         If specified in the related prospectus supplement, a separate special                                                       
hazard insurance policy will be obtained for the mortgage pool and will be                                                           
issued by the insurer named in the prospectus supplement. Each special hazard                                                        
insurance policy will, subject to policy limitations, protect holders of the                                                         
related certificates from loss caused by the application of the coinsurance                                                          
clause contained in hazard insurance policies and loss from damage to mortgaged                                                      
properties caused by certain hazards not insured against under the standard form                                                     
of hazard insurance policy in the states where the mortgaged properties are                                                          
located or under a flood insurance policy if the mortgaged property is located                                                       
in a federally designated flood area. Some of the losses covered include                                                             
earthquakes and, to a limited extent, tidal waves and related water damage or as                                                     
otherwise specified in the related prospectus supplement. See "The Pooling and                                                       
Servicing Agreement -- Hazard Insurance." No special hazard insurance policy                                                         
will cover losses from fraud or conversion by the trustee or master servicer,                                                        
war, insurrection, civil war, certain governmental action, errors in design,                                                         
faulty workmanship or materials (except under certain circumstances), nuclear or                                                     
chemical reaction, flood (if the mortgaged property is located in a federally                                                        
designated flood area), nuclear or chemical contamination and certain other                                                          
risks. The amount of coverage under any special hazard insurance policy will be                                                      
specified in the related prospectus supplement. Each special hazard insurance                                                        
policy will provide that no claim may be paid unless hazard and, if applicable,                                                      
flood insurance on the property securing the mortgage loan have been kept in                                                         
force and other protection and preservation expenses have been paid.                                                                 
                                                                                                                                     
         The applicable prospectus supplement may provide for other payment                                                          
coverage, but if it does not, then, subject to these limitations, each 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                                                                                                                               
                                                                                                                                     
                                       48                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
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, the special hazard insurer will pay the lesser of the cost of                                                       
repair or replacement of the property or, upon transfer of the property to the                                                       
special hazard 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 to the date of claim settlement and certain                                                       
expenses incurred by the master servicer with respect to the property. If the                                                        
unpaid principal balance of a mortgage loan plus accrued interest and certain                                                        
expenses is paid by the special hazard 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 to repair                                                       
the property will further reduce coverage by that amount. So long as a mortgage                                                      
pool insurance policy remains in effect, the payment by the special hazard                                                           
insurer of the cost of repair or of the unpaid principal balance of the related                                                      
mortgage loan plus accrued interest and certain expenses will not affect the                                                         
total insurance proceeds paid to certificateholders, but will affect the                                                             
relative amounts of coverage remaining under the related special hazard                                                              
insurance policy and mortgage pool insurance policy.                                                                                 
                                                                                                                                     
         To the extent specified in the prospectus supplement, the master                                                            
servicer may deposit cash, an irrevocable letter of credit, or any other                                                             
instrument acceptable to each nationally recognized rating agency rating the                                                         
certificates of the related series at the request of the depositor in a special                                                      
trust account to provide protection in lieu of or in addition to that provided                                                       
by a special hazard insurance policy. The amount of any special hazard insurance                                                     
policy or of the deposit to the special trust account relating to the                                                                
certificates may be reduced so long as the reduction will not result in a                                                            
downgrading of the rating of the certificates by a rating agency rating                                                              
certificates at the request of the depositor.                                                                                        
                                                                                                                                     
BANKRUPTCY BONDS                                                                                                                     
                                                                                                                                     
         If specified in the related prospectus supplement, a bankruptcy bond to                                                     
cover losses resulting from proceedings under the federal Bankruptcy Code with                                                       
respect to a mortgage loan will be issued by an insurer named in the prospectus                                                      
supplement. Each bankruptcy bond will cover, to the extent specified in the                                                          
related prospectus supplement, certain losses resulting from a reduction by a                                                        
bankruptcy court of scheduled payments of principal and interest on a mortgage                                                       
loan or a reduction by the court of the principal amount of a mortgage loan and                                                      
will cover certain unpaid interest on the amount of a principal reduction from                                                       
the date of the filing of a bankruptcy petition. The required amount of coverage                                                     
under each bankruptcy bond will be set forth in the related prospectus                                                               
supplement. Coverage under a bankruptcy bond may be cancelled or reduced by the                                                      
master servicer if the cancellation or reduction would not adversely affect the                                                      
then current rating or ratings of the related certificates. See "Certain Legal                                                       
Aspects of the Mortgage Loans -- Anti-Deficiency Legislation and Other                                                               
Limitations on Lenders."                                                                                                             
                                                                                                                                     
         To the extent specified in the prospectus supplement, the master                                                            
servicer may deposit cash, an irrevocable letter of credit or any other                                                              
instrument acceptable to each nationally recognized rating agency rating the                                                         
certificates of the related series at the request of the depositor in a special                                                      
trust account to provide protection in lieu of or in addition to that provided                                                       
by a bankruptcy bond. The amount of any bankruptcy bond or of the deposit to the                                                     
special trust account relating to the certificates may be reduced so long as the                                                     
reduction will not result in a downgrading of the rating of the certificates by                                                      
a rating agency rating certificates at the request of the depositor.                                                                 
                                                                                                                                     
RESERVE FUND                                                                                                                         
                                                                                                                                     
         If so specified in the related prospectus supplement, credit support                                                        
with respect to a series of certificates may be provided by one or more reserve                                                      
funds held by the trustee, in trust, for the series of certificates. The related                                                     
prospectus supplement will specify whether or not a reserve fund will be                                                             
included in the trust fund for a series.                                                                                             
                                                                                                                                     
                                       49                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         The reserve fund for a series will be funded by a deposit of cash, U.S.                                                     
Treasury securities or instruments evidencing ownership of principal or interest                                                     
payments on U.S. Treasury securities, letters of credit, demand notes,                                                               
certificates of deposit, or a combination of them in an aggregate amount                                                             
specified in the related prospectus supplement; by the deposit from time to time                                                     
of amounts specified in the related prospectus supplement to which the                                                               
subordinated certificateholders, if any, would otherwise be entitled; or in any                                                      
other manner specified in the related prospectus supplement.                                                                         
                                                                                                                                     
         Any amounts on deposit in the reserve fund and the proceeds of any                                                          
other instrument deposited in it upon maturity will be held in cash or will be                                                       
invested in permitted investments. The applicable prospectus supplement may                                                          
specify a different definition of permitted investments, but if it does not,                                                         
then permitted investments will include obligations of the United States and                                                         
specified agencies of the United States, certificates of deposit, specified                                                          
commercial paper, time deposits and bankers acceptances sold by eligible                                                             
commercial banks, and specified repurchase agreements for United States                                                              
government securities with eligible commercial banks. If a letter of credit is                                                       
deposited with the trustee, the letter of credit will be irrevocable. Generally,                                                     
any deposited instrument will name the trustee, in its capacity as trustee for                                                       
the certificateholders, as beneficiary and will be issued by an entity                                                               
acceptable to each rating agency that rates the certificates at the request of                                                       
the depositor. Additional information about the instruments deposited in the                                                         
reserve funds will be set forth in the related prospectus supplement.                                                                
                                                                                                                                     
         Any amounts so deposited and payments on instruments so deposited will                                                      
be available for withdrawal from the reserve fund for distribution to the                                                            
certificateholders for the purposes, in the manner and at the times specified in                                                     
the related prospectus supplement.                                                                                                   
                                                                                                                                     
CROSS SUPPORT                                                                                                                        
                                                                                                                                     
         If specified in the related prospectus supplement, the beneficial                                                           
ownership of separate groups of assets included in a trust fund may be evidenced                                                     
by separate classes of the related series of certificates. In that case, credit                                                      
support may be provided by a cross support feature that requires that                                                                
distributions be made on certificates evidencing a beneficial ownership interest                                                     
in other asset groups within the same trust fund. The related prospectus                                                             
supplement for a series that includes a cross support feature will describe the                                                      
manner and conditions for applying the cross support feature.                                                                        
                                                                                                                                     
         If specified in the related prospectus supplement, the coverage                                                             
provided by one or more forms of credit support may apply concurrently to two or                                                     
more related trust funds. If applicable, the related prospectus supplement will                                                      
identify the trust funds to which the credit support relates and the manner of                                                       
determining the amount of the coverage provided by it and of the application of                                                      
the coverage to the identified trust funds.                                                                                          
                                                                                                                                     
INSURANCE POLICIES, SURETY BONDS AND GUARANTIES                                                                                      
                                                                                                                                     
         If so provided in the prospectus supplement for a series of                                                                 
certificates, deficiencies in amounts otherwise payable on the certificates or                                                       
certain of their classes will be covered by insurance policies or surety bonds                                                       
provided by one or more insurance companies or sureties. These instruments may                                                       
cover timely distributions of interest or full distributions of principal or                                                         
both on the basis of a schedule of principal distributions set forth in or                                                           
determined in the manner specified in the related prospectus supplement. In                                                          
addition, if specified in the related prospectus supplement, a trust fund may                                                        
also include bankruptcy bonds, special hazard insurance policies, other                                                              
insurance or guaranties for the purpose of maintaining timely payments or                                                            
providing additional protection against losses on the assets included in the                                                         
trust fund, paying administrative expenses, or establishing a minimum                                                                
reinvestment rate on the payments made on the assets or principal payment rate                                                       
on the assets. These arrangements may include                                                                                        
                                                                                                                                     
                                       50                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
agreements under which certificateholders are entitled to receive amounts                                                            
deposited in various accounts held by the trustee on the terms specified in the                                                      
prospectus supplement.                                                                                                               
                                                                                                                                     
OVER-COLLATERALIZATION                                                                                                               
                                                                                                                                     
         If so provided in the prospectus supplement for a series of                                                                 
certificates, a portion of the interest payment on each Mortgage Asset may be                                                        
applied as an additional distribution of principal to reduce the principal                                                           
balance of a particular class or classes of certificates and, thus, accelerate                                                       
the rate of payment of principal on the class or classes of certificates.                                                            
Reducing the principal balance of the certificates without a corresponding                                                           
reduction in the principal balance of the underlying Mortgage Assets will result                                                     
in over-collateralization.                                                                                                           
                                                                                                                                     
FINANCIAL INSTRUMENTS                                                                                                                
                                                                                                                                     
         If specified in the related prospectus supplement, the trust fund may                                                       
include one or more swap arrangements or other financial instruments that are                                                        
intended to meet the following goals:                                                                                                
                                                                                                                                     
         -        to convert the payments on some or all of the mortgage loans                                                       
                  from fixed to floating payments, or from floating to fixed, or                                                     
                  from floating based on a particular index to floating based on                                                     
                  another index;                                                                                                     
                                                                                                                                     
         -        to provide payments in the event that any index rises above or                                                     
                  falls below specified levels; or                                                                                   
                                                                                                                                     
         -        to provide protection against interest rate changes, certain                                                       
                  type of losses, including reduced market value, or other                                                           
                  payment shortfalls to one or more classes of the related                                                           
                  series.                                                                                                            
                                                                                                                                     
         If a trust fund includes financial instruments of this type, the                                                            
instruments may be structured to be exempt from the registration requirements of                                                     
the Securities Act of 1933, as amended.                                                                                              
                                                                                                                                     
                       YIELD AND PREPAYMENT CONSIDERATIONS                                                                           
                                                                                                                                     
         The yields to maturity and weighted average lives of the certificates                                                       
will be affected primarily by the amount and timing of principal payments                                                            
received on or in respect of the Mortgage Assets included in the related trust                                                       
fund. The original terms to maturity of the underlying mortgage loans of the                                                         
Mortgage Assets in a given mortgage pool will vary depending upon the type of                                                        
mortgage loans included in it, and each prospectus supplement will contain                                                           
information about the type and maturities of the mortgage loans. The applicable                                                      
prospectus supplement may indicate that some mortgage loans provide for                                                              
prepayment penalties, but if it does not, then the mortgage loans may be prepaid                                                     
without penalty in full or in part at any time. The prepayment experience on the                                                     
underlying mortgage loans of the Mortgage Assets will affect the life of the                                                         
related series of certificates.                                                                                                      
                                                                                                                                     
         A number of factors may affect the prepayment experience of mortgage                                                        
loans, including homeowner mobility, economic conditions, the presence and                                                           
enforceability of due-on-sale clauses, mortgage market interest rates and the                                                        
availability of mortgage funds.                                                                                                      
                                                                                                                                     
         The applicable prospectus supplement may indicate that some                                                                 
conventional mortgage loans do not have due-on-sale provisions, but if it does                                                       
not, then all conventional mortgage loans will contain due-on-sale provisions                                                        
permitting the mortgagee to accelerate the maturity of the loan upon sale or                                                         
specified transfers by the mortgagor of the underlying mortgaged property.                                                           
Mortgage loans insured by the FHA and mortgage loans partially guaranteed by the                                                     
VA are assumable with the consent of the FHA and the VA, respectively. Thus, the                                                     
rate of prepayments on those mortgage loans may be lower than that on                                                                
                                                                                                                                     
                                       51                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
conventional mortgage loans bearing comparable interest rates. The master                                                            
servicer generally will enforce any due-on-sale or due-on-encumbrance clause, to                                                     
the extent it has knowledge of the conveyance or further encumbrance or the                                                          
proposed conveyance or proposed further encumbrance of the mortgaged property                                                        
and reasonably believes that it is entitled to do so under applicable law.                                                           
However, the master servicer will not take any enforcement action that would                                                         
impair or threaten to impair any recovery under any related insurance policy.                                                        
See "The Pooling and Servicing Agreement -- Collection Procedures" and "Certain                                                      
Legal Aspects of the Mortgage Loans" for a description of certain provisions of                                                      
each pooling and servicing agreement and certain legal developments that may                                                         
affect the prepayment experience on the mortgage loans.                                                                              
                                                                                                                                     
         The rate of prepayments of conventional mortgage loans has fluctuated                                                       
significantly in recent years. In general, if prevailing rates fall                                                                  
significantly below the mortgage rates borne by the mortgage loans, the mortgage                                                     
loans are likely to be subject to higher prepayment rates than if prevailing                                                         
interest rates remain at or above those mortgage rates. Conversely, if                                                               
prevailing interest rates rise appreciably above the mortgage rates borne by the                                                     
mortgage loans, the mortgage loans are likely to experience a lower prepayment                                                       
rate than if prevailing rates remain at or below those mortgage rates. However,                                                      
there can be no assurance that this will be the case.                                                                                
                                                                                                                                     
         When a full prepayment is made on a mortgage loan, the mortgagor is                                                         
charged interest on the principal amount of the mortgage loan prepaid only for                                                       
the number of days in the month actually elapsed up to the date of the                                                               
prepayment rather than for a full month. Thus, in most instances, the effect of                                                      
prepayments in full will be to reduce the amount of interest passed through in                                                       
the following month to certificateholders. Partial prepayments in a given month                                                      
may be applied to the outstanding principal balances of the mortgage loans so                                                        
prepaid in the month of receipt or the month following receipt. In the latter                                                        
case, partial prepayments will not reduce the amount of interest passed through                                                      
in the month.                                                                                                                        
                                                                                                                                     
         Interest payable on the certificates on any given distribution date                                                         
will include all interest accrued during their related interest accrual period.                                                      
The interest accrual period for the certificates of each series will be                                                              
specified in the applicable prospectus supplement. If the interest accrual                                                           
period ends two or more days before the related distribution date, your                                                              
effective yield will be less than it would be if the interest accrual period                                                         
ended the day before the distribution date, and your effective yield at par                                                          
would be less than the indicated coupon rate.                                                                                        
                                                                                                                                     
         Under specified circumstances, the master servicer or the holders of                                                        
the residual interests in a REMIC may have the option to purchase the assets of                                                      
a trust fund thereby effecting earlier retirement of the related series of                                                           
certificates. See "The Pooling and Servicing Agreement -- Termination; Optional                                                      
Termination."                                                                                                                        
                                                                                                                                     
         Factors other than those identified in this prospectus and in the                                                           
related prospectus supplement could significantly affect principal prepayments                                                       
at any time and over the lives of the certificates. The relative contribution of                                                     
the various factors affecting prepayment may also vary from time to time. There                                                      
can be no assurance as to the rate of payment of principal of the Mortgage                                                           
Assets at any time or over the lives of the certificates.                                                                            
                                                                                                                                     
         The prospectus supplement relating to a series of certificates will                                                         
discuss in greater detail the effect of the rate and timing of principal                                                             
payments (including principal prepayments), delinquencies and losses on the                                                          
yield, weighted average lives and maturities of the certificates.                                                                    
                                                                                                                                     
                                       52                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
                       THE POOLING AND SERVICING AGREEMENT                                                                           
                                                                                                                                     
         The following is a summary of the material provisions of the pooling                                                        
and servicing agreement which are not described elsewhere in this prospectus.                                                        
Where particular provisions or terms used in the pooling and servicing agreement                                                     
are referred to, the provisions or terms are as specified in the related pooling                                                     
and servicing agreement.                                                                                                             
                                                                                                                                     
ASSIGNMENT OF MORTGAGE ASSETS                                                                                                        
                                                                                                                                     
         Assignment of the Mortgage Loans. At the time of issuance of the                                                            
certificates of a series, the depositor will cause the mortgage loans comprising                                                     
the related trust fund to be assigned to the trustee, together with all                                                              
principal and interest received by or on behalf of the depositor on or with                                                          
respect to the mortgage loans after the cut-off date, other than principal and                                                       
interest due on or before the cut-off date and other than any retained interest                                                      
specified in the related prospectus supplement. The trustee will, concurrently                                                       
with the assignment, deliver the certificates to the depositor in exchange for                                                       
the mortgage loans. Each mortgage loan will be identified in a schedule                                                              
appearing as an exhibit to the related pooling and servicing agreement. The                                                          
schedule will include information as to the outstanding principal balance of                                                         
each mortgage loan after application of payments due on the cut-off date, as                                                         
well as information regarding the mortgage rate, the current scheduled monthly                                                       
payment of principal and interest, the maturity of the loan, the Loan-to-Value                                                       
Ratio at origination and other specified information.                                                                                
                                                                                                                                     
         In addition, the depositor will deliver or cause to be delivered to the                                                     
trustee (or to the custodian) for each mortgage loan                                                                                 
                                                                                                                                     
         -        the mortgage note endorsed without recourse in blank or to the                                                     
                  order of the trustee, except that the depositor may deliver or                                                     
                  cause to be delivered a lost note affidavit in lieu of any                                                         
                  original mortgage note that has been lost,                                                                         
                                                                                                                                     
         -        the mortgage, deed of trust or similar instrument with                                                             
                  evidence of recording indicated on it (except for any mortgage                                                     
                  not returned from the public recording office, in which case                                                       
                  the depositor will deliver or cause to be delivered a copy of                                                      
                  the mortgage together with a certificate that the original of                                                      
                  the mortgage was delivered to the recording office or some                                                         
                  other arrangement will be provided for),                                                                           
                                                                                                                                     
         -        an assignment of the mortgage to the trustee in recordable                                                         
                  form and                                                                                                           
                                                                                                                                     
         -        any other security documents specified in the related                                                              
                  prospectus supplement or the related pooling and servicing                                                         
                  agreement.                                                                                                         
                                                                                                                                     
         The applicable prospectus supplement may provide other arrangements for                                                     
assuring the priority of the assignments, but if it does not, then the depositor                                                     
will promptly cause the assignments of the related loans to be recorded in the                                                       
appropriate public office for real property records, except in states in which                                                       
in the opinion of counsel recording is not required to protect the trustee's                                                         
interest in the loans against the claim of any subsequent transferee or any                                                          
successor to or creditor of the depositor or the originator of the loans.                                                            
                                                                                                                                     
                                       53                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         With respect to any mortgage loans that are cooperative loans, the                                                          
depositor will cause to be delivered to the trustee                                                                                  
                                                                                                                                     
         -        the related original cooperative note endorsed without                                                             
                  recourse in blank or to the order of the trustee (or, to the                                                       
                  extent the related pooling and servicing agreement so                                                              
                  provides, a lost note affidavit),                                                                                  
                                                                                                                                     
         -        the original security agreement,                                                                                   
                                                                                                                                     
         -        the proprietary lease or occupancy agreement,                                                                      
                                                                                                                                     
         -        the recognition agreement,                                                                                         
                                                                                                                                     
         -        an executed financing agreement and                                                                                
                                                                                                                                     
         -        the relevant stock certificate, related blank stock powers and                                                     
                  any other document specified in the related prospectus                                                             
                  supplement.                                                                                                        
                                                                                                                                     
         The depositor will cause to be filed in the appropriate office an                                                           
assignment and a financing statement evidencing the trustee's security interest                                                      
in each cooperative loan.                                                                                                            
                                                                                                                                     
         The trustee (or the custodian) will review the mortgage loan documents                                                      
within the time period specified in the related prospectus supplement after                                                          
receipt of them, and the trustee will hold the documents in trust for the                                                            
benefit of the certificateholders. Generally, if the document is found to be                                                         
missing or defective in any material respect, the trustee (or the custodian)                                                         
will notify the master servicer and the depositor, and the master servicer will                                                      
notify the related seller. If the seller cannot cure the omission or defect                                                          
within the time period specified in the related prospectus supplement after                                                          
receipt of the notice, the seller will be obligated to purchase the related                                                          
mortgage loan from the trustee at the purchase price or, if so specified in the                                                      
related prospectus supplement, replace the mortgage loan with another mortgage                                                       
loan that meets specified requirements. There can be no assurance that a seller                                                      
will fulfill this purchase obligation. Although the master servicer may be                                                           
obligated to enforce the obligation to the extent described under "Mortgage Loan                                                     
Program -- Representations by Sellers; Repurchases," neither the master servicer                                                     
nor the depositor will be obligated to purchase the mortgage loan if the seller                                                      
defaults on its purchase obligation, unless the breach also constitutes a breach                                                     
of the representations or warranties of the master servicer or the depositor.                                                        
The applicable prospectus supplement may provide other remedies but if it does                                                       
not, then this purchase obligation constitutes the sole remedy available to the                                                      
certificateholders or the trustee for omission of, or a material defect in, a                                                        
constituent document.                                                                                                                
                                                                                                                                     
         The trustee will be authorized to appoint a custodian pursuant to a                                                         
custodial agreement to maintain possession of and, if applicable, to review the                                                      
documents relating to the mortgage loans as agent of the trustee.                                                                    
                                                                                                                                     
         Notwithstanding these provisions, unless the related prospectus                                                             
supplement otherwise provides, no mortgage loan will be purchased from a trust                                                       
fund for which one or more REMIC elections are made if the purchase would result                                                     
in the imposition of a prohibited transaction tax under the Code.                                                                    
                                                                                                                                     
         Assignment of Agency Securities. The depositor will cause the Agency                                                        
Securities to be registered in the name of the trustee or its nominee, and the                                                       
trustee concurrently will execute, countersign and deliver the certificates.                                                         
Each Agency Security will be identified in a schedule appearing as an exhibit to                                                     
the pooling and servicing agreement, which will specify as to each Agency                                                            
Security the original principal                                                                                                      
                                                                                                                                     
                                       54                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
amount and outstanding principal balance as of the cut-off date, the annual                                                          
pass-through rate and the maturity date.                                                                                             
                                                                                                                                     
         Assignment of Private Mortgage-Backed Securities. The depositor will                                                        
cause the Private Mortgage-Backed Securities to be registered in the name of the                                                     
trustee. The trustee (or the custodian) will have possession of any certificated                                                     
Private Mortgage-Backed Securities. Generally, the trustee will not be in                                                            
possession of or be assignee of record of any underlying assets for a Private                                                        
Mortgage-Backed Security. See "The Trust Fund -- Private Mortgage-Backed                                                             
Securities." Each Private Mortgage-Backed Security will be identified in a                                                           
schedule appearing as an exhibit to the related pooling and servicing agreement                                                      
which will specify the original principal amount, outstanding principal balance                                                      
as of the cut-off date, annual pass-through rate or interest rate and maturity                                                       
date and other specified pertinent information for each Private Mortgage-Backed                                                      
Security conveyed to the trustee.                                                                                                    
                                                                                                                                     
PAYMENTS ON MORTGAGE ASSETS; DEPOSITS TO CERTIFICATE ACCOUNT                                                                         
                                                                                                                                     
         The master servicer will establish and maintain or cause to be                                                              
established and maintained for the related trust fund a separate account or                                                          
accounts for the collection of payments on the related Mortgage Assets in the                                                        
trust fund (the "Certificate Account"). The applicable prospectus supplement may                                                     
provide for other requirements for the Certificate Account, but if it does not,                                                      
then the Certificate Account must be either                                                                                          
                                                                                                                                     
         -        maintained with a depository institution the short-term                                                            
                  unsecured debt obligations of which are rated in the highest                                                       
                  short-term rating category by the nationally recognized                                                            
                  statistical rating organizations (other than Standard &                                                            
                  Poor's) that rated one or more classes of the related series                                                       
                  of certificates at the request of the depositor, or one of the                                                     
                  two highest short-term ratings categories if the related                                                           
                  certificates are rated by Standard & Poor's, or in the case of                                                     
                  a depository institution that is the principal subsidiary of a                                                     
                  holding company, the short-term debt obligations of the                                                            
                  holding company are so rated,                                                                                      
                                                                                                                                     
         -        an account or accounts the deposits in which are insured by                                                        
                  the FDIC or SAIF to the limits established by the FDIC or the                                                      
                  SAIF, and the uninsured deposits in which are otherwise                                                            
                  secured such that, as evidenced by an opinion of counsel, the                                                      
                  certificateholders have a claim with respect to the funds in                                                       
                  the Certificate Account or a perfected first priority security                                                     
                  interest against any collateral securing the funds that is                                                         
                  superior to the claims of any other depositors or general                                                          
                  creditors of the depository institution with which the                                                             
                  Certificate Account is maintained,                                                                                 
                                                                                                                                     
         -        a trust account or accounts maintained with the trust                                                              
                  department of a federal or a state chartered depository                                                            
                  institution or trust company, acting in a fiduciary capacity                                                       
                  or                                                                                                                 
                                                                                                                                     
         -        an account or accounts otherwise acceptable to each rating                                                         
                  agency that rated one or more classes of the related series of                                                     
                  certificates at the request of the depositor.                                                                      
                                                                                                                                     
The collateral eligible to secure amounts in the Certificate Account is limited                                                      
to defined permitted investments. A Certificate Account may be maintained as an                                                      
interest bearing account or the funds held in it may be invested pending each                                                        
succeeding distribution date in defined permitted investments. To the extent                                                         
provided in the related prospectus supplement, the master servicer or its                                                            
designee will be entitled to receive the interest or other income earned on                                                          
funds in the Certificate Account as additional compensation and will be                                                              
obligated to deposit in the Certificate Account the amount of any loss                                                               
immediately as realized. The Certificate Account may be maintained with the                                                          
master servicer or with a depository institution that is an affiliate of the                                                         
master servicer, provided it meets the standards set forth above.                                                                    
                                                                                                                                     
                                       55                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         The master servicer will deposit or cause to be deposited in the                                                            
Certificate Account for each trust fund within two days following its receipt or                                                     
on a daily basis, to the extent the master servicer's or its parent's long-term                                                      
credit rating does not satisfy the requirements set forth in the related pooling                                                     
and servicing agreement, the following payments and collections received or                                                          
advances made by or on behalf of it after the cut-off date (other than payments                                                      
due on or before the cut-off date and exclusive of any amounts representing any                                                      
retained interest specified in the related prospectus supplement):                                                                   
                                                                                                                                     
         -        all payments on account of principal, including principal                                                          
                  prepayments and, if specified in the related prospectus                                                            
                  supplement, prepayment penalties, on the mortgage loans;                                                           
                                                                                                                                     
         -        all payments on account of interest on the mortgage loans, net                                                     
                  of applicable servicing compensation;                                                                              
                                                                                                                                     
         -        all proceeds (net of unreimbursed payments of property taxes,                                                      
                  insurance premiums and similar items ("Insured Expenses")                                                          
                  incurred, and unreimbursed advances made, by the master                                                            
                  servicer) of the hazard insurance policies and any primary                                                         
                  mortgage insurance policies, to the extent the proceeds are                                                        
                  not applied to the restoration of the property or released to                                                      
                  the mortgagor in accordance with the master servicer's normal                                                      
                  servicing procedures and all other cash amounts (net of                                                            
                  unreimbursed expenses incurred in connection with liquidation                                                      
                  or foreclosure and unreimbursed advances, if any) received and                                                     
                  retained in connection with the liquidation of defaulted                                                           
                  mortgage loans, by foreclosure or otherwise, together with any                                                     
                  net proceeds received on a monthly basis with respect to any                                                       
                  properties acquired on behalf of the certificateholders by                                                         
                  foreclosure or deed in lieu of foreclosure;                                                                        
                                                                                                                                     
         -        all proceeds of any mortgage loan or property in respect                                                           
                  thereof purchased by the master servicer, the depositor or any                                                     
                  seller as described under "Mortgage Loan Program --                                                                
                  Representations by Sellers; Repurchases" or "The Pooling and                                                       
                  Servicing Agreement -- Assignment of Mortgage Assets" above                                                        
                  and all proceeds of any mortgage loan repurchased as described                                                     
                  under "The Pooling and Servicing Agreement -- Termination;                                                         
                  Optional Termination";                                                                                             
                                                                                                                                     
         -        all payments required to be deposited in the Certificate                                                           
                  Account with respect to any deductible clause in any blanket                                                       
                  insurance policy described under "-- Hazard Insurance";                                                            
                                                                                                                                     
         -        any amount required to be deposited by the master servicer in                                                      
                  connection with losses realized on investments for the benefit                                                     
                  of the master servicer of funds held in the Certificate                                                            
                  Account and, to the extent specified in the related prospectus                                                     
                  supplement, any payments required to be made by the master                                                         
                  servicer in connection with prepayment interest shortfalls;                                                        
                  and                                                                                                                
                                                                                                                                     
         -        all other amounts required to be deposited in the Certificate                                                      
                  Account pursuant to the pooling and servicing agreement.                                                           
                                                                                                                                     
         The master servicer (or the depositor, as applicable) may from time to                                                      
time direct the institution that maintains the Certificate Account to withdraw                                                       
funds from the Certificate Account for the following purposes:                                                                       
                                                                                                                                     
         -        to pay to the master servicer the servicing fees described in                                                      
                  the related prospectus supplement, the master servicing fees                                                       
                  (subject to reduction) and, as additional servicing                                                                
                  compensation, earnings on or investment income with respect to                                                     
                  funds in the amounts in the Certificate Account credited                                                           
                  thereto;                                                                                                           
                                                                                                                                     
                                       56                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         -        to reimburse the master servicer for advances, the right of                                                        
                  reimbursement with respect to any mortgage loan being limited                                                      
                  to amounts received that represent late recoveries of payments                                                     
                  of principal and interest on the mortgage loan (or insurance                                                       
                  proceeds or liquidation proceeds from the mortgage loan) with                                                      
                  respect to which the advance was made;                                                                             
                                                                                                                                     
         -        to reimburse the master servicer for any advances previously                                                       
                  made that the master servicer has determined to be                                                                 
                  nonrecoverable;                                                                                                    
                                                                                                                                     
         -        to reimburse the master servicer from insurance proceeds not                                                       
                  used to restore the property for expenses incurred by the                                                          
                  master servicer and covered by the related insurance policies;                                                     
                                                                                                                                     
         -        to reimburse the master servicer for unpaid master servicing                                                       
                  fees and unreimbursed out-of-pocket costs and expenses                                                             
                  incurred by the master servicer in the performance of its                                                          
                  servicing obligations, the right of reimbursement being                                                            
                  limited to amounts received representing late recoveries of                                                        
                  the payments for which the advances were made;                                                                     
                                                                                                                                     
         -        to pay to the master servicer, with respect to each mortgage                                                       
                  loan or property acquired in respect thereof that has been                                                         
                  purchased by the master servicer pursuant to the pooling and                                                       
                  servicing agreement, all amounts received on them and not                                                          
                  taken into account in determining the principal balance of the                                                     
                  repurchased mortgage loan;                                                                                         
                                                                                                                                     
         -        to reimburse the master servicer or the depositor for expenses                                                     
                  incurred and reimbursable pursuant to the pooling and                                                              
                  servicing agreement;                                                                                               
                                                                                                                                     
         -        to withdraw any amount deposited in the Certificate Account                                                        
                  that was not required to be deposited in it; and                                                                   
                                                                                                                                     
         -        to clear and terminate the Certificate Account upon                                                                
                  termination of the pooling and servicing agreement.                                                                
                                                                                                                                     
         In addition, the pooling and servicing agreement will generally provide                                                     
that on or before the business day preceding each distribution date, the master                                                      
servicer shall withdraw from the Certificate Account the amount of Available                                                         
Funds, to the extent on deposit, for deposit in an account maintained by the                                                         
trustee for the related series of certificates.                                                                                      
                                                                                                                                     
COLLECTION PROCEDURES                                                                                                                
                                                                                                                                     
         The master servicer, directly or through one or more sub-servicers,                                                         
will make reasonable efforts to collect all payments called for under the                                                            
mortgage loans and will, consistent with each pooling and servicing agreement                                                        
and any mortgage pool insurance policy, primary mortgage insurance policy, FHA                                                       
insurance, VA guaranty and bankruptcy bond or alternative arrangements, follow                                                       
the collection procedures it customarily follows for mortgage loans that are                                                         
comparable to the mortgage loans. Consistent with the above, the master servicer                                                     
may, in its discretion, waive any assumption fee, late payment or other charge                                                       
in connection with a mortgage loan and arrange with a mortgagor a schedule for                                                       
the liquidation of delinquencies running for no more than 125 days after the                                                         
applicable due date for each payment to the extent not inconsistent with the                                                         
coverage of the mortgage loan by a mortgage pool insurance policy, primary                                                           
mortgage insurance policy, FHA insurance, VA guaranty or bankruptcy bond or                                                          
alternative arrangements, if applicable. To the extent the master servicer is                                                        
obligated to make or to cause to be made advances, the obligation will remain                                                        
during any period of such an arrangement.                                                                                            
                                                                                                                                     
                                       57                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         The applicable prospectus supplement may provide for other alternatives                                                     
regarding due-on-sale clauses, but if it does not, then in any case in which                                                         
property securing a conventional mortgage loan has been, or is about to be,                                                          
conveyed by the mortgagor, the master servicer will, to the extent it has                                                            
knowledge of the conveyance or proposed conveyance, exercise or cause to be                                                          
exercised its rights to accelerate the maturity of the mortgage loan under any                                                       
due-on-sale clause applicable to it, but only if permitted by applicable law and                                                     
the exercise will not impair or threaten to impair any recovery under any                                                            
related primary mortgage insurance policy. If these conditions are not met or if                                                     
the master servicer reasonably believes it is unable under applicable law to                                                         
enforce the due-on-sale clause or if the mortgage loan is insured by the FHA or                                                      
partially guaranteed by the VA, the master servicer will enter into or cause to                                                      
be entered into an assumption and modification agreement with the person to whom                                                     
the property has been or is about to be conveyed, pursuant to which that person                                                      
becomes liable for repayment of the mortgage loan and, to the extent permitted                                                       
by applicable law, the mortgagor also remains liable on it. Any fee collected by                                                     
or on behalf of the master servicer for entering into an assumption agreement                                                        
will be retained by or on behalf of the master servicer as additional servicing                                                      
compensation. See "Certain Legal Aspects of the Mortgage Loans -- Due-on-Sale                                                        
Clauses." The terms of the related mortgage loan may not be changed in                                                               
connection with an assumption.                                                                                                       
                                                                                                                                     
         Any prospective purchaser of a cooperative apartment will generally                                                         
have to obtain the approval of the board of directors of the relevant                                                                
cooperative before purchasing the shares and acquiring rights under the related                                                      
proprietary lease or occupancy agreement. See "Certain Legal Aspects of the                                                          
Mortgage Loans." This approval is usually based on the purchaser's income and                                                        
net worth and numerous other factors. Although the cooperative's approval is                                                         
unlikely to be unreasonably withheld or delayed, the necessity of acquiring the                                                      
approval could limit the number of potential purchasers for those shares and                                                         
otherwise limit the trust fund's ability to sell and realize the value of shares                                                     
securing a cooperative loan.                                                                                                         
                                                                                                                                     
         In general, a "tenant-stockholder" (as defined in Code Section                                                              
216(b)(2)) of a corporation that qualifies as a "cooperative housing                                                                 
corporation" within the meaning of Code Section 216(b)(1) is allowed a deduction                                                     
for amounts paid or accrued within his taxable year to the corporation                                                               
representing his proportionate share of certain interest expenses and certain                                                        
real estate taxes allowable as a deduction under Code Section 216(a) to the                                                          
corporation under Code Sections 163 and 164. In order for a corporation to                                                           
qualify under Code Section 216(b)(1) for its taxable year in which the items are                                                     
allowable as a deduction to the corporation, the Section requires, among other                                                       
things, that at least 80% of the gross income of the corporation be derived from                                                     
its tenant-stockholders (as defined in Code Section 216(b)(2)). By virtue of                                                         
this requirement, the status of a corporation for purposes of Code Section                                                           
216(b)(1) must be determined on a year-to-year basis. Consequently, there can be                                                     
no assurance that cooperatives relating to the cooperative loans will qualify                                                        
under Section 216(b)(1) for any particular year. If a cooperative fails to                                                           
qualify for one or more years, the value of the collateral securing any related                                                      
cooperative loans could be significantly impaired because no deduction would be                                                      
allowable to tenant-stockholders under Code Section 216(a) with respect to those                                                     
years. In view of the significance of the tax benefits accorded                                                                      
tenant-stockholders of a corporation that qualifies under Code Section                                                               
216(b)(1), the likelihood that a failure to qualify would be permitted to                                                            
continue over a period of years appears remote.                                                                                      
                                                                                                                                     
HAZARD INSURANCE                                                                                                                     
                                                                                                                                     
         The master servicer will require the mortgagor on each mortgage loan to                                                     
maintain a hazard insurance policy providing for no less than the coverage of                                                        
the standard form of fire insurance policy with extended coverage customary for                                                      
the type of mortgaged property in the state in which the mortgaged property is                                                       
located. The coverage will be in an amount that is at least equal to the lesser                                                      
of                                                                                                                                   
                                                                                                                                     
         -        the maximum insurable value of the improvements securing the                                                       
                  mortgage loan or                                                                                                   
                                                                                                                                     
                                       58                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         -        the greater of                                                                                                     
                                                                                                                                     
                  -        the outstanding principal balance of the mortgage                                                         
                           loan and                                                                                                  
                                                                                                                                     
                  -        an amount such that the proceeds of the policy shall                                                      
                           be sufficient to prevent the mortgagor or the                                                             
                           mortgagee from becoming a co-insurer.                                                                     
                                                                                                                                     
All amounts collected by the master 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 the master servicer's normal                                                            
servicing procedures) will be deposited in the related Certificate Account. If                                                       
the master servicer maintains a blanket policy insuring against hazard losses on                                                     
all the mortgage loans comprising part of a trust fund, it will have satisfied                                                       
its obligation relating to the maintenance of hazard insurance. The blanket                                                          
policy may contain a deductible clause, in which case the master servicer will                                                       
be required to deposit from its own funds into the related Certificate Account                                                       
the amounts that 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 securing a mortgage                                                     
loan by fire, lightning, explosion, smoke, windstorm and hail, riot, strike and                                                      
civil commotion, subject to the conditions and exclusions particularized in each                                                     
policy. Although the policies relating to the mortgage loans may have been                                                           
underwritten by different insurers under different state laws in accordance with                                                     
different applicable forms and therefore may not contain identical terms, their                                                      
basic terms are dictated by the respective state laws, and most policies                                                             
typically do not cover any physical damage resulting from war, revolution,                                                           
governmental actions, floods and other water-related causes, earth movement                                                          
(including earthquakes, landslides and mud flows), nuclear reactions, wet or dry                                                     
rot, vermin, rodents, insects or domestic animals, theft and, in certain cases,                                                      
vandalism. This list is merely indicative of certain kinds of uninsured risks                                                        
and is not all inclusive. If the mortgaged property securing a mortgage loan is                                                      
located in a federally designated special flood area at the time of origination,                                                     
the master servicer will require the mortgagor to obtain and maintain flood                                                          
insurance.                                                                                                                           
                                                                                                                                     
         The hazard insurance policies covering properties securing the mortgage                                                     
loans typically contain a clause that 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 insured property in order to recover the full                                                          
amount of any partial loss. If the insured's coverage falls below this specified                                                     
percentage, then the insurer's liability upon partial loss will not exceed the                                                       
larger of the actual cash value (generally defined as replacement cost at the                                                        
time and place of loss, less physical depreciation) of the improvements damaged                                                      
or destroyed and the proportion of the loss that the amount of insurance carried                                                     
bears to the specified percentage of the full replacement cost of the                                                                
improvements. Since the amount of hazard insurance the master servicer may cause                                                     
to be maintained on the improvements securing the mortgage loans declines as the                                                     
principal balances owing on them decrease, and since improved real estate                                                            
generally has appreciated in value over time in the past, the effect of this                                                         
requirement upon partial loss may be that hazard insurance proceeds will be                                                          
insufficient to fully restore the damaged property. If specified in the related                                                      
prospectus supplement, a special hazard insurance policy will be obtained to                                                         
insure against certain of the uninsured risks described above. See "Credit                                                           
Enhancement -- Special Hazard Insurance Policies" and "Credit Enhancements --                                                        
Insurance -- Special Hazard Insurance Policy" in the related prospectus                                                              
supplement.                                                                                                                          
                                                                                                                                     
         The master servicer will not require that a standard hazard or flood                                                        
insurance policy be maintained on the cooperative dwelling relating to any                                                           
cooperative loan. Generally, the cooperative itself is responsible for                                                               
maintenance of hazard insurance for the property owned by the cooperative and                                                        
the tenant-stockholders of that cooperative do not maintain individual hazard                                                        
insurance policies. To the extent, however, that a cooperative and the related                                                       
borrower on a cooperative loan do not maintain                                                                                       
                                                                                                                                     
                                       59                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
insurance or do not maintain adequate coverage or any insurance proceeds are not                                                     
applied to the restoration of damaged property, any damage to the borrower's                                                         
cooperative dwelling or the cooperative's building could significantly reduce                                                        
the value of the collateral securing the cooperative loan.                                                                           
                                                                                                                                     
REALIZATION UPON DEFAULTED MORTGAGE LOANS                                                                                            
                                                                                                                                     
         Primary Mortgage Insurance Policies. The master servicer will maintain                                                      
or cause to be maintained, as the case may be, in effect, to the extent                                                              
specified in the related prospectus supplement, a primary mortgage insurance                                                         
policy with regard to each mortgage loan for which coverage is required. The                                                         
master servicer will not cancel or refuse to renew any primary mortgage                                                              
insurance policy in effect at the time of the initial issuance of a series of                                                        
certificates that is required to be kept in force under the applicable pooling                                                       
and servicing agreement unless the replacement primary mortgage insurance policy                                                     
for the cancelled or nonrenewed policy is maintained with an insurer whose                                                           
claims-paying ability is sufficient to maintain the current rating of the                                                            
classes of certificates of the series that have been rated.                                                                          
                                                                                                                                     
         Although the terms of primary mortgage insurance vary, the amount of a                                                      
claim for benefits under a primary mortgage insurance policy covering a mortgage                                                     
loan will consist of the insured percentage of the unpaid principal amount of                                                        
the covered mortgage loan and accrued and unpaid interest on it and                                                                  
reimbursement of certain expenses, less all rents or other payments collected or                                                     
received by the insured (other than the proceeds of hazard insurance) that are                                                       
derived from or in any way related to the mortgaged property, hazard insurance                                                       
proceeds in excess of the amount required to restore the mortgaged property and                                                      
which have not been applied to the payment of the mortgage loan, amounts                                                             
expended but not approved by the issuer of the related primary mortgage                                                              
insurance policy, claim payments previously made by the primary insurer and                                                          
unpaid premiums.                                                                                                                     
                                                                                                                                     
         Primary mortgage insurance policies reimburse certain losses sustained                                                      
from defaults in payments by borrowers. Primary mortgage insurance policies will                                                     
not insure against, and exclude from coverage, a loss sustained from a default                                                       
arising from or involving certain matters, including fraud or negligence in                                                          
origination or servicing of the mortgage loans, including misrepresentation by                                                       
the originator, mortgagor or other persons involved in the origination of the                                                        
mortgage loan; failure to construct the mortgaged property subject to the                                                            
mortgage loan in accordance with specified plans; physical damage to the                                                             
mortgaged property; and the related sub-servicer not being approved as a                                                             
servicer by the primary insurer.                                                                                                     
                                                                                                                                     
         Recoveries Under A Primary Mortgage Insurance Policy. As conditions                                                         
precedent to the filing of or payment of a claim under a primary mortgage                                                            
insurance policy covering a mortgage loan, the insured will be required to                                                           
                                                                                                                                     
         -        advance or discharge                                                                                               
                                                                                                                                     
                  -        all hazard insurance policy premiums and as necessary                                                     
                           and approved in advance by the primary insurer, real                                                      
                           estate property taxes, all expenses required to                                                           
                           maintain the related mortgaged property in at least                                                       
                           as good a condition as existed at the effective date                                                      
                           of the primary mortgage insurance policy, ordinary                                                        
                           wear and tear excepted, mortgaged property sales                                                          
                           expenses, any specified outstanding liens on the                                                          
                           mortgaged property and foreclosure costs, including                                                       
                           court costs and reasonable attorneys' fees;                                                               
                                                                                                                                     
         -        upon any physical loss or damage to the mortgaged property,                                                        
                  have the mortgaged property restored and repaired to at least                                                      
                  as good a condition as existed at the effective date of the                                                        
                  primary mortgage insurance policy, ordinary wear and tear                                                          
                  excepted; and                                                                                                      
                                                                                                                                     
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         -        tender to the primary insurer good and merchantable title to                                                       
                  and possession of the mortgaged property.                                                                          
                                                                                                                                     
         The master servicer, on behalf of itself, the trustee and the                                                               
certificateholders, will present claims to the insurer under each primary                                                            
mortgage insurance policy, and will take any reasonable steps consistent with                                                        
its practices regarding comparable mortgage loans and necessary to receive                                                           
payment or to permit recovery under the policy with respect to defaulted                                                             
mortgage loans. As set forth above, all collections by or on behalf of the                                                           
master servicer under any primary mortgage insurance policy and, when the                                                            
mortgaged property has not been restored, the hazard insurance policy, are to be                                                     
deposited in the Certificate Account, subject to withdrawal as heretofore                                                            
described.                                                                                                                           
                                                                                                                                     
         If the mortgaged property securing a defaulted mortgage loan is damaged                                                     
and proceeds, if any, from the related hazard insurance policy are insufficient                                                      
to restore the damaged mortgaged property to a condition sufficient to permit                                                        
recovery under the related primary mortgage insurance policy, if any, the master                                                     
servicer is not required to expend its own funds to restore the damaged                                                              
mortgaged property unless it determines that the restoration will increase the                                                       
proceeds to certificateholders on liquidation of the mortgage loan after                                                             
reimbursement of the master servicer for its expenses and that the expenses will                                                     
be recoverable by it from related insurance proceeds or liquidation proceeds.                                                        
                                                                                                                                     
         If recovery on a defaulted mortgage loan under any related primary                                                          
mortgage insurance policy is not available for the reasons set forth in the                                                          
preceding paragraph, or if the defaulted mortgage loan is not covered by a                                                           
primary mortgage insurance policy, the master servicer will be obligated to                                                          
follow or cause to be followed the normal practices and procedures that it deems                                                     
appropriate to realize upon the defaulted mortgage loan. If the proceeds of any                                                      
liquidation of the mortgaged property securing the defaulted mortgage loan are                                                       
less than the principal balance of the mortgage loan plus interest accrued on it                                                     
that is payable to certificateholders, the trust fund will realize a loss in the                                                     
amount of the difference plus the aggregate of expenses incurred by the master                                                       
servicer in connection with the proceedings that are reimbursable under the                                                          
pooling and servicing agreement. In the unlikely event that the proceedings                                                          
result in a total recovery which is, after reimbursement to the master servicer                                                      
of its expenses, in excess of the principal balance of the mortgage loan plus                                                        
interest accrued on it that is payable to certificateholders, the master                                                             
servicer will be entitled to withdraw or retain from the Certificate Account                                                         
amounts representing its normal servicing compensation with respect to the                                                           
mortgage loan and, unless otherwise specified in the related prospectus                                                              
supplement, amounts representing the balance of the excess, exclusive of any                                                         
amount required by law to be forwarded to the related mortgagor, as additional                                                       
servicing compensation.                                                                                                              
                                                                                                                                     
         If the master servicer or its designee recovers insurance proceeds not                                                      
used to restore the property which, when added to any related liquidation                                                            
proceeds and after deduction of certain expenses reimbursable to the master                                                          
servicer, exceed the principal balance of a mortgage loan plus interest accrued                                                      
thereon that is payable to certificateholders, the master servicer will be                                                           
entitled to withdraw or retain from the Certificate Account amounts representing                                                     
its normal servicing compensation with respect to the mortgage loan. If the                                                          
master servicer has expended its own funds to restore the damaged mortgaged                                                          
property and the funds have not been reimbursed under the related hazard                                                             
insurance policy, it will be entitled to withdraw from the Certificate Account                                                       
out of related liquidation proceeds or insurance proceeds an amount equal to the                                                     
expenses incurred by it, in which event the trust fund may realize a loss up to                                                      
the amount so charged. Since insurance proceeds cannot exceed deficiency claims                                                      
and certain expenses incurred by the master servicer, no insurance payment or                                                        
recovery will result in a recovery to the trust fund that exceeds the principal                                                      
balance of the defaulted mortgage loan together with accrued interest on it. See                                                     
"Credit Enhancement" in this prospectus and in the related prospectus                                                                
supplement.                                                                                                                          
                                                                                                                                     
         FHA Insurance; VA Guaranties. Mortgage loans designated in the related                                                      
prospectus supplement as insured by the FHA will be insured by the FHA as                                                            
authorized under the National Housing Act of 1934,                                                                                   
                                                                                                                                     
                                       61                                                                                            
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as amended, and the United States Housing Act of 1937, as amended. Those                                                             
mortgage loans will be insured under various FHA programs including the standard                                                     
FHA 203(b) program to finance the acquisition of one-to four-family housing                                                          
units and the FHA 245 graduated payment mortgage program. These programs                                                             
generally limit the principal amount and interest rates of the mortgage loans                                                        
insured. Mortgage loans insured by the FHA generally require a minimum down                                                          
payment of approximately 5% of the original principal amount of the loan. No                                                         
FHA-insured mortgage loans relating to a series may have an interest rate or                                                         
original principal amount exceeding the applicable FHA limits at the time of                                                         
origination of the loan.                                                                                                             
                                                                                                                                     
         The insurance premiums for mortgage loans insured by the FHA are                                                            
collected by lenders approved by the HUD or by the master servicer or any                                                            
sub-servicers and are paid to the FHA. The regulations governing FHA                                                                 
single-family mortgage insurance programs provide that insurance benefits are                                                        
payable either upon foreclosure (or other acquisition of possession) and                                                             
conveyance of the mortgaged premises to HUD or upon assignment of the defaulted                                                      
mortgage loan to HUD. With respect to a defaulted FHA-insured mortgage loan, the                                                     
master servicer or any sub-servicer is limited in its ability to initiate                                                            
foreclosure proceedings. When it is determined, either by the master servicer or                                                     
any sub-servicer or HUD, that default was caused by circumstances beyond the                                                         
mortgagor's control, the master servicer or any sub-servicer is expected to make                                                     
an effort to avoid foreclosure by entering, if feasible, into one of a number of                                                     
available forms of forbearance plans with the mortgagor. These plans may involve                                                     
the reduction or suspension of regular mortgage payments for a specified period,                                                     
with the payments to be made up on or before the maturity date of the mortgage,                                                      
or the recasting of payments due under the mortgage up to or beyond the maturity                                                     
date. In addition, when a default caused by circumstances beyond the mortgagor's                                                     
control is accompanied by certain other criteria, HUD may provide relief by                                                          
making payments to the master servicer or any sub-servicer in partial or full                                                        
satisfaction of amounts due under the mortgage loan (which payments are to be                                                        
repaid by the mortgagor to HUD) or by accepting assignment of the loan from the                                                      
master servicer or any sub-servicer. With certain exceptions, at least three                                                         
full monthly installments must be due and unpaid under the mortgage loan and HUD                                                     
must have rejected any request for relief from the mortgagor before the master                                                       
servicer or any sub-servicer may initiate foreclosure proceedings.                                                                   
                                                                                                                                     
         HUD has the option, in most cases, to pay insurance claims in cash or                                                       
in debentures issued by HUD. Currently, claims are being paid in cash, and                                                           
claims have not been paid in debentures since 1965. HUD debentures issued in                                                         
satisfaction of FHA insurance claims bear interest at the applicable HUD                                                             
debentures interest rate. The master servicer of any sub-servicer of each                                                            
FHA-insured mortgage loan will be obligated to purchase the debenture issued in                                                      
satisfaction of the mortgage loan upon default for an amount equal to the                                                            
principal amount of the debenture.                                                                                                   
                                                                                                                                     
         The amount of insurance benefits generally paid by the FHA is equal to                                                      
the entire unpaid principal amount of the defaulted mortgage loan adjusted to                                                        
reimburse the master servicer or sub-servicer for certain costs and expenses and                                                     
to deduct certain amounts received or retained by the master servicer or                                                             
sub-servicer after default. When entitlement to insurance benefits results from                                                      
foreclosure (or other acquisition of possession) and conveyance to HUD, the                                                          
master servicer or sub-servicer is compensated for no more than two-thirds of                                                        
its foreclosure costs, and is compensated for accrued and unpaid interest but in                                                     
general only to the extent it was allowed pursuant to a forbearance plan                                                             
approved by HUD. When entitlement to insurance benefits results from assignment                                                      
of the mortgage loan to HUD, the insurance payment includes full compensation                                                        
for interest accrued and unpaid to the assignment date. The insurance payment                                                        
itself, upon foreclosure of an FHA-insured mortgage loan, bears interest from a                                                      
date 30 days after the mortgagor's first uncorrected failure to perform any                                                          
obligation to make any payment due under the mortgage loan and, upon assignment,                                                     
from the date of assignment to the date of payment of the claim, in each case at                                                     
the same interest rate as the applicable HUD debenture interest rate as                                                              
described above.                                                                                                                     
                                                                                                                                     
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         Mortgage loans designated in the related prospectus supplement as                                                           
guaranteed by the VA will be partially guaranteed by the VA under the                                                                
Serviceman's Readjustment Act of 1944, as amended. The Serviceman's Readjustment                                                     
Act of 1944, as amended, permits a veteran (or in certain instances the spouse                                                       
of a veteran) to obtain a mortgage loan guaranty by the VA covering mortgage                                                         
financing of the purchase of a one- to four-family dwelling unit at interest                                                         
rates permitted by the VA. The program has no mortgage loan limits, requires no                                                      
down payment from the purchaser and permits the guarantee of mortgage loans of                                                       
up to 30 years' duration. However, no mortgage loan guaranteed by the VA will                                                        
have an original principal amount greater than five times the partial VA                                                             
guaranty for the mortgage loan.                                                                                                      
                                                                                                                                     
         The liability on the guaranty may be reduced or increased pro rata with                                                     
any reduction or increase in the amount of indebtedness, but in no event will                                                        
the amount payable on the guaranty exceed the amount of the original guaranty.                                                       
The VA, at its option and without regard to the guaranty, may make full payment                                                      
to a mortgage holder of unsatisfied indebtedness on a mortgage upon its                                                              
assignment to the VA.                                                                                                                
                                                                                                                                     
         With respect to a defaulted VA guaranteed mortgage loan, the master                                                         
servicer or sub-servicer is, absent exceptional circumstances, authorized to                                                         
announce its intention to foreclose only when the default has continued for                                                          
three months. Generally, a claim for the guaranty is submitted after liquidation                                                     
of the mortgaged property.                                                                                                           
                                                                                                                                     
         The amount payable under the guaranty will be the percentage of the                                                         
VA-insured mortgage loan originally guaranteed applied to indebtedness                                                               
outstanding as of the applicable date of computation specified in the VA                                                             
regulations. Payments under the guaranty will be equal to the unpaid principal                                                       
amount of the loan, interest accrued on the unpaid balance of the loan to the                                                        
appropriate date of computation and limited expenses of the mortgagee, but in                                                        
each case only to the extent that the amounts have not been recovered through                                                        
liquidation of the mortgaged property. The amount payable under the guaranty may                                                     
in no event exceed the amount of the original guaranty.                                                                              
                                                                                                                                     
         Application of Liquidation Proceeds. Unless the related pooling and                                                         
servicing agreement provides for a different application of liquidation                                                              
proceeds, the proceeds from any liquidation of a mortgage loan will be applied                                                       
in the following order of priority:                                                                                                  
                                                                                                                                     
                  first, to reimburse the master servicer for any unreimbursed                                                       
         expenses incurred by it to restore the related mortgaged property and                                                       
         any unreimbursed servicing compensation payable to the master servicer                                                      
         with respect to the mortgage loan;                                                                                          
                                                                                                                                     
                  second, to reimburse the master servicer for any unreimbursed                                                      
         advances with respect to the mortgage loan;                                                                                 
                                                                                                                                     
                  third, to accrued and unpaid interest (to the extent no                                                            
         advance has been made for the amount) on the mortgage loan; and                                                             
                                                                                                                                     
                  fourth, as a recovery of principal of the mortgage loan.                                                           
                                                                                                                                     
         If a final liquidation of a mortgage loan resulted in a realized loss                                                       
and thereafter the master servicer receives a recovery specifically related to                                                       
that mortgage loan, such recovery (net of any reimbursable expenses) shall be                                                        
distributed to the certificateholders in the same manner as prepayments received                                                     
in the prior calendar month, to the extent that the related realized loss was                                                        
allocated to any class of certificates. In addition, the class certificate                                                           
balance of each class of certificates to which realized losses have been                                                             
allocated, will be increased, sequentially in the order of payment priority, to                                                      
the extent that such subsequent recoveries are distributed as principal to any                                                       
class of certificates. However, the class certificate balance of each such class                                                     
of certificates will not be increased by more than the amount of                                                                     
                                                                                                                                     
                                       63                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
realized losses previously applied to reduce the class certificate balance of                                                        
each such class of certificates. Holders of certificates whose class certificate                                                     
balance is increased in this manner will not be entitled to interest on the                                                          
increased balance for any interest accrual period preceding the Distribution                                                         
Date on which the increase occurs. The foregoing provisions will apply even if                                                       
the class certificate balance of a class of certificates was previously reduced                                                      
to zero. Accordingly, each class of certificates will be considered to remain                                                        
outstanding until the termination of the related trust.                                                                              
                                                                                                                                     
SERVICING AND OTHER COMPENSATION AND PAYMENT OF EXPENSES                                                                             
                                                                                                                                     
         The principal servicing compensation to be paid to the master servicer                                                      
in respect of its master servicing activities for each series of certificates                                                        
will be equal to the percentage per annum described in the related prospectus                                                        
supplement (which may vary under certain circumstances) of the outstanding                                                           
principal balance of each mortgage loan, and the compensation will be retained                                                       
by it from collections of interest on the mortgage loan in the related trust                                                         
fund. As compensation for its servicing duties, a sub-servicer or, if there is                                                       
no sub-servicer, the master servicer will be entitled to a monthly servicing fee                                                     
as described in the related prospectus supplement. In addition, generally the                                                        
master servicer or a sub-servicer will retain all prepayment charges, assumption                                                     
fees and late payment charges, to the extent collected from mortgagors, and any                                                      
benefit that may accrue as a result of the investment of funds in the applicable                                                     
Certificate Account.                                                                                                                 
                                                                                                                                     
         The master servicer will, to the extent provided in the related pooling                                                     
and servicing agreement, pay or cause to be paid certain ongoing expenses                                                            
associated with each trust fund and incurred by it in connection with its                                                            
responsibilities under the related pooling and servicing agreement, including,                                                       
without limitation, payment of the fees and disbursements of the trustee, any                                                        
custodian appointed by the trustee, the certificate registrar and any paying                                                         
agent, and payment of expenses incurred in enforcing the obligations of                                                              
sub-servicers and sellers. The master servicer will be entitled to reimbursement                                                     
of expenses incurred in enforcing the obligations of sub-servicers and sellers                                                       
under certain limited circumstances. In addition, as indicated in the preceding                                                      
section, the master servicer will be entitled to reimbursement for certain                                                           
expenses incurred by it in connection with any defaulted mortgage loan as to                                                         
which it has determined that all recoverable liquidation proceeds and insurance                                                      
proceeds have been received (a "Liquidated Mortgage"), and in connection with                                                        
the restoration of mortgaged properties, the right of reimbursement being before                                                     
the rights of certificateholders to receive any related liquidation proceeds                                                         
(including insurance proceeds).                                                                                                      
                                                                                                                                     
EVIDENCE AS TO COMPLIANCE                                                                                                            
                                                                                                                                     
         Each pooling and servicing agreement will provide that on or before a                                                       
specified date in each year, a firm of independent public accountants will                                                           
furnish a statement to the trustee to the effect that, on the basis of the                                                           
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 by or on behalf of the master                                                      
servicer of mortgage loans, Private Mortgage-Backed Securities or Agency                                                             
Securities, under pooling and servicing agreements substantially similar to each                                                     
other (including the related pooling and servicing agreement) was conducted in                                                       
compliance with those agreements except for any significant exceptions or errors                                                     
in records that, in the opinion of the firm, the Audit Program for Mortgages                                                         
serviced for Freddie Mac or the Uniform Single Attestation Program for Mortgage                                                      
Bankers requires it to report. In rendering its statement the firm may rely, as                                                      
to matters relating to the direct servicing of mortgage loans, Private                                                               
Mortgage-Backed Securities or Agency Securities by sub-servicers, 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 the                                                            
related sub-servicer.                                                                                                                
                                                                                                                                     
                                       64                                                                                            
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         Each pooling 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 two officers of the master servicer to the effect that the master                                                          
servicer has fulfilled its obligations under the pooling and servicing agreement                                                     
throughout the preceding year.                                                                                                       
                                                                                                                                     
         Copies of the annual accountants' statement and the statement of                                                            
officers of the master servicer may be obtained by certificateholders of the                                                         
related series without charge upon written request to the master servicer at the                                                     
address set forth in the related prospectus supplement.                                                                              
                                                                                                                                     
LIST OF CERTIFICATEHOLDERS                                                                                                           
                                                                                                                                     
         Each pooling and servicing agreement will provide that three or more                                                        
holders of certificates of any series may, by written request to the trustee,                                                        
obtain access to the list of all certificateholders maintained by the trustee                                                        
for the purpose of communicating with other certificateholders with respect to                                                       
their rights under the pooling and servicing agreement and the certificates.                                                         
                                                                                                                                     
CERTAIN MATTERS REGARDING THE MASTER SERVICER AND THE DEPOSITOR                                                                      
                                                                                                                                     
         The master servicer under each pooling and servicing agreement will be                                                      
named in the related prospectus supplement. The entity serving as master                                                             
servicer may be an affiliate of the depositor and may have other business                                                            
relationships with the depositor or the depositor's affiliates.                                                                      
                                                                                                                                     
         Each pooling and servicing agreement will provide that the master                                                           
servicer may not resign from its obligations and duties under the pooling and                                                        
servicing agreement except upon a determination that the performance by it of                                                        
its duties under the pooling and servicing agreement is no longer permissible                                                        
under applicable law. No resignation will become effective until the trustee or                                                      
a successor servicer has assumed the master servicer's obligations and duties                                                        
under the pooling and servicing agreement.                                                                                           
                                                                                                                                     
         Each pooling and servicing agreement will further provide that neither                                                      
the master servicer, the depositor nor any director, officer, employee, or agent                                                     
of the master servicer or the depositor will be under any liability to the                                                           
related trust fund or certificateholders for any action taken or for refraining                                                      
from the taking of any action in good faith pursuant to the pooling and                                                              
servicing agreement, or for errors in judgment. However, neither the master                                                          
servicer, the depositor nor any director, officer, employee, or agent of the                                                         
master servicer or the depositor will be protected against any liability that                                                        
would otherwise be imposed for willful misfeasance, bad faith or negligence in                                                       
the performance of duties under the pooling and servicing agreement or for                                                           
reckless disregard of obligations and duties under the pooling and servicing                                                         
agreement. Each pooling and servicing agreement will further provide that the                                                        
master servicer, the depositor and any director, officer, employee or agent of                                                       
the master servicer or the depositor will be entitled to indemnification by the                                                      
related trust fund and will be held harmless against any loss, liability or                                                          
expense incurred in connection with any legal action relating to the pooling and                                                     
servicing agreement or the certificates, other than any loss, liability or                                                           
expense related to any specific Mortgage Asset or Mortgage Assets (except any                                                        
loss, liability or expense otherwise reimbursable pursuant to the pooling and                                                        
servicing agreement) and any loss, liability or expense incurred for willful                                                         
misfeasance, bad faith or negligence in the performance of duties under the                                                          
pooling and servicing agreement or for reckless disregard of obligations and                                                         
duties under the pooling and servicing agreement. In addition, each pooling and                                                      
servicing agreement will provide that neither the master servicer nor the                                                            
depositor will be under any obligation to appear in, prosecute or defend any                                                         
legal action that is not incidental to its respective responsibilities under the                                                     
pooling and servicing agreement and that in its opinion may involve it in any                                                        
expense or liability. The master servicer or the depositor may, however, in its                                                      
discretion undertake any action that it deems appropriate with respect to the                                                        
pooling and servicing agreement and the rights and duties of the parties to the                                                      
pooling and servicing agreement and the interests of the certificateholders                                                          
                                                                                                                                     
                                       65                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
under the pooling and servicing agreement. In that event, the legal expenses and                                                     
costs of the action and any liability resulting from it will be expenses, costs                                                      
and liabilities of the trust fund, and the master servicer or the depositor, as                                                      
the case may be, will be entitled to be reimbursed for them out of funds                                                             
otherwise distributable to certificateholders.                                                                                       
                                                                                                                                     
         Any person into which the master servicer may be merged or                                                                  
consolidated, or 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 each pooling                                                     
and servicing agreement, provided that the person is qualified to sell mortgage                                                      
loans to, and service mortgage loans on behalf of, Fannie Mae or Freddie Mac and                                                     
further provided that the merger, consolidation or succession does not adversely                                                     
affect the then current rating or ratings of the class or classes of                                                                 
certificates of any series that have been rated.                                                                                     
                                                                                                                                     
EVENTS OF DEFAULT                                                                                                                    
                                                                                                                                     
         The applicable prospectus supplement may provide for other events of                                                        
default, but if it does not, then events of default under each pooling and                                                           
servicing agreement will consist of                                                                                                  
                                                                                                                                     
         -        any failure by the master servicer to deposit in the                                                               
                  Certificate Account or remit to the trustee any payment which                                                      
                  continues unremedied for five days after the giving of written                                                     
                  notice of the failure to the master servicer by the trustee or                                                     
                  the depositor, or to the master servicer and the trustee by                                                        
                  the holders of certificates having not less than 25% of the                                                        
                  voting rights evidenced by the certificates;                                                                       
                                                                                                                                     
         -        any failure by the master servicer to observe or perform in                                                        
                  any material respect any of its other covenants or agreements                                                      
                  in the pooling and servicing agreement which failure                                                               
                  materially affects the rights of certificateholders that                                                           
                  continues unremedied for sixty days after the giving of                                                            
                  written notice of the failure to the master servicer by the                                                        
                  trustee or the depositor, or to the master servicer and the                                                        
                  trustee by the holders of certificates of any class evidencing                                                     
                  not less than 25% of the voting rights evidenced by the                                                            
                  certificate; and                                                                                                   
                                                                                                                                     
         -        certain events of insolvency, readjustment of debt,                                                                
                  marshalling of assets and liabilities or similar proceeding                                                        
                  and certain actions by or on behalf of the master servicer                                                         
                  indicating its insolvency, reorganization or inability to pay                                                      
                  its obligations.                                                                                                   
                                                                                                                                     
"Voting rights" are the portion of voting rights of all of the certificates that                                                     
is allocated to any certificate pursuant to the terms of the pooling and                                                             
servicing agreement.                                                                                                                 
                                                                                                                                     
         If specified in the related prospectus supplement, the pooling and                                                          
servicing agreement will permit the trustee to sell the Mortgage Assets and the                                                      
other assets of the trust fund if payments on them are insufficient to make                                                          
payments required in the pooling and servicing agreement. The assets of the                                                          
trust fund will be sold only under the circumstances and in the manner specified                                                     
in the related prospectus supplement.                                                                                                
                                                                                                                                     
RIGHTS UPON EVENT OF DEFAULT                                                                                                         
                                                                                                                                     
         So long as an event of default under a pooling and servicing agreement                                                      
remains unremedied, the depositor or the trustee may, and at the direction of                                                        
holders of certificates having not less than 66 2/3% of the voting rights and                                                        
under any other circumstances specified in the pooling and servicing agreement,                                                      
the trustee shall, terminate all of the rights and obligations of the master                                                         
servicer under the pooling and servicing agreement relating to the trust fund                                                        
and in the Mortgage Assets, whereupon the trustee will                                                                               
                                                                                                                                     
                                       66                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
succeed to all of the responsibilities, duties and liabilities of the master                                                         
servicer under the pooling and servicing agreement, including, if specified in                                                       
the related prospectus supplement, the obligation to make advances, and will be                                                      
entitled to similar compensation arrangements. If the trustee is unwilling or                                                        
unable so to act, it may appoint, or petition a court of competent jurisdiction                                                      
for the appointment of, a mortgage loan servicing institution with a net worth                                                       
of at least $10,000,000 to act as successor to the master servicer under the                                                         
pooling and servicing agreement. Pending appointment, the trustee is obligated                                                       
to act as master servicer. The trustee and any successor may agree upon the                                                          
servicing compensation to be paid to the successor servicer, which may not be                                                        
greater than the compensation payable to the master servicer under the pooling                                                       
and servicing agreement.                                                                                                             
                                                                                                                                     
         No certificateholder, solely by virtue of its status as a                                                                   
certificateholder, will have any right under any pooling and servicing agreement                                                     
to institute any proceeding with respect to the pooling and servicing agreement,                                                     
unless the holder previously has given to the trustee written notice of default                                                      
and unless the holders of any class of certificates of the series evidencing not                                                     
less than 25% of the voting rights have requested the trustee in writing to                                                          
institute a proceeding in its own name as trustee and have offered to the                                                            
trustee reasonable indemnity, and the trustee for 60 days has neglected or                                                           
refused to institute the proceeding.                                                                                                 
                                                                                                                                     
AMENDMENT                                                                                                                            
                                                                                                                                     
         The applicable prospectus supplement may specify other amendment                                                            
provisions, but if it does not, then each pooling and servicing agreement may be                                                     
amended by the depositor, the master servicer and the trustee, without the                                                           
consent of any of the certificateholders,                                                                                            
                                                                                                                                     
                  (a)      to cure any ambiguity or mistake;                                                                         
                                                                                                                                     
                  (b)      to correct any defective provision therein or to                                                          
         supplement any provision in the pooling and servicing agreement that                                                        
         may be inconsistent with any other provision in it;                                                                         
                                                                                                                                     
                  (c)      to conform the pooling and servicing agreement to the                                                     
         final prospectus supplement provided to investors in accordance with                                                        
         the initial offering of the certificates;                                                                                   
                                                                                                                                     
                  (d)      to add to the duties of the depositor, the seller or                                                      
         the master servicer;                                                                                                        
                                                                                                                                     
                  (e)      to add any other provisions with respect to matters                                                       
         or questions arising under the pooling and servicing agreement; or                                                          
                                                                                                                                     
                  (f)      to modify, alter, amend, add to or rescind any of the                                                     
         terms or provisions contained in the pooling and servicing agreement.                                                       
                                                                                                                                     
However, no action pursuant to clauses (e) or (f) may, as evidenced by an                                                            
opinion of counsel, adversely affect in any material respect the interests of                                                        
any certificateholder. But no opinion of counsel will be required if the person                                                      
requesting the amendment obtains a letter from each rating agency requested to                                                       
rate the class or classes of certificates of the series stating that the                                                             
amendment will not result in the downgrading or withdrawal of the respective                                                         
ratings then assigned to the certificates.                                                                                           
                                                                                                                                     
         In addition, to the extent provided in the related pooling and                                                              
servicing agreement, a pooling and servicing agreement may be amended without                                                        
the consent of any of the certificateholders to change the manner in which the                                                       
Certificate Account is maintained, if the change does not adversely affect the                                                       
then current rating of the class or classes of certificates of the series that                                                       
have been rated at the request of the depositor. Moreover, if one or more REMIC                                                      
elections are made with respect to the trust fund, the related                                                                       
                                                                                                                                     
                                       67                                                                                            
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pooling and servicing agreement may be amended to modify, eliminate or add to                                                        
any of its provisions to the extent necessary to maintain the qualification of                                                       
any REMIC, to avoid or minimize the risk of imposition of any tax on any REMIC                                                       
or to comply with any other requirements of the Code, if the trustee has                                                             
received an opinion of counsel to the effect that the action is necessary or                                                         
helpful to maintain the qualification, avoid or minimize that risk or comply                                                         
with those requirements, as applicable.                                                                                              
                                                                                                                                     
         The applicable prospectus supplement may specify other amendment                                                            
provisions, but if it does not, then each pooling and servicing agreement may                                                        
also be amended by the depositor, the master servicer and the trustee with the                                                       
consent of holders of certificates of the series evidencing a majority in                                                            
interest of each class affected thereby 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 the related certificates. However, no amendment may                                                                               
                                                                                                                                     
                  (a)      reduce in any manner the amount of, or delay the                                                          
         timing of, payments received on Mortgage Assets that are required to be                                                     
         distributed on any certificate without the consent of the holder of the                                                     
         certificate,                                                                                                                
                                                                                                                                     
                  (b)      adversely affect in any material respect the                                                              
         interests of the holders of any class of certificates in a manner other                                                     
         than as described in (a), without the consent of the holders of                                                             
         certificates of the class evidencing, as to the class, percentage                                                           
         interests aggregating 66 2/3%, or                                                                                           
                                                                                                                                     
                  (c)      reduce the aforesaid percentage of certificates of                                                        
         any class of holders that is 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.                                                            
                                                                                                                                     
If one or more REMIC elections are made with respect to a trust fund, the                                                            
trustee will not be entitled to consent to an amendment to the related pooling                                                       
and servicing agreement without having first received an opinion of counsel to                                                       
the effect that the amendment will not cause any REMIC to fail to qualify as a                                                       
REMIC.                                                                                                                               
                                                                                                                                     
TERMINATION; OPTIONAL TERMINATION                                                                                                    
                                                                                                                                     
         Generally, the obligations created by each pooling and servicing                                                            
agreement for each series of certificates will terminate upon the payment to the                                                     
related certificateholders of all amounts held in the Certificate Account or by                                                      
the master servicer and required to be paid to them pursuant to the pooling and                                                      
servicing agreement following the later of                                                                                           
                                                                                                                                     
         -        the final payment or other liquidation of the last of the                                                          
                  Mortgage Assets subject to it or the disposition of all                                                            
                  property acquired upon foreclosure of the Mortgage Assets                                                          
                  remaining in the trust fund and                                                                                    
                                                                                                                                     
         -        the purchase by the master servicer or, if REMIC treatment has                                                     
                  been elected and if specified in the related prospectus                                                            
                  supplement, by the holder of the residual interest in the                                                          
                  REMICs (see "Material Federal Income Tax Consequences" in this                                                     
                  prospectus and in the related prospectus supplement), from the                                                     
                  related trust fund of all of the remaining Mortgage Assets and                                                     
                  all property acquired in respect of the Mortgage Assets.                                                           
                                                                                                                                     
         Any purchase of Mortgage Assets and property acquired in respect of                                                         
Mortgage Assets evidenced by a series of certificates will be made at the option                                                     
of the master servicer or the party specified in the related prospectus                                                              
supplement, including the holder of the REMIC residual interest, at a price, and                                                     
in accordance with the procedures, specified in the related prospectus                                                               
supplement. The exercise of that right                                                                                               
                                                                                                                                     
                                       68                                                                                            
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will effect early retirement of the certificates of that series, but the right                                                       
of the master servicer or the other party or, if applicable, the holder of the                                                       
REMIC residual interest, to so purchase is subject to the principal balance of                                                       
the related Mortgage Assets being less than the percentage specified in the                                                          
related prospectus supplement of the aggregate principal balance of the Mortgage                                                     
Assets at the cut-off date for the series. The foregoing is subject to the                                                           
provision that if one or more REMIC elections are made with respect to a trust                                                       
fund, any repurchase pursuant to the second bulleted item above will not be made                                                     
if such repurchase would result in a "prohibited transaction tax" (within the                                                        
meaning of Section 860F(a)(1) of the Code) being imposed on any REMIC.                                                               
                                                                                                                                     
THE TRUSTEE                                                                                                                          
                                                                                                                                     
         The trustee under each pooling and servicing agreement will be named in                                                     
the applicable prospectus supplement. The commercial bank or trust company                                                           
serving as trustee may have normal banking relationships with the depositor, the                                                     
master servicer and any of their respective affiliates.                                                                              
                                                                                                                                     
                   CERTAIN LEGAL ASPECTS OF THE MORTGAGE LOANS                                                                       
                                                                                                                                     
         The following discussion contains summaries, which are general in                                                           
nature, of certain legal matters relating to the mortgage loans. Because the                                                         
legal aspects are governed primarily by applicable state law (which laws may                                                         
differ substantially), the summaries do not purport to be complete or to reflect                                                     
the laws of any particular state or to encompass the laws of all states in which                                                     
the security for the mortgage loans is situated.                                                                                     
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         The mortgage loans will be secured by deeds of trust, mortgages,                                                            
security deeds or deeds to secure debt, depending upon the prevailing practice                                                       
in the state in which the property subject to the loan is located. Deeds of                                                          
trust are used almost exclusively in California instead of mortgages. A mortgage                                                     
creates a lien upon the real property encumbered by the mortgage, which lien is                                                      
generally not before the lien for real estate taxes and assessments. Priority                                                        
between mortgages depends on their terms and generally on the order of recording                                                     
with a state or county office. There are two parties to a mortgage, the                                                              
mortgagor, who is the borrower and owner of the mortgaged property, and the                                                          
mortgagee, who is the lender. Under the mortgage instrument, the mortgagor                                                           
delivers to the mortgagee a note or bond and the mortgage. Although a deed of                                                        
trust is similar to a mortgage, a deed of trust formally has three parties, the                                                      
borrower-property owner called the trustor (similar to a mortgagor), a lender                                                        
(similar to a mortgagee) called the beneficiary, 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. A security deed and a deed to                                                       
secure debt are special types of deeds which indicate on their face that they                                                        
are granted to secure an underlying debt. By executing a security deed or deed                                                       
to secure debt, the grantor conveys title to, as opposed to merely creating a                                                        
lien upon, the subject property to the grantee until the underlying debt is                                                          
repaid. The trustee's authority under a deed of trust, the mortgagee's authority                                                     
under a mortgage and the grantee's authority under a security deed or deed to                                                        
secure debt are governed by law and, with respect to some deeds of trust, the                                                        
directions of the beneficiary.                                                                                                       
                                                                                                                                     
         In this prospectus, we generally use the term "mortgage" to generically                                                     
describe real-estate security instruments, however, if certain information                                                           
relates to a particular security instrument, we will refer to that security                                                          
instrument.                                                                                                                          
                                                                                                                                     
                                       69                                                                                            
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         Cooperatives. Certain of the mortgage loans may be cooperative loans.                                                       
The cooperative owns all the real property that comprises the project, including                                                     
the land, separate dwelling units and all common areas. The cooperative is                                                           
directly responsible for project management and, in most cases, payment of real                                                      
estate taxes and hazard and liability insurance. If there is a blanket mortgage                                                      
on the cooperative or underlying land or both, as is generally the case, the                                                         
cooperative, as project mortgagor, is also responsible for meeting these                                                             
mortgage obligations. A blanket mortgage is ordinarily incurred by the                                                               
cooperative in connection with the construction or purchase of the cooperative's                                                     
apartment building. The interest of the occupant under proprietary leases or                                                         
occupancy agreements to which that cooperative is a party are generally                                                              
subordinate to the interest of the holder of the blanket mortgage in that                                                            
building. If the cooperative is unable to meet the payment obligations arising                                                       
under its blanket mortgage, the mortgagee holding the blanket mortgage could                                                         
foreclose on that mortgage and terminate all subordinate proprietary leases and                                                      
occupancy agreements. In addition, the blanket 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 lump sum at final maturity.                                                        
The inability of the cooperative to refinance this mortgage and its consequent                                                       
inability to make the final payment could lead to foreclosure by the mortgagee                                                       
providing the financing. A foreclosure in either event by the holder of the                                                          
blanket mortgage could eliminate or significantly diminish the value of any                                                          
collateral held by the lender who financed the purchase by an individual                                                             
tenant-stockholder of cooperative shares or, in the case of a trust fund                                                             
including cooperative loans, the collateral securing the cooperative loans.                                                          
                                                                                                                                     
         The cooperative is owned by tenant-stockholders who, through ownership                                                      
of stock, shares or membership certificates in the corporation, receive                                                              
proprietary leases or occupancy agreements which confer exclusive rights to                                                          
occupy specific units. Generally, a tenant-stockholder of a cooperative must                                                         
make a monthly payment to the cooperative representing the tenant-stockholder's                                                      
pro rata share of the cooperative's payments for its blanket mortgage, real                                                          
property taxes, maintenance expenses and other capital or ordinary expenses. An                                                      
ownership interest in a cooperative and accompanying rights is financed through                                                      
a cooperative share loan evidenced by a promissory note and secured by a                                                             
security interest in the occupancy agreement or proprietary lease and in the                                                         
related cooperative shares. The lender 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 lender'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 promissory 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.                                                                                                                              
                                                                                                                                     
FORECLOSURE AND REPOSSESSION                                                                                                         
                                                                                                                                     
         Deed of Trust. Foreclosure of a deed of trust is generally accomplished                                                     
by a non-judicial sale under a specific provision in the deed of trust which                                                         
authorizes the trustee to sell the property at public auction upon any material                                                      
default by the borrower under the terms of the note or deed of trust. In certain                                                     
states, foreclosure also may be accomplished by judicial action in the manner                                                        
provided for foreclosure of mortgages. In some states, such as California, 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 any 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 lien holders. If the deed of trust is not reinstated within                                                     
any applicable cure period, a notice of sale must be posted in a public place                                                        
and, in most states, including California, published for a specified period of                                                       
time in one or more newspapers. In addition, these notice provisions require                                                         
that a copy of the notice of sale be posted on the property and sent to all                                                          
parties having an interest of record in the property. In California, the entire                                                      
process from recording a notice of default to a non-judicial sale usually takes                                                      
four to five months.                                                                                                                 
                                                                                                                                     
                                       70                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
         In some states, including California, the borrower-trustor has the                                                          
right to reinstate the loan at any time following default until shortly before                                                       
the trustee's sale. In general, 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. Certain state laws control the amount of                                                       
foreclosure expenses and costs, including attorney's fees, which may be                                                              
recoverable by a lender.                                                                                                             
                                                                                                                                     
         Mortgages. Foreclosure of a mortgage is generally accomplished by                                                           
judicial action. The action is initiated by the service of legal pleadings upon                                                      
all parties having an interest 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                                                      
parties. When the mortgagee's right to foreclosure is contested, the legal                                                           
proceedings necessary to resolve the issue can be time consuming. After the                                                          
completion of a judicial foreclosure proceeding, the court generally issues a                                                        
judgment of foreclosure and appoints a referee or other court officer to conduct                                                     
the sale of the property. In general, the borrower, or any other person having a                                                     
junior encumbrance on the real estate, may, during a statutorily prescribed                                                          
reinstatement period, cure a monetary default by paying the entire amount in                                                         
arrears plus other designated costs and expenses incurred in enforcing the                                                           
obligation. Generally, state law controls the amount of foreclosure expenses and                                                     
costs, including attorney's fees, which may be recovered by a lender. After the                                                      
reinstatement period has expired without the default having been cured, the                                                          
borrower or junior lienholder no longer has the right to reinstate the loan and                                                      
must pay the loan in full to prevent the scheduled foreclosure sale. If the deed                                                     
of trust is not reinstated, 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 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 in the                                                     
real property.                                                                                                                       
                                                                                                                                     
         Although foreclosure sales are typically public sales, frequently no                                                        
third party purchaser bids in excess of the lender's lien because of the                                                             
difficulty of determining the exact status of title to the property, the                                                             
possible deterioration of the property during the foreclosure proceedings and a                                                      
requirement that the purchaser pay for the property in cash or by cashier's                                                          
check. Thus the foreclosing lender often purchases the property from the trustee                                                     
or referee for an amount equal to the principal amount outstanding under the                                                         
loan, accrued and unpaid interest and the expenses of foreclosure. Thereafter,                                                       
the lender will assume the burden of ownership, including obtaining hazard                                                           
insurance and making repairs at its own expense necessary to render the property                                                     
suitable for sale. The lender will commonly 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.                                                                  
                                                                                                                                     
         Courts have imposed general equitable principles upon foreclosure,                                                          
which are generally designed to mitigate the legal consequences to the borrower                                                      
of the borrower's defaults under the loan documents. Some courts have been faced                                                     
with the issue of whether federal or state constitutional provisions reflecting                                                      
due process concerns for fair notice require that borrowers under deeds of trust                                                     
receive notice longer than that prescribed by statute. 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 does not involve sufficient state                                                        
action to afford constitutional protection to the borrower.                                                                          
                                                                                                                                     
         Cooperative Loans. The cooperative shares owned by the                                                                      
tenant-stockholder and pledged to the lender are, in almost all cases, subject                                                       
to restrictions on transfer as set forth in the cooperative's certificate of                                                         
incorporation and bylaws, as well as the proprietary lease or occupancy                                                              
agreement, and may be cancelled by the cooperative for failure by the                                                                
tenant-stockholder to pay rent or other obligations or charges owed by the                                                           
tenant-stockholder, including mechanics' liens against the cooperative apartment                                                     
building incurred by the tenant-stockholder. The proprietary lease or occupancy                                                      
agreement generally                                                                                                                  
                                                                                                                                     
                                       71                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
permits the cooperative to terminate the lease or agreement if an obligor fails                                                      
to make payments or defaults in the performance of covenants required under it.                                                      
Typically, the lender and the cooperative enter into a recognition agreement,                                                        
which establishes the rights and obligations of both parties upon 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, if 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 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 the sale of the cooperative apartment,                                                           
subject, however, to the cooperative's right to sums due under 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 value of the collateral below the outstanding                                                              
principal balance of the cooperative loan and accrued and unpaid interest on it.                                                     
                                                                                                                                     
         Recognition agreements also provide that upon foreclosure of a                                                              
cooperative loan, the lender must obtain the approval or consent of the                                                              
cooperative as required by the proprietary lease before transferring the                                                             
cooperative shares or assigning the proprietary lease. Generally, the lender is                                                      
not limited in any rights it may have to dispossess the tenant-stockholders.                                                         
                                                                                                                                     
         In some states, foreclosure on the cooperative shares is accomplished                                                       
by a sale in accordance with the provisions of Article 9 of the UCC and the                                                          
security agreement relating to those shares. Article 9 of the UCC requires that                                                      
a sale be conducted in a "commercially reasonable" manner. Whether a foreclosure                                                     
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 foreclosure. Generally, a sale conducted according to the usual practice of                                                      
banks selling similar collateral 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 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."                                                                                                             
                                                                                                                                     
         In the case of foreclosure on a building converted from a rental                                                            
building to a building owned by a cooperative under a non-eviction plan, some                                                        
states require that a purchaser at a foreclosure sale take the property subject                                                      
to rent control and rent stabilization laws that apply to certain tenants who                                                        
elected to remain in the building but who did not purchase shares in the                                                             
cooperative when the building was so converted.                                                                                      
                                                                                                                                     
RIGHTS OF REDEMPTION                                                                                                                 
                                                                                                                                     
         In some states after a sale pursuant to a deed of trust or foreclosure                                                      
of a mortgage, the borrower and certain foreclosed junior lienors are given a                                                        
statutory period in which to redeem the property from the foreclosure sale. In                                                       
certain other states, including California, this right of redemption applies                                                         
only to sales following judicial foreclosure, and not to sales pursuant to a                                                         
non-judicial power of sale. In most states where the right of redemption is                                                          
available, statutory redemption may occur upon payment of the                                                                        
                                                                                                                                     
                                       72                                                                                            
<PAGE>                                                                                                                               
                                                                                                                                     
foreclosure purchase price, accrued interest and taxes. In some states, the                                                          
right to redeem is an equitable right. The effect of a right of redemption is to                                                     
diminish the ability of the lender to sell the foreclosed property. The exercise                                                     
of a right of redemption would defeat the title of any purchaser at a                                                                
foreclosure sale, or of any purchaser from the lender after judicial foreclosure                                                     
or sale under a deed of trust. Consequently, the practical effect of the                                                             
redemption right is to force the lender to retain the property and pay the                                                           
expenses of ownership until the redemption period has run.                                                                           
                                                                                                                                     
ANTI-DEFICIENCY LEGISLATION AND OTHER LIMITATIONS ON LENDERS                                                                         
                                                                                                                                     
         Certain states have imposed statutory restrictions that limit the                                                           
remedies of a beneficiary under a deed of trust or a mortgagee under a mortgage.                                                     
In some states, including California, statutes limit the right of the                                                                
beneficiary or mortgagee to obtain a deficiency judgment against the borrower                                                        
following foreclosure or a sale under a deed of trust. A deficiency judgment is                                                      
a personal judgment against the borrower equal in most cases to the difference                                                       
between the amount due to the lender and the current fair market value of the                                                        
property at the time of the foreclosure sale. As a result of these prohibitions,                                                     
it is anticipated that in most instances the master servicer will utilize the                                                        
non-judicial foreclosure remedy and will not seek deficiency judgments against                                                       
defaulting mortgagors.                                                                                                               
                                                                                                                                     
         Some state statutes may require the beneficiary or mortgagee to exhaust                                                     
the security afforded under a deed of trust or mortgage by foreclosure in an                                                         
attempt to satisfy the full debt before bringing a personal action against the                                                       
borrower. In certain other states, the lender has the option of bringing a                                                           
personal action against the borrower on the debt without first exhausting that                                                       
security. However, in some of these states, following judgment on a personal                                                         
action, the lender may be considered to have elected a remedy and may be                                                             
precluded from exercising other remedies with respect to the security.                                                               
Consequently, the practical effect of the election requirement, when applicable,                                                     
is that lenders will usually proceed first against the security rather than                                                          
bringing a personal action against the borrower.                                                                                     
                                                                                                                                     
         In some states, exceptions to the anti-deficiency statutes are provided                                                     
for in certain instances where the value of the lender's security has been                                                           
impaired by acts or omissions of the borrower, for example, upon waste of the                                                        
property.                                                                                                                            
                                                                                                                                     
         In addition to anti-deficiency and related legislation, numerous other                                                      
federal and state statutory provisions, including the federal bankruptcy laws,                                                       
the federal Soldiers' and Sailors' Civil Relief Act of 1940 and state laws                                                           
affording relief to debtors, may interfere with or affect the ability of the                                                         
secured mortgage lender to realize on its security. For example, in a proceeding                                                     
under the federal Bankruptcy Code, a lender may not foreclose on a mortgaged                                                         
property without the permission of the bankruptcy court. And in certain                                                              
instances a bankruptcy court may allow a borrower to reduce the monthly                                                              
payments, change the rate of interest, and alter the mortgage loan repayment                                                         
schedule for under collateralized mortgage loans. The effect of these types of                                                       
proceedings can be to cause delays in receiving payments on the loans underlying                                                     
certificates and even to reduce the aggregate amount of payments on the loans                                                        
underlying certificates.                                                                                                             
                                                                                                                                     
         The federal tax laws provide priority to certain tax liens over the                                                         
lien of a mortgage or secured party. Numerous federal and state consumer                                                             
protection laws impose substantive requirements upon mortgage lenders in                                                             
connection with the origination, servicing and enforcement of mortgage loans.                                                        
These laws include the federal Truth-in-Lending Act, Real Estate Settlement                                                          
Procedures Act, Equal Credit Opportunity Act, Fair Credit Billing Act, Fair                                                          
Credit Reporting Act and related statutes and regulations. These federal and                                                         
state laws impose specific statutory liabilities on lenders who fail to comply                                                       
with the provisions of the law. In some cases, this liability may affect                                                             
assignees of the loans or contracts.                                                                                                 
                                                                                                                                     
                                       73                                                                                            
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         Generally, Article 9 of the UCC governs foreclosure on cooperative                                                          
shares and the related proprietary lease or occupancy agreement. Some courts                                                         
have interpreted section 9-504 of the UCC to prohibit a deficiency award unless                                                      
the creditor establishes that the sale of the collateral (which, in the case of                                                      
a cooperative loan, would be the shares of the cooperative and the related                                                           
proprietary lease or occupancy agreement) was conducted in a commercially                                                            
reasonable manner.                                                                                                                   
                                                                                                                                     
ENVIRONMENTAL RISKS                                                                                                                  
                                                                                                                                     
         Real property pledged as security to a lender may be subject to                                                             
unforeseen environmental risks. Under the laws of certain states, contamination                                                      
of a property may give rise to a lien on the property to assure the payment of                                                       
the costs of clean-up. In several states that lien has priority over the lien of                                                     
an existing mortgage on the property. In addition, under the federal                                                                 
Comprehensive Environmental Response, Compensation and Liability Act of 1980                                                         
("CERCLA"), the EPA may impose a lien on property where the EPA has incurred                                                         
clean-up costs. However, a CERCLA lien is subordinate to pre-existing, perfected                                                     
security interests.                                                                                                                  
                                                                                                                                     
         Under the laws of some states, and under CERCLA, it is conceivable that                                                     
a secured lender may be held liable as an "owner" or "operator" for the costs of                                                     
addressing releases or threatened releases of hazardous substances at a                                                              
mortgaged property, even though the environmental damage or threat was caused by                                                     
a prior or current owner or operator. CERCLA imposes liability for the costs on                                                      
any and all "responsible parties," including owners or operators. However,                                                           
CERCLA excludes from the definition of "owner or operator" a secured creditor                                                        
who holds indicia of ownership primarily to protect its security interest but                                                        
does not "participate in the management" of the property. Thus, if a lender's                                                        
activities begin to encroach on the actual management of a contaminated facility                                                     
or property, the lender may incur liability as an "owner or operator" under                                                          
CERCLA. Similarly, if a lender forecloses and takes title to a contaminated                                                          
facility or property, the lender may incur CERCLA liability in various                                                               
circumstances, including when it holds the facility or property as an investment                                                     
(including leasing the facility or property to a third party), or fails to                                                           
market the property in a timely fashion.                                                                                             
                                                                                                                                     
         Whether actions taken by a lender would constitute participation in the                                                     
management of a mortgaged property, or the business of a borrower, so as to                                                          
render the secured creditor exemption unavailable to a lender, was historically                                                      
a matter of judicial interpretation of the statutory language. Court decisions                                                       
were inconsistent and, in fact, in 1990, the Court of Appeals for the Eleventh                                                       
Circuit suggested that the mere capacity of the lender to influence a borrower's                                                     
decisions regarding disposal of hazardous substances was sufficient                                                                  
participation in the management of a borrower's business to deny the protection                                                      
of the secured creditor exemption to the lender. In 1996, Congress enacted the                                                       
Asset Conservation, Lender Liability and Deposit Insurance Protection Act                                                            
("Asset Conservation Act"), which provides that, in order to be deemed to have                                                       
participated in the management of a mortgaged property, a lender must actually                                                       
participate in the operational affairs of either the property or the borrower.                                                       
The Asset Conservation Act also provides that participation in the management of                                                     
the property does not include merely having the capacity to influence, or                                                            
unexercised right to control operations. Rather, 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.                                                                   
                                                                                                                                     
         If a lender is or becomes liable, it can bring an action for                                                                
contribution under CERCLA against any other "responsible parties," including a                                                       
previous owner or operator, who created the environmental hazard and who has not                                                     
settled its liability with the government, but those persons or entities may be                                                      
bankrupt or otherwise judgment proof. The costs associated with environmental                                                        
cleanup may be substantial. It is conceivable that the costs arising from the                                                        
circumstances set forth above would result in a loss to certificateholders.                                                          
                                                                                                                                     
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         The secured creditor exclusion does not govern liability for cleanup                                                        
costs under federal laws other than CERCLA, and state environmental statutes may                                                     
or may not contain protections for secured creditors. Subtitle I of the                                                              
regulations promulgated under the federal Resource Conservation and Recovery Act                                                     
("RCRA") regulates underground petroleum storage tanks (except heating oil                                                           
tanks). The EPA has adopted a lender liability rule for underground storage                                                          
tanks under Subtitle I of RCRA. Under the Asset Conservation Act, the                                                                
protections accorded to lenders under CERCLA are also accorded to holders of                                                         
security interests in underground petroleum storage tanks. It should be noted,                                                       
however, that liability for cleanup of petroleum contamination may be governed                                                       
by state law, which may not provide for any specific protection for secured                                                          
creditors or alternatively, may not impose liability on secured creditors at                                                         
all.                                                                                                                                 
                                                                                                                                     
         Except as otherwise specified in the applicable prospectus supplement,                                                      
at the time the mortgage loans were originated, no environmental assessment or a                                                     
very limited environmental assessment of the Mortgage Properties was conducted.                                                      
                                                                                                                                     
DUE-ON-SALE CLAUSES                                                                                                                  
                                                                                                                                     
         Generally, each conventional mortgage loan will contain a due-on-sale                                                       
clause which will generally provide that if the mortgagor or obligor sells,                                                          
transfers or conveys the mortgaged property, the loan may be accelerated by the                                                      
mortgagee. In recent years, court decisions and legislative actions have placed                                                      
substantial restriction on the right of lenders to enforce these clauses in many                                                     
states. For instance, the California Supreme Court in August 1978 held that                                                          
due-on-sale clauses were generally unenforceable. However, the Garn-St Germain                                                       
Depository Institutions Act of 1982 (the "Garn-St Germain Act"), subject to                                                          
specified exceptions, preempts state constitutional, statutory and case law                                                          
prohibiting the enforcement of due-on-sale clauses. As to loans secured by an                                                        
owner-occupied residence, the Garn-St Germain Act sets forth nine specific                                                           
instances in which a mortgagee covered by the Garn-St Germain Act may not                                                            
exercise its rights under a due-on-sale clause, notwithstanding the fact that a                                                      
transfer of the property may have occurred. The inability to enforce a                                                               
due-on-sale clause may result in transfer of the related mortgaged property to                                                       
an uncreditworthy person, which could increase the likelihood of default or may                                                      
result in a mortgage bearing an interest rate below the current market rate                                                          
being assumed by a new home buyer, which may affect the average life of the                                                          
mortgage loans and the number of mortgage loans which may extend to maturity.                                                        
                                                                                                                                     
PREPAYMENT CHARGES                                                                                                                   
                                                                                                                                     
         Under certain state laws, prepayment charges may not be imposed after a                                                     
certain period of time following the origination of mortgage loans with respect                                                      
to prepayments on loans secured by liens encumbering owner-occupied residential                                                      
properties. Since many of the mortgaged properties will be owner-occupied, it is                                                     
anticipated that prepayment charges may not be imposed on many of the mortgage                                                       
loans. The absence of this a restraint on prepayment, particularly with respect                                                      
to fixed rate mortgage loans having higher mortgage rates, may increase the                                                          
likelihood of refinancing or other early retirement of the loans or contracts.                                                       
                                                                                                                                     
APPLICABILITY OF USURY LAWS                                                                                                          
                                                                                                                                     
         Title V of the depository Institutions Deregulation and Monetary                                                            
Control Act of 1980, enacted in March 1980 ("Title V"), provides that state                                                          
usury limitations shall not apply to certain types of residential first mortgage                                                     
loans originated by certain lenders after March 31, 1980. The Office of Thrift                                                       
Supervision, as successor to the Federal Home Loan Bank Board, is authorized to                                                      
issue rules and regulations and to publish interpretations governing                                                                 
implementation of Title V. The statute authorized the states to reimpose                                                             
interest rate limits by adopting, before April 1, 1983, a law or constitutional                                                      
provision that expressly                                                                                                             
                                                                                                                                     
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rejects an 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.                                                      
Certain states have taken action to reimpose interest rate limits or to limit                                                        
discount points or other charges, or both.                                                                                           
                                                                                                                                     
SOLDIERS' AND SAILORS' CIVIL RELIEF ACT                                                                                              
                                                                                                                                     
         Generally, under the terms of the Soldiers' and Sailors' Civil Relief                                                       
Act of 1940, as amended (the "Relief Act"), a borrower who enters military                                                           
service after the origination of the borrower's mortgage loan (including a                                                           
borrower who is a member of the National Guard or is in reserve status at the                                                        
time of the origination of the mortgage loan and is later called to active duty)                                                     
may not be charged interest above an annual rate of 6% during the period of the                                                      
borrower's active duty status, unless a court orders otherwise upon application                                                      
of the lender. It is possible that this interest rate limitation could have an                                                       
effect, for an indeterminate period of time, on the ability of the master                                                            
servicer to collect full amounts of interest on some of the mortgage loans.                                                          
Unless the applicable prospectus supplement provides a special feature for a                                                         
particular trust fund, any shortfall in interest collections resulting from the                                                      
application of the Relief Act could result in losses to the holders of the                                                           
certificates. In addition, the Relief Act imposes limitations which would impair                                                     
the ability of the master servicer to foreclose on an affected mortgage loan                                                         
during the borrower's period of active duty status. Thus, if an affected                                                             
mortgage loan goes into default, there may be delays and losses occasioned by                                                        
the inability to realize upon the mortgaged property in a timely fashion.                                                            
                                                                                                                                     
CONSUMER PROTECTION LAWS                                                                                                             
                                                                                                                                     
         Federal, state and local laws extensively regulate various aspects of                                                       
brokering, originating, servicing and collecting mortgage loans. Among other                                                         
things, these laws may regulate interest rates and other charges, require                                                            
disclosures, impose financial privacy requirements, mandate specific business                                                        
practices, and prohibit unfair and deceptive trade practices. In addition,                                                           
licensing requirements may be imposed on persons that broker, originate, service                                                     
or collect such loans.                                                                                                               
                                                                                                                                     
         Additional requirements may be imposed under federal, state or local                                                        
laws on so-called "high cost mortgage loans," which typically are defined as                                                         
loans that have interest rates or origination costs in excess of prescribed                                                          
levels. These laws may limit certain loan terms, such as prepayment penalties,                                                       
or the ability of a creditor to refinance a loan unless it is in the borrower's                                                      
interest. In addition, certain of these laws may allow claims against loan                                                           
brokers or originators, including claims based on fraud or misrepresentations,                                                       
to be asserted against persons acquiring the loans, such as the trust fund.                                                          
                                                                                                                                     
         The federal laws that may apply to loans held in the trust fund include                                                     
the following:                                                                                                                       
                                                                                                                                     
         -    the Truth in Lending Act and its regulations, which (among other                                                       
              things) require disclosures to borrowers regarding the terms of                                                        
              mortgage loans and provide property owners in a non-purchase money                                                     
              transaction with a right of rescission that generally extends for                                                      
              three days after proper disclosures are given (but in no event                                                         
              more than three years);                                                                                                
                                                                                                                                     
         -    the Home Ownership and Equity Protection Act and its regulations,                                                      
              which (among other things) imposes additional disclosure                                                               
              requirements and limitations on loan terms with respect to                                                             
              non-purchase money mortgage loans with interest rates or                                                               
              origination costs in excess of prescribed levels;                                                                      
                                                                                                                                     
                                       76                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    the Real Estate Settlement Procedures Act and its regulations,                                                         
              which (among other things) prohibit the payment of referral fees                                                       
              for real estate settlement services and regulate escrow accounts                                                       
              for taxes and insurance and billing inquiries made by borrowers;                                                       
                                                                                                                                     
         -    the Equal Credit Opportunity Act and its regulations, which (among                                                     
              other things) generally prohibits discrimination in any aspect of                                                      
              a credit transaction on certain enumerated basis, such as age,                                                         
              race, color, sex, religion, marital status, national origin or                                                         
              receipt of public assistance; and                                                                                      
                                                                                                                                     
         -    the Fair Credit Reporting Act, which (among other things)                                                              
              regulates the use of consumer reports obtained from consumer                                                           
              reporting agencies and the reporting of payment histories to                                                           
              consumer reporting agencies.                                                                                           
                                                                                                                                     
         The penalties for violating these federal, state, or local laws vary                                                        
depending on the applicable law and the particular facts of the situation.                                                           
However, private plaintiffs typically may assert claims for actual damages and,                                                      
in some cases, also may recover civil money penalties or exercise a right to                                                         
rescind the mortgage loan. Violations of certain laws may limit the ability to                                                       
collect all or part of the principal or interest on a mortgage loan and, in some                                                     
cases, borrowers even may be entitled to a refund of amounts previously paid.                                                        
Federal, state and local administrative or law enforcement agencies also may be                                                      
entitled to bring legal actions, including actions for civil money penalties or                                                      
restitution, for violations of certain of these laws.                                                                                
                                                                                                                                     
         Depending on the particular alleged misconduct, it is possible that                                                         
claims may be asserted against various participants in secondary mortgage market                                                     
transactions, including assignees that hold the mortgage loan, such as the trust                                                     
fund. Losses on loans from the application of these federal, state and local                                                         
laws that are not otherwise covered by a credit enhancement will be borne by the                                                     
holders of one or more classes of certificates.                                                                                      
                                                                                                                                     
                    MATERIAL FEDERAL INCOME TAX CONSEQUENCES                                                                         
                                                                                                                                     
         The following discussion is the opinion of Sidley Austin Brown & Wood                                                       
LLP, counsel to the depositor, as to the material federal income tax                                                                 
consequences of the purchase, ownership, and disposition of certificates. The                                                        
opinion of Sidley Austin Brown & Wood LLP is based on laws, regulations,                                                             
administrative rulings, and judicial decisions now in effect, all of which are                                                       
subject to change either prospectively or retroactively. The following                                                               
discussion does not describe aspects of federal tax law that are unique to                                                           
special taxpayers such as insurance companies and securities dealers and                                                             
investors who hold certificates as part of a straddle within the meaning of                                                          
Section 1092 of the Internal Revenue Code of 1986, as amended. Prospective                                                           
investors are encouraged to consult their tax advisors regarding the federal,                                                        
state, local, and any other tax consequences to them of the purchase, ownership,                                                     
and disposition of certificates.                                                                                                     
                                                                                                                                     
GENERAL                                                                                                                              
                                                                                                                                     
         The federal income tax consequences to certificateholders will vary                                                         
depending on whether an election is made to treat the trust fund relating to a                                                       
particular series of certificates as one or more REMICs under the Code. The                                                          
prospectus supplement for each series of certificates will specify whether one                                                       
or more REMIC elections will be made.                                                                                                
                                                                                                                                     
                                       77                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
NON-REMIC CERTIFICATES                                                                                                               
                                                                                                                                     
         If no REMIC election is made, the trust fund will be classified as a                                                        
"grantor trust" under subpart E, Part I of subchapter J of chapter 1 of subtitle                                                     
A of the Code, in which case, certificate owners will be treated for federal                                                         
income tax purposes as owners of a portion of the trust fund's assets as                                                             
described below. Sidley Austin Brown & Wood LLP will issue an opinion confirming                                                     
the above-stated conclusions for each trust fund for which no REMIC election is                                                      
made.                                                                                                                                
                                                                                                                                     
a.       SINGLE CLASS OF CERTIFICATES                                                                                                
                                                                                                                                     
         Characterization. The trust fund may be created with one class of                                                           
certificates, in which case, each certificateholder will be treated as the owner                                                     
of a pro rata undivided interest in each of the mortgage loans in the Pool. Any                                                      
amount received by a certificateholder in lieu of an amount due with respect to                                                      
any mortgage loan because of a default or delinquency in payment will be treated                                                     
for federal income tax purposes as having the same character as the payment it                                                       
replaces.                                                                                                                            
                                                                                                                                     
         Each certificateholder will be required to report on its federal income                                                     
tax return in accordance with its method of accounting its pro rata share of the                                                     
income from the mortgage loans in the trust fund, including interest, original                                                       
issue discount ("OID"), if any, prepayment fees, assumption fees, any gain                                                           
recognized upon an assumption and late payment charges received by the master                                                        
servicer. Under Code Sections 162 or 212 each certificateholder will be entitled                                                     
to deduct its pro rata share of servicing fees, prepayment fees, assumption                                                          
fees, any loss recognized upon an assumption and late payment charges retained                                                       
by the master servicer, provided that the amounts are reasonable compensation                                                        
for services rendered to the trust fund. Certificateholders that are                                                                 
individuals, estates or trusts will be entitled to deduct their share of                                                             
expenses only to the extent expenses of the trust fund plus their other                                                              
miscellaneous itemized deductions (as defined in the Code) exceed two percent of                                                     
their adjusted gross income. A certificateholder using the cash method of                                                            
accounting must take into account its pro rata share of income and deductions as                                                     
and when collected by or paid by the master servicer. A certificateholder using                                                      
an accrual method of accounting must take into account its pro rata share of                                                         
income as it accrues, or when received if the income is received before it                                                           
accrues, and must take into account its pro rata share of deductions as they                                                         
accrue. If the servicing fees paid to the master servicer are deemed to exceed                                                       
reasonable servicing compensation, the amount of any excess could be considered                                                      
as an ownership interest retained by the master servicer (or any person to whom                                                      
the master servicer assigned for value all or a portion of the servicing fees)                                                       
in a portion of the interest payments on the mortgage loans. The mortgage loans                                                      
would then be subject to the "coupon stripping" rules of the Code discussed                                                          
below.                                                                                                                               
                                                                                                                                     
         Generally, as to each series of certificates:                                                                               
                                                                                                                                     
         -    a certificate owned by a "domestic building and loan association"                                                      
              within the meaning of Code Section 7701(a)(19) and representing                                                        
              principal and interest payments on mortgage loans will be                                                              
              considered to represent "loans . . . secured by an interest in                                                         
              real property which is . . . residential property" within the                                                          
              meaning of Code Section 7701(a)(19)(C)(v), to the extent that the                                                      
              mortgage loans in the trust fund are of a type described in that                                                       
              Code section;                                                                                                          
                                                                                                                                     
         -    a certificate owned by a real estate investment trust representing                                                     
              an interest in mortgage loans will be considered to represent                                                          
              "real estate assets" within the meaning of Code Section                                                                
              856(c)(4)(A), to the extent that the mortgage loans in the trust                                                       
              fund are of a type described in that Code section, and interest                                                        
              income on the mortgage loans will be considered "interest on                                                           
              obligations secured by mortgages on real property" within the                                                          
              meaning of Code Section 856(c)(3)(B), to the extent income on the                                                      
              trust fund is described in that Code section; and                                                                      
                                                                                                                                     
                                       78                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    a certificate owned by a REMIC will represent an "obligation . . .                                                     
              which is principally secured, directly or indirectly, by an                                                            
              interest in real property" within the meaning of Code Section                                                          
              860G(a)(3) to the extent the mortgage loans in the trust fund are                                                      
              of a type described in that Code Section.                                                                              
                                                                                                                                     
         Buydown Loans. Certain trust funds may hold buydown loans. These loans                                                      
can be secured not only by a lien on real property but also by a pledged account                                                     
that is drawn upon to subsidize the mortgagor's monthly mortgage payments for a                                                      
limited period of time. For purposes of the conclusions described immediately                                                        
above, so long as the loan value of the underlying real property at least equals                                                     
the amount of the loan, then the loan will be treated as fully secured by real                                                       
property. If the loan value of the real property is less than the amount of the                                                      
loan, then a certificateholder could be required to treat the loan as one                                                            
secured by an interest in real property only to the extent of the value of the                                                       
real property. The related prospectus supplement for any series of certificates                                                      
will specify whether such apportionment would be required.                                                                           
                                                                                                                                     
         Premium. The price paid for a certificate by a holder will be allocated                                                     
to the holder's undivided interest in each mortgage loan based on each mortgage                                                      
loan's relative fair market value, so that the holder's undivided interest in                                                        
each mortgage loan will have its own tax basis. A certificateholder that                                                             
acquires an interest in mortgage loans at a premium may elect, under Code                                                            
Section 171, to amortize the premium under a constant interest method.                                                               
Amortizable bond premium will be treated as an offset to interest income on the                                                      
certificate. The basis for the certificate will be reduced to the extent that                                                        
amortizable premium is applied to offset interest payments. It is not clear                                                          
whether a reasonable prepayment assumption should be used in computing                                                               
amortization of premium allowable under Code Section 171. The legislative                                                            
history indicates that if a prepayment assumption is applied to an instrument                                                        
for purposes of the OID rules, that prepayment assumption should be applied in                                                       
amortizing bond premium.                                                                                                             
                                                                                                                                     
         If a premium is not subject to amortization using a reasonable                                                              
prepayment assumption, then the holder of a certificate acquired at a premium                                                        
may recognize a loss if a mortgage loan prepays in full. The amount of the loss                                                      
is 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                                                       
reasonable prepayment assumption is used to amortize premium, it appears that                                                        
any loss would be available, if at all, only if prepayments have occurred at a                                                       
rate faster than the reasonable assumed prepayment rate. It is not clear whether                                                     
any other adjustments would be required to reflect differences between an                                                            
assumed prepayment rate and the actual rate of prepayments. In addition, amounts                                                     
received on the redemption of an obligation issued by a natural person are                                                           
considered received in exchange for the obligation if the debt obligation is                                                         
purchased or issued after June 8, 1997 (i.e., treated the same as obligations                                                        
issued by corporations). This change could affect the character of any loss                                                          
(e.g., cause the loss to be treated as capital if the assets are held as capital                                                     
assets by the taxpayer).                                                                                                             
                                                                                                                                     
         On December 30, 1997 the IRS issued final regulations (the "Amortizable                                                     
Bond Premium Regulations") dealing with amortizable bond premium. These                                                              
regulations specifically do not apply to prepayable debt instruments subject to                                                      
Code Section 1272(a)(6). Absent further guidance from the IRS, the trustee                                                           
intends to account for amortizable bond premium in the manner described above.                                                       
Prospective purchasers of the certificates are encouraged to consult their tax                                                       
advisors regarding the possible application of the Amortizable Bond Premium                                                          
Regulations.                                                                                                                         
                                                                                                                                     
         Original Issue Discount. The IRS has stated in published rulings that,                                                      
in circumstances similar to those described in this prospectus, the special                                                          
rules of the Code relating to "original issue discount" (currently Code Sections                                                     
1271 through 1273 and 1275) will be applicable to a certificateholder's interest                                                     
in those mortgage loans meeting the conditions necessary for these sections to                                                       
apply. OID generally must                                                                                                            
                                                                                                                                     
                                       79                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
be reported as ordinary gross income as it accrues under a constant interest                                                         
method. See "-- Multiple Classes of Certificates -- Certificates Representing                                                        
Interests in Loans Other Than ARM Loans."                                                                                            
                                                                                                                                     
         Market Discount. A certificateholder that acquires an undivided                                                             
interest in mortgage loans may be subject to the market discount rules of Code                                                       
Sections 1276 through 1278 to the extent an undivided interest in a mortgage                                                         
loan is considered to have been purchased at a "market discount." Provided the                                                       
mortgage loan was not issued with OID, the amount of market discount is equal to                                                     
the excess of the portion of the principal amount of the mortgage loan allocable                                                     
to the holder's undivided interest in the mortgage loans over the holder's tax                                                       
basis in the undivided interest. Market discount with respect to a certificate                                                       
will be considered to be zero if the amount allocable to the certificate is less                                                     
than 0.25% of the certificate's stated redemption price at maturity multiplied                                                       
by the weighted average maturity remaining after the date of purchase. Treasury                                                      
regulations implementing the market discount rules have not yet been issued;                                                         
therefore, investors are advised to consult their own tax advisors regarding the                                                     
application of these rules and the advisability of making any of the elections                                                       
allowed under Code Sections 1276 through 1278.                                                                                       
                                                                                                                                     
         The Code provides that any principal payment (whether a scheduled                                                           
payment or a prepayment) or any gain on disposition of a market discount bond                                                        
shall be treated as ordinary income to the extent that it does not exceed the                                                        
accrued market discount at the time of the payment. The amount of accrued market                                                     
discount for purposes of determining the tax treatment of subsequent principal                                                       
payments or dispositions of the market discount bond is to be reduced by the                                                         
amount so treated as ordinary income.                                                                                                
                                                                                                                                     
         The Code also grants the Treasury Department authority to issue                                                             
regulations providing for the computation of accrued market discount on debt                                                         
instruments, the principal of which is payable in more than one installment.                                                         
Although the Treasury Department has not yet issued regulations, rules described                                                     
in the relevant legislative history describes how market discount should be                                                          
accrued on instruments bearing market discount. According to the legislative                                                         
history, the holder of a market discount bond may elect to accrue market                                                             
discount either on the basis of a constant interest rate or according to one of                                                      
the following methods. If a certificate is issued with OID, the amount of market                                                     
discount that accrues during any accrual period would be equal to the product of                                                     
the total remaining market discount and a fraction, the numerator of which is                                                        
the OID accruing during the period and the denominator of which is the total                                                         
remaining OID at the beginning of the accrual period. For certificates issued                                                        
without OID, the amount of market discount that accrues during a period is equal                                                     
to the product of the total remaining market discount and a fraction, the                                                            
numerator of which is the amount of stated interest paid during the accrual                                                          
period and the denominator of which is the total amount of stated interest                                                           
remaining to be paid at the beginning of the accrual period. For purposes of                                                         
calculating market discount under any of these methods in the case of                                                                
instruments that provide for payments that may be accelerated due to prepayments                                                     
of other obligations securing the instruments, the same prepayment assumption                                                        
applicable to calculating the accrual of OID will apply. The legislative history                                                     
states Congress intends that if a prepayment assumption would be used to                                                             
calculate OID it should also be used to accrue marked discount. Because the                                                          
regulations described above have not been issued, it is impossible to predict                                                        
what effect those regulations might have on the tax treatment of a certificate                                                       
purchased at a discount or premium in the secondary market.                                                                          
                                                                                                                                     
         A holder who acquired a certificate at a market discount also may be                                                        
required to defer, until the maturity date of the certificate or its earlier                                                         
disposition in a taxable transaction, the deduction of a portion of the amount                                                       
of interest that the holder paid or accrued during the taxable year on                                                               
indebtedness incurred or maintained to purchase or carry the certificate in                                                          
excess of the aggregate amount of interest (including OID) includible in the                                                         
holder's gross income for the taxable year with respect to the certificate. The                                                      
amount of the interest expense deferred in a taxable year may not exceed the                                                         
amount of market discount accrued on the certificate for the days during the                                                         
taxable year on which the holder held the certificate and, in general, would be                                                      
deductible when the market discount is includible in income. The amount of any                                                       
remaining deferred deduction is to be taken into account in the taxable year in                                                      
which the certificate                                                                                                                
                                                                                                                                     
                                       80                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
matures or is disposed of in a taxable transaction. In the case of a disposition                                                     
in which gain or loss is not recognized in whole or in part, any remaining                                                           
deferred deduction will be allowed to the extent of gain recognized on the                                                           
disposition. This deferral rule does not apply if the certificateholder elects                                                       
to include the market discount in income currently as it accrues on all market                                                       
discount obligations acquired by the certificateholder in that taxable year or                                                       
thereafter.                                                                                                                          
                                                                                                                                     
         Election to Treat All Interest as OID. The OID Regulations permit a                                                         
certificateholder to elect to accrue all interest, discount (including de                                                            
minimis market or original issue discount) and premium in income as interest,                                                        
based on a constant yield method. If this election is made with respect to a                                                         
certificate having market discount, the certificateholder is deemed to have made                                                     
an election to include market discount in income currently with respect to all                                                       
other market discount debt instruments that the certificateholder acquires                                                           
during the year of the election and thereafter. Similarly, a certificateholder                                                       
that makes this election for a certificate that is acquired at a premium is                                                          
deemed to have made an election to amortize bond premium with respect to all                                                         
premium debt instruments that the certificateholder owns and acquires. See "--                                                       
Single Class of Certificates -- Premium." The election to accrue interest,                                                           
discount and premium on a constant yield method with respect to a certificate                                                        
cannot be revoked without the consent of the IRS.                                                                                    
                                                                                                                                     
b.       MULTIPLE CLASSES OF CERTIFICATES                                                                                            
                                                                                                                                     
         1.       Stripped Bonds and Stripped Coupons                                                                                
                                                                                                                                     
         Pursuant to Code Section 1286, the separation of ownership of the right                                                     
to receive some or all of the interest payments on an obligation from ownership                                                      
of the right to receive some or all of the principal payments results in the                                                         
creation of "stripped bonds" with respect to principal payments and "stripped                                                        
coupons" with respect to interest payments. For purposes of Code Sections 1271                                                       
through 1288, Code Section 1286 treats a stripped bond or a stripped coupon as                                                       
an obligation issued on the date that the stripped interest is created. If a                                                         
trust fund is created with two classes of certificates, one class of                                                                 
certificates may represent the right to principal and interest, or principal                                                         
only, on all or a portion of the mortgage loans (the "Stripped Bond                                                                  
Certificates"), while the other class of certificates may represent the right to                                                     
some or all of the interest on the same mortgage loans (the "Stripped Coupon                                                         
Certificates").                                                                                                                      
                                                                                                                                     
         Servicing fees in excess of reasonable servicing fees ("excess                                                              
servicing") will be subject to the stripped bond rules. If the excess servicing                                                      
fee is less than 100 basis points (i.e., 1% interest on the mortgage loan                                                            
principal balance) or the certificates are initially sold with a de minimis                                                          
discount (which amount may be calculated without a prepayment assumption), any                                                       
non-de minimis discount arising from a subsequent transfer of the certificates                                                       
should be treated as market discount. The IRS appears to require that reasonable                                                     
servicing fees be calculated on a loan-by-loan basis, which could result in some                                                     
mortgage loans being treated as having more than 100 basis points of interest                                                        
stripped off. See "-- Non-REMIC Certificates" and "-- Multiple Classes of Senior                                                     
Certificates -- Stripped Bonds and Stripped Coupons."                                                                                
                                                                                                                                     
         Although current authority is not entirely clear, a Stripped Bond                                                           
Certificate should be treated as an interest in mortgage loans issued on the day                                                     
the certificate is purchased for purposes of calculating any OID. Generally, if                                                      
the discount on a mortgage loan is larger than a de minimis amount (as                                                               
calculated for purposes of the OID rules) a purchaser of the certificate will be                                                     
required to accrue the discount under the OID rules of the Code. See "--                                                             
Non-REMIC Certificates" and "-- Single Class of Certificates -- Original Issue                                                       
Discount." However, a purchaser of a Stripped Bond Certificate will be required                                                      
to account for any discount on the mortgage loans as market discount rather than                                                     
OID if either the amount of OID with respect to the mortgage loan is treated as                                                      
zero under the OID de minimis rule when the certificate was stripped or no more                                                      
than 100 basis points (including any amount of servicing fees in excess of                                                           
reasonable servicing fees) is stripped off of the trust fund's mortgage loans.                                                       
                                                                                                                                     
                                       81                                                                                            
                                                                                                                                     
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         The precise tax treatment of Stripped Coupon Certificates is                                                                
substantially uncertain. The Code could be read literally to require that OID                                                        
computations be made for each payment from each mortgage loan. However, based on                                                     
IRS guidance, it appears that all payments from a mortgage loan underlying a                                                         
Stripped Coupon Certificate should be treated as a single installment obligation                                                     
subject to the OID rules of the Code, in which case, all payments from the                                                           
mortgage loan would be included in the mortgage loan's stated redemption price                                                       
at maturity for purposes of calculating income on the Stripped Coupon                                                                
Certificate under the OID rules of the Code.                                                                                         
                                                                                                                                     
         Based on current authority it is unclear under what circumstances, if                                                       
any, the prepayment of mortgage loans will give rise to a loss to the holder of                                                      
a Stripped Bond Certificate purchased at a premium or a Stripped Coupon                                                              
Certificate. If the 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 certificate, it appears that                                                     
no loss will be available as a result of any particular prepayment unless                                                            
prepayments occur at a rate faster than the assumed prepayment rate. However, if                                                     
a certificate is treated as an interest in discrete mortgage loans, or if no                                                         
prepayment assumption is used, then when a mortgage loan is prepaid, any                                                             
certificate so treated should be able to recognize a loss equal to the portion                                                       
of the unrecovered premium of the certificate that is allocable to the mortgage                                                      
loan. In addition, amounts received in redemption for debt instruments issued by                                                     
natural persons purchased or issued after June 8, 1997 are treated as received                                                       
in exchange therefore (i.e., treated the same as obligations issued by                                                               
corporations). This change could affect the character of any loss.                                                                   
                                                                                                                                     
         Holders of Stripped Bond Certificates and Stripped Coupon Certificates                                                      
are encouraged to consult with their own tax advisors regarding the proper                                                           
treatment of these certificates for federal income tax purposes.                                                                     
                                                                                                                                     
         2.       Certificates Representing Interests in Loans Other Than ARM                                                        
Loans                                                                                                                                
                                                                                                                                     
         Under the OID Regulations, original issue discount could arise by the                                                       
charging of points by the originator of the mortgage in an amount greater than                                                       
the statutory de minimis exception, including a payment of points that is                                                            
currently deductible by the borrower under applicable Code provisions, or under                                                      
certain circumstances, by the presence of "teaser" rates (i.e., the initial                                                          
rates on the mortgage loans are lower than subsequent rates on the mortgage                                                          
loans) on the mortgage loans.                                                                                                        
                                                                                                                                     
         OID on each certificate must be included in the owner's ordinary income                                                     
for federal income tax purposes as it accrues, in accordance with a constant                                                         
yield method that takes into account the semi-annual (or more frequent)                                                              
compounding of interest, in advance of receipt of the cash attributable to the                                                       
income. The amount of OID required to be included in an owner's income in any                                                        
taxable year with respect to a certificate representing an interest in mortgage                                                      
loans other than mortgage loans with interest rates that adjust periodically                                                         
("ARM Loans") likely will be computed as described under "-- Accrual of Original                                                     
Issue Discount." The following discussion is based in part on Treasury                                                               
regulations issued under Code Sections 1271 through 1273 and 1275 (the "OID                                                          
Regulations") and on the provisions of the Tax Reform Act of 1986 (the "1986                                                         
Act"). The holder of a certificate should be aware, however, that the OID                                                            
Regulations may not adequately address certain issues relevant to prepayable                                                         
securities.                                                                                                                          
                                                                                                                                     
         Under the Code, each mortgage loan underlying the certificates will be                                                      
treated as having been issued on the date it was originated with an amount of                                                        
OID equal to the excess, if any, of the mortgage loan's stated redemption price                                                      
at maturity over its issue price. The issue price of a mortgage loan is                                                              
generally the amount lent to the mortgagee, which may be adjusted to take into                                                       
account certain loan origination fees. The stated redemption price at maturity                                                       
of a mortgage loan is the sum of all payments to be made on the mortgage loan                                                        
other than payments that are treated as qualified stated interest ("QSI")                                                            
payments. The accrual of this OID, as described under "-- Accrual of Original                                                        
Issue Discount," will,                                                                                                               
                                                                                                                                     
                                       82                                                                                            
                                                                                                                                     
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unless otherwise specified in the related prospectus supplement, utilize the                                                         
original yield to maturity of the certificates calculated based on a reasonable                                                      
assumed prepayment rate for the mortgage loans underlying the certificates (the                                                      
"Prepayment Assumption"), and will take into account events that occur during                                                        
the calculation period. There are no regulations dictating how the Prepayment                                                        
Assumption is determined. The legislative history of the 1986 Act (the                                                               
"Legislative History") provides, however, that the regulations will require that                                                     
the Prepayment Assumption be the prepayment assumption that is used in                                                               
determining the offering price of the certificate. No representation is made                                                         
that any certificate will prepay at the Prepayment Assumption or at any other                                                        
rate. The requirement of using a prepayment assumption for the purpose of                                                            
calculating OID only applies to debt instruments collateralized by other debt                                                        
instruments that are subject to prepayment rather than direct ownership                                                              
interests in debt instruments, (and, in tax years beginning after August 5,                                                          
1997, to pools of receivables the yield on which may be affected by prepayments                                                      
of receivables such mortgage loans the certificates represent.) However, no                                                          
other legal authority provides guidance with regard to the proper method for                                                         
accruing OID on obligations that are subject to prepayment, and, until further                                                       
guidance is issued, the master servicer intends to calculate and report OID                                                          
under the method described in "-- Accrual of Original Issue Discount."                                                               
                                                                                                                                     
         Accrual of Original Issue Discount. Generally, the owner of a                                                               
certificate must include in gross income the sum of the "daily portions," as                                                         
defined below, of the OID on any certificate for each day on which it owns the                                                       
certificate, including the date of purchase but excluding the date of                                                                
disposition. In the case of an original owner, the daily portions of OID will                                                        
generally be determined as set forth under the OID Regulations. In the case of                                                       
each full accrual period, this will be done by (i) adding (A) the present value                                                      
of all remaining payments, determined as of the end of the accrual period and                                                        
(B) any payments received during the accrual period, and (ii) subtracting from                                                       
that total the "adjusted issue price" at the beginning of the accrual period.                                                        
The present value of the remaining payments are determined first by using the                                                        
Prepayment Assumption to calculate the amount and timing of the remaining                                                            
payments and then by discounting the payments so determined using the original                                                       
yield to maturity. The adjusted issue price of a certificate at the beginning of                                                     
the first accrual period is its issue price; the adjusted issue price of a                                                           
certificate at the beginning of a subsequent accrual period is the adjusted                                                          
issue price at the beginning of the immediately preceding accrual period plus                                                        
the amount of OID allocable to that accrual period reduced by the amount of any                                                      
payment (other than QSI) made at the end of or during that accrual period. The                                                       
OID accruing during the accrual period will then be divided by the number of                                                         
days in the period to determine the daily portion of OID for each day in the                                                         
period. With respect to an initial accrual period shorter than a full monthly                                                        
accrual period, the daily portions of OID must be determined according to an                                                         
appropriate allocation under any reasonable method.                                                                                  
                                                                                                                                     
         Original issue discount generally must be reported as ordinary gross                                                        
income as it accrues under a constant yield method that takes into account the                                                       
compounding of interest as it accrues rather than when it is received. However,                                                      
the amount of original issue discount includible in the income of a holder of an                                                     
obligation is reduced when the obligation is acquired after its initial issuance                                                     
at a price greater than the sum of the original issue price and the previously                                                       
accrued original issue discount, less prior payments of principal. Accordingly,                                                      
if mortgage loans acquired by a certificateholder are purchased at a price equal                                                     
to the then unpaid principal amount of those mortgage loans, no original issue                                                       
discount attributable to the difference between the issue price and the original                                                     
principal amount of those mortgage loans (e.g., due to points) will be                                                               
includible by the holder. Other original issue discount on the mortgage loans                                                        
(that is, OID attributable to factors other than a difference between the issue                                                      
price and original principal amount, such as interest payments that increase                                                         
after an initial "teaser" rate) would still need to be accrued.                                                                      
                                                                                                                                     
         3.       Certificates Representing Interests in ARM Loans                                                                   
                                                                                                                                     
         The OID Regulations do not address the treatment of instruments, such                                                       
as the certificates, which represent interests in ARM Loans. Additionally, the                                                       
IRS has not issued guidance under the Code's                                                                                         
                                                                                                                                     
                                       83                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
coupon stripping rules with respect to instruments that represent interests in                                                       
ARM Loans. In the absence of any authority, the master servicer will report OID                                                      
on certificates attributable to ARM Loans ("Stripped ARM Obligations") to                                                            
holders in a manner it believes is consistent with the rules described under the                                                     
heading "-- Certificates Representing Interests in Loans Other Than ARM Loans"                                                       
and with the OID Regulations. As such, for purposes of projecting both the                                                           
remaining payments and future yield, the assumed rate payable on the ARM Loans                                                       
will be the fixed rate equivalent on the issue date. Application of these rules                                                      
may require inclusion of income on a Stripped ARM Obligation in advance of the                                                       
receipt of cash attributable to the income. Further, the addition to the                                                             
principal balance of an ARM Loan of interest deferred due to negative                                                                
amortization ("Deferred Interest") may require the inclusion of the interest in                                                      
the income of the certificateholder when the interest accrues. Furthermore, the                                                      
addition of Deferred Interest to the certificate's principal balance will result                                                     
in additional income (including possibly OID income) to the certificateholder                                                        
over the remaining life of the certificates.                                                                                         
                                                                                                                                     
         Because the treatment of Stripped ARM Obligations is uncertain,                                                             
investors are encouraged to consult their tax advisors regarding how income will                                                     
be includible with respect to the certificates.                                                                                      
                                                                                                                                     
c.       SALE OR EXCHANGE OF A CERTIFICATE                                                                                           
                                                                                                                                     
         Sale or exchange of a certificate before its maturity will result in                                                        
gain or loss equal to the difference, if any, between the amount received and                                                        
the owner's adjusted basis in the certificate. The adjusted basis of a                                                               
certificate generally will equal the seller's purchase price for the                                                                 
certificate, increased by the OID and market discount (if any) included in the                                                       
seller's gross income with respect to the certificate, and reduced by amortized                                                      
premiums (if any) and principal payments on the certificate previously received                                                      
by the seller. Except for the amount of any market discount not previously                                                           
included in income, the gain or loss will be capital gain or loss to an owner                                                        
for which a certificate is a "capital asset" within the meaning of Code Section                                                      
1221, and will be long-term or short-term depending on whether the certificate                                                       
has been owned for the long-term capital gain holding period (currently more                                                         
than one year).                                                                                                                      
                                                                                                                                     
         The certificates will be "evidences of indebtedness" within the meaning                                                     
of Code Section 582(c)(1), so that gain or loss recognized from the sale of a                                                        
certificate by a bank or a thrift institution to which that section applies will                                                     
be ordinary income or loss.                                                                                                          
                                                                                                                                     
d.       NON-U.S. PERSONS                                                                                                            
                                                                                                                                     
         As used in this prospectus, a "U.S. Person" means                                                                           
                                                                                                                                     
         -    a citizen or resident of the United States,                                                                            
                                                                                                                                     
         -    a corporation or a partnership (including an entity treated as a                                                       
              corporation or partnership for U.S. federal income tax purposes)                                                       
              organized in or created under the laws of the United States or any                                                     
              State thereof or the District of Columbia (unless in the case of a                                                     
              partnership Treasury Regulations provide otherwise),                                                                   
                                                                                                                                     
         -    an estate, the income of which from sources outside the United                                                         
              States is includible in gross income for federal income tax                                                            
              purposes regardless of its connection with the conduct of a trade                                                      
              or business within the United States, 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 authority to control all                                                            
              substantial decisions of the trust.                                                                                    
                                                                                                                                     
                                       84                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
In addition, U.S. Persons would include certain trusts that can elect to be                                                          
treated as U.S. Persons. A "Non-U.S. Person" is a person other than a U.S.                                                           
Person.                                                                                                                              
                                                                                                                                     
         Interest paid (or accrued) on the mortgage loans to a certificateholder                                                     
who is a non-U.S. Person will be considered "portfolio interest," and generally                                                      
will not be subject to United States federal income tax and withholding tax,                                                         
provided, that the interest is not effectively connected with the conduct of a                                                       
trade or business within the United States by the non-U.S. Person, and the                                                           
non-U.S. Person provides the trust or other person who is otherwise required to                                                      
withhold U.S. tax with respect to the mortgage loans with an appropriate                                                             
statement (on Form W-8BEN or other similar form), signed under penalties of                                                          
perjury, certifying that the beneficial owner of the mortgage loan is a foreign                                                      
person and providing that non-U.S. person's name and address. If an interest in                                                      
a mortgage loan is held through a securities clearing organization or certain                                                        
other financial institutions, the organization or institution may provide the                                                        
relevant signed statement to the withholding agent. In that case, however, the                                                       
signed statement must be accompanied by a Form W-8BEN or substitute form                                                             
provided by the non-U.S. Person that owns that interest in the mortgage loan. If                                                     
interest does not constitute portfolio interest, then it will be subject to U.S.                                                     
federal income and withholding tax at a rate of 30%, unless reduced or                                                               
eliminated pursuant to an applicable tax treaty and the non-U.S. Person provides                                                     
the trust, or an organization or financial institution described above, with an                                                      
appropriate statement (e.g., a Form W-8BEN), signed under penalties of perjury,                                                      
to that effect. Any foreclosure property owned by the trust fund could be                                                            
treated as a U.S. real property interest owned by certificateholders.                                                                
                                                                                                                                     
e.       INFORMATION REPORTING AND BACKUP WITHHOLDING                                                                                
                                                                                                                                     
         The master servicer will furnish or make available, within a reasonable                                                     
time after the end of each calendar year, to each person who was a                                                                   
certificateholder at any time during the year, the information deemed                                                                
appropriate to assist certificateholders in preparing their federal income tax                                                       
returns, or to enable holders to make any information available to beneficial                                                        
owners or financial intermediaries that hold certificates as nominees on behalf                                                      
of beneficial owners. If a holder, beneficial owner, financial intermediary or                                                       
other recipient of a payment on behalf of a beneficial owner fails to supply a                                                       
certified taxpayer identification number or if the Secretary of the Treasury                                                         
determines that the person has not reported all interest and dividend income                                                         
required to be shown on its federal income tax return, backup withholding may be                                                     
required with respect to any payments. Any amounts deducted and withheld from a                                                      
distribution to a recipient would be allowed as a credit against a recipient's                                                       
federal income tax liability providing the required information is supplied to                                                       
the IRS.                                                                                                                             
                                                                                                                                     
REMIC CERTIFICATES                                                                                                                   
                                                                                                                                     
         The trust fund relating to a series of certificates may elect to be                                                         
treated as a REMIC. Qualification as a REMIC requires ongoing compliance with                                                        
certain conditions. Although a REMIC is not generally subject to federal income                                                      
tax (see, however "-- Residual Certificates" and "-- Prohibited Transactions"),                                                      
if during any taxable year a trust fund with respect to which a REMIC election                                                       
is made fails to comply with one or more of the ongoing requirements of the Code                                                     
for REMIC status, including the implementation of restrictions on the purchase                                                       
and transfer of the residual interests in a REMIC as described under "Residual                                                       
Certificates," then the trust fund will not be treated as a REMIC for that year                                                      
and thereafter. In that event, the entity may be taxable as a separate                                                               
corporation, and the related certificates (the "REMIC Certificates") may not be                                                      
accorded the status or given the tax treatment described below. While the Code                                                       
authorizes the Treasury Department to issue regulations providing relief upon an                                                     
inadvertent termination of the status of a trust fund as a REMIC, no such                                                            
regulations have been issued. Any 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 REMIC status are not                                                     
satisfied. Assuming compliance with all provisions of the related pooling and                                                        
                                                                                                                                     
                                       85                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
servicing agreement, each trust fund that elects REMIC status will qualify as a                                                      
REMIC, and the related certificates will be considered to be regular interests                                                       
("Regular Certificates") or residual interests ("Residual Certificates") in the                                                      
REMIC. The related prospectus supplement for each series of certificates will                                                        
indicate whether the trust fund will make a REMIC election and whether a class                                                       
of certificates will be treated as a regular or residual interest in the REMIC.                                                      
With respect to each trust fund for which a REMIC election is to be made, Sidley                                                     
Austin Brown & Wood LLP will issue an opinion confirming the conclusions                                                             
expressed above concerning the status of the trust fund as a REMIC and the                                                           
status of the certificates as representing regular or residual interests in a                                                        
REMIC.                                                                                                                               
                                                                                                                                     
         In general, with respect to each series of certificates for which a                                                         
REMIC election is made, certificates held by a thrift institution taxed as a                                                         
"domestic building and loan association" will constitute assets described in                                                         
Code Section 7701(a)(19)(C); certificates held by a real estate investment trust                                                     
will constitute "real estate assets" within the meaning of Code Section                                                              
856(c)(4)(A); and interest on certificates held by a real estate investment                                                          
trust will be considered "interest on obligations secured by mortgages on real                                                       
property" within the meaning of Code Section 856(c)(3)(B). If less than 95% of                                                       
the REMIC's assets are assets qualifying under any of these Code sections, the                                                       
certificates will be qualifying assets only to the extent that the REMIC's                                                           
assets are qualifying assets and interest on the certificates will be qualifying                                                     
income only to the extent the REMIC's income is qualifying income. In addition,                                                      
payments on mortgage loans held pending distribution on the REMIC Certificates                                                       
will be considered to be real estate assets for purposes of Code Section 856(c).                                                     
                                                                                                                                     
         In some instances the mortgage loans may not be treated entirely as                                                         
assets described in the foregoing sections. See, in this regard, the discussion                                                      
of buydown loans contained in "-- Non-REMIC Certificates -- Single Class of                                                          
Certificates." REMIC Certificates held by a real estate investment trust will                                                        
not constitute "Government Securities" within the meaning of Code Section                                                            
856(c)(4)(A), and REMIC Certificates held by a regulated investment company will                                                     
not constitute "Government Securities" within the meaning of Code Section                                                            
851(b)(4)(A)(ii). REMIC Certificates held by certain financial institutions will                                                     
constitute "evidences of indebtedness" within the meaning of Code Section                                                            
582(c)(1).                                                                                                                           
                                                                                                                                     
         A "qualified mortgage" for REMIC purposes is any obligation (including                                                      
certificates of participation in an obligation) that is principally secured by                                                       
an interest in real property and that is transferred to the REMIC within a                                                           
prescribed time period in exchange for regular or residual interests in the                                                          
REMIC. The REMIC Regulations provide that manufactured housing or mobile homes                                                       
(not including recreational vehicles, campers or similar vehicles) that are                                                          
"single family residences" under Code Section 25(e)(10) will qualify as real                                                         
property without regard to state law classifications. Under Code Section                                                             
25(e)(10), a single family residence includes any manufactured home that has a                                                       
minimum of 400 square feet of living space and a minimum width in excess of 102                                                      
inches and that is of a kind customarily used at a fixed location.                                                                   
                                                                                                                                     
         Tiered REMIC Structures. For certain series of certificates, two or                                                         
more separate elections may be made to treat designated portions of the related                                                      
trust fund as REMICs (respectively, the "Underlying REMIC" or "REMICs" and the                                                       
"Master REMIC") for federal income tax purposes. Upon the issuance of such a                                                         
series of certificates, assuming compliance with all provisions of the related                                                       
pooling and servicing agreement, the Master REMIC as well as each Underlying                                                         
REMIC will each qualify as a REMIC, and the REMIC Certificates issued by the                                                         
Master REMIC and each Underlying REMIC, respectively, will be considered to                                                          
evidence ownership of Regular Certificates or Residual Certificates in the                                                           
related REMIC within the meaning of the REMIC provisions. With respect to each                                                       
trust fund for which more than one REMIC election is to be made, Sidley Austin                                                       
Brown & Wood LLP will issue an opinion confirming the conclusions expressed                                                          
above concerning the status of the Master REMIC and each Underlying REMIC as a                                                       
REMIC and the status of the certificates as regular or residual interests in a                                                       
REMIC.                                                                                                                               
                                                                                                                                     
                                       86                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         Except for the residual interest in any Underlying REMIC, only REMIC                                                        
Certificates issued by the Master REMIC will be offered under this prospectus.                                                       
All Underlying REMICs and the Master REMIC will be treated as one REMIC 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; "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.                                                                                                            
                                                                                                                                     
a.       REGULAR CERTIFICATES                                                                                                        
                                                                                                                                     
         General. Except as otherwise stated in this discussion, 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 Regular Certificates that otherwise report income under a                                                       
cash method of accounting will be required to report income with respect to                                                          
Regular Certificates under an accrual method.                                                                                        
                                                                                                                                     
         Original Issue Discount and Premium. The Regular Certificates may be                                                        
issued with OID. Generally, OID, if any, will equal the difference between the                                                       
"stated redemption price at maturity" of a Regular Certificate and its "issue                                                        
price." Holders of any class of certificates issued with OID will be required to                                                     
include OID in gross income for federal income tax purposes as it accrues, in                                                        
accordance with a constant yield method based on the semi-annual (or more                                                            
frequent) compounding of interest rather than in accordance with receipt of the                                                      
interest payments. The following discussion is based in part on the OID                                                              
Regulations and in part on the provisions of the 1986 Act. Holders of Regular                                                        
Certificates (the "Regular Certificateholders") should be aware, however, that                                                       
the OID Regulations do not adequately address certain issues relevant to                                                             
prepayable securities, such as the Regular Certificates.                                                                             
                                                                                                                                     
         Rules governing OID are set forth in Code Sections 1271 through 1273                                                        
and 1275. These rules require that the amount and rate of accrual of OID be                                                          
calculated based on the Prepayment Assumption and the anticipated reinvestment                                                       
rate, if any, relating to the Regular Certificates and prescribe a method for                                                        
adjusting the amount and rate of accrual of the discount where the actual                                                            
prepayment rate differs from the Prepayment Assumption. Under the Code, the                                                          
Prepayment Assumption must be determined in the manner prescribed by                                                                 
regulations, which regulations have not yet been issued. The Legislative History                                                     
provides, however, that Congress intended the regulations to require that the                                                        
Prepayment Assumption be the prepayment assumption that is used in determining                                                       
the initial offering price of the Regular Certificates. The prospectus                                                               
supplement for each series of Regular Certificates will specify the Prepayment                                                       
Assumption to be used for the purpose of determining the amount and rate of                                                          
accrual of OID. No representation is made that the Regular Certificates will                                                         
prepay at the Prepayment Assumption or at any other rate.                                                                            
                                                                                                                                     
         The IRS issued final regulations (the "Contingent Regulations") in June                                                     
1996 governing the calculation of OID on instruments having contingent interest                                                      
payments. The Contingent Regulations specifically do not apply for purposes of                                                       
calculating OID on debt instruments subject to Code Section 1272(a)(6), such as                                                      
the Regular Certificates. Additionally, the OID Regulations do not contain                                                           
provisions specifically interpreting Code Section 1272(a)(6). The trustee                                                            
intends to base its computations on Code Section 1272(a)(6) and the OID                                                              
Regulations as described in this prospectus. However, because no regulatory                                                          
guidance currently exists under Code Section 1272(a)(6), there can be no                                                             
assurance that this methodology represents the correct manner of calculating                                                         
OID.                                                                                                                                 
                                                                                                                                     
         In general, each Regular Certificate will be treated as a single                                                            
installment obligation issued with an amount of OID equal to the excess of its                                                       
"stated redemption price at maturity" over its issue price. The issue price of a                                                     
Regular Certificate is the first price at which a substantial amount of Regular                                                      
Certificates of that class are first sold to the public (excluding bond houses,                                                      
brokers, underwriters or wholesalers).                                                                                               
                                                                                                                                     
                                       87                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
The issue price of a Regular Certificate includes the amount, if any, paid by an                                                     
initial certificateholder for interest accruing before the issue date of the                                                         
Regular Certificate. The stated redemption price at maturity of a Regular                                                            
Certificate includes the original principal amount of the Regular Certificate,                                                       
but generally will not include distributions of interest that constitute                                                             
"qualified stated interest." Qualified stated interest generally means interest                                                      
unconditionally payable at intervals of one year or less at a single fixed rate                                                      
or qualified variable rate (as described below) during the entire term of the                                                        
Regular Certificate. Interest is payable at a single fixed rate only if the rate                                                     
appropriately takes into account the length of the interval between payments.                                                        
Distributions of interest on Regular Certificates with respect to which Deferred                                                     
Interest will accrue will not constitute qualified stated interest payments, and                                                     
the stated redemption price at maturity of the Regular Certificates includes all                                                     
distributions of interest as well as principal thereon.                                                                              
                                                                                                                                     
         If the interval between the issue date and the first distribution date                                                      
on a Regular Certificate is longer than the interval between subsequent                                                              
distribution dates, but the amount of the distribution is not adjusted to                                                            
reflect the longer interval, then for purposes of determining whether the                                                            
Regular Certificate has de minimis OID, the stated redemption price of the                                                           
Regular Certificate is treated as the issue price (determined as described                                                           
above) plus the greater of (i) the amount of the distribution foregone or (ii)                                                       
the excess (if any) of the Regular Certificates stated principal over its issue                                                      
price. If the interval between the issue date and the first distribution date on                                                     
a Regular Certificate is shorter than the interval between subsequent                                                                
distribution dates, but the amount of the distribution is not adjusted to                                                            
reflect the shorter interval, then for the purposes of determining the OID, if                                                       
any, on the Regular Certificate, the excess amount of the distribution would be                                                      
added to the Regular Certificate's stated redemption price. Regular                                                                  
Certificateholders should consult their own tax advisors to determine the issue                                                      
price and stated redemption price at maturity of a Regular Certificate.                                                              
Additionally, it is possible that the IRS could assert that the stated                                                               
pass-through rate of interest on the Regular Certificates is not unconditionally                                                     
payable because late payments or nonpayments on the mortgage loans are not                                                           
penalized nor are there reasonable remedies in place to compel payment on the                                                        
mortgage loans. That position, if successful, would require all holders of                                                           
Regular Certificates to accrue income on the certificates under the OID                                                              
Regulations.                                                                                                                         
                                                                                                                                     
         Under the de minimis rule, OID on a Regular Certificate will be                                                             
considered to be zero if it is less than 0.25% of the stated redemption price at                                                     
maturity of the Regular Certificate multiplied by the weighted average maturity                                                      
of the Regular Certificate. The weighted average maturity of a Regular                                                               
Certificate is the sum of the weighted maturity of each payment of the Regular                                                       
Certificate's stated redemption price. The weighted maturity of each stated                                                          
redemption price payment is (i) the number of complete years from the issue date                                                     
until the payment is made, multiplied by (ii) a fraction, the numerator of which                                                     
is the amount of the payment and the denominator of which is the Regular                                                             
Certificate's total stated redemption price. Although currently unclear, it                                                          
appears that the schedule of these distributions should be determined in                                                             
accordance with the Prepayment Assumption. The Prepayment Assumption with                                                            
respect to a series of Regular Certificates will be set forth in the related                                                         
prospectus supplement. Holders generally must report de minimis OID pro rata as                                                      
principal payments are received, and income will be capital gain if the Regular                                                      
Certificate is held as a capital asset. However, accrual method holders may                                                          
elect to accrue all de minimis OID as well as market discount under a constant                                                       
yield method.                                                                                                                        
                                                                                                                                     
         The prospectus supplement with respect to a trust fund may provide for                                                      
certain Regular Certificates to be issued at prices significantly exceeding                                                          
their principal amounts or based on notional principal balances (the                                                                 
"Super-Premium Certificates"). The income tax treatment of Super-Premium                                                             
Certificates is not entirely certain. For information reporting purposes, the                                                        
trust fund intends to take the position that the stated redemption price at                                                          
maturity of Super-Premium Certificates is the sum of all payments to be made on                                                      
these Regular Certificates determined under the Prepayment Assumption, with the                                                      
result that these Regular Certificates would be issued with OID. The calculation                                                     
of income in this manner could result in negative original issue discount (which                                                     
delays future accruals of OID rather than being immediately deductible) when                                                         
prepayments on the mortgage loans exceed those estimated under                                                                       
                                                                                                                                     
                                       88                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
the Prepayment Assumption. As discussed above, the Contingent Regulations                                                            
specifically do not apply to prepayable debt instruments subject to Code Section                                                     
1272(a)(6), such as the Regular Certificates. However, if the Super-Premium                                                          
Certificates were treated as contingent payment obligations, it is unclear how                                                       
holders of those certificates would report income or recover their basis. In the                                                     
alternative, the IRS could assert that the stated redemption price at maturity                                                       
of Super-Premium Certificates should be limited to their principal amount                                                            
(subject to the discussion under "-- Accrued Interest Certificates"), so that                                                        
the Regular Certificates would be considered for federal income tax purposes to                                                      
be issued at a premium. If this position were to prevail, the rules described                                                        
under "-- Regular Certificates -- Premium" would apply. It is unclear when a                                                         
loss may be claimed for any unrecovered basis for a Super-Premium Certificate.                                                       
It is possible that a holder of a Super-Premium Certificate may only claim a                                                         
loss either (i) when its remaining basis exceeds the maximum amount of future                                                        
payments (assuming no further prepayments) or (ii) when the final payment is                                                         
received with respect to the Super-Premium Certificate. Absent further guidance,                                                     
the trustee intends to treat the Super-Premium Certificates as described in this                                                     
prospectus.                                                                                                                          
                                                                                                                                     
         Under the REMIC Regulations, if the issue price of a Regular                                                                
Certificate (other than those based on a notional amount) does not exceed 125%                                                       
of its actual principal amount, the interest rate is not considered                                                                  
disproportionately high. Accordingly, such a Regular Certificate generally                                                           
should not be treated as a Super-Premium Certificate and the rules described                                                         
under "-- Regular Certificates -- Premium" should apply. However, it is possible                                                     
that the holder of a certificate issued at a premium, even if the premium is                                                         
less than 25% of the certificate's actual principal balance, will be required to                                                     
amortize the premium under an original issue discount method or contingent                                                           
interest method even though no election under Code section 171 is made to                                                            
amortize the premium.                                                                                                                
                                                                                                                                     
         Generally, a Regular Certificateholder must include in gross income the                                                     
"daily portions," as determined below, of the OID that accrues on the Regular                                                        
Certificate for each day the certificateholder holds the Regular Certificate,                                                        
including the purchase date but excluding the disposition date. The daily                                                            
portions of OID are determined by allocating to each day in an accrual period                                                        
the ratable portion of OID allocable to the accrual period. Accrual periods may                                                      
be of any length and may vary in length over the term of the Regular                                                                 
Certificates, provided that each accrual period (i) is no longer than one year,                                                      
(ii) begins or ends on a distribution date (except for the first accrual period                                                      
which begins on the issue date) and (iii) begins on the day after the preceding                                                      
accrual period ends. In the case of a full accrual period, the OID accrued                                                           
during the accrual period will be determined by                                                                                      
                                                                                                                                     
         -    adding                                                                                                                 
                                                                                                                                     
              -   The present value at the end of the accrual period                                                                 
                  (determined by using as a discount factor the original yield                                                       
                  to maturity of the Regular Certificates as calculated under                                                        
                  the Prepayment Assumption) of all remaining payments to be                                                         
                  received on the Regular Certificates under the Prepayment                                                          
                  Assumption and                                                                                                     
                                                                                                                                     
              -   any payments included in the stated redemption price at                                                            
                  maturity received during the same accrual period, and                                                              
                                                                                                                                     
         -    subtracting from that total the adjusted issue price of the                                                            
              Regular Certificates at the beginning of the same accrual period.                                                      
                                                                                                                                     
The adjusted issue price of a Regular Certificate at the beginning of the first                                                      
accrual period is its issue price; the adjusted issue price of a Regular                                                             
Certificate at the beginning of a subsequent accrual period is the adjusted                                                          
issue price at the beginning of the immediately preceding accrual period plus                                                        
the amount of OID allocable to that accrual period and reduced by the amount of                                                      
any payment other than a payment of qualified stated interest made at the end of                                                     
or during that accrual period. The OID accrued during an                                                                             
                                                                                                                                     
                                       89                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
accrual period will then be divided by the number of days in the period to                                                           
determine the daily portion of OID for each day in the accrual period. The                                                           
calculation of OID under the method described above will cause the accrual of                                                        
OID to either increase or decrease (but never below zero) in a given accrual                                                         
period to reflect the fact that prepayments are occurring faster or slower than                                                      
under the Prepayment Assumption. With respect to an initial accrual period                                                           
shorter than a full accrual period, the daily portions of OID may be determined                                                      
according to an appropriate allocation under any reasonable method.                                                                  
                                                                                                                                     
         A subsequent purchaser of a Regular Certificate issued with OID who                                                         
purchases the Regular Certificate at a cost less than the remaining stated                                                           
redemption price at maturity will also be required to include in gross income                                                        
the sum of the daily portions of OID on that Regular Certificate. In computing                                                       
the daily portions of OID for a subsequent purchaser of a Regular Certificate                                                        
(as well as an initial purchaser that purchases at a price higher than the                                                           
adjusted issue price but less than the stated redemption price at maturity),                                                         
however, the daily portion is reduced by the amount that would be the daily                                                          
portion for the day (computed in accordance with the rules set forth above)                                                          
multiplied by a fraction, the numerator of which is:                                                                                 
                                                                                                                                     
         -    the sum of the issue price plus the aggregate amount of OID that                                                       
              would have been includible in the gross income of an original                                                          
              Regular Certificateholder (who purchased the Regular Certificate                                                       
              at its issue price), less                                                                                              
                                                                                                                                     
         -    any prior payments included in the stated redemption price at                                                          
              maturity, and the denominator of which is the sum of the daily                                                         
              portions for that Regular Certificate for all days beginning on                                                        
              the date after the purchase date and ending on the maturity date                                                       
              computed under the Prepayment Assumption.                                                                              
                                                                                                                                     
A holder who pays an acquisition premium instead may elect to accrue OID by                                                          
treating the purchase as a purchase at original issue.                                                                               
                                                                                                                                     
         Variable Rate Regular Certificates. Regular Certificates may provide                                                        
for interest based on a variable rate. Interest is treated as payable at a                                                           
variable rate and not as contingent interest if, generally, the issue price does                                                     
not exceed the original principal balance by more than a specified amount and                                                        
the interest compounds or is payable at least annually based on current values                                                       
of certain objective rates or based on lending rates for newly borrowed funds.                                                       
An objective rate is a rate (other than a qualified floating rate) that is                                                           
determined using a single fixed formula and that is based on objective financial                                                     
or economic information. The variable interest generally will be qualified                                                           
stated interest to the extent it is unconditionally payable at least annually                                                        
and, to the extent successive variable rates are used, interest is not                                                               
significantly accelerated or deferred.                                                                                               
                                                                                                                                     
         The amount of OID with respect to a Regular Certificate bearing a                                                           
variable rate of interest will accrue in the manner described under "-- Original                                                     
Issue Discount and Premium" by assuming generally that the index used for the                                                        
variable rate will remain fixed throughout the term of the certificate.                                                              
Appropriate adjustments are made for the actual variable rate.                                                                       
                                                                                                                                     
         Election to Treat All Interest as OID. The OID Regulations permit a                                                         
certificateholder to elect to accrue all interest, discount (including de                                                            
minimis market or original issue discount) and premium in income as interest,                                                        
based on a constant yield method. If this election is made with respect to a                                                         
certificate having market discount, then the certificateholder is deemed to have                                                     
made an election to include market discount in income currently with respect to                                                      
all other market discount debt instruments that the certificateholder acquires                                                       
during the year of the election and thereafter. Similarly, a certificateholder                                                       
that makes this election for a certificate that is acquired at a premium is                                                          
deemed to have made an election to amortize bond premium with respect to all                                                         
premium debt instruments that the certificateholder owns and                                                                         
                                                                                                                                     
                                       90                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
acquires. See "-- Regular Certificates -- Premium." The election to accrue                                                           
interest, discount and premium on a constant yield method with respect to a                                                          
certificate cannot be revoked without the consent of the IRS.                                                                        
                                                                                                                                     
         Market Discount. A purchaser of a Regular Certificate may also be                                                           
subject to the market discount provisions of Code Sections 1276 through 1278.                                                        
Under these provisions and the OID Regulations, "market discount" equals the                                                         
excess, if any, of a Regular Certificate's stated principal amount or, in the                                                        
case of a Regular Certificate with OID, the adjusted issue price (determined for                                                     
this purpose as if the purchaser had purchased the Regular Certificate from an                                                       
original holder) over the price for the Regular Certificate paid by the                                                              
purchaser. A certificateholder that purchases a Regular Certificate at a market                                                      
discount will recognize income upon receipt of each distribution representing                                                        
stated redemption price. In particular, under Section 1276 of the Code a holder                                                      
generally will be required to allocate each principal distribution 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 electing certificateholder on                                                     
or after the first day of the first taxable year to which the election applies.                                                      
                                                                                                                                     
         Market discount with respect to a Regular Certificate will be                                                               
considered to be zero if it is less than 0.25% of the Regular Certificate's                                                          
stated redemption price at maturity multiplied by the Regular Certificate's                                                          
weighted average maturity remaining after the date of purchase. If market                                                            
discount on a Regular Certificate is considered to be zero under this rule, the                                                      
actual amount of market discount must be allocated to the remaining principal                                                        
payments on the Regular Certificate, and gain equal to the allocated amount will                                                     
be recognized when the corresponding principal payment is made. Treasury                                                             
regulations implementing the market discount rules have not yet been issued;                                                         
therefore, investors should consult their own tax advisors regarding the                                                             
application of these rules and the advisability of making any of the elections                                                       
allowed under Code Sections 1276 through 1278.                                                                                       
                                                                                                                                     
         The Code provides that any principal payment (whether a scheduled                                                           
payment or a prepayment) or any gain on disposition of a market discount bond                                                        
shall be treated as ordinary income to the extent that it does not exceed the                                                        
accrued market discount at the time of the payment or disposition. The amount of                                                     
accrued market discount for purposes of determining the tax treatment of                                                             
subsequent principal payments or dispositions of the market discount bond is to                                                      
be reduced by the amount so treated as ordinary income.                                                                              
                                                                                                                                     
         The Code also grants authority to the Treasury Department to issue                                                          
regulations providing for the computation of accrued market discount on debt                                                         
instruments, the principal of which is payable in more than one installment.                                                         
Until regulations are issued by the Treasury, rules described in the Legislative                                                     
History will apply. Under those rules, the holder of a market discount bond may                                                      
elect to accrue market discount either on the basis of a constant yield rate or                                                      
according to one of the following methods:                                                                                           
                                                                                                                                     
         -    For Regular Certificates issued with OID, the amount of market                                                         
              discount that accrues during a period is equal to the product of                                                       
              the total remaining market discount and a fraction, the numerator                                                      
              of which is the OID accruing during the period and the denominator                                                     
              of which is the total remaining OID at the beginning of the                                                            
              period.                                                                                                                
                                                                                                                                     
         -    For Regular Certificates issued without OID, the amount of market                                                      
              discount that accrues during a period is equal to the product of                                                       
              the total remaining market discount and a fraction, the numerator                                                      
              of which is the amount of stated interest paid during the accrual                                                      
              period and the denominator of which is the total amount of stated                                                      
              interest remaining to be paid at the beginning of the period.                                                          
                                                                                                                                     
                                       91                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
For purposes of calculating market discount under any of the above methods in                                                        
the case of instruments (such as the Regular Certificates) that provide for                                                          
payments that may be accelerated due to prepayments of other obligations                                                             
securing the instruments, the same Prepayment Assumption applicable to                                                               
calculating the accrual of OID will apply.                                                                                           
                                                                                                                                     
         A holder of a Regular Certificate that acquires the Regular Certificate                                                     
at a market discount also may be required to defer, until the maturity date of                                                       
the Regular Certificate or its earlier disposition in a taxable transaction, the                                                     
deduction of a portion of the amount of interest that the holder paid or accrued                                                     
during the taxable year on indebtedness incurred or maintained to purchase or                                                        
carry the Regular Certificate in excess of the aggregate amount of interest                                                          
(including OID) includible in the holder's gross income for the taxable year                                                         
with respect to the Regular Certificate. The amount of the net interest expense                                                      
deferred in a taxable year may not exceed the amount of market discount accrued                                                      
on the Regular Certificate for the days during the taxable year on which the                                                         
holder held the Regular Certificate and, in general, would be deductible when                                                        
the market discount is includible in income. The amount of any remaining                                                             
deferred deduction is to be taken into account in the taxable year in which the                                                      
Regular Certificate matures or is disposed of in a taxable transaction. In the                                                       
case of a disposition in which gain or loss is not recognized in whole or in                                                         
part, any remaining deferred deduction will be allowed to the extent of gain                                                         
recognized on the disposition. This deferral rule does not apply if the Regular                                                      
Certificateholder elects to include the market discount in income currently as                                                       
it accrues on all market discount obligations acquired by the Regular                                                                
Certificateholder in that taxable year or thereafter.                                                                                
                                                                                                                                     
         Premium. A purchaser of a Regular Certificate that purchases the                                                            
Regular Certificate at a cost (not including accrued qualified stated interest)                                                      
greater than its remaining stated redemption price at maturity will be                                                               
considered to have purchased the Regular Certificate at a premium and may elect                                                      
to amortize the premium under a constant yield method. It is not clear whether                                                       
the Prepayment Assumption would be taken into account in determining the life of                                                     
the Regular Certificate for this purpose. The Amortizable Bond Premium                                                               
Regulations described above specifically do not apply to prepayable debt                                                             
instruments subject to Code Section 1272(a)(6) such as the Regular Certificates.                                                     
Absent further guidance from the IRS, the trustee intends to account for                                                             
amortizable bond premium in the manner described in this prospectus. However,                                                        
the Legislative History states that the same rules that apply to accrual of                                                          
market discount (which rules require use of a Prepayment Assumption in accruing                                                      
market discount with respect to Regular Certificates without regard to whether                                                       
the certificates have OID) will also apply in amortizing bond premium under Code                                                     
Section 171. The Code provides that amortizable bond premium will be allocated                                                       
among the interest payments on the Regular Certificates and will be applied as                                                       
an offset against the interest payment. Prospective purchasers of the Regular                                                        
Certificates should consult their tax advisors regarding the possible                                                                
application of the Amortizable Bond Premium Regulations.                                                                             
                                                                                                                                     
         Deferred Interest. Certain classes of Regular Certificates will provide                                                     
for the accrual of Deferred Interest with respect to one or more ARM Loans. Any                                                      
Deferred Interest that accrues with respect to a class of Regular Certificates                                                       
will constitute income to the holders of the certificates before the time                                                            
distributions of cash with respect to the Deferred Interest are made. It is                                                          
unclear, under the OID Regulations, whether any of the interest on the                                                               
certificates will constitute qualified stated interest or whether all or a                                                           
portion of the interest payable on the certificates must be included in the                                                          
stated redemption price at maturity of the certificates and accounted for as OID                                                     
(which could accelerate the inclusion). Interest on Regular Certificates must in                                                     
any event be accounted for under an accrual method by the holders of the                                                             
certificates and, therefore, applying the latter analysis may result only in a                                                       
slight difference in the timing of the inclusion in income of interest on the                                                        
Regular Certificates.                                                                                                                
                                                                                                                                     
         Effects of Defaults and Delinquencies. Certain series of certificates                                                       
may contain one or more classes of subordinated certificates, and in the event                                                       
there are defaults or delinquencies on the mortgage loans, amounts that would                                                        
otherwise be distributed on the subordinated certificates may instead be                                                             
                                                                                                                                     
                                       92                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
distributed on senior certificates. Subordinated certificateholders nevertheless                                                     
will be required to report income with respect to their certificates under an                                                        
accrual method without giving effect to delays and reductions in distributions                                                       
on the subordinated certificates attributable to defaults and delinquencies on                                                       
the mortgage loans, except to the extent that it can be established that the                                                         
amounts are uncollectible. As a result, the amount of income reported by a                                                           
subordinated certificateholder in any period could significantly exceed the                                                          
amount of cash distributed to the holder in that period. The holder will                                                             
eventually be allowed a loss (or will be allowed to report a lesser amount of                                                        
income) to the extent that the aggregate amount of distributions on the                                                              
subordinated certificate is reduced as a result of defaults and delinquencies on                                                     
the mortgage loans. However, the timing and characterization of any losses or                                                        
reductions in income are uncertain, and, accordingly, subordinated                                                                   
certificateholders are urged to consult their own tax advisors on this point.                                                        
                                                                                                                                     
         Sale, Exchange or Redemption. If a Regular Certificate is sold,                                                             
exchanged, redeemed or retired, the seller will recognize gain or loss equal to                                                      
the difference between the amount realized on the sale, exchange, redemption, or                                                     
retirement and the seller's adjusted basis in the Regular Certificate. The                                                           
adjusted basis generally will equal the original cost of the Regular Certificate                                                     
to the seller, increased by any OID and market discount included in the seller's                                                     
gross income with respect to the Regular Certificate, and reduced (but not below                                                     
zero) by payments included in the stated redemption price at maturity previously                                                     
received by the seller and by any amortized premium. Similarly, a holder who                                                         
receives a payment that is part of the stated redemption price at maturity of a                                                      
Regular Certificate will recognize gain equal to the excess, if any, of the                                                          
amount of the payment over the holder's adjusted basis in the Regular                                                                
Certificate. A Regular Certificateholder who receives a final payment that is                                                        
less than the holder's adjusted basis in the Regular Certificate will generally                                                      
recognize a loss. Except as provided in the following paragraph and as provided                                                      
under "Market Discount," any gain or loss will be capital gain or loss, provided                                                     
that the Regular Certificate is held as a "capital asset" (generally, property                                                       
held for investment) within the meaning of Code Section 1221.                                                                        
                                                                                                                                     
         Gain from the sale or other disposition of a Regular Certificate that                                                       
might otherwise be capital gain will be treated as ordinary income to the extent                                                     
that the gain does not exceed the excess, if any, of the amount that would have                                                      
been includible in the holder's income with respect to the Regular Certificate                                                       
had income accrued on it at a rate equal to 110% of the AFR as defined in Code                                                       
Section 1274(d) determined as of the date of purchase of the Regular                                                                 
Certificate, over the amount actually includible in the holder's income.                                                             
                                                                                                                                     
         The Regular Certificates will be "evidences of indebtedness" within the                                                     
meaning of Code Section 582(c)(1), so that gain or loss recognized from the sale                                                     
of a Regular Certificate by a bank or a thrift institution to which this section                                                     
applies will be ordinary income or loss.                                                                                             
                                                                                                                                     
         The Regular Certificate information reports will include a statement of                                                     
the adjusted issue price of the Regular Certificate at the beginning of each                                                         
accrual period. In addition, the reports will include information necessary to                                                       
compute the accrual of any market discount that may arise upon secondary trading                                                     
of Regular Certificates. Because exact computation of the accrual of market                                                          
discount on a constant yield method would require information relating to the                                                        
holder's purchase price which the REMIC may not have, it appears that the                                                            
information reports will only require information pertaining to the appropriate                                                      
proportionate method of accruing market discount.                                                                                    
                                                                                                                                     
         Certain of the Regular Certificates ("Payment Lag Certificates") may                                                        
provide for payments of interest based on accrual periods that have the same                                                         
number of days as the accrual periods between distribution dates (the "Ordinary                                                      
Accrual Period") but that end and begin on other dates. In addition, in some                                                         
cases, even though the period between the Closing Date for a Payment Lag                                                             
Certificate and its first distribution date is shorter than an Ordinary Accrual                                                      
Period, the Payment Lag Certificate will pay on the                                                                                  
                                                                                                                                     
                                       93                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
first distribution date an amount of interest for a full Ordinary Accrual Period                                                     
(the extra interest being "pre-issuance interest"). In the case of such a                                                            
Payment Lag Certificate, the trust fund intends to (i) treat the pre-issuance                                                        
interest as part of the issue price of the Payment Lag Certificate and (ii) the                                                      
remaining amount of such interest as interest.                                                                                       
                                                                                                                                     
         Investors are encouraged to consult their own tax advisors concerning                                                       
the treatment for federal income tax purposes of Payment Lag Certificates.                                                           
                                                                                                                                     
         Non-Interest Expenses of the REMIC. Under the temporary Treasury                                                            
regulations, if the REMIC is considered to be a "single-class REMIC," a portion                                                      
of the REMIC's servicing, administrative and other non-interest expenses will be                                                     
allocated as a separate item to those Regular Certificateholders that are                                                            
"pass-through interest holders." Certificateholders that are pass-through                                                            
interest holders should consult their own tax advisors about the impact of these                                                     
rules on an investment in the Regular Certificates. See "-- Residual                                                                 
Certificates -- Pass-Through of Non-Interest Expenses of the REMIC."                                                                 
                                                                                                                                     
         Treatment of Realized Losses. Although not entirely clear, it appears                                                       
that holders of Regular Certificates that are corporations should in general be                                                      
allowed to deduct as an ordinary loss any loss sustained during the taxable year                                                     
on account of the certificates becoming wholly or partially worthless, and that,                                                     
in general, holders of certificates that are not corporations should be allowed                                                      
to deduct as a short-term capital loss any loss sustained during the taxable                                                         
year on account of the certificates becoming wholly worthless. Although the                                                          
matter is unclear, non-corporate holders of certificates may be allowed a bad                                                        
debt deduction at the time that the principal balance of a certificate is                                                            
reduced to reflect realized losses resulting from any liquidated mortgage loans.                                                     
The Internal Revenue Service, however, could take the position that                                                                  
non-corporate holders will be allowed a bad debt deduction to reflect realized                                                       
losses only after all mortgage loans remaining in the related trust fund have                                                        
been liquidated or the certificates of the related series have been otherwise                                                        
retired. Potential investors and Holders of the certificates are urged to                                                            
consult their own tax advisors regarding the appropriate timing, amount and                                                          
character of any loss sustained with respect to their certificates, including                                                        
any loss resulting from the failure to recover previously accrued interest or                                                        
discount income.                                                                                                                     
                                                                                                                                     
         Subsequent Recoveries. Class Certificate Balances that have been                                                            
reduced because of allocations of Realized Losses may also be increased as a                                                         
result of Subsequent Recoveries. See the discussion under the caption "The                                                           
Pooling and Servicing Agreement -- Realization Upon Defaulted Mortgage Loans --                                                      
Application of Liquidation Proceeds." An increase in a Certificate Balance                                                           
caused by a Subsequent Recovery should be treated by the certificateholder as                                                        
ordinary (or capital) income to the extent that the certificateholder claimed an                                                     
ordinary (or capital) deduction for any decrease in the Certificate Balance                                                          
caused by Realized Losses. Potential investors and Holders of the certificates                                                       
are urged to consult their own tax advisors regarding the appropriate timing,                                                        
amount and character of any income realized with respect to their certificates                                                       
as a result of Subsequent Recoveries. "Subsequent Recoveries" are unexpected                                                         
recoveries, net of reimbursable expenses, with respect to a Liquidated Mortgage                                                      
Loan that resulted in a Realized Loss prior to the receipt of such recoveries.                                                       
                                                                                                                                     
         Non-U.S. Persons. Generally, payments of interest (including any                                                            
payment with respect to accrued OID) on the Regular Certificates to a Regular                                                        
Certificateholder who is not a U.S. Person and is not engaged in a trade or                                                          
business within the United States will not be subject to federal withholding tax                                                     
if the non-U.S. Person provides the REMIC or other person who is otherwise                                                           
required to withhold U.S. tax with respect to the Regular Certificate with an                                                        
appropriate statement (on Form W-8BEN or other similar form), signed under                                                           
penalties of perjury, certifying that the beneficial owner of the mortgage loan                                                      
is a foreign person and providing that non-U.S. person's name and address. If a                                                      
Regular Certificateholder is not exempt from withholding, distributions of                                                           
interest, including distributions in respect of accrued OID, the holder may be                                                       
subject to a 30% withholding tax, subject to reduction under any applicable tax                                                      
treaty.                                                                                                                              
                                                                                                                                     
                                       94                                                                                            
                                                                                                                                     
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         Further, it appears that a 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 are encouraged to consult their tax advisors concerning this                                                             
question.                                                                                                                            
                                                                                                                                     
         It is recommended that Regular Certificateholders who are not U.S.                                                          
Persons and persons related to them not acquire any Residual Certificates, and                                                       
holders of Residual Certificates (the "Residual Certificateholder") and persons                                                      
related to Residual Certificateholders not acquire any Regular Certificates                                                          
without consulting their tax advisors as to the possible adverse tax                                                                 
consequences of doing so.                                                                                                            
                                                                                                                                     
         Information Reporting and Backup Withholding. The master servicer will                                                      
furnish or make available, within a reasonable time after the end of each                                                            
calendar year, to each person who was a Regular Certificateholder at any time                                                        
during the year, any information deemed appropriate to assist Regular                                                                
Certificateholders in preparing their federal income tax returns, or to enable                                                       
holders to make the information available to beneficial owners or financial                                                          
intermediaries that hold the Regular Certificates on behalf of beneficial                                                            
owners. If a holder, beneficial owner, financial intermediary or other recipient                                                     
of a payment on behalf of a beneficial owner fails to supply a certified                                                             
taxpayer identification number or if the Secretary of the Treasury determines                                                        
that the person has not reported all interest and dividend income required to be                                                     
shown on its federal income tax return, backup withholding may be required with                                                      
respect to any payments. Any amounts deducted and withheld from a distribution                                                       
to a recipient would be allowed as a credit against a recipient's federal income                                                     
tax liability providing the requisite information is supplied to the IRS.                                                            
                                                                                                                                     
b.       RESIDUAL CERTIFICATES                                                                                                       
                                                                                                                                     
         Allocation of the Income of the REMIC to the Residual Certificates. The                                                     
REMIC will not be subject to federal income tax except with respect to income                                                        
from prohibited transactions and certain other transactions. See "-- Prohibited                                                      
Transactions and Other Taxes." Instead, each original holder of a Residual                                                           
Certificate will report on its federal income tax return, as ordinary income,                                                        
its share of the taxable income of the REMIC for each day during the taxable                                                         
year on which it owns any Residual Certificates. The taxable income of the REMIC                                                     
for each day will be determined by allocating the taxable income of the REMIC                                                        
for each calendar quarter ratably to each day in the quarter. An original                                                            
holder's share of the taxable income of the REMIC for each day will be based on                                                      
the portion of the outstanding Residual Certificates that the holder owns on                                                         
that day. The taxable income of the REMIC will be determined under an accrual                                                        
method and will be taxable to the holders of Residual Certificates without                                                           
regard to the timing or amounts of cash distributions by the REMIC. Ordinary                                                         
income derived from Residual Certificates will be "portfolio income" for                                                             
purposes of the taxation of taxpayers subject to the limitations on the                                                              
deductibility of "passive losses." As residual interests, the Residual                                                               
Certificates will be subject to tax rules, described below, that differ from                                                         
those that would apply if the Residual Certificates were treated for federal                                                         
income tax purposes as direct ownership interests in the certificates or as debt                                                     
instruments issued or held by the REMIC.                                                                                             
                                                                                                                                     
         In most cases, a Residual Certificateholder will be required to include                                                     
taxable income from the Residual Certificate in excess of the cash received                                                          
("phantom income"). This mismatch may be caused, for example, by a structure in                                                      
which interest from the mortgage loans in excess of what is needed to pay                                                            
interest on the Regular Certificates is used to pay the principal on the Regular                                                     
Certificates. This mismatching may be caused by the use of certain required tax                                                      
accounting methods by the REMIC, variations in the prepayment rate of the                                                            
underlying mortgage loans and certain other factors. Depending upon the                                                              
structure of a particular transaction, the aforementioned factors may                                                                
significantly reduce the after-tax yield of a Residual Certificate to a Residual                                                     
Certificateholder. Investors should consult their own tax advisors concerning                                                        
the federal income tax treatment of a Residual Certificate and the impact of the                                                     
tax treatment on the after-tax yield of a Residual Certificate.                                                                      
                                                                                                                                     
                                       95                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         A subsequent Residual Certificateholder also will report on its federal                                                     
income tax return amounts representing a daily share of the taxable income of                                                        
the REMIC for each day that the Residual Certificateholder owns the Residual                                                         
Certificate. Those daily amounts generally would equal the amounts that would                                                        
have been reported for the same days by an original Residual Certificateholder,                                                      
as described above. The Legislative History indicates that certain adjustments                                                       
may be appropriate to reduce (or increase) the income of a subsequent holder of                                                      
a Residual Certificate that purchased the Residual Certificate at a price                                                            
greater than (or less than) the adjusted basis the Residual Certificate would                                                        
have in the hands of an original Residual Certificateholder. See "-- Sale or                                                         
Exchange of Residual Certificates." It is not clear, however, whether these                                                          
adjustments will in fact be permitted or required and, if so, how they would be                                                      
made. The REMIC Regulations do not provide for these adjustments.                                                                    
                                                                                                                                     
         Taxable Income of the REMIC Attributable to Residual Interests. The                                                         
taxable income of the REMIC will reflect a netting of the income from the                                                            
mortgage loans and the REMIC's other assets and the deductions allowed to the                                                        
REMIC for interest and OID on the Regular Certificates and, except as described                                                      
under "-- Regular Certificates -- Non-Interest Expenses of the REMIC," other                                                         
expenses. REMIC taxable income is generally determined in the same manner as the                                                     
taxable income of an individual using the accrual method of accounting, except                                                       
that the limitations on deductibility of investment interest expense and                                                             
expenses for the production of income do not apply, all bad loans will be                                                            
deductible as business bad debts, and the limitation on the deductibility of                                                         
interest and expenses related to tax-exempt income is more restrictive than with                                                     
respect to individual. The REMIC's gross income includes interest, original                                                          
issue discount income, and market discount income, if any, on the mortgage                                                           
loans, as well as, income earned from temporary investments or reserve assets,                                                       
reduced by the amortization of any premium on the mortgage loans. In addition, a                                                     
Residual Certificateholder will recognize additional income due to the                                                               
allocation of realized losses to the Regular Certificates due to defaults,                                                           
delinquencies and realized losses on the mortgage loans. The timing of the                                                           
inclusion of the income by Residual Certificateholders may differ from the time                                                      
the actual loss is allocated to the Regular Certificates. The REMIC's deductions                                                     
include interest and original issue discount expense on the Regular                                                                  
Certificates, servicing fees on the mortgage loans, other administrative                                                             
expenses of the REMIC and realized losses on the mortgage loans. The requirement                                                     
that Residual Certificateholders report their pro rata share of taxable income                                                       
or net loss of the REMIC will continue until there are no certificates of any                                                        
class of the related series outstanding.                                                                                             
                                                                                                                                     
         For purposes of determining its taxable income, the REMIC will have an                                                      
initial aggregate tax basis in its assets equal to the sum of the issue prices                                                       
of the Regular Certificates and the Residual Certificates (or, if a class of                                                         
certificates is not sold initially, its fair market value). The aggregate basis                                                      
will be allocated among the mortgage loans and other assets of the REMIC in                                                          
proportion to their respective fair market value. A mortgage loan will be deemed                                                     
to have been acquired with discount or premium to the extent that the REMIC's                                                        
basis therein is less than or greater than its principal balance, respectively.                                                      
Any discount (whether market discount or OID) will be includible in the income                                                       
of the REMIC as it accrues, in advance of receipt of the cash attributable to                                                        
this income, under a method similar to the method described above for accruing                                                       
OID on the Regular Certificates. The REMIC expects to elect under Code Section                                                       
171 to amortize any premium on the mortgage loans. Premium on any mortgage loan                                                      
to which the election applies would be amortized under a constant yield method.                                                      
It is not clear whether the yield of a mortgage loan would be calculated for                                                         
this purpose based on scheduled payments or taking account of the Prepayment                                                         
Assumption.                                                                                                                          
                                                                                                                                     
         The REMIC will be allowed a deduction for interest and OID on the                                                           
Regular Certificates. The amount and method of accrual of OID will be calculated                                                     
for this purpose in the same manner as described above with respect to Regular                                                       
Certificates except that the 0.25% per annum de minimis rule and adjustments for                                                     
subsequent holders described therein will not apply.                                                                                 
                                                                                                                                     
                                       96                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         A Residual Certificateholder will not be permitted to amortize the cost                                                     
of the Residual Certificate as an offset to its share of the REMIC's taxable                                                         
income. However, that taxable income will not include cash received by the REMIC                                                     
that represents a recovery of the REMIC's basis in its assets, and, as described                                                     
above, the issue price of the Residual Certificates will be added to the issue                                                       
price of the Regular Certificates in determining the REMIC's initial basis in                                                        
its assets. See "-- Sale or Exchange of Residual Certificates." For a discussion                                                     
of possible adjustments to income of a subsequent holder of a Residual                                                               
Certificate to reflect any difference between the actual cost of the Residual                                                        
Certificate to the holder and the adjusted basis the Residual Certificate would                                                      
have in the hands of an original Residual Certificateholder, see "-- Allocation                                                      
of the Income of the REMIC to the Residual Certificates."                                                                            
                                                                                                                                     
         Net Losses of the REMIC. The REMIC will have a net loss for any                                                             
calendar quarter in which its deductions exceed its gross income. The net loss                                                       
would be allocated among the Residual Certificateholders in the same manner as                                                       
the REMIC's taxable income. The net loss allocable to any Residual Certificate                                                       
will not be deductible by the holder to the extent that the net loss exceeds the                                                     
holder's adjusted basis in the Residual Certificate. Any net loss that is not                                                        
currently deductible due to this limitation may only be used by the Residual                                                         
Certificateholder to offset its share of the REMIC's taxable income in future                                                        
periods (but not otherwise). The ability of Residual Certificateholders that are                                                     
individuals or closely held corporations to deduct net losses may be subject to                                                      
additional limitations under the Code.                                                                                               
                                                                                                                                     
         For purposes of determining REMIC taxable income or loss, the trustee                                                       
intends to treat Subsequent Recoveries in the way described under the caption                                                        
"Subsequent Recoveries."                                                                                                             
                                                                                                                                     
         Mark to Market Rules. A Residual Certificate cannot be marked-to-                                                           
market.                                                                                                                              
                                                                                                                                     
         Pass-Through of Non-Interest Expenses of the REMIC. As a general rule,                                                      
all of the fees and expenses of a REMIC will be taken into account by holders of                                                     
the Residual Certificates. In the case of a single class REMIC, however, the                                                         
expenses and a matching amount of additional income will be allocated, under                                                         
temporary Treasury regulations, among the Regular Certificateholders and the                                                         
Residual Certificateholders on a daily basis in proportion to the relative                                                           
amounts of income accruing to each certificateholder on that day. In general                                                         
terms, a single class REMIC is one that either would qualify, under existing                                                         
Treasury regulations, as a grantor trust if it were not a REMIC (treating all                                                        
interests as ownership interests, even if they would be classified as debt for                                                       
federal income tax purposes) or is similar to a grantor trust and is structured                                                      
with the principal purpose of avoiding the single class REMIC rules. The                                                             
applicable prospectus supplement may apportion expenses to the Regular                                                               
Certificates, but if it does not, then the expenses of the REMIC will be                                                             
allocated to holders of the related Residual Certificates in their entirety and                                                      
not to holders of the related Regular Certificates.                                                                                  
                                                                                                                                     
         In the case of individuals (or trusts, estates or other persons that                                                        
compute their income in the same manner as individuals) who own an interest in a                                                     
Regular Certificate or a Residual Certificate directly or through a pass-through                                                     
interest holder that is required to pass miscellaneous itemized deductions                                                           
through to its owners or beneficiaries (e.g. a partnership, an S corporation or                                                      
a grantor trust), the trust expenses will be deductible under Code Section 67                                                        
only to the extent that those expenses, plus other "miscellaneous itemized                                                           
deductions" of the individual, exceed 2% of the individual's adjusted gross                                                          
income. In addition, Code Section 68 provides that the amount of itemized                                                            
deductions otherwise allowable for an individual whose adjusted gross income                                                         
exceeds a certain amount (the "Applicable Amount") will be reduced by the lesser                                                     
of 3% of the excess of the individual's adjusted gross income over the                                                               
Applicable Amount or 80% of the amount of itemized deductions otherwise                                                              
allowable for the taxable year. This reduction is scheduled to be phased out                                                         
from 2006 through 2009, and reinstated after 2010. The amount of additional                                                          
taxable income recognized by Residual Certificateholders who are subject to the                                                      
limitations of Code Section 67, Code Section 68 or both may be substantial.                                                          
Further, holders (other than                                                                                                         
                                                                                                                                     
                                       97                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
corporations) subject to the alternative minimum tax may not deduct                                                                  
miscellaneous itemized deductions in determining their alternative minimum                                                           
taxable income. The REMIC is required to report to each pass-through interest                                                        
holder and to the IRS the holder's allocable share, if any, of the REMIC's                                                           
non-interest expenses. The term "pass-through interest holder" generally refers                                                      
to individuals, entities taxed as individuals and certain pass-through entities,                                                     
but does not include real estate investment trusts. Residual Certificateholders                                                      
that are pass-through interest holders are encouraged to consult their own tax                                                       
advisors about the impact of these rules on an investment in the Residual                                                            
Certificates.                                                                                                                        
                                                                                                                                     
         Excess Inclusions. All or a portion of the income on a Residual                                                             
Certificate (referred to in the Code as an "excess inclusion") for any calendar                                                      
quarter generally will be subject to federal income tax in all events. Thus, for                                                     
example, an excess inclusion may not be offset by any unrelated losses,                                                              
deductions or loss carryovers of a Residual Certificateholder; will be treated                                                       
as "unrelated business taxable income" within the meaning of Code Section 512 if                                                     
the Residual Certificateholder is a pension fund or any other organization that                                                      
is subject to tax only on its unrelated business taxable income (see "--                                                             
Tax-Exempt Investors"); and is not eligible for any reduction in the rate of                                                         
withholding tax in the case of a Residual Certificateholder that is a foreign                                                        
investor. See "-- Non-U.S. Persons."                                                                                                 
                                                                                                                                     
         Except as discussed in the following paragraph, with respect to any                                                         
Residual Certificateholder, the excess inclusions for any calendar quarter is                                                        
the excess, if any, of the income of the Residual Certificateholder for that                                                         
calendar quarter from its Residual Certificate over the sum of the "daily                                                            
accruals" for all days during the calendar quarter on which the Residual                                                             
Certificateholder holds the Residual Certificate. For this purpose, the daily                                                        
accruals with respect to a Residual Certificate are determined by allocating to                                                      
each day in the calendar quarter its ratable portion of the product of the                                                           
"adjusted issue price" of the Residual Certificate at the beginning of the                                                           
calendar quarter and 120 percent of the "Federal long-term rate" in effect at                                                        
the time the Residual Certificate is issued. For this purpose, the "adjusted                                                         
issue price" of a Residual Certificate at the beginning of any calendar quarter                                                      
equals the issue price of the Residual Certificate, increased by the amount of                                                       
daily accruals for all prior quarters, and decreased (but not below zero) by the                                                     
aggregate amount of payments made on the Residual Certificate before the                                                             
beginning of the same quarter. The "federal long-term 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.                                                                                    
                                                                                                                                     
         In the case of any Residual Certificates held by a real estate                                                              
investment trust, the aggregate excess inclusions with respect to the Residual                                                       
Certificates, reduced (but not below zero) by the real estate investment trust                                                       
taxable income (within the meaning of Code Section 857(b)(2), 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                                                         
Residual Certificate as if held directly by the shareholder. Regulated                                                               
investment companies, common trust funds and certain cooperatives are subject to                                                     
similar rules.                                                                                                                       
                                                                                                                                     
         Payments. Any distribution made on a Residual Certificate to a Residual                                                     
Certificateholder will be treated as a non-taxable return of capital to the                                                          
extent it does not exceed the Residual Certificateholder's adjusted basis in the                                                     
Residual Certificate. To the extent a distribution exceeds the adjusted basis,                                                       
it will be treated as gain from the sale of the Residual Certificate.                                                                
                                                                                                                                     
         Sale or Exchange of Residual Certificates. If a Residual Certificate is                                                     
sold or exchanged, the seller will generally recognize gain or loss equal to the                                                     
difference between the amount realized on the sale or exchange and its adjusted                                                      
basis in the Residual Certificate (except that the recognition of loss may be                                                        
limited under the "wash sale" rules). A holder's adjusted basis in a Residual                                                        
Certificate generally equals the cost of the Residual Certificate to the                                                             
Residual Certificateholder, increased by the taxable income of the REMIC that                                                        
was included in the income of the Residual Certificateholder with respect to the                                                     
Residual                                                                                                                             
                                                                                                                                     
                                       98                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
Certificate, and decreased (but not below zero) by the net losses that have been                                                     
allowed as deductions to the Residual Certificateholder with respect to the                                                          
Residual Certificate and by the distributions received thereon by the Residual                                                       
Certificateholder. In general, the gain or loss will be capital gain or loss                                                         
provided the Residual Certificate is held as a capital asset. However, Residual                                                      
Certificates will be "evidences of indebtedness" within the meaning of Code                                                          
Section 582(c)(1), so that gain or loss recognized from sale of a Residual                                                           
Certificate by a bank or thrift institution to which that section applies would                                                      
be ordinary income or loss.                                                                                                          
                                                                                                                                     
         Any loss from the sale of a Residual Certificate will be subject to the                                                     
"wash sale" rules of Code Section 1091 if, during the period beginning six                                                           
months before and ending six months after the sale of the Residual Certificate,                                                      
the seller reacquires the Residual Certificate, or acquires (i) a Residual                                                           
Certificate in any other REMIC, (ii) a similar interest in a "taxable mortgage                                                       
pool" (as defined in Code Section 7701(i)) or (iii) an ownership interest in a                                                       
FASIT (as defined in Code Section 860L). In general, under the wash sale rules,                                                      
loss from the Residual Certificate will be disallowed and the Residual                                                               
Certificateholder's basis in the replacement interest will be the basis in the                                                       
Residual Certificate that was sold, decreased or increased, as the case may be,                                                      
by the difference between the selling price of the Residual Certificate and the                                                      
purchase price of the replacement interest.                                                                                          
                                                                                                                                     
PROHIBITED TRANSACTIONS AND OTHER TAXES                                                                                              
                                                                                                                                     
         The Code imposes a tax on REMICs equal to 100 percent of the net income                                                     
derived from "prohibited transactions" (the "Prohibited Transactions Tax") and                                                       
prohibits deducting any loss with respect to prohibited transactions. In                                                             
general, subject to certain 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 certain 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 certificates. It is not anticipated that the trust fund for                                                      
any series of certificates will engage in any prohibited transactions in which                                                       
it would recognize a material amount of net income.                                                                                  
                                                                                                                                     
         In addition, certain contributions to a trust fund that has elected to                                                      
be treated as a REMIC, if made after the day on which the trust fund issues all                                                      
of its interest could result in the imposition of a tax on the trust fund equal                                                      
to 100% of the value of the contributed property (the "Contributions Tax"). No                                                       
trust fund for any series of certificates will accept contributions that would                                                       
subject it to a Contributions Tax.                                                                                                   
                                                                                                                                     
         In addition, a trust fund that has elected to be treated as a REMIC may                                                     
also be 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 income from foreclosure property other than qualifying                                                     
income for a real estate investment trust.                                                                                           
                                                                                                                                     
         Where any Prohibited Transactions Tax, Contributions Tax, tax on net                                                        
income from foreclosure property or state or local income or franchise tax that                                                      
may be imposed on a REMIC relating to any series of certificates results from                                                        
                                                                                                                                     
         -    a breach of the related master servicer's, trustee's or seller's                                                       
              obligations under the related pooling and servicing agreement for                                                      
              the series, the tax will be borne by the master servicer, trustee                                                      
              or seller, as the case may be, out of its own funds or                                                                 
                                                                                                                                     
         -    the seller's obligation to repurchase a mortgage loan, the tax                                                         
              will be borne by the seller.                                                                                           
                                                                                                                                     
                                       99                                                                                            
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
If the master servicer, trustee or seller, as the case may be, fails to pay or                                                       
is not required to pay the tax as provided above, the tax will be payable out of                                                     
the trust fund for the series and will result in a reduction in amounts                                                              
available to be distributed to the certificateholders of the series.                                                                 
                                                                                                                                     
LIQUIDATION AND TERMINATION                                                                                                          
                                                                                                                                     
         If the REMIC adopts a plan of complete liquidation, within the meaning                                                      
of Code Section 860F(a)(4)(A)(i), which may be accomplished by designating in                                                        
the REMIC's final tax return a date on which the adoption is deemed to occur,                                                        
and sells all of its assets (other than cash) within a 90-day period beginning                                                       
on that date, the REMIC will not be subject to any Prohibited Transactions Tax,                                                      
provided that the REMIC credits or distributes in liquidation all of the sale                                                        
proceeds plus its cash (other than the amounts retained to meet claims) to                                                           
holders of Regular and Residual Certificates within the 90-day period.                                                               
                                                                                                                                     
         The REMIC will terminate shortly following the retirement of the                                                            
Regular Certificates. If a Residual Certificateholder's adjusted basis in the                                                        
Residual Certificate exceeds the amount of cash distributed to the Residual                                                          
Certificateholder in final liquidation of its interest, then it would appear                                                         
that the Residual Certificateholder would be entitled to a loss equal to the                                                         
amount of the excess. It is unclear whether the loss, if allowed, will be a                                                          
capital loss or an ordinary loss.                                                                                                    
                                                                                                                                     
ADMINISTRATIVE MATTERS                                                                                                               
                                                                                                                                     
         Solely for the purpose of the administrative provisions of the Code,                                                        
the REMIC generally will be treated as a partnership and the Residual                                                                
Certificateholders will be treated as the partners if there is more than one                                                         
holder of the Residual Certificate. Certain information is required to be                                                            
furnished quarterly to each Residual Certificateholder who held a Residual                                                           
Certificate on any day in the previous calendar quarter.                                                                             
                                                                                                                                     
         Each Residual Certificateholder is required to treat items on its                                                           
return consistently with their treatment on the REMIC's return, unless the                                                           
Residual Certificateholder either files a statement identifying the                                                                  
inconsistency or establishes that the inconsistency resulted from incorrect                                                          
information received from the REMIC. The IRS may assert a deficiency resulting                                                       
from a failure to comply with the consistency requirement without instituting an                                                     
administrative proceeding at the REMIC level. The REMIC does not intend to                                                           
register as a tax shelter pursuant to Code Section 6111 because it is not                                                            
anticipated that the REMIC will have a net loss for any of the first five                                                            
taxable years of its existence. Any person that holds a Residual Certificate as                                                      
a nominee for another person may be required to furnish the REMIC, in a manner                                                       
to be provided in Treasury regulations, with the name and address of the person                                                      
and other information.                                                                                                               
                                                                                                                                     
TAX-EXEMPT INVESTORS                                                                                                                 
                                                                                                                                     
         Any Residual Certificateholder that is a pension fund or other entity                                                       
that is subject to federal income taxation only on its "unrelated business                                                           
taxable income" within the meaning of Code Section 512 will be subject to the                                                        
tax on that portion of the distributions received on a Residual Certificate that                                                     
is considered an excess inclusion. See "-- Residual Certificates -- Excess                                                           
Inclusions."                                                                                                                         
                                                                                                                                     
NON-U.S. PERSONS                                                                                                                     
                                                                                                                                     
         Amounts paid to Residual Certificateholders who are not U.S. persons                                                        
(see "-- Regular Certificates -- Non-U.S. Persons") are treated as interest for                                                      
purposes of the 30% (or lower treaty rate) United States withholding tax.                                                            
Amounts distributed to holders of Residual Certificates should qualify as                                                            
"portfolio interest," subject to the conditions described in "-- Regular                                                             
Certificates." Furthermore, the rate                                                                                                 
                                                                                                                                     
                                       100                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
of withholding on any income on a Residual Certificate that is excess inclusion                                                      
income will not be subject to reduction under any applicable tax treaties. See                                                       
"-- Residual Certificates -- Excess Inclusions." If the portfolio interest                                                           
exemption is unavailable, the amount will be subject to United States                                                                
withholding tax when paid or otherwise distributed (or when the Residual                                                             
Certificate is disposed of) under rules similar to those for withholding upon                                                        
disposition of debt instruments that have OID. The Code, however, grants the                                                         
Treasury Department authority to issue regulations requiring that those amounts                                                      
be taken into account earlier than otherwise provided where necessary to prevent                                                     
avoidance of tax (for example, where the Residual Certificates do not have                                                           
significant value). See "-- Residual Certificates -- Excess Inclusions." If the                                                      
amounts paid to Residual Certificateholders that are not U.S. persons are                                                            
effectively connected with their conduct of a trade or business within the                                                           
United States, the 30% (or lower treaty rate) withholding will not apply.                                                            
Instead, the amounts paid to the non-U.S. Person will be subject to U.S. federal                                                     
income taxation at regular graduated rates. For special restrictions on the                                                          
transfer of Residual Certificates, see "-- Tax-Related Restrictions on Transfers                                                     
of Residual Certificates."                                                                                                           
                                                                                                                                     
TAX-RELATED RESTRICTIONS ON TRANSFERS OF RESIDUAL CERTIFICATES                                                                       
                                                                                                                                     
         Disqualified Organizations. An entity may not qualify as a REMIC unless                                                     
there are reasonable arrangements designed to ensure that residual interests in                                                      
the entity are not held by "disqualified organizations." Further, a tax is                                                           
imposed on the transfer of a residual interest in a REMIC to a "disqualified                                                         
organization." The amount of the tax equals the product of an amount (as                                                             
determined under the REMIC Regulations) equal to the present value of the total                                                      
anticipated "excess inclusions" with respect to the interest for periods after                                                       
the transfer and the highest marginal federal income tax rate applicable to                                                          
corporations. The tax is imposed on the transferor unless the transfer is                                                            
through an agent (including a broker or other middleman) for a disqualified                                                          
organization, in which event the tax is imposed on the agent. The person                                                             
otherwise liable for the tax shall be relieved of liability for the tax if the                                                       
transferee furnished to it an affidavit that the transferee is not a                                                                 
disqualified organization and, at the time of the transfer, the person does not                                                      
have actual knowledge that the affidavit is false. A "disqualified organization"                                                     
means the United States, any State, possession or political subdivision of the                                                       
United States, any foreign government, any international organization or any                                                         
agency or instrumentality of any of the foregoing entities (provided that the                                                        
term does not include an instrumentality if all its activities are subject to                                                        
tax and, except for Freddie Mac, a majority of its board of directors is not                                                         
selected by a governmental agency), any organization (other than certain farmers                                                     
cooperatives) generally exempt from federal income taxes unless the organization                                                     
is subject to the tax on "unrelated business taxable income" and a rural                                                             
electric or telephone cooperative.                                                                                                   
                                                                                                                                     
         A tax is imposed on a "pass-through entity" holding a residual interest                                                     
in a REMIC if at any time during the taxable year of the pass-through entity a                                                       
disqualified organization is the record holder of an interest in the entity. The                                                     
amount of the tax is equal to the product of the amount of excess inclusions for                                                     
the taxable year allocable to the interest held by the disqualified organization                                                     
and the highest marginal federal income tax rate applicable to corporations. The                                                     
pass-through entity otherwise liable for the tax, for any period during which                                                        
the disqualified organization is the record holder of an interest in the entity,                                                     
will be relieved of liability for the tax if the record holder furnishes to the                                                      
entity an affidavit that the record holder is not a disqualified organization                                                        
and, for the applicable period, the pass-through entity does not have actual                                                         
knowledge that the affidavit is false. For this purpose, a "pass-through entity"                                                     
means a regulated investment company, real estate investment trust, or common                                                        
trust fund; a partnership, trust, or estate; and certain cooperatives. Any                                                           
person holding an interest in a pass-through entity as a nominee for another                                                         
will, with respect to the interest, be treated as a pass-through entity. Large                                                       
partnerships (generally with 100 or more partners) will be taxable on excess                                                         
inclusion income as if all partners were disqualified organizations.                                                                 
                                                                                                                                     
                                       101                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         To comply with these rules, the pooling and servicing agreement will                                                        
provide that no record or beneficial ownership interest in a Residual                                                                
Certificate may be purchased, transferred or sold, directly or indirectly,                                                           
without the express written consent of the master servicer. The master servicer                                                      
will grant consent to a proposed transfer only if it receives an affidavit from                                                      
the proposed transferee to the effect that it is not a disqualified organization                                                     
and is not acquiring the Residual Certificate as a nominee or agent for a                                                            
disqualified organization and a covenant by the proposed transferee to the                                                           
effect that the proposed transferee agrees to be bound by and to abide by the                                                        
transfer restrictions applicable to the Residual Certificate.                                                                        
                                                                                                                                     
         Noneconomic Residual Certificates. The REMIC Regulations disregard, for                                                     
federal income tax purposes, any transfer of a Noneconomic Residual Certificate                                                      
to a "U.S. Transferee" unless no significant purpose of the transfer is to                                                           
enable the transferor to impede the assessment or collection of tax. For this                                                        
purpose, a U.S. Transferee means a U.S. Person as defined under "Certain Federal                                                     
Income Tax Consequences -- Non-REMIC Certificates -- Non-U.S. Persons." A U.S.                                                       
Transferee also includes foreign entities and individuals (Non-U.S. Persons) but                                                     
only if their income from the residual interest is subject to tax under Code                                                         
Section 871(b) or Code Section 882 (income effectively connected with a U.S.                                                         
trade or business). If the transfer of a Noneconomic Residual Certificate is                                                         
disregarded, the transferor continues to be treated as the owner of the Residual                                                     
Certificate and continues to be subject to tax on its allocable portion of the                                                       
net income of the REMIC.                                                                                                             
                                                                                                                                     
         A Residual Certificate (including a Residual Certificate with a                                                             
positive value at issuance) is a "Noneconomic Residual Certificate" at the time                                                      
of transfer unless, (i) taking into account the Prepayment Assumption and any                                                        
required or permitted clean up calls or required liquidation provided for in the                                                     
REMIC's organizational documents, the present value of the expected future                                                           
distributions on the Residual Certificate at least equals the product of (A) the                                                     
present value of the anticipated excess inclusions and (B) the highest corporate                                                     
income tax rate in effect for the year in which the transfer occurs, and (ii)                                                        
the transferor reasonably expects that the transferee will receive distributions                                                     
from the REMIC at or after the time at which taxes accrue on the anticipated                                                         
excess inclusions in an amount sufficient to satisfy the accrued taxes. A                                                            
transfer of a Noneconomic Residual Certificate has a "significant purpose to                                                         
impede the assessment or collection of tax" if, at the time of transfer, the                                                         
transferor either knew or should have known (had "Improper Knowledge") that the                                                      
transferee would be unwilling or unable to pay taxes due on its share of the                                                         
taxable income of the REMIC.                                                                                                         
                                                                                                                                     
         The REMIC Regulations also provide a safe harbor under which the                                                            
transferor of a Noneconomic Residual Certificate is presumed not to have                                                             
Improper knowledge at the time of transfer if the following conditions are met:                                                      
(i) the transferor conducts a reasonable investigation of the financial                                                              
condition of the transferee, finds that the transferee has historically paid its                                                     
debts as they came due, and finds no significant evidence to indicate that the                                                       
transferee will not continue to pay its debts as they come due; (ii) the                                                             
transferee represents that it understands that as a result of holding the                                                            
Noneconomic Residual Certificate, it may incur tax liabilities in excess of any                                                      
cash flows generated by the Noneconomic Residual Certificate and intends to pay                                                      
taxes associated with holding the Noneconomic Residual Certificate as they                                                           
become due; (iii) the transferee represents that it will not cause income from                                                       
the noneconomic residual interest to be attributable to a foreign permanent                                                          
establishment or fixed base (within the meaning of an applicable income tax                                                          
treaty) ("Offshore Location") of the transferee or another U.S. taxpayer; (iv)                                                       
the transferee is not located in an Offshore Location; and (v) the transferee                                                        
meets either the Formula Test or the Asset Test.                                                                                     
                                                                                                                                     
         A transfer of a Noneconomic Residual Certificate meets the Formula Test                                                     
if the present value of the anticipated tax liabilities associated with holding                                                      
the residual interest does not exceed the sum of, (i) the present value of any                                                       
consideration given to the transferee to acquire the interest; (ii) the present                                                      
value of the expected future distributions on the interest; and (3) the present                                                      
value of the anticipated tax savings                                                                                                 
                                                                                                                                     
                                       102                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
associated with holding the interest as the REMIC generates losses. For purposes                                                     
of the Formula Test the transferee is assumed to pay tax at a rate equal to the                                                      
highest corporate rate of tax specified in Code Section 11(b)(1). If, however,                                                       
the transferee has been subject to the alternative minimum tax ("AMT") under                                                         
Code Section 55 in the preceding two years and will compute its taxable income                                                       
in the current taxable year using the AMT rate, then the transferee can assume                                                       
that it pays tax at the AMT rate specified in Code Section 55(b)(1)(B). Present                                                      
values are computed using a discount rate equal to the Federal short-term rate                                                       
prescribed by Code Section 1274(d) for the month of the transfer and the                                                             
compounding period used by the transferee.                                                                                           
                                                                                                                                     
         The Asset Test only applies in cases where the transferee is an                                                             
Eligible Corporation. To be an Eligible Corporation, the transferee must be a                                                        
taxable domestic C corporation, but an Eligible Corporation does not include a                                                       
regulated investment company, a real estate investment trust, a REMIC or a                                                           
cooperative. In addition, regardless of who the transferee may be, the transfer                                                      
of a residual interest to an Offshore Location does not qualify as a transfer to                                                     
an Eligible Corporation even if the Offshore Location is only a branch of an                                                         
Eligible Corporation and not a separate legal entity. A transfer of a                                                                
Noneconomic Residual Certificate meets the Asset Test if at the time of the                                                          
transfer, and at the close of each of the transferee's two fiscal years                                                              
preceding the year of transfer, the transferee's gross assets for financial                                                          
reporting purposes exceed $100 million and its net assets for financial                                                              
reporting purposes exceed $10 million. The gross assets and net assets of a                                                          
transferee do not include any obligation of any person related to the transferee                                                     
(such as a shareholder, partner affiliate or sister corporation) or any asset                                                        
acquired for a principal purpose of satisfying the Asset Test. In addition, the                                                      
transferee must make a written agreement that any subsequent transfer of the                                                         
interest will be to another Eligible Corporation in a transaction that satisfies                                                     
the Asset Test. A transfer fails to meet this requirement if the transferor                                                          
knows, or has reason to know, that the transferee will not honor the                                                                 
restrictions on subsequent transfers. Finally, the facts and circumstances known                                                     
to the transferor on or before the date of the transfer must not reasonably                                                          
indicate that the taxes associated with the residual interest will not be paid.                                                      
The consideration given to the transferee to acquire the noneconomic residual                                                        
interest in the REMIC is only one factor to be considered. However, if the                                                           
amount of consideration is so low that under any set of reasonable assumptions a                                                     
reasonable person would conclude that the taxes associated with holding the                                                          
residual interest will not be paid, then the transferor is deemed to know that                                                       
the transferee cannot or will not pay. In determining whether the amount is too                                                      
low, the specific terms of the Formula Test need not be used.                                                                        
                                                                                                                                     
         Foreign Investors. The REMIC Regulations provide that the transfer of a                                                     
Residual Certificate that has a "tax avoidance potential" to a "foreign person"                                                      
will be disregarded for federal income tax purposes. This rule appears to apply                                                      
to a transferee who is not a U.S. Person unless the transferee's income in                                                           
respect of the Residual Certificate is effectively connected with the conduct of                                                     
a United States trade or business. A Residual Certificate is deemed to have a                                                        
tax avoidance potential unless, at the time of transfer, the transferor                                                              
reasonably expects that the REMIC will distribute to the transferee amounts that                                                     
will equal at least 30 percent of each excess inclusion, and that the amounts                                                        
will be distributed at or after the time the excess inclusion accrues and not                                                        
later than the end of the calendar year following the year of accrual. If the                                                        
non-U.S. Person transfers the Residual Certificate to a U.S. Person, the                                                             
transfer will be disregarded, and the foreign transferor will continue to be                                                         
treated as the owner, if the transfer has the effect of allowing the transferor                                                      
to avoid tax on accrued excess inclusions. The pooling and servicing agreement                                                       
will provide that no record or beneficial ownership interest in a Residual                                                           
Certificate may be transferred, directly or indirectly, to a non-U.S. Person                                                         
unless the person provides the trustee with a duly completed I.R.S. Form W-8ECI                                                      
and the trustee consents to the transfer in writing.                                                                                 
                                                                                                                                     
         Any attempted transfer or pledge in violation of the transfer                                                               
restrictions shall be absolutely null and void and shall vest no rights in any                                                       
purported transferee. Investors in Residual Certificates are encouraged to                                                           
consult their own tax advisors with respect to transfers of the Residual                                                             
Certificates and                                                                                                                     
                                                                                                                                     
                                       103                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
pass-through entities are encouraged to consult their own tax advisors with                                                          
respect to any tax which may be imposed on a pass-through entity.                                                                    
                                                                                                                                     
                            OTHER TAX CONSIDERATIONS                                                                                 
                                                                                                                                     
         In addition to the federal income tax consequences described in                                                             
"Certain Federal Income Tax Considerations," potential investors are encouraged                                                      
to consider the state, local and foreign income tax consequences of the                                                              
acquisition, ownership, and disposition of the certificates. State, local and                                                        
foreign income tax law may differ substantially from the corresponding federal                                                       
law, and this discussion does not purport to describe any aspect of the income                                                       
tax laws of any state or locality. Therefore, potential investors are encouraged                                                     
to consult their own tax advisors with respect to the various tax consequences                                                       
of investments in the certificates.                                                                                                  
                                                                                                                                     
                              ERISA CONSIDERATIONS                                                                                   
                                                                                                                                     
         The following describes certain considerations under the Employee                                                           
Retirement Income Security Act of 1974, as amended ("ERISA") and the Code, which                                                     
apply to certificates issued by the trust. The related prospectus supplement                                                         
will contain more specific information concerning the considerations relating to                                                     
ERISA and the Code applicable to each series of certificates.                                                                        
                                                                                                                                     
         ERISA imposes requirements on employee benefit plans subject to ERISA                                                       
(and the Code imposes requirements on certain other retirement plans and                                                             
arrangements, including individual retirement accounts and annuities, Keogh                                                          
plans and collective investment funds and separate accounts in which the plans,                                                      
accounts or arrangements are invested) (collectively "Plans") and on persons who                                                     
bear specified relationships to Plans ("Parties in Interest") or are fiduciaries                                                     
with respect to Plans. Generally, ERISA applies to investments made by Plans.                                                        
Among other things, ERISA requires that the assets of a Plan be held in trust                                                        
and that the trustee, or other duly authorized fiduciary, have exclusive                                                             
authority and discretion to manage and control the assets of the Plan. ERISA                                                         
also imposes certain duties on persons who are fiduciaries of Plans. Under                                                           
ERISA, any person who exercises any authority or control respecting the                                                              
management or disposition of the assets of a Plan is considered to be a                                                              
fiduciary of the Plan (subject to certain exceptions not here relevant). Certain                                                     
employee benefit plans, such as governmental plans (as defined in ERISA Section                                                      
3(32)) and, if no election has been made under Section 410(d) of the Code,                                                           
church plans (as defined in ERISA Section 3(33)), are not subject to ERISA                                                           
requirements. Accordingly, assets of those plans may be invested in certificates                                                     
without regard to ERISA's requirements, but subject to the provisions of                                                             
applicable federal or state law. Any of those plans that are qualified and                                                           
exempt from taxation under Code Sections 401(a) and 501(a) are subject to the                                                        
prohibited transaction rules set forth in Code Section 503.                                                                          
                                                                                                                                     
         On November 13, 1986, the United States Department of Labor ("DOL")                                                         
issued final regulations concerning the definition of what constitutes the                                                           
assets of a Plan. (DOL Reg. Section 2510.3-101.) Under this "Plan Assets                                                             
Regulation," the underlying assets and properties of corporations, partnerships                                                      
and certain other entities in which a Plan acquires an "equity interest" could                                                       
be deemed for purposes of ERISA to be assets of the investing Plan in certain                                                        
circumstances. Under the Plan Assets Regulation, the term "equity interest" is                                                       
defined as any interest in an entity other than an instrument that is treated as                                                     
indebtedness under applicable local law and has no "substantial equity                                                               
features." If certificates are not treated as equity interests in the issuer for                                                     
purposes of the Plan Assets Regulation, a Plan's investment in the certificates                                                      
would not cause the assets of the issuer to be deemed plan assets. If the                                                            
certificates are deemed to be equity interests in the issuer, the issuer could                                                       
be considered to hold plan assets because of a Plan's investment in those                                                            
securities. In that event, the master servicer and other persons exercising                                                          
management or discretionary control over the assets of the issuer or providing                                                       
services with respect to the issuer could be deemed to be fiduciaries or other                                                       
parties in interest with respect to investing Plans and                                                                              
                                                                                                                                     
                                       104                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
thus subject to the prohibited transaction provisions of Section 406 of ERISA                                                        
and Section 4975 of the Code and, in the case of fiduciaries, to the fiduciary                                                       
responsibility provisions of Title I of ERISA, with respect to transactions                                                          
involving the issuer's assets. Trust certificates are "equity interests" for                                                         
purposes of the Plan Asset Regulation.                                                                                               
                                                                                                                                     
         In addition to the imposition of general fiduciary standards of                                                             
investment prudence and diversification, ERISA and the Code prohibit a broad                                                         
range of transactions involving plan assets of a Plan and Parties in Interest                                                        
with respect to the Plan and impose additional prohibitions where Parties in                                                         
Interest are fiduciaries with respect to the Plan. Because the mortgage loans                                                        
may be deemed plan assets of each Plan that purchases certificates, an                                                               
investment in the certificates by a Plan might be a prohibited transaction under                                                     
ERISA Sections 406 and 407 and subject to an excise tax under Code Section 4975                                                      
unless a statutory, regulatory or administrative exemption applies.                                                                  
                                                                                                                                     
         Without regard to whether securities are considered to be equity                                                            
interest in the issuer, certain affiliates of the issuer might be considered or                                                      
might become Parties in Interest with respect to a Plan. In this case, the                                                           
acquisition or holding of the securities by or on behalf of the Plan could                                                           
constitute or give rise to a prohibited transaction, within the meaning of ERISA                                                     
and the Code, unless they were subject to one or more exemptions. Depending on                                                       
the relevant facts and circumstances, certain prohibited transaction exemptions                                                      
may apply to the purchase or holding of securities: for example, Prohibited                                                          
Transaction Class Exemption ("PTCE") 96-23, which exempts certain transactions                                                       
effected on behalf of a Plan by an "in-house asset manager"; PTCE 95-60, which                                                       
exempts certain transactions by insurance company general accounts; PTCE 91-38,                                                      
which exempts certain transactions by bank collective investment funds; PTCE                                                         
90-1, which exempts certain transactions by insurance company pooled separate                                                        
accounts; or PTCE 84-14, which exempts certain transactions effected on behalf                                                       
of a Plan by a "qualified professional asset manager". There can be no assurance                                                     
that any of these exemptions will apply with respect to any Plan's investment in                                                     
securities, or that such an exemption, if it did apply, would apply to all                                                           
prohibited transactions that may occur in connection with the investment.                                                            
Furthermore, these exemptions would not apply to transactions involved in                                                            
operation of the trust if, as described above, the assets of the trust were                                                          
considered to include Plan assets.                                                                                                   
                                                                                                                                     
         The DOL has granted to certain underwriters individual administrative                                                       
exemptions (the "Underwriter Exemptions") from certain of the prohibited                                                             
transaction rules of ERISA and the related excise tax provisions of Section 4975                                                     
of the Code with respect to the initial purchase, the holding and the subsequent                                                     
resale by Plans of securities, including certificates, issued by entities,                                                           
including trusts, that hold investment pools consisting of certain secured                                                           
receivables, loans and other obligations ("issuer") and the servicing, operation                                                     
and management of such entities, provided that the conditions and requirements                                                       
of the Underwriter Exemptions are met.                                                                                               
                                                                                                                                     
         While each Underwriter Exemption is an individual exemption separately                                                      
granted to a specific underwriter, the terms and conditions which generally                                                          
apply to the Underwriter Exemptions are substantially the following:                                                                 
                                                                                                                                     
         -    the acquisition of the securities by a Plan is on terms (including                                                     
              the price for the securities) that are at least as favorable to                                                        
              the Plan as they would be in an arm's length transaction with an                                                       
              unrelated party;                                                                                                       
                                                                                                                                     
         -    the rights and interests evidenced by the securities acquired by                                                       
              the Plan are not subordinated to the rights and interests                                                              
              evidenced by other securities of the issuer, unless the investment                                                     
              pool contains certain types of collateral, such as fully-secured                                                       
              mortgages on real property in (a "Designated Transaction");                                                            
                                                                                                                                     
                                       105                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    the securities acquired by the Plan have received a rating at the                                                      
              time of acquisition that is one of the three highest generic                                                           
              rating categories (four, in a Designated Transaction) from                                                             
              Standard & Poor's, a division of The McGraw-Hill Company, Inc.,                                                        
              Moody's Investors Service, Inc. or Fitch Ratings (the "rating                                                          
              agencies");                                                                                                            
                                                                                                                                     
         -    the trustee is not an affiliate of any other member of the                                                             
              Restricted Group, as defined below, other than an underwriter;                                                         
                                                                                                                                     
         -    the sum of all payments made to and retained by the underwriters                                                       
              in connection with the distribution of the securities represents                                                       
              not more than reasonable compensation for underwriting the                                                             
              securities; the sum of all payments made to and retained by the                                                        
              seller pursuant to the assignment of the loans to the issuer                                                           
              represents not more than the fair market value of the loans; the                                                       
              sum of all payments made to and retained by the master servicer                                                        
              and any other servicer represents not more than reasonable                                                             
              compensation for its services under the agreement pursuant to                                                          
              which the loans are pooled and reimbursements of its reasonable                                                        
              expenses in connection therewith; and                                                                                  
                                                                                                                                     
         -    the Plan investing in the securities is an "accredited investor"                                                       
              as defined in Rule 501(a)(1) of Regulation D of the SEC under the                                                      
              Securities Act of 1933, as amended.                                                                                    
                                                                                                                                     
         If an issuer holds obligations that have high loan-to-value ratios, the                                                     
Underwriter Exemption may apply to the issuer's non-subordinated securities                                                          
rated in one of the two highest generic rating categories by at least one of the                                                     
rating agencies if the obligations are residential or home equity loans, and the                                                     
fair market value of the collateral for each loan on the closing date is at                                                          
least 80% of the sum of the outstanding principal balance of the related                                                             
obligation held in the investment pool and the outstanding principal balance of                                                      
any obligation of higher priority secured by the same collateral.                                                                    
                                                                                                                                     
         The issuer must also meet the following requirements:                                                                       
                                                                                                                                     
         -    the investment pool must consist solely of assets of the type that                                                     
              have been included in other investment pools;                                                                          
                                                                                                                                     
         -    securities in those other investment pools must have been rated in                                                     
              one of the three highest rating categories (or four, in a                                                              
              Designated Transaction) of at least one of the rating agencies for                                                     
              at least one year prior to the Plan's acquisition of securities;                                                       
              and                                                                                                                    
                                                                                                                                     
         -    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 Plan's acquisition of securities.                                                                    
                                                                                                                                     
         Moreover, the Underwriter Exemptions generally provide relief from                                                          
certain self-dealing and conflict of interest prohibited transactions that may                                                       
occur when the Plan fiduciary causes a Plan to acquire securities in an issuer                                                       
holding receivables as to which the fiduciary (or its affiliate) is an obligor                                                       
provided that, among other requirements:                                                                                             
                                                                                                                                     
         -    in the case of an acquisition in connection with the initial                                                           
              issuance of securities, at least fifty percent of each class of                                                        
              securities in which Plans have invested and at least fifty percent                                                     
              of the aggregate interest in the issuer are acquired by persons                                                        
              independent of the Restricted Group;                                                                                   
                                                                                                                                     
         -    the fiduciary (or its affiliate) is an obligor with respect to                                                         
              five percent or less of the fair market value of the obligations                                                       
              contained in the investment pool;                                                                                      
                                                                                                                                     
                                       106                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         -    the Plan's investment in securities of any class does not exceed                                                       
              twenty-five percent of all of the securities of that class                                                             
              outstanding at the time of the acquisition; and                                                                        
                                                                                                                                     
         -    immediately after the acquisition, no more than twenty-five                                                            
              percent of the assets of any Plan with respect to which the person                                                     
              is a fiduciary is invested in securities representing an interest                                                      
              in one or more issuers containing assets sold or serviced by the                                                       
              same entity.                                                                                                           
                                                                                                                                     
This relief is not available to Plans sponsored by the seller, any underwriter,                                                      
the trustee, the master servicer, any servicer, any insurer with respect to the                                                      
trust, any obligor with respect to mortgage loans included in the investment                                                         
pool constituting more than five percent of the aggregate unamortized principal                                                      
balance of the assets in the investment pool, any counterparty to a permissible                                                      
notional principal contract included in the trust, or any affiliate of those                                                         
parties (the "Restricted Group").                                                                                                    
                                                                                                                                     
         The Underwriter Exemptions provide exemptive relief to mortgage-backed                                                      
and asset-backed securities transactions that use pre-funding accounts and that                                                      
otherwise meet the requirements of the Underwriter Exemptions. Mortgage loans or                                                     
other secured receivables supporting payments to securityholders, and having a                                                       
value equal to no more than twenty-five percent of the total principal amount of                                                     
the securities being offered by the issuer, may be transferred to the issuer                                                         
within a 90-day or three-month period following the closing date, instead of                                                         
being required to be either identified or transferred on or before the closing                                                       
date. The relief is available when the pre-funding accounts meet certain                                                             
conditions.                                                                                                                          
                                                                                                                                     
         The rating of a security may change. If a class of securities no longer                                                     
has a permitted rating from at least one rating agency, securities of that class                                                     
will no longer be eligible for relief under the Underwriter Exemptions (although                                                     
a Plan that had purchased the security when it had a permitted rating would not                                                      
be required by the Underwriter Exemptions to dispose of it). A certificate that                                                      
satisfies the requirements of the Underwriter Exemptions other than the rating                                                       
requirement may be eligible for purchase by an insurance company investing                                                           
assets of its general account that include plan assets when the requirements of                                                      
Sections I and III of Prohibited Transaction Class Exemption 95-60 are met.                                                          
                                                                                                                                     
         The prospectus supplement for each series of certificates will indicate                                                     
the classes of certificates offered thereby, if any, as to which it is expected                                                      
that an Underwriter Exemption will apply.                                                                                            
                                                                                                                                     
         Any Plan fiduciary that proposes to cause a Plan to purchase                                                                
certificates is encouraged to consult with its counsel concerning the impact of                                                      
ERISA and the Code, the effect of the Plan Assets Regulation, the availability                                                       
and applicability of any Underwriter Exemption or any other exemptions from the                                                      
prohibited transaction provisions of ERISA and the Code and the potential                                                            
consequences in their specific circumstances, before making the investment.                                                          
Moreover, each Plan fiduciary should determine whether under the general                                                             
fiduciary standards of investment prudence and diversification an investment in                                                      
the certificates is appropriate for the Plan, taking into account the overall                                                        
investment policy of the Plan and the composition of the Plan's investment                                                           
portfolio.                                                                                                                           
                                                                                                                                     
         The sale of certificates to a Plan is in no respect a representation by                                                     
the issuer or any underwriter of the Certificates that this investment meets all                                                     
relevant legal requirements with respect to investments by Plans generally or                                                        
any particular Plan, or that this investment is appropriate for Plans generally                                                      
or any particular Plan.                                                                                                              
                                                                                                                                     
                                LEGAL INVESTMENT                                                                                     
                                                                                                                                     
         The prospectus supplement for each series of certificates will specify                                                      
which, if any, of the classes of certificates offered by it will constitute                                                          
"mortgage related securities" for purposes of the Secondary                                                                          
                                                                                                                                     
                                       107                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
Mortgage Market Enhancement Act of 1984 ("SMMEA"). Classes of certificates that                                                      
qualify as "mortgage related securities" will be legal investments for those                                                         
investors whose authorized investments are subject to state regulation, to the                                                       
same extent as, under applicable law, obligations issued by or guaranteed as to                                                      
principal and interest by the United States constitute legal investments for                                                         
them. Those investors are 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 (including the                                                          
District of Columbia and Puerto Rico). Under SMMEA, if a state enacts                                                                
legislation before October 4, 1991 specifically limiting the legal investment                                                        
authority of those entities with respect to "mortgage related securities," the                                                       
certificates will constitute legal investments for entities subject to the                                                           
legislation only to the extent provided in it. Approximately twenty-one states                                                       
adopted limiting legislation before the October 4, 1991 deadline.                                                                    
                                                                                                                                     
         SMMEA also amended the legal investment authority of federally-                                                             
chartered depository institutions as follows: federal savings and loan                                                               
associations and federal savings banks may invest in, sell or otherwise deal in                                                      
certificates without limitations as to the percentage of their assets                                                                
represented by them, federal credit unions may invest in mortgage related                                                            
securities, and national banks may purchase certificates 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 regulations that                                                        
the applicable federal authority may prescribe. In this connection, federal                                                          
credit unions should review the National Credit Union Administration Letter to                                                       
Credit Unions No. 96, as modified by Letter to Credit Unions No. 108, which                                                          
includes guidelines to assist federal credit unions in making investment                                                             
decisions for mortgage related securities, and the its regulation "Investment                                                        
and Deposit Activities" (12 C.F.R. Part 703), (whether or not the class of                                                           
certificates under consideration for purchase constitutes a "mortgage related                                                        
security").                                                                                                                          
                                                                                                                                     
         All depository institutions considering an investment in the                                                                
certificates (whether or not the class of certificates under consideration for                                                       
purchase constitutes a "mortgage related security" should review the Federal                                                         
Financial Institutions Examination Council's Supervisory Policy Statement on                                                         
Securities Activities (to the extent adopted by their respective regulators),                                                        
setting forth, in relevant part, certain securities trading and sales practices                                                      
deemed unsuitable for an institution's investment portfolio, and guidelines for                                                      
(and restrictions on) investing in mortgage derivative products, including                                                           
"mortgage related securities" that are "high-risk mortgage securities" as                                                            
defined in the policy statement. According to the policy statement, "high-risk                                                       
mortgage securities" include securities such as certificates not entitled to                                                         
distributions allocated to principal or interest, or subordinated certificates.                                                      
Under the policy statement, each depository institution must determine, before                                                       
purchase (and at stated intervals thereafter), whether a particular mortgage                                                         
derivative product is a "high-risk mortgage security," and whether the purchase                                                      
(or retention) of such a product would be consistent with the policy statement.                                                      
                                                                                                                                     
         The foregoing does not take into consideration the applicability of                                                         
statutes, rules, regulations, orders, guidelines, or agreements generally                                                            
governing investments made by a particular investor, including "prudent                                                              
investor" provisions, percentage-of-assets limits and provisions that may                                                            
restrict or prohibit investment in securities that are not "interest bearing" or                                                     
"income paying."                                                                                                                     
                                                                                                                                     
         There may be other restrictions on the ability of certain investors,                                                        
including depository institutions, either to purchase certificates or to                                                             
purchase certificates representing more than a specified percentage of the                                                           
investor's assets. Investors are encouraged to consult their own legal advisors                                                      
in determining whether and to what extent the certificates constitute legal                                                          
investments for them.                                                                                                                
                                                                                                                                     
                                       108                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                             METHOD OF DISTRIBUTION                                                                                  
                                                                                                                                     
         Certificates are being offered hereby in series from time to time (each                                                     
series evidencing a separate trust fund) through any of the following methods:                                                       
                                                                                                                                     
         -    by negotiated firm commitment or best efforts underwriting and                                                         
              public reoffering by underwriters;                                                                                     
                                                                                                                                     
         -    by agency placements through one or more placement agents                                                              
              primarily with institutional investors and dealers; and                                                                
                                                                                                                                     
         -    by placement directly by the depositor with institutional                                                              
              investors.                                                                                                             
                                                                                                                                     
         A prospectus supplement will be prepared for each series which will                                                         
describe the method of offering being used for that series and will set forth                                                        
the identity of any of its underwriters and either the price at which the series                                                     
is being offered, the nature and amount of any underwriting discounts or                                                             
additional compensation to the underwriters and the proceeds of the offering to                                                      
the depositor, or the method by which the price at which the underwriters will                                                       
sell the certificates will be determined. Each prospectus supplement for an                                                          
underwritten offering will also contain information regarding the nature of the                                                      
underwriters obligations, any material relationship between the depositor and                                                        
any underwriter and, where appropriate, information regarding any discounts or                                                       
concessions to be allowed or reallowed to dealers or others and any arrangements                                                     
to stabilize the market for the certificates so offered. In firm commitment                                                          
underwritten offerings, the underwriters will be obligated to purchase all of                                                        
the certificates of the series if any certificates are purchased. Certificates                                                       
may be acquired by the underwriters for their own accounts and may be resold                                                         
from time to time in one or more transactions, including negotiated                                                                  
transactions, at a fixed public offering price or at varying prices determined                                                       
at the time of sale.                                                                                                                 
                                                                                                                                     
         This prospectus, together with the related prospectus supplement, may                                                       
be used by Countrywide Securities Corporation, an affiliate of CWMBS, Inc., in                                                       
connection with offers and sales related to market making transactions in the                                                        
certificates in which Countrywide Securities Corporation acts as principal.                                                          
Countrywide Securities Corporation may also act as agent in those transactions.                                                      
Sales in those transactions will be made at prices related to prevailing prices                                                      
at the time of sale.                                                                                                                 
                                                                                                                                     
         Underwriters and agents may be entitled under agreements entered into                                                       
with the depositor to indemnification by the depositor against certain civil                                                         
liabilities, including liabilities under the Securities Act of 1933, as amended,                                                     
or to contribution with respect to payments which the underwriters or agents may                                                     
be required to make in respect thereof.                                                                                              
                                                                                                                                     
         If a series is offered other than through underwriters, the prospectus                                                      
supplement relating to it will contain information regarding the nature of the                                                       
offering and any agreements to be entered into between the depositor and                                                             
purchasers of certificates of the series.                                                                                            
                                                                                                                                     
                                  LEGAL MATTERS                                                                                      
                                                                                                                                     
         The validity of the certificates, including certain federal income tax                                                      
consequences with respect to the certificates, will be passed upon for the                                                           
depositor by Sidley Austin Brown & Wood LLP, 787 Seventh Avenue, New York, New                                                       
York 10019.                                                                                                                          
                                                                                                                                     
                              FINANCIAL INFORMATION                                                                                  
                                                                                                                                     
                                       109                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
         A new trust fund will be formed for each series of certificates and no                                                      
trust fund will engage in any business activities or have any assets or                                                              
obligations before the issuance of the related series of certificates.                                                               
Accordingly, no financial statements for any trust fund will be included in this                                                     
prospectus or in the related prospectus supplement.                                                                                  
                                                                                                                                     
                                     RATING                                                                                          
                                                                                                                                     
         It is a condition to the issuance of the certificates of each series                                                        
offered by this prospectus and by the prospectus supplement that they shall have                                                     
been rated in one of the four highest rating categories by the nationally                                                            
recognized statistical rating agency or agencies specified in the related                                                            
prospectus supplement.                                                                                                               
                                                                                                                                     
         Ratings on mortgage pass-through certificates address the likelihood of                                                     
receipt by certificateholders of all distributions on the underlying mortgage                                                        
loans. These ratings address the structural, legal and issuer-related aspects                                                        
associated with the certificates, the nature of the underlying mortgage loans                                                        
and the credit quality of the credit enhancer or guarantor, if any. Ratings on                                                       
mortgage pass-through certificates do not represent any assessment of the                                                            
likelihood of principal prepayments by mortgagors or of the degree by which the                                                      
prepayments might differ from those originally anticipated. As a result,                                                             
certificateholders might suffer a lower than anticipated yield, and, in                                                              
addition, holders of stripped pass-through certificates in extreme cases might                                                       
fail to recoup their underlying 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. Each security rating should be evaluated                                                              
independently of any other security rating.                                                                                          
                                                                                                                                     
                                       110                                                                                           
                                                                                                                                     
<PAGE>                                                                                                                               
                                                                                                                                     
                             INDEX TO DEFINED TERMS                                                                                  
                                                                                                                                     
<TABLE>                                                                                                                              
<S>                                                    <C>                                                                           
1986 Act..........................................      82                                                                           
Agency Securities.................................      14                                                                           
Amortizable Bond Premium Regulations..............      79                                                                           
Applicable Amount.................................      97                                                                           
ARM Loans.........................................      82                                                                           
Asset Conservation Act............................      74                                                                           
CERCLA............................................      73                                                                           
Certificate Account...............................      54                                                                           
Class Certificate Balance.........................      33                                                                           
Code..............................................      29                                                                           
Contingent Regulations............................      87                                                                           
Contributions Tax.................................      99                                                                           
Deferred Interest.................................      83                                                                           
Eleventh District.................................      41                                                                           
ERISA.............................................     104                                                                           
excess inclusion..................................      97                                                                           
excess servicing..................................      81                                                                           
FHLBSF............................................      41                                                                           
Garn-St Germain Act...............................      75                                                                           
Insured Expenses..................................      55                                                                           
Legislative History...............................      82                                                                           
Liquidated Mortgage...............................      64                                                                           
Loan-to-Value Ratio...............................      17                                                                           
Master REMIC......................................      86                                                                           
Mortgage Assets...................................      14                                                                           
National Cost of Funds Index......................      42                                                                           
Non-U.S. Person...................................      84                                                                           
OID...............................................      77                                                                           
OID Regulations...................................      82                                                                           
OTS...............................................      42                                                                           
Parties in Interest...............................     104                                                                           
pass-through entity...............................     101                                                                           
Payment Lag Certificates..........................      93                                                                           
Plans.............................................     104                                                                           
Prepayment Assumption.............................      82                                                                           
Private Mortgage-Backed Securities................      14                                                                           
Prohibited Transactions Tax.......................      99                                                                           
RCRA..............................................      74                                                                           
Regular Certificateholders........................      87                                                                           
Regular Certificates..............................      85                                                                           
Relief Act........................................      75                                                                           
REMIC Certificates................................      85                                                                           
REMICs............................................      86                                                                           
Residual Certificateholder........................      94                                                                           
Residual Certificates.............................      85                                                                           
Restricted Group..................................     106                                                                           
single-class REMIC................................      93                                                                           
SMMEA.............................................     107                                                                           
Stripped ARM Obligations..........................      83                                                                           
Stripped Bond Certificates........................      81                                                                           
Stripped Coupon Certificates......................      81                                                                           
Subsequent Recoveries.............................      94                                                                           
Super-Premium Certificates........................      88                                                                           
Title V...........................................      75                                                                           
U.S. Person.......................................      84                                                                           
Underlying REMIC..................................      86                                                                           
Underwriter Exemptions............................     105                                                                           
</TABLE>                                                                                                                             
                                                                                                                                     
                                       111                                                                                           
<PAGE>                                                                                                                               
                                                                                                                                     
                    CHL MORTGAGE PASS-THROUGH TRUST 2003-44                                                                          
                                                                                                                                     
                                     ISSUER                                                                                          
                                                                                                                                     
                                  CWMBS, INC.                                                                                        
                                   DEPOSITOR                                                                                         
                                                                                                                                     
                         [COUNTRYWIDE HOME LOANS LOGO]                                                                               
                                     SELLER                                                                                          
                                                                                                                                     
                      COUNTRYWIDE HOME LOANS SERVICING LP                                                                            
                                MASTER SERVICER                                                                                      
                                                                                                                                     
                                  $497,249,999                                                                                       
                                 (APPROXIMATE)                                                                                       
                                                                                                                                     
               MORTGAGE PASS-THROUGH CERTIFICATES, SERIES 2003-44                                                                    
                         ------------------------------                                                                              
                             PROSPECTUS SUPPLEMENT                                                                                   
                         ------------------------------                                                                              
                                                                                                                                     
                                   CITIGROUP                                                                                         
                                  UNDERWRITER                                                                                        
                                                                                                                                     
                       COUNTRYWIDE SECURITIES CORPORATION                                                                            
                                  UNDERWRITER                                                                                        
                                                                                                                                     
                          EDWARD D. JONES & CO., L.P.                                                                                
                                     DEALER                                                                                          
                                                                                                                                     
     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 Series 2003-44 Mortgage Pass-Through Certificates                                                       
in any state where the offer is not permitted.                                                                                       
                                                                                                                                     
     Dealers will deliver a prospectus supplement and prospectus when acting as                                                      
underwriters of the Series 2003-44 Mortgage Pass-Through Certificates and with                                                       
respect to their unsold allotments or subscriptions. In addition, all dealers                                                        
selling the Series 2003-44 Mortgage Pass-Through Certificates will be required                                                       
to deliver a prospectus supplement and prospectus until November 20, 2003.                                                           
                                                                                                                                     
                                August 22, 2003                                                                                      
                                                                                                                                     
</TEXT>                                                                                                                              
</DOCUMENT>