Establishment of and Deposits to Collection Account Clause Samples
The 'Establishment of and Deposits to Collection Account' clause requires the creation of a dedicated account into which specified funds, such as payments received from customers or proceeds from collateral, must be deposited. Typically, this clause outlines who is responsible for opening the account, the timing and manner of deposits, and any restrictions on withdrawals or transfers from the account. Its core function is to ensure that funds are properly segregated and managed, providing transparency and security for parties with an interest in the collected amounts.
Establishment of and Deposits to Collection Account. The Servicer shall segregate and hold all funds collected and received pursuant to the Mortgage Loans separate and apart from any of its own funds and general assets and shall establish and maintain one or more Collection Accounts, if necessary. Each Collection Account shall be an Eligible Account. Funds deposited in the Collection Account may be withdrawn by the Servicer in accordance with Section 3.05 herein. The creation of any Collection Account shall be evidenced by a letter agreement in the form of Exhibit A attached hereto and incorporated herein. The Servicer shall deposit in the Collection Account on a daily basis in accordance with its Accepted Servicing Practices, and retain therein, the following collections received by the Servicer and payments made by the Servicer on or after the related Closing Date through the Servicing Transfer Date:
(i) all payments on account of principal on the Mortgage Loans, including all Principal Prepayments;
(ii) [Reserved];
(iii) all payments on account of interest on the Mortgage Loans minus all Servicing Fees attributable thereto;
(iv) all Liquidation Proceeds;
(v) all Insurance Proceeds including amounts required to be deposited pursuant to Section 3.10 herein (other than proceeds to be held in the Escrow Account and applied to the restoration and repair of the Mortgaged Property or released to the Mortgagor in accordance with Sections 3.14 and 3.18 herein);
(vi) all Condemnation Proceeds that are not applied to the restoration or repair of the Mortgaged Property or release to the Mortgagor;
(vii) any amount required to be deposited in the Collection Account pursuant to Section 3.01, 3.08 or 3.10 herein:
(viii) any amounts required to be deposited by the Servicer pursuant to Section 3.11 herein in connection with the deductible clause in any blanket hazard insurance policy;
(ix) with respect to each Principal Prepayment, the Prepayment Interest Shortfall Amount, if any, for the month of distribution. Such deposit shall be made from the Servicer's own funds; and
(x) any amounts received with respect to or related to any REO Property or REO Disposition Proceeds. The foregoing requirements for deposit into the Collection Account shall be exclusive, it being understood and agreed that, without limiting the generality of the foregoing, payments in the nature of Servicing Fees or Ancillary Income need not be deposited by the Servicer into the Collection Account. Any interest paid on funds deposited in the Collection ...
Establishment of and Deposits to Collection Account. The Master Servicer shall establish and maintain, on behalf of the Certificateholders and the NIMS Insurer, if any, a Collection Account entitled “▇▇▇▇▇ Fargo Bank, N.A. for the benefit of the Trustee on behalf of the registered holders of BASIC Mortgage Loan Pass-Through Certificates, 2006-1.” The Collection Account shall be established as an Eligible Account. In addition, the Master Servicer shall deposit in the Collection Account any amounts required to be deposited by it pursuant to Section 3A.14 in connection with losses on Permitted Investments in the Collection Account. In the event that the Servicer shall remit any amount not required to be remitted by it, it may at any time direct the Master Servicer to withdraw such amount from the Collection Account, any provision herein to the contrary notwithstanding. Such direction may be accomplished by delivering an Officer’s Certificate to the Master Servicer, which describes the amounts deposited in error in the Collection Account. All funds deposited in the Collection Account shall be held by the Master Servicer in escrow for the Certificateholders until disbursed in accordance with this Agreement or withdrawn in accordance with Section 3A.13. In no event shall the Master Servicer incur liability for withdrawals from the Collection Account at the direction of the Servicer. If the Collection Account ceases to be an Eligible Account, the Master Servicer shall establish a new Collection Account that is an Eligible Account within 15 days and transfer all funds and investment property on deposit in such existing Collection Account into such new Collection Account.