MORTGAGE LOAN PURCHASE AGREEMENT
EXECUTION
This
Mortgage Loan Purchase Agreement (the “Agreement”), dated as of January 1, 2007,
is between HSI Asset Securitization Corporation, a Delaware corporation (the
“Company”), and HSBC Bank USA, National Association, a national banking
association (the “Seller”).
The
Company and the Seller hereby recite and agree as follows:
1. Defined
Terms.
Terms
used without definition herein shall have the respective meanings assigned
to
them in the Pooling and Servicing Agreement, dated as of January 1, 2007, by
and
among HSI Asset Securitization Corporation, as depositor, CitiMortgage, Inc.,
as
master servicer, Citibank, N.A., as securities administrator, Xxxxx Fargo Bank,
N.A., as custodian (the “Custodian”), OfficeTiger Global Real Estate Services
Inc., as credit risk manager, and Deutsche Bank National Trust Company, as
trustee (the “Trustee”),
relating to the issuance of the HSI Asset Loan Obligation Trust 2007-WF1
Mortgage Pass-Through Certificates, Series 2007-WF1 (the “Pooling and Servicing
Agreement”). Unless otherwise defined herein, capitalized terms used herein
shall have the same meanings assigned to them in the Pooling and Servicing
Agreement.
2. Purchase
of Mortgage Loans.
The
Seller hereby sells, transfers, assigns and conveys, and the Company hereby
purchases the mortgage loans (the “Mortgage Loans”) listed on the Mortgage Loan
Schedule in Exhibit
1.
3. Purchase
Price; Purchase and Sale.
The
purchase price (the “Purchase Price”) for the Mortgage Loans shall be
$299,041,842.21 inclusive
of accrued
and unpaid interest on the Mortgage Loans at the weighted average interest
rate
borne by the Mortgage Loans from the date hereof to but not including the
Closing Date, payable by the Company
to
the
Seller on the Closing Date either (i) by appropriate notation of an
inter-company transfer between affiliates of HSBC or (ii) in immediately
available federal funds wired to such bank as may be designated by the
Seller.
Upon
payment of the Purchase Price, the Seller shall be deemed to have transferred,
assigned, set over and otherwise conveyed to the Company all the right, title
and interest of the Seller in and to the Mortgage Loans as of the Cut-Off Date,
including all interest and principal due on the Mortgage Loans after the Cut-Off
Date (including Scheduled Payments due after the Cut-Off Date but received
by
the Seller on or before the Cut-Off Date, but not including payments of
principal and interest due on the Mortgage Loans on or before the Cut-Off Date),
together with all of the Seller’s right, title and interest in and to the
proceeds of any related title, hazard, primary mortgage or other insurance
policies.
The
Company hereby directs the Seller, and the Seller hereby agrees, to deliver
to
the Trustee all documents, instruments and agreements required to be delivered
by the Company to the Trustee under the Pooling and Servicing Agreement and
such
other documents, instruments and agreements as the Company or the Trustee shall
reasonably request.
4. Representations
and Warranties.
The
Seller hereby represents and warrants to the Company with respect to each
Mortgage Loan as of the date hereof and as of the Closing Date as follows:
|
(a)
|
With
respect to each Mortgage Loan, as of the date hereof and as of the
Closing
Date:
|
|
(1)
|
All
payments required to be made up to the Closing Date for the Mortgage
Loan
under the terms of the Mortgage Note have been made and credited.
No
payment under any Mortgage Loan has been thirty (30) days delinquent
more
than one time within twelve (12) months prior to the Closing
Date;
|
|
(2)
|
There
are no defaults in complying with the terms of the Mortgages, and
all
taxes, governmental assessments, ground rents, insurance premiums,
leasehold payments, water, sewer and municipal charges, which previously
became due and owing have been paid, or an escrow of funds has been
established in an amount sufficient to pay for every such item which
remains unpaid and which has been assessed but is not yet due and
payable;
|
|
(3)
|
From
and after the Initial Sale Date to the Closing Date, the terms of
the
Mortgage and related Mortgage Note, have not been impaired, waived,
altered or modified in any respect, except by a written instrument
which
has been recorded or registered with the MERS System, if necessary,
to
protect the interests of the Seller and is retained by the Originator
in
the servicing file; the related Mortgage Note has been delivered
to the
Custodian. The substance of any such waiver, alteration or modification
has been approved by the issuer of any related PMI policy and the
title
insurer, to the extent required by the policy, and its terms are
reflected
on the related Mortgage Loan Schedule. No Mortgagor has been released,
in
whole or in part, except in connection with an assumption agreement
approved by the issuer of any related PMI policy and the title insurer,
to
the extent required by the policy, and which assumption agreement
is part
of the Mortgage File delivered to the Custodian and the terms of
which are
reflected in the related Mortgage Loan Schedule;
|
|
(4)
|
The
Mortgage Loan is not subject to any right of rescission, set-off,
counterclaim or defense, including without limitation the defense
of
usury, nor will the operation of any of the terms of the related
Mortgage
Note or Mortgage, or the exercise of any right thereunder, render
either
such Mortgage Note or Mortgage unenforceable, in whole or in part,
or
subject to any right of rescission, set-off, counterclaim or defense,
including without limitation the defense of usury, and no such right
of
rescission, set-off, counterclaim or defense has been asserted with
respect thereto;
|
2
|
(5)
|
The
Mortgage has not been satisfied, canceled, subordinated or rescinded,
in
whole or in part, and the Mortgaged Property has not been released
from
the lien of the Mortgage, in whole or in part, nor has any instrument
been
executed that would effect any such satisfaction, release, cancellation,
subordination or rescission;
|
|
(6)
|
No
error, omission, misrepresentation, negligence, fraud or similar
occurrence with respect to a Mortgage Loan has taken place on the
part of
the Seller or the Mortgagor (except with respect to the accuracy
of
information not verified in the origination process for those loans
listed
on Exhibit E to the Seller’s Warranties and Servicing
Agreement);
|
|
(7)
|
The
Mortgaged Property securing the Mortgage Loan is insured by an insurer
acceptable to Xxxxxx Mae or Xxxxxxx Mac against loss by fire and
such
hazards as are covered under a standard extended coverage endorsement
and
such other hazards as are customary in the area where the Mortgaged
Property is located;
|
|
(8)
|
From
and after the Initial Sale Date to the Closing Date, each Mortgage
Loan
complied with any and all requirements of any federal, state or local
law
including, without limitation, usury, truth-in-lending, real estate
settlement procedures, consumer credit protection and privacy, equal
credit opportunity, disclosure, fair housing and predatory and abusive
and
fair lending laws applicable to such Mortgage Loan. All inspections,
licenses and certificates required to be made or issued with respect
to
all occupied portions of the related Mortgaged Property and, with
respect
to the use and occupancy of the same, including, but not limited
to,
certificates of occupancy and fire underwriting certificates, have
been
made or obtained from the appropriate authorities;
|
|
(9)
|
The
Mortgaged Property is located in the state identified in the Mortgage
Loan
Schedule and consists of a contiguous parcel of real property with
a
detached single family residence erected thereon, or a two- to four-family
dwelling, or an individual condominium unit in a condominium project,
or
an individual unit in a planned unit development or a townhouse,
provided,
however, that any condominium project or planned unit development
shall
conform to the applicable Xxxxxx Mae or Xxxxxxx Mac requirements,
or the
Originator’s underwriting guidelines, regarding such dwellings, and no
residence or dwelling is a mobile
home;
|
3
|
(10)
|
The
Mortgage is a valid, subsisting and enforceable first lien on the
related
Mortgaged Property, including all buildings on such Mortgaged Property
and
all installations and mechanical, electrical, plumbing, heating and
air
conditioning systems located in or annexed to such buildings, and
all
additions, alterations and replacements made at any time with respect
to
the foregoing. The lien of the Mortgage is subject only
to:
|
|
(i)
|
the
lien of current real property taxes and assessments not yet due and
payable;
|
|
(ii)
|
covenants,
conditions and restrictions, rights of way, easements and other matters
of
the public record as of the date of recording acceptable to mortgage
lending institutions generally and specifically referred to in the
lender's title insurance policy delivered to the Originator and (a)
referred to or otherwise considered in the appraisal made for the
originator of the Mortgage Loan and (b) which do not adversely affect
the
appraised value of the Mortgaged Property set forth in such appraisal;
and
|
|
(iii)
|
other
matters to which like properties are commonly subject which do not
materially interfere with the benefits of the security intended to
be
provided by the mortgage or the use, enjoyment, value or marketability
of
the related Mortgaged Property;
|
|
(11)
|
Any
future advances made after the Initial Sale Date and prior to the Closing
Date, have been consolidated with the outstanding principal amount
secured
by the Mortgage, and the secured principal amount, as consolidated,
bears
a single interest rate and single repayment term reflected on the
related
Mortgage Loan Schedule. The lien of the Mortgage securing the consolidated
principal amount is expressly insured as having first lien priority
by a
title insurance policy, an endorsement to the policy insuring the
mortgagee’s consolidated interest or by other title evidence acceptable to
Xxxxxx Mae or Xxxxxxx Mac; the consolidated principal amount does
not
exceed the original principal amount of the Mortgage
Loan;
|
|
(12)
|
The
Seller is the sole owner of record and holder of the Mortgage Loan
and the
related Mortgage Note and the Mortgage are not assigned or pledged,
and
the Seller has good and marketable title thereto and has full right
and
authority to transfer and sell the Mortgage Loan to the Purchaser.
The
Seller is transferring the Mortgage Loan free and clear of any and
all
encumbrances, liens, pledges, equities, participation interests,
claims,
charges or security interests of any nature encumbering such Mortgage
Loan;
|
4
|
(13)
|
The
Mortgage Loan is covered by an American Land Title Association lender’s
title insurance policy (or in the case of any Mortgage Loan secured
by a
Mortgaged Property located in a jurisdiction where such policies
are
generally not available, an opinion of counsel of the type customarily
rendered in such jurisdiction in lieu of title insurance), or other
generally acceptable form of policy of insurance acceptable to Xxxxxx
Mae
or Xxxxxxx Mac, issued by a title insurer acceptable to Xxxxxx Mae
or
Xxxxxxx Mac and qualified to do business in the jurisdiction where
the
Mortgaged Property is located, insuring the Originator, its successors
and
assigns, as to the first priority lien of the Mortgage in the original
principal amount of the Mortgage Loan, subject only to the exceptions
contained in clauses (i), (ii) and (iii) of representation 10 above,
and
against any loss by reason of the invalidity or unenforceability
of the
lien resulting from the provisions of the Mortgage providing for
adjustment to the Mortgage Rate and monthly payment. Additionally,
such
lender's title insurance policy includes no exceptions regarding
ingress,
egress or encroachments that impact the value or the marketability
of the
Mortgaged Property. The Originator is the sole insured of such lender's
title insurance policy, and such lender's title insurance policy
is in
full force and effect and will be in force and effect upon the
consummation of the transactions contemplated by the Seller’s Warranties
and Servicing Agreement. No claims have been made under such lender's
title insurance policy, and as of the Closing Date no prior holder
of the
mortgage, including the Originator, has done, by act or omission,
anything
which would impair the coverage of such lender's title insurance
policy;
|
|
(14)
|
There
is no default, breach, violation or event of acceleration existing
under
the Mortgage or the Mortgage Note and no event which, with the passage
of
time or with notice and the expiration of any grace or cure period,
would
constitute a default, breach, violation or event of acceleration,
and the
Seller has not waived any default, breach, violation or event of
acceleration;
|
|
(15)
|
There
are no mechanics' or similar liens or claims which have been filed
for
work, labor or material (and no rights are outstanding that under
the law
could give rise to such liens) affecting the related Mortgaged Property
which are or may be liens prior to, or equal or coordinate with,
the lien
of the related Mortgage which are not insured against by the title
insurance policy referenced in representation 12
above;
|
5
|
(16)
|
Except
as insured against by the title insurance policy referenced in
representation 12 above, from and after the Initial Sale Date to
the
Closing Date, all improvements which were considered in determining
the
appraised value of the Mortgaged Property lay wholly within the boundaries
and building restriction lines of the Mortgaged Property and no
improvements on adjoining properties encroach upon the Mortgaged
Property.
No improvement located on or being part of the Mortgaged Property
is in
violation of any applicable zoning law or
regulation;
|
|
(17)
|
As
of the Initial Sale Date, and to the best of the Seller’s knowledge, the
Mortgaged Property was lawfully occupied under applicable law;
|
|
(18)
|
The
Mortgage Note is not and has not been secured by any collateral,
pledged
account or other security except the lien of the related Mortgage
and the
security interest of any applicable security agreement or chattel
mortgage
referred to in representation 10 above;
|
|
(19)
|
From
and after the Initial Sale Date to the Closing Date, the Mortgaged
Property is undamaged by waste, fire, earthquake or earth movement,
windstorm, flood, tornado or other casualty so as to affect adversely
the
value of the Mortgaged Property as security for the related Mortgage
Loan
or the use for which the premises were intended;
|
|
(20)
|
From
and after the Initial Sale Date to the Closing Date, there
has been no proceeding pending or to the best of the Seller’s knowledge
threatened for the total or partial condemnation of the related Mortgaged
Property;
|
|
(21)
|
No
Mortgage Loan is (a) a “high cost” loan under the Home Ownership and
Equity Protection Act of 1994, (b) categorized as a “Covered” or “High
Cost,” as applicable, pursuant to the Standard & Poor’s Glossary for
File Format for LEVELSâ
Version 5.7, Appendix E, in effect on the Intial Sale Date or (c)
a “high
cost home,” “threshold,” “covered” (excluding New Jersey “Covered Home
Loans” as that term is defined in clause (1) of the definition of that
term in the New Jersey Home Ownership Security Act of 2002), “high risk
home,” “predatory” or similar loan under any applicable state, federal or
local law;
|
6
|
(22)
|
The
Mortgaged Property securing each Mortgage Loan is insured by an insurer
acceptable to Xxxxxx Xxx or Xxxxxxx Mac against loss by fire and
such
hazards as are covered under a standard extended coverage endorsement
and
such other hazards as are customary in the area where the Mortgaged
Property is located, in an amount which is at least equal to the
lesser of
(i) 100% of the insurable value, on a replacement cost basis, of
the
improvements on the related Mortgaged Property and (ii) the greater
of (a)
the outstanding principal balance of the Mortgage Loan and (b) an
amount
such that the proceeds of such insurance shall be sufficient to prevent
the application to the Mortgagor or the loss payee of any coinsurance
clause under the policy. If the Mortgaged Property is a condominium
unit,
it is included under the coverage afforded by a blanket policy for
the
project. If the improvements on the Mortgaged Property are in an
area
identified in the Federal Register by the Federal Emergency Management
Agency as having special flood hazards, a flood insurance policy
meeting
the requirements of the current guidelines of the Federal Insurance
Administration is in effect with a generally acceptable insurance
carrier,
in an amount representing coverage not less than the least of (A) the
outstanding principal balance of the Mortgage Loan, (B) the full
insurable value and (C) the maximum amount of insurance which was
available under the Flood Disaster Protection Act of 1973, as amended.
All
individual insurance policies contain a standard mortgagee clause
naming
the Company and its successors and assigns as mortgagee, and all
premiums
thereon have been paid. The Mortgage obligates the Mortgagor thereunder
to
maintain a hazard insurance policy at the Mortgagor's cost and expense,
and on the Mortgagor's failure to do so, authorizes the holder of
the
Mortgage to obtain and maintain such insurance at such Mortgagor's
cost
and expense, and to seek reimbursement therefor from the Mortgagor.
The
hazard insurance policy is the valid and binding obligation of the
insurer, is in full force and effect, and will be in full force and
effect
and inure to the benefit of the Company upon the consummation of
the
transactions contemplated by this Agreement. The Seller has not acted
or
failed to act so as to impair the coverage of any such insurance
policy or
the validity, binding effect and enforceability
thereof;
|
|
(23)
|
From
and after the Initial Sale Date to the Closing Date, no Mortgagor
has
notified the Seller, and the Seller has no knowledge of any relief
requested or allowed to the Mortgagor under the Servicemembers Civil
Relief Act, as amended;
|
|
(24)
|
From
and after the Initial Sale Date to the Closing Date, no Mortgagor
was a
debtor in any state or federal bankruptcy or insolvency proceeding
at the
time the Mortgage Loan was originated and as of the Closing Date,
the
Seller has not received notice that any Mortgagor is a debtor under
any
state or federal bankruptcy or insolvency
proceeding;
|
7
|
(25)
|
There
is no pending action or proceeding directly involving the Mortgaged
Property of which the Seller is aware in which compliance with any
applicable environmental law, rule or regulation is an issue; and
to the
best of the Seller’s knowledge, the Mortgaged Property is in material
compliance with all applicable environmental laws and nothing further
remains to be done to satisfy in full all requirements of each such
law,
rule or regulation constituting a prerequisite to the use and enjoyment
of
the Mortgaged Property;
|
|
(26)
|
No
Mortgage Loan originated on or after October 1, 2002, will impose
a
prepayment premium for a term in excess of 3 years after its origination.
No Mortgage Loan originated before October 1, 2002, will impose a
prepayment premium for a term in excess of 5 years after its origination.
Each Prepayment Premium with respect to any Mortgage Loan is permissible,
enforceable and collectible under applicable federal, state and local
law;
and
|
|
(27)
|
No
mortgage loan originated on or after October 1, 2002 through March
6, 2003
is governed by the Georgia Fair Lending
Act.
|
|
(b)
|
[Reserved.]
|
It
is
understood and agreed that the representations and warranties of the Seller
set
forth in this Section 4 shall survive the Closing Date. Upon the discovery
by
either the Seller or the Company of a breach of any of the foregoing
representations and warranties (excluding a breach with respect to the
representation made in subparagraph (a)(25) of Section 4 above) that adversely
and materially affects the value of the related Mortgage Loan and that does
not
also constitute a breach of a representation or warranty of the Originator
under
the Pooling and Servicing Agreement, the party discovering the breach shall
give
prompt written notice to the other. Within 30 days of the earlier of either
discovery by or notice to the Seller of any breach of any of the foregoing
representations or warranties that materially and adversely affects the value
of
any Mortgage Loan, the Seller shall use its best efforts to cure such breach
in
all material respects and, if such defect or breach cannot be remedied, the
Seller shall, at the Company’s option as specified in writing and provided to
the Seller, (i) if such 30 day period expires prior to the second anniversary
of
the Closing Date, remove such Mortgage Loan from the Trust Fund and substitute
in its place a Substitute Mortgage Loan; or (ii) repurchase such Mortgage Loan
at the Repurchase Price.
Notwithstanding
the preceding paragraph, in connection with the Seller’s representations and
warranties made in subparagraph (a)(25) of Section 4 and within 90 days of
the
earlier of discovery by the Seller or receipt of notice from the Servicer of
a
breach of such representation and warranty by the Seller, which breach
materially and adversely affects the interests of the Class P Certificateholders
in any Prepayment Charge, the Seller shall, if (i) such representation and
warranty is breached and a Principal Prepayment has occurred or (ii) if a change
in law subsequent to the Closing Date limits the enforceability of the
Prepayment Charge, pay, at the time of such Principal Prepayment or change
in
law, the amount of the scheduled Prepayment Charge, for the benefit of the
holders of the Class P Certificates, by depositing such amount into the
Distribution Account no later than the Remittance Date immediately following
the
Prepayment Period in which such Principal Prepayment on the related Mortgage
Loan or such change in law has occurred.
8
5. Repurchase
and Substitution of Mortgage Loans.
In the
event the Originator fails to perform its repurchase or substitution obligations
under Section 2.03 of the Pooling and Servicing Agreement resulting from the
insolvency or financial inability of the Originator to do so, the Seller may,
in
its sole discretion, opt to undertake such repurchase or
substitution.
6. Underwriting.
The
Seller hereby agrees to furnish any and all information, documents,
certificates, letters or opinions with respect to the Mortgage Loans, reasonably
requested by the Company in order to perform any of its obligations or satisfy
any of the conditions on its part to be performed or satisfied pursuant to
this
Agreement or the underwriting agreement dated February 5, 2007, among the
Company, the Seller, HSBC Securities (USA) Inc., Xxxxxxxx & Company, Inc.
and Xxxxxxxx Capital Partners, L.P. at or prior to the Closing
Date.
7. Notices.
All
demands, notices and communications hereunder shall be in writing, shall be
effective only upon receipt and shall, if sent to the Company, be addressed
to
it at HSI Asset Securitization Corporation, 000 Xxxxx Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Head MBS Principal Finance, or, if sent
to
the Seller, be addressed to it at HSBC Bank USA, National Association, 000
Xxxxx
Xxxxxx, 00xx
Xxxxx,
Xxx Xxxx, Xxx Xxxx 00000, Attention: Head MBS Principal Finance.
8. Miscellaneous.
This
Agreement shall be governed by and construed in accordance with the laws of
the
State of New York. Neither this Agreement nor any term hereof may be changed,
waived, discharged or terminated except by a writing signed by the party against
whom enforcement of such change, waiver, discharge or termination is sought.
This Agreement may be signed in any number of counterparts, each of which shall
be deemed an original, which taken together shall constitute one and the same
instrument. This Agreement shall bind and inure to the benefit of and be
enforceable by the Company and the Seller and their respective successors and
assigns.
[SIGNATURE
PAGE FOLLOWS]
9
IN
WITNESS WHEREOF, the Company and the Seller have caused this Agreement to be
duly executed by their respective officers as of the day and year first above
written.
HSI
ASSET
SECURITIZATION
CORPORATION
CORPORATION
By:
/s/
Xxxxxx Xxxxx
Name:
Xxxxxx Xxxxx
Title:
Senior Vice President
HSBC
BANK
USA, NATIONAL
ASSOCIATION
ASSOCIATION
By:
/s/
Xxx X. Xxxxxxxx
Name:
Xxx
X. Xxxxxxxx
Title:
Officer #14311
EXHIBIT
1
Mortgage
Loan Schedule
[To
be
retained in a separate closing binder entitled “HALO 2007-WF1 Mortgage Loan
Schedules” at the Washington, DC offices of XxXxx Xxxxxx LLP]
Schedules” at the Washington, DC offices of XxXxx Xxxxxx LLP]
1-1
