AURORA LOAN SERVICES LLC, as Servicer LEHMAN BROTHERS HOLDINGS INC., as Seller and AURORA LOAN SERVICES LLC, as Master Servicer
EXECUTION
AURORA
LOAN SERVICES LLC,
as
Servicer
XXXXXX
BROTHERS HOLDINGS
INC.,
as
Seller
and
AURORA
LOAN SERVICES LLC,
as
Master
Servicer
Structured
Asset Securities Corporation
Xxxxxx
XS Trust
Mortgage
Pass-Through Certificates, Series 2007-20N
Dated
as
of November 1, 2007
TABLE
OF CONTENTS
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Page
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ARTICLE
I. DEFINITIONS
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ARTICLE
II. SELLER’S ENGAGEMENT OF SERVICER TO PERFORM SERVICING
RESPONSIBILITIES
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Section
2.01
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Contract
for Servicing; Possession of Servicing Files.
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13
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Section
2.02
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Books
and Records.
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13
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ARTICLE
III. SERVICING OF THE MORTGAGE LOANS
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Section
3.01
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Servicer
to Service.
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14
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Section
3.02
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Collection
of Mortgage Loan Payments.
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16
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Section
3.03
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Establishment
of and Deposits to Custodial Account.
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17
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Section
3.04
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Permitted
Withdrawals From Custodial Account.
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18
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Section
3.05
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Establishment
of and Deposits to Escrow Account.
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20
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Section
3.06
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Permitted
Withdrawals From Escrow Account.
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20
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Section
3.07
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Maintenance
of PMI Policy and/or LPMI Policy; Claims.
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21
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Section
3.08
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Fidelity
Bond and Errors and Omissions Insurance.
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22
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Section
3.09
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Notification
of Adjustments.
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22
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Section
3.10
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Completion
and Recordation of Assignments of Mortgage.
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23
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Section
3.11
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Protection
of Accounts.
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23
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Section
3.12
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Payment
of Taxes, Insurance and Other Charges.
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23
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Section
3.13
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Maintenance
of Hazard Insurance.
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24
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Section
3.14
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Maintenance
of Mortgage Impairment Insurance Policy.
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25
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Section
3.15
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Restoration
of Mortgaged Property.
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25
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Section
3.16
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Title,
Management and Disposition of REO Property.
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25
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Section
3.17
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Real
Estate Owned Reports.
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28
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Section
3.18
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MERS.
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28
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Section
3.19
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Waiver
of Prepayment Penalty Amounts.
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28
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ARTICLE
IV. PAYMENTS TO MASTER SERVICER
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Section
4.01
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Remittances.
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29
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Section
4.02
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Statements
to Master Servicer.
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30
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Section
4.03
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Monthly
Advances by Servicer.
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32
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ARTICLE
V. GENERAL SERVICING PROCEDURES
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Section
5.01
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Servicing
Compensation.
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32
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Section
5.02
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Report
on Attestation of Compliance with Applicable Servicing
Criteria.
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33
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Section
5.03
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Annual
Officer’s Certificate.
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33
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Section
5.04
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Report
on Assessment of Compliance with Applicable Servicing
Criteria.
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34
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Section
5.05
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Transfers
of Mortgaged Property.
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34
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ARTICLE
VI. REPRESENTATIONS, WARRANTIES AND
AGREEMENTS
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Section
6.01
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Representations,
Warranties and Agreements of the Servicer.
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35
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i
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Section
6.02
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Remedies
for Breach of Representations and Warranties of the
Servicer.
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37
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Section
6.03
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Additional
Indemnification by the Servicer; Third Party Claims.
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38
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Section
6.04
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Indemnification
with Respect to Certain Taxes and Loss of REMIC Status.
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39
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Section
6.05
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Reporting
Requirements of the Commission and Indemnification.
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39
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ARTICLE
VII. THE SERVICER
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Section
7.01
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Merger
or Consolidation of the Servicer.
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41
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Section
7.02
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Limitation
on Liability of the Servicer and Others.
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41
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Section
7.03
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Limitation
on Resignation and Assignment by the Servicer.
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41
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Section
7.04
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Subservicing
Agreements and Successor Subservicer.
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42
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ARTICLE
VIII. TERMINATION
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Section
8.01
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Termination
for Cause.
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44
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Section
8.02
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Termination
Without Cause.
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46
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ARTICLE
IX. MISCELLANEOUS PROVISIONS
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Section
9.01
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Successor
to the Servicer.
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47
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Section
9.02
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Costs.
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49
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Section
9.03
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Notices.
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49
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Section
9.04
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Severability
Clause.
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50
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Section
9.05
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No
Personal Solicitation.
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51
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Section
9.06
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Counterparts.
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51
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Section
9.07
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Place
of Delivery and Governing Law.
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51
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Section
9.08
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Further
Agreements.
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52
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Section
9.09
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Intention
of the Parties.
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52
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Section
9.10
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Successors
and Assigns; Assignment of Servicing Agreement.
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52
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Section
9.11
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Assignment
by the Seller.
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52
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Section
9.12
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Amendment.
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52
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Section
9.13
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Waivers.
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53
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Section
9.14
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Exhibits.
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53
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Section
9.15
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General
Interpretive Principles.
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53
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Section
9.16
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Intended
Third Party Beneficiaries.
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53
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Section
9.17
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Reproduction
of Documents.
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54
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Section
9.18
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Protection
of Confidential Information.
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54
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-ii-
EXHIBITS
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EXHIBIT
A
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Mortgage
Loan Schedule
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EXHIBIT
B
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Custodial
Account Certification
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EXHIBIT
C
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Escrow
Account Certification
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EXHIBIT
D-1
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Master
Servicer Data Field Requirements (Standard Layout)
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EXHIBIT
D-2
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Standard
Layout for Monthly Defaulted Loan Report
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EXHIBIT
D-3
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Form
of Modified Loan Report
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EXHIBIT
E
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Form
of Certification to be Provided to the Depositor, the Master Servicer
and
the Trustee by the Servicer
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EXHIBIT
F
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Assignment
and Assumption Agreement
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EXHIBIT
G
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Xxxxxx
Xxx Guide No. 95-19
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EXHIBIT
H
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Servicing
Criteria to be Addressed in Report on Assessment of
Compliance
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EXHIBIT
I
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Transaction
Parties
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EXHIBIT
J
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Form
of Annual Officer’s Certificate
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-iii-
THIS
SERVICING AGREEMENT (this “Agreement”), entered into as of the 1st day of
November, 2007, by and among XXXXXX BROTHERS HOLDINGS INC., a Delaware
corporation (“Xxxxxx Holdings” or the “Seller”), AURORA LOAN SERVICES LLC, a
Delaware limited liability company in its capacity as primary servicer (the
“Servicer”), and AURORA LOAN SERVICES LLC, in its capacity as Master Servicer
under the Trust Agreement (as defined herein), recites and provides as
follows:
RECITALS
WHEREAS,
the Servicer and Xxxxxx Brothers Bank, FSB (the “Bank”) are parties to a Flow
Servicing Agreement dated as of August 31, 1999, pursuant to which the Servicer
services certain of the residential, fixed and adjustable rate mortgage loans
identified on Exhibit A hereto (the “Bank Mortgage Loans”).
WHEREAS,
pursuant to an assignment and assumption agreement dated as of November 1,
2007
(the “Assignment and Assumption Agreement”), between the Bank, as assignor, and
Xxxxxx Holdings, as assignee, annexed hereto as Exhibit F, the Bank has assigned
all of its rights, title and interest in the Bank Mortgage Loans to Xxxxxx
Holdings, and Xxxxxx Holdings has accepted such assignment.
WHEREAS,
the Servicer and the Seller are parties to a Flow Servicing Agreement dated
as
of February 15, 2000 (the “Flow Servicing Agreement”), pursuant to which the
Servicer services certain of the mortgage loans identified on Exhibit A hereto
(the “Holdings Mortgage Loans,” and together with the Bank Mortgage Loans, the
“Mortgage Loans”).
WHEREAS,
the Seller has conveyed the Mortgage Loans on a servicing-retained basis to
Structured Asset Securities Corporation, a Delaware special purpose corporation
(the “Depositor”), pursuant to a mortgage loan sale and assignment agreement
dated as of November 1, 2007 (the “Mortgage Loan Sale and Assignment
Agreement”), which in turn has conveyed the Mortgage Loans to U.S. Bank National
Association, solely in its capacity as trustee (in such capacity, the
“Trustee”), under a trust agreement dated as of November 1, 2007 (the “Trust
Agreement”), among the Trustee, Aurora Loan Services LLC, as master servicer
(“Aurora,” and together with any successor Master Servicer appointed pursuant to
the provisions of the Trust Agreement, the “Master Servicer”), and the
Depositor.
WHEREAS,
from time to time certain other mortgage loans conveyed by the Depositor to
the
Trustee under the Trust Agreement on the Closing Date and serviced by other
servicers may subsequent to the Closing Date be transferred to the Servicer
for
servicing under this Agreement and Exhibit A hereto will be amended by the
parties hereto to include such mortgage loans which will then be “Mortgage
Loans” under this Agreement.
WHEREAS,
the Seller desires that the Servicer service the Mortgage Loans pursuant to
this
Agreement, and the Servicer has agreed to do so, subject to the right of the
Seller and of the
Master
Servicer to terminate the rights and
obligations of the Servicer hereunder at any time and to the other conditions
set forth herein.
WHEREAS,
the Seller and the Servicer agree that the provisions of the Flow Servicing
Agreement shall not apply to the Mortgage Loans for so long as the Mortgage
Loans remain subject to the provisions of the Trust Agreement;
WHEREAS,
the Master Servicer shall be obligated under the Trust Agreement, among other
things, to supervise the servicing of the Mortgage Loans on behalf of the
Trustee, and shall have the right, under certain circumstances, to terminate
the
rights and obligations of the Servicer under this Servicing
Agreement.
WHEREAS,
the Seller and the Servicer acknowledge and agree that the Seller will assign
all of its rights and delegate all of its obligations hereunder (excluding
the
Seller’s rights and obligations as owner of the servicing rights relating to the
Mortgage Loans) to the Depositor and the Depositor will assign all of its rights
(but not the obligations, except as set forth in the Trust Agreement) hereunder
to the Trustee pursuant to the Trust Agreement, and that each reference herein
(other than with respect to the Seller’s ownership of the servicing rights) to
the Seller is intended, unless otherwise specified, to mean the Seller or the
Trustee, as assignee, whichever is the owner of the Mortgage Loans from time
to
time.
NOW,
THEREFORE, in consideration of the mutual agreements hereinafter set forth
and
for other good and valuable consideration, the receipt and adequacy of which
are
hereby acknowledged, the Seller, the Servicer and the Master Servicer hereby
agree as follows:
ARTICLE
I.
DEFINITIONS
The
following terms are defined as follows (except as otherwise agreed in writing
by
the parties):
Accepted
Servicing Practices:
With
respect to any Mortgage Loan, those mortgage servicing practices (i) of prudent
mortgage lending institutions that service mortgage loans of the same type
as
such Mortgage Loans in the jurisdiction where the related Mortgaged Property
is
located and (ii) in accordance with applicable state, local and federal laws,
rules and regulations; provided, further, that, unless otherwise specified
in
this Agreement, such mortgage servicing practices shall be undertaken in
accordance with the provisions of the Xxxxxx Mae Guides.
Adjustable
Rate Mortgage Loan:
A
Mortgage Loan serviced pursuant to this Agreement under which the Mortgage
Interest Rate is adjusted from time to time in accordance with the terms and
provisions of the related Mortgage Note.
Aggregate
Loan Balance:
At any
date of determination, the outstanding principal balance of the Mortgage Loans
serviced hereunder.
Agreement:
This
Servicing Agreement and all amendments hereof and supplements
hereto.
-2-
Ancillary
Income:
All
income derived from the Mortgage Loans, other than Servicing Fees and Prepayment
Penalty Amounts, including but not limited to late charges, fees received with
respect to checks or bank drafts returned by the related bank for non-sufficient
funds, assumption fees, optional insurance administrative fees and all other
incidental fees and charges. Ancillary Income shall not include any Prepayment
Penalty Amount.
Assignment
of Mortgage:
An
assignment of the Mortgage, notice of transfer or equivalent instrument in
recordable form, sufficient under the laws of the jurisdiction wherein the
related Mortgaged Property is located to reflect the transfer of the Mortgage
to
the party indicated therein, which assignment, notice of transfer or equivalent
instrument may be in the form of one or more blanket assignments covering the
Mortgage Loans secured by Mortgaged Properties located in the same jurisdiction,
if permitted by law.
Best
Efforts:
Efforts
determined to be reasonably diligent by the Seller or the Servicer, as the
case
may be, taking into account Accepted Servicing Practices. Such efforts do not
require the Seller or the Servicer, as the case may be, to enter into any
litigation, arbitration or other legal or quasi-legal proceeding, nor do they
require the Seller or the Servicer, as the case may be, to advance or expend
fees or sums of money in addition to those specifically set forth in this
Agreement.
Business
Day:
Any day
other than (i) a Saturday or a Sunday or (ii) a day on which banking
institutions in Colorado, Illinois, Nebraska, New York, New York or, if other
than New York, the state in which the corporate trust office of the Trustee
is
located are authorized or obliged by executive order to be closed.
Capitalization
Reimbursement Amount:
As
defined in Section 3.01.
Certificates:
Any or
all of the Certificates issued pursuant to the Trust Agreement.
Closing
Date:
November 30, 2007.
Code:
The
Internal Revenue Code of 1986, as it may be amended from time to time or any
successor statute thereto, and applicable U.S. Department of the Treasury
regulations issued pursuant thereto.
Commission:
The
United States Securities and Exchange Commission.
Condemnation
Proceeds:
All
awards of settlements in respect of a Mortgaged Property, whether permanent
or
temporary, partial or entire, by exercise of the power of eminent domain or
condemnation, to the extent not required to be released to a Mortgagor in
accordance with the terms of the related Mortgage Loan documents.
Costs:
For any
Person, any claims, losses, damages, penalties, fines, forfeitures, reasonable
and necessary legal fees and related costs, judgments, and other costs and
expenses of such Person.
Custodial
Account:
The
separate account or accounts created and maintained pursuant to Section
3.03.
-3-
Custodial
Agreement:
Each
custodial agreement relating to custody of certain of the Mortgage Loans, each
between the applicable Custodian and the Trustee, each dated as of November
1,
2007.
Custodian:
Each of
Deutsche Bank National Trust Company, U.S. Bank National Association and LaSalle
Bank National Association, and their respective successors.
Cut-off
Date:
November 1, 2007.
Depositor:
Structured Asset Securities Corporation or any successor in
interest.
Determination
Date:
With
respect to each Remittance Date, the 15th day of the month in which such
Remittance Date occurs, or, if such 15th day is not a Business Day, the next
succeeding Business Day.
Due
Date:
The day
of the month on which the Monthly Payment is due on a Mortgage Loan, exclusive
of any days of grace. With respect to the Mortgage Loans for which payment
from
the Mortgagor is due on a day other than the first day of the month, such
Mortgage Loans will be treated as if the Monthly Payment is due on the first
day
of the immediately succeeding month.
Due
Period:
With
respect to each Remittance Date, the period commencing on the second day of
the
month immediately preceding the month of the Remittance Date and ending on
the
first day of the month of the Remittance Date.
Eligible
Deposit Account:
An
account that is maintained with a federal or state-chartered depository
institution or trust company that complies with the definition of Eligible
Institution.
Eligible
Institution:
Any of
the following:
|
(i)
|
an
institution whose:
|
(A) commercial
paper, short-term debt obligations, or other short-term deposits are rated
at
least “A-1+” or long-term unsecured debt obligations are rated at least “AA-” by
S&P, if the amounts on deposit are to be held in the account for no more
than 365 days; provided, that following a downgrade, withdrawal or suspension
of
such institution’s ratings below such ratings set forth above, each account
shall promptly (and in any case within not more than 60 calendar days) be
transferred to accounts which have the required ratings; or
(B) commercial
paper, short-term debt obligations, demand deposits, or other short-term
deposits are rated at least “A-2” by S&P, if the amounts on deposit are to
be held in the account for no more than 30 days and are not intended to be
used
as credit enhancement. Upon the loss of the required rating set forth in clause
(i)(A) or this clause (i)(B), the accounts shall be transferred immediately
to
accounts which have the required rating. Furthermore, commingling by the
Servicer is acceptable at the A-2 rating level if the Servicer is a bank, thrift
or depository and provided the Servicer has the capability to
-4-
immediately
segregate funds and commence remittance
to an Eligible Deposit Account upon a downgrade; provided, that following a
downgrade, withdrawal or suspension of such institution’s ratings below such
ratings set forth above, each Aurora Servicing Agreement account shall promptly
(and in any case within not more than 30 calendar days) be transferred to
accounts which have the required ratings;
(ii) the
corporate trust department of a federal depository institution or
state-chartered depository institution subject to regulations regarding
fiduciary funds on deposit similar to Title 12 of the U.S. Code of Federal
Regulation Section 9.10(b), which, in either case, has corporate trust powers
and is acting in its fiduciary capacity; or
(iii) the
Bank;
provided, that following a downgrade, withdrawal or suspension of such
institution’s short-term rating below “A-2”, each account shall promptly (and in
any case not more than 30 calendar days) be transferred to accounts that have
the required ratings.
Eligible
Investments:
Any one
or more of the obligations and securities listed below which investment provides
for a date of maturity not later than the Determination Date in each
month:
(i)
direct
obligations of, and obligations fully guaranteed as to timely payment of
principal and interest by, the United States of America or any agency or
instrumentality of the United States of America the obligations of which are
backed by the full faith and credit of the United States of America (“Direct
Obligations”);
(ii)
federal
funds, or demand and time deposits in, certificates of deposits of, or bankers’
acceptances issued by, any depository institution or trust company (including
U.S. subsidiaries of foreign depositories, the Trustee or any agent of the
Trustee, acting in its respective commercial capacity) incorporated or organized
under the laws of the United States of America or any state thereof and subject
to supervision and examination by federal or state banking authorities, so
long
as at the time of investment or the contractual commitment providing for such
investment the commercial paper or other short-term debt obligations of such
depository institution or trust company (or, in the case of a depository
institution or trust company which is the principal subsidiary of a holding
company, the commercial paper or other short-term debt or deposit obligations
of
such holding company or deposit institution, as the case may be) have been
rated
by each Rating Agency in its highest short-term rating category or one of its
two highest long-term rating categories;
(iii)
repurchase
agreements collateralized by Direct Obligations or securities guaranteed by
Xxxxxx Xxx, Xxxxxx Xxx or Xxxxxxx Mac with any registered broker/dealer subject
to Securities Investors’ Protection Corporation jurisdiction or any commercial
bank insured by the FDIC, if such broker/dealer or bank has an uninsured,
unsecured and unguaranteed obligation rated by each Rating Agency in its highest
short-term rating category;
(iv)
securities
bearing interest or sold at a discount issued by any corporation incorporated
under the laws of the United States of America or any state thereof which have
a
-5-
credit
rating from each Rating Agency, at the time of
investment or the contractual commitment providing for such investment, at
least
equal to one of the two highest long-term credit rating categories of each
Rating Agency; provided,
however,
that
securities issued by any particular corporation will not be Eligible Investments
to the extent that investment therein will cause the then outstanding principal
amount of securities issued by such corporation and held as part of the Trust
Fund to exceed 20% of the sum of the Aggregate Loan Balance and the aggregate
principal amount of all Eligible Investments in the Certificate Account;
provided, further, that such securities will not be Eligible Investments if
they
are published as being under review with negative implications from any Rating
Agency;
(v)
commercial
paper (including both non-interest-bearing discount obligations and
interest-bearing obligations payable on demand or on a specified date not more
than 180 days after the date of issuance thereof) rated by each Rating Agency
in
its highest short-term rating category;
(vi)
certificates
or receipts representing direct ownership interests in future interest or
principal payments on obligations of the United States of America or its
agencies or instrumentalities (which obligations are backed by the full faith
and credit of the United States of America) held by a custodian in safekeeping
on behalf of the holders of such receipts; and
(vii)
any
other
demand, money market, common trust fund or time deposit or obligation, or
interest-bearing or other security or investment, (A) rated in the highest
rating category by each Rating Agency or (B) that would not adversely affect
the
then current rating by any Rating Agency of any of the Certificates. Such
investments in this subsection (viii) may include money market mutual funds
or
common trust funds, including any fund for which the Trustee, the Master
Servicer or an affiliate thereof serves as an investment advisor, administrator,
shareholder servicing agent, and/or custodian or subcustodian, notwithstanding
that (x) the Trustee, the Master Servicer or an affiliate thereof charges and
collects fees and expenses from such funds for services rendered, (y) the
Trustee, the Master Servicer or an affiliate thereof charges and collects fees
and expenses for services rendered pursuant to this Agreement, and (z) services
performed for such funds and pursuant to this Agreement may converge at any
time.
provided,
however,
that no
such instrument shall be an Eligible Investment if such instrument evidences
either (i) a right to receive only interest payments with respect to the
obligations underlying such instrument, or (ii) both principal and interest
payments derived from obligations underlying such instrument and the principal
and interest payments with respect to such instrument provide a yield to
maturity of greater than 120% of the yield to maturity at par of such underlying
obligations.
Errors
and Omissions Insurance:
Errors
and Omissions Insurance to be maintained by the Servicer in accordance with
the
Xxxxxx Mae Guides.
Escrow
Account:
The
separate account or accounts created and maintained pursuant to Section
3.05.
Escrow
Payments:
With
respect to any Mortgage Loan, the amounts constituting ground rents, taxes,
assessments, water rates, sewer rents, municipal charges, mortgage insurance
-6-
premiums,
fire and hazard insurance premiums,
condominium charges, and any other payments required to be escrowed by the
Mortgagor with the mortgagee pursuant to the Mortgage or any other related
document.
Event
of Default:
Any
event set forth in Section 8.01.
Xxxxxx
Xxx:
Xxxxxx
Xxx, or any successor thereto.
Xxxxxx
Mae Guides:
The
Xxxxxx Xxx Selling Guide and the Xxxxxx Mae Servicing Guide and all amendments
or additions thereto.
FDIC:
The
Federal Deposit Insurance Corporation or any successor thereto.
Fidelity
Bond:
A
fidelity bond to be maintained by the Servicer in accordance with the Xxxxxx
Xxx
Guides.
Xxxxxxx
Mac:
Xxxxxxx
Mac or any successor thereto.
Xxxxxx
Mae:
The
Government National Mortgage Association or any successor thereto.
Insurance
Proceeds:
With
respect to each Mortgage Loan, proceeds of insurance policies insuring the
Mortgage Loan or the related Mortgaged Property including proceeds of any hazard
or flood insurance policy, PMI Policy or LPMI Policy.
Liquidation
Proceeds:
Cash
received in connection with the liquidation of a defaulted Mortgage Loan,
whether through the sale or assignment of such Mortgage Loan, trustee’s sale,
discounted payoff, foreclosure sale or otherwise, or the sale of the related
REO
Property, if the Mortgaged Property is acquired in satisfaction of the Mortgage
Loan.
LPMI
Fee:
With
respect to each LPMI Loan, the portion of the Mortgage Interest Rate as set
forth on the related Mortgage Loan Schedule (which shall be payable solely
from
the interest portion of Monthly Payments, Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds), which, during such period prior to the
required cancellation of the LPMI Policy, shall be used to pay the premium
due
on the related LPMI Policy.
LPMI
Insurer:
None.
LPMI
Loan:
A
Mortgage Loan covered by an LPMI Policy, as set forth in the Mortgage Loan
Schedule or otherwise identified to the Servicer in writing.
LPMI
Policy:
A
policy of primary mortgage guaranty insurance issued by a LPMI Insurer pursuant
to which the related premium is to be paid from payments of interest made by
the
Mortgagor.
Master
Servicer:
Aurora
Loan Services LLC, or any successor in interest, or if any successor master
servicer shall be appointed as provided in the Trust Agreement, then such
successor master servicer.
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MERS:
Mortgage Electronic Registration Systems, Inc., a Delaware corporation, or
any
successor in interest thereto.
MERS
Eligible Mortgage Loan:
Any
Mortgage
Loan that has been designated by the Servicer as recordable in the name of
MERS.
MERS
Mortgage Loan:
Any
Mortgage Loan as to which the related Mortgage, or an Assignment of Mortgage,
has been or will be recorded in the name of MERS, as agent for the holder from
time to time of the Mortgage Note.
Monthly
Advance:
With
respect to each Remittance Date and each Mortgage Loan, an amount equal to
the
Monthly Payment (with the interest portion of such Monthly Payment adjusted
to
the Mortgage Loan Remittance Rate) that was due on the Mortgage Loan on the
Due
Date in the related Due Period, and that (i) was delinquent at the close of
business on the related Determination Date and (ii) was not the subject of
a
previous Monthly Advance, but only to the extent that such amount is expected,
in the reasonable judgment of the Servicer, to be recoverable from collections
or other recoveries in respect of such Mortgage Loan; provided, for the purpose
of clarification, that the Servicer shall not be required to make a Monthly
Advance for any payments of principal or interest with respect to a reduction
in
the value of a Mortgage Note upon the order of a bankruptcy court of competent
jurisdiction. To the extent that the Servicer determines that any such amount
is
not recoverable from collections or other recoveries in respect of such Mortgage
Loan, such determination shall be evidenced by a certificate of a Servicing
Officer delivered to the Master Servicer setting forth such determination and
the procedures and considerations of the Servicer forming the basis of such
determination.
Monthly
Payment:
The
scheduled monthly payment of principal and interest on a Mortgage
Loan.
Moody’s:
Xxxxx’x
Investors Service, Inc. or any successor in interest.
Mortgage:
The
mortgage, deed of trust or other instrument securing a Mortgage Note, which
creates a first or second lien on an unsubordinated estate in fee simple in
real
property securing the Mortgage Note.
Mortgage
Impairment Insurance Policy:
A
mortgage impairment or blanket hazard insurance policy as described in the
Xxxxxx Mae Guides.
Mortgage
Interest Rate:
The
annual rate of interest borne on a Mortgage Note, after giving effect to any
applicable Relief Act Reduction.
Mortgage
Loan:
An
individual Mortgage Loan that is the subject of this Agreement, each Mortgage
Loan subject to this Agreement being identified on the Mortgage Loan Schedule,
which Mortgage Loan includes without limitation the Mortgage Loan documents,
the
Monthly Payments, Principal Prepayments, Liquidation Proceeds, Condemnation
Proceeds, Insurance Proceeds, REO Disposition Proceeds, and all other rights,
benefits, proceeds and obligations arising from or in connection with such
Mortgage Loan.
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Mortgage
Loan Remittance Rate:
With
respect to each Mortgage Loan, the annual rate of interest remitted to the
Master Servicer, which shall be equal to the Mortgage Interest Rate minus the
applicable Servicing Fee.
Mortgage
Loan Schedule:
A
schedule of the Mortgage Loans setting forth information with respect to such
Mortgage Loans (including any MERS identification number (if available) with
respect to each MERS Mortgage Loan or MERS Eligible Mortgage Loan and a
Prepayment Penalty Schedule), attached hereto as Exhibit A, which may be amended
from time to time to include additional mortgage loans which are transferred
to
the Servicer by a Prior Servicer in a Servicing Transfer.
Mortgage
Note:
The
note or other evidence of the indebtedness of a Mortgagor secured by a
Mortgage.
Mortgaged
Property:
The
real property securing repayment of the debt evidenced by a Mortgage
Note.
Mortgagor:
The
obligor on a Mortgage Note.
Non-MERS
Eligible Mortgage Loan:
Any
Mortgage
Loan other than a MERS Eligible Mortgage Loan.
Non-MERS
Mortgage Loan:
Any
Mortgage Loan other than a MERS Mortgage Loan.
Opinion
of Counsel:
A
written opinion of counsel, who may be an employee of the Servicer, reasonably
acceptable to the Seller, but which must be independent outside counsel with
respect to any such opinion of counsel concerning (i) the non-recordation of
Mortgage Loans pursuant to Section 2.02 hereof and (ii) federal income tax
matters.
Participating
Entity:
As
defined in Section 5.02 hereof.
Person:
Any
individual, corporation, partnership, limited liability company, joint venture,
association, joint-stock company, trust, unincorporated organization, government
or any agency or political subdivision thereof.
PMI
Policy:
A
policy of primary mortgage guaranty insurance issued by a Qualified Insurer,
as
required by this Agreement with respect to certain Mortgage Loans.
Prepayment
Interest Excess Amount:
With
respect to any Principal Prepayment in full which is applied to the related
Mortgage Loan from the first day of the month of any Remittance Date through
the
sixteenth day of the month of such Remittance Date, all amounts paid in respect
of interest on such Principal Prepayment in full. A Prepayment Interest Excess
Amount cannot result from a Principal Prepayment in part, but only from a
Principal Prepayment in full.
Prepayment
Interest Shortfall Amount:
With
respect to any Remittance Date and any Principal Prepayment in full which is
applied to the related Mortgage Loan from the seventeenth day of the month
immediately preceding the month of such Remittance Date through the last day
of
the month immediately preceding the month of such Remittance Date, the amount
of
interest
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(net
of the related Servicing Fee) that would have
accrued on the amount of such Principal Prepayment in full from the date on
which such Principal Prepayment was applied to such Mortgage Loan until the
last
day of the month immediately preceding the month of such Remittance Date,
inclusive. With respect to any Remittance Date and any Principal Prepayment
in
part which is applied to the related Mortgage Loan during the related Prepayment
Period, the amount of interest that would have accrued on the amount of such
Principal Prepayment in part from the date on which such Principal Prepayment
in
part was applied to such Mortgage Loan until the end of the Prepayment Period,
inclusive.
Prepayment
Penalty Amount:
With
respect to any Remittance Date, all prepayment penalties, penalty or yield
maintenance premiums or charges paid by the obligors under the Mortgage Notes
due to Principal Prepayments collected by the Servicer during the immediately
preceding Prepayment Period.
Prepayment
Penalty Schedule:
A data
field in the Mortgage Loan Schedule attached hereto as Exhibit A which sets
forth the amount or method of calculation of the Prepayment Penalty Amount
and
the term during which such Prepayment Penalty Amount is imposed with respect
to
a Mortgage Loan.
Prepayment
Period:
With
respect to any Remittance Date and a Principal Prepayment in full, the period
from the seventeenth day of the month immediately preceding the month of such
Remittance Date to the sixteenth day of the month of such Remittance Date.
With
respect to any Remittance Date and any Principal Prepayment in part, the
calendar month immediately preceding the month of such Remittance
Date.
Prime
Rate:
The
prime rate published from time to time, as published as the average rate in
The
Wall Street Journal Northeast Edition.
Principal
Prepayment:
Any
payment or other recovery of principal on a Mortgage Loan which is received
in
advance of its scheduled Due Date and which is not accompanied by an amount
of
interest representing scheduled interest due on any date or dates in any month
or months subsequent to the month of prepayment.
Prior
Servicer:
Any
prior servicer (other than the Servicer) of any of the Mortgage
Loans.
Qualified
Insurer:
A
mortgage guaranty insurance company duly authorized and licensed where required
by law to transact mortgage guaranty insurance business and approved as an
insurer by Xxxxxx Xxx or Xxxxxxx Mac.
Rating
Agency:
Each of
Xxxxx’x and S&P.
Regulation
AB:
Subpart
229.1100 - Asset Backed Securities (Regulation AB), 17 C.F.R.
§§229.1100-229.1123, as such may be amended from time to time, and subject to
such clarification and interpretation as have been provided by the Commission
in
the adopting release (Asset-Backed Securities, Securities Act Release No.
33-8518, 70 Fed. Reg. 1,506, 1,531 (Jan. 7, 2005)) or by the staff of the
Commission, or as may be provided by the Commission or its staff from time
to
time.
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Relief
Act Reduction: With
respect to any Mortgage Loan as to which there has been a reduction in the
amount of the interest collectible thereon as a result of the application of
the
Servicemembers Civil Relief Act or similar state or local law, as amended,
any
amount by which interest collectible on such Mortgage Loan for the Due Date
in
the related Due Period is less than the interest accrued thereon for the
applicable one month period at the Mortgage Interest Rate without giving effect
to such reduction.
REMIC:
A “real
estate mortgage investment conduit” within the meaning of Section 860D of the
Code.
REMIC
Provisions:
The
provisions of the federal income tax law relating to real estate mortgage
investment conduits which appear at sections 860A through 860G of Subchapter
M
of Chapter 1 of the Code, and related provisions, and regulations, including
proposed regulations and rulings, and administrative pronouncements promulgated
thereunder, as the foregoing may be in effect from time to time.
Remittance
Date:
The
18th day (or if such 18th day is not a Business Day, the first Business Day
immediately following) of any month.
REO
Disposition:
The
final sale or other disposition by the Servicer of any REO
Property.
REO
Disposition Proceeds:
All
amounts received with respect to an REO Disposition pursuant to Section
3.16.
REO
Property:
A
Mortgaged Property acquired by the Servicer on behalf of the Trustee through
foreclosure or by deed in lieu of foreclosure, pursuant to Section
3.16.
Retained
Interest:
The
meaning set forth in the Trust Agreement.
Retained
Interest Holder:
The
meaning set forth in the Trust Agreement.
Seller:
Xxxxxx
Brothers Holdings Inc. or its successors in interest and assigns.
Servicer:
Aurora
Loan Services LLC or its successor in interest or assigns or any successor
to
the Servicer under this Agreement as herein provided.
Servicing
Advances:
All
customary, reasonable and necessary “out of pocket” costs and expenses
(including reasonable attorneys’ fees and disbursements) incurred in the
performance by the Servicer of its servicing obligations, including, but not
limited to, the cost of (i) the preservation, inspection, restoration and
protection of the Mortgaged Property, (ii) any enforcement or administrative
or
judicial proceedings, including foreclosures and bankruptcies, (iii) the
management and liquidation of the Mortgaged Property if the Mortgaged Property
is acquired in satisfaction of the Mortgage, (iv) taxes, assessments, water
rates, sewer rents and other charges which are or may become a lien upon the
Mortgaged Property, and PMI Policy premiums and
fire
and hazard insurance coverage, (v) any losses sustained by the Servicer with
respect to the liquidation of the Mortgaged Property and (vi) compliance with
the obligations pursuant to the provisions of the Xxxxxx Mae
Guides.
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Servicing
Fee:
An
amount equal to (a) one-twelfth the product of (i) a rate per annum equal to
0.375% and (ii) the outstanding principal balance of such Mortgage Loan and
(b)
any Prepayment Interest Excess Amount. The obligation of the Trustee to pay
the
Servicing Fee is limited to, and the Servicing Fee is payable solely from the
interest portion (including recoveries with respect to interest from Liquidation
Proceeds to the extent permitted by Section 3.04 of this Agreement) of such
Monthly Payment collected by the Servicer or as otherwise provided under this
Agreement.
Servicing
File:
The
items pertaining to a particular Mortgage Loan including, but not limited to,
the computer files, data disks, books, records, data tapes, notes, and all
additional documents generated as a result of or utilized in originating and/or
servicing each Mortgage Loan, which are held in trust for the Trustee by the
Servicer.
Servicing
Officer:
Any
officer of the Servicer involved in or responsible for, the administration
and
servicing of the Mortgage Loans whose name appears on a list of servicing
officers furnished by the Servicer to the Master Servicer or the Seller upon
request, as such list may from time to time be amended.
Servicing
Transfer:
Any
transfer of the servicing by a Prior Servicer of Mortgage Loans to the Servicer
under this Agreement.
Servicing
Transfer Date:
The
date on which a Servicing Transfer occurs.
S&P:
Standard & Poor’s Ratings Services, a division of The XxXxxx-Xxxx Companies,
Inc. or any successor in interest.
Subcontractor:
Any
vendor, subcontractor or other
Person
determined solely by the Servicer that is not responsible for the overall
servicing (as “servicing” is commonly understood by participants in the
mortgage-backed securities market) of the Mortgage Loans but performs one or
more discrete functions identified in Item 1122(d) of Regulation AB with respect
to the Mortgage Loans under the direction or authority of the Servicer or a
related Subservicer.
Subservicer:
Any
Person determined solely by the Servicer that services Mortgage Loans on behalf
of the Servicer or any Subservicer and is responsible for the performance
(whether directly or through Subservicers or Subcontractors) of a substantial
portion of the material servicing functions required to be performed by the
Servicer under this Agreement that are identified in Item 1122(d) of Regulation
AB.
Trust
Agreement:
The
Trust Agreement dated as of November 1, 2007, among the Trustee, the Master
Servicer and the Depositor.
Trust
Fund:
The
trust fund established by the Trust Agreement, the assets of which consist
of
the Mortgage Loans and any related assets.
Trustee:
U.S.
Bank National Association or any successor in interest, or if any successor
trustee or co-trustee shall be appointed as provided in the Trust Agreement,
then such successor trustee or such co-trustee, as the case may be.
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Any
capitalized terms used and not defined in this Agreement shall have the meanings
ascribed to such terms in the Trust Agreement.
ARTICLE
II.
SELLER’S
ENGAGEMENT OF SERVICER TO PERFORM SERVICING
RESPONSIBILITIES
Section
2.01 Contract
for Servicing; Possession of Servicing Files.
The
Seller, by execution and delivery of this Agreement, does hereby contract with
the Servicer, subject to the terms of this Agreement, for the servicing of
the
Mortgage Loans. On or before the Closing Date or Servicing Transfer Date, as
applicable, the Seller shall cause to be delivered the Servicing Files with
respect to the Mortgage Loans listed on the Mortgage Loan Schedule to the
Servicer. Each Servicing File delivered to a Servicer shall be held in trust
by
such Servicer for the benefit of the Trustee; provided,
however,
that
the Servicer shall have no liability for any Servicing Files (or portions
thereof) not delivered by the Seller. The Servicer’s possession of any portion
of the Mortgage Loan documents shall be at the will of the Trustee for the
sole
purpose of facilitating servicing of the related Mortgage Loan pursuant to
this
Agreement, and such retention and possession by the Servicer shall be in a
custodial capacity only. The ownership of each Mortgage Note, Mortgage, and
the
contents of the Servicing File shall be vested in the Trustee and the ownership
of all records and documents with respect to the related Mortgage Loan prepared
by or which come into the possession of the Servicer shall immediately vest
in
the Trustee and shall be retained and maintained, in trust, by the Servicer
at
the will of the Trustee in such custodial capacity only. The portion of each
Servicing File retained by the Servicer pursuant to this Agreement shall be
segregated from the other books and records of the Servicer (which, except
for
collateral documents such as the Mortgage and the Mortgage Note, may be stored
as imaged files) and shall be appropriately marked to clearly reflect the
ownership of the related Mortgage Loan by the Trustee. The Servicer shall
release from its custody the contents of any Servicing File retained by it
only
in accordance with this Agreement.
Section
2.02 Books
and Records.
(a)
Subject
to Section 3.01(a) hereof, as soon as practicable after the Closing Date, the
Servicing Transfer Date or the date on which a Qualifying Substitute Mortgage
Loan is delivered pursuant to Section 2.05 of the Trust Agreement, as applicable
(but in no event more than 90 days thereafter except to the extent delays are
caused by the applicable recording office), the Servicer, at the expense of
the
Depositor, shall cause the Mortgage or Assignment of Mortgage, as applicable,
with respect to each MERS Eligible Mortgage Loan, to be properly recorded in
the
name of MERS in the public recording office in the applicable jurisdiction,
or
shall ascertain that such have previously been so recorded and, with the
cooperation of the Trustee, shall take such actions as are necessary to cause
the Trustee to be clearly identified as the owner of each MERS Mortgage Loan
and
each MERS Eligible Mortgage Loan on the records of MERS for purposes of the
system of recording transfers of beneficial ownership of mortgages maintained
by
MERS.
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(b)
Subject
to Section 3.01(a) hereof, an Assignment of Mortgage in favor of the Trustee
shall be recorded as to each Non-MERS Mortgage Loan unless instructions to
the
contrary are delivered to the Servicer, in writing, by the Seller. Subject
to
the preceding sentence, as soon as practicable after the Closing Date or
Servicing Transfer Date, as applicable (but in no event more than 90 days
thereafter except to the extent delays are caused by the applicable recording
office), the Servicer, at the expense of the Seller, shall cause to be properly
recorded in each public recording office where such Non-MERS Eligible Mortgage
Loans are recorded each Assignment of Mortgage.
(c)
Additionally,
the Servicer shall prepare and execute, any note endorsements relating to any
of
the Non-MERS Mortgage Loans.
(d)
All
rights arising out of the Mortgage Loans shall be vested in the Trustee, subject
to the Servicer’s right to service and administer the Mortgage Loans hereunder
in accordance with the terms of this Agreement. All funds received on or in
connection with a Mortgage Loan, other than the Servicing Fee and other
compensation to which the Servicer is entitled as set forth herein, including
but not limited to any and all servicing compensation pursuant to Section 5.01
below, shall be received and held by the Servicer in trust for the benefit
of
the Trustee pursuant to the terms of this Agreement.
(e)
Any
out-of-pocket costs incurred by the Servicer pursuant to this Section 2.02
and
Section 3.01(a), including any recording or other fees in connection with the
Servicer’s obtaining the necessary powers of attorney (and which are specified
herein to be an expense of the Seller), shall be reimbursed to the Servicer
by
the Seller within five (5) Business Days of receipt by the Seller of an invoice
for reimbursement. The Trust Fund shall not reimburse the Seller for any such
reimbursement to the Servicer.
(f)
The
Master Servicer and the Trustee shall have the right to examine the books,
records and other information of the Servicer, with respect to or concerning
this Agreement or the Mortgage Loans, during business hours or at such other
times as may be reasonable under applicable circumstances, upon reasonable
advance written notice to the Servicer.
ARTICLE
III.
SERVICING
OF THE MORTGAGE LOANS
Section
3.01 Servicer
to Service.
The
Servicer, as an independent contractor, shall service and administer the
Mortgage Loans from and after the Closing Date or Servicing Transfer Date,
as
applicable, and shall have full power and authority, acting alone, to do any
and
all things in connection with such servicing and administration which the
Servicer may deem necessary or desirable, consistent with the terms of this
Agreement and with Accepted Servicing Practices.
The
Seller, the Master Servicer and the Servicer additionally agree that the
Servicer will fully furnish, in accordance with the Fair Credit Reporting Act
of
1970, as amended (the “Fair Credit Reporting Act”) and its implementing
regulations, accurate and complete information
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(e.g.,
favorable and unfavorable) on its borrower
credit files to Equifax, Experian and Trans Union Credit Information Company
(three of the credit repositories), on a monthly basis.
The
Seller and the Servicer additionally agree as follows:
(a)
The
Servicer shall (i) record or cause to be recorded the Mortgage or the Assignment
of Mortgage, as applicable, with respect to all MERS Eligible Mortgage Loans,
in
the name of MERS, or shall ascertain that such have previously been so recorded;
(ii) with the cooperation of the Trustee, take such actions as are necessary
to
cause the Trustee to be clearly identified as the owner of each MERS Mortgage
Loan and each MERS Eligible Mortgage Loan on the records of MERS for purposes
of
the system of recording transfers of beneficial ownership of mortgages
maintained by MERS; (iii) prepare or cause to be prepared all Assignments of
Mortgage with respect to all Non-MERS Eligible Mortgage Loans; (iv) record
or
cause to be recorded, subject to Section 2.02(b) hereof, all Assignments of
Mortgage with respect to Non-MERS Mortgage Loans in the name of the Trustee;
(v)
pay the recording costs pursuant to Section 2.02 hereof; and/or (vi) track
such
Mortgages and Assignments of Mortgage to ensure they have been recorded. The
Servicer shall be entitled to be paid by the Seller fees for the preparation
and
recordation of the Mortgages and Assignments of Mortgage. After the expenses
of
such recording costs pursuant to Section 2.02 hereof shall have been paid by
the
Servicer, the Servicer shall submit to the Seller a reasonably detailed invoice
for reimbursement of recording costs and fees it incurred
hereunder.
(b)
If
applicable, the Servicer shall, in accordance with the relevant provisions
of
the Xxxxxxxx-Xxxxxxxx National Affordable Housing Act of 1990, as the same
may
be amended from time to time, and the regulations provided in accordance with
the Real Estate Settlement Procedures Act, provide notice to the Mortgagor
of
each Mortgage Loan of the transfer of the servicing thereto to the
Servicer.
(c)
The
Servicer shall be responsible for the preparation of and costs associated with
notifications to Mortgagors of the assumption of servicing by the
Servicer.
Consistent
with the terms of this Agreement and except as provided in Section 3.19, the
Servicer may waive any late payment charge, assumption fee or other fee that
may
be collected in the ordinary course of servicing the Mortgage Loans.
The
Servicer may make such modifications as it deems to be in the best interests
of
the Trust Fund; provided, for purposes of clarification, that any such actions
taken in connection therewith may be taken without regard to the Xxxxxx Mae
Guides. The
Servicer shall not make any future advances to any obligor under any Mortgage
Loan, and (unless the Mortgagor is in default with respect to the Mortgage
Loan
or such default is, in the judgment of the Servicer, reasonably foreseeable)
the
Servicer shall not permit any modification of any material term of any Mortgage
Loan, including any modification that would change the Mortgage Interest Rate,
defer or forgive the payment of principal or interest, reduce or increase the
outstanding principal balance (except for actual payments of principal) or
change the final maturity date on such Mortgage Loan; provided,
however,
that the
maturity date of any Mortgage Loan shall not be extended past the Final
Scheduled Distribution Date (as defined in the Trust Agreement), which is
December 25, 2037. In the event of any such modification, the Servicer shall
calculate the Monthly Payment for such Mortgage Loan based on the modified
terms
of such Mortgage Loan and shall only be required to make Monthly Advances
pursuant to
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Section
4.03 to the extent of such new Monthly
Payment. The Servicer shall be entitled to reimbursement for such advances
to
the same extent as for all other advances made pursuant to Section 4.03;
provided that if, in connection with any modification, a Mortgage Loan has
been
modified to increase its principal balance by the amount of any Monthly Advances
or any Servicing Advances previously made by the Servicer on behalf of the
related Mortgagor (any such amount, a “Capitalization Reimbursement Amount”),
the Servicer may be reimbursed for such Capitalization Reimbursement Amount
as
provided in Section 3.04. Without limiting the generality of the foregoing,
the
Servicer shall continue, and is hereby authorized and empowered, to execute
and
deliver on behalf of itself and the Trustee, all instruments of satisfaction
or
cancellation, or of partial or full release, discharge or note endorsements
and
all other comparable instruments, with respect to the Mortgage Loans and with
respect to the Mortgaged Properties; provided, further, that upon the full
release or discharge, the Servicer shall notify the related Custodian of the
related Mortgage Loan of such full release or discharge. Upon the request of
the
Servicer, the Trustee shall execute and deliver to the Servicer any powers
of
attorney and other documents, furnished to it by the Servicer and reasonably
satisfactory to the Trustee, necessary or appropriate to enable the Servicer
to
carry out its servicing and administrative duties under this Agreement.
Notwithstanding anything contained herein to the contrary, the Servicer shall
not, without the Trustee’s written consent: (i) initiate any action, suit or
proceeding solely under the Trustee’s name without indicating the Servicer’s
representative capacity; or (ii) take any action with the intent to cause,
and
that actually causes, the Trustee to be registered to do business in any state.
Promptly after the execution of any assumption, modification, consolidation
or
extension of any Mortgage Loan, the Servicer shall forward to the Master
Servicer copies of any documents evidencing such assumption, modification,
consolidation or extension. Notwithstanding anything to the contrary contained
in this Servicing Agreement, the Servicer shall not otherwise make or permit
any
modification, waiver or amendment of any term of any Mortgage Loan that would
cause any REMIC created under the Trust Agreement to fail to qualify as a REMIC
or result in the imposition of any tax under Section 860F(a) or Section 860G(d)
of the Code.
In
servicing and administering the Mortgage Loans, the Servicer shall employ
procedures (including collection procedures) and exercise the same care that
it
customarily employs and exercises in servicing and administering mortgage loans
for its own account, giving due consideration to Accepted Servicing Practices
where such practices do not conflict with the requirements of this Agreement,
the Xxxxxx Xxx Guides, and the Master Servicer’s and Seller’s reliance on the
Servicer.
Section
3.02 Collection
of Mortgage Loan Payments.
Continuously
from the Closing Date or Servicing Transfer Date, as applicable, until the
date
each Mortgage Loan ceases to be subject to this Agreement, the Servicer shall
proceed diligently to collect all payments due under each of the Mortgage Loans
when the same shall become due and payable and shall take special care in
ascertaining and estimating Escrow Payments and all other charges that will
become due and payable with respect to the Mortgage Loans and each related
Mortgaged Property, to the end that the installments payable by the Mortgagors
will be sufficient to pay such charges as and when they become due and
payable.
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Section
3.03 Establishment
of and Deposits to Custodial 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 Custodial Accounts, in
the
form of time deposit or demand accounts, titled as directed by the Master
Servicer. The Custodial Account shall be an Eligible Deposit Account established
with an Eligible Institution. Any funds deposited in the Custodial Account
may
be invested in Eligible Investments subject to the provisions of Section 3.11
hereof. Funds deposited in the Custodial Account may be drawn on by the Servicer
in accordance with Section 3.04. The creation of any Custodial Account shall
be
evidenced by a certification in the form of Exhibit B. No later than 30 days
after the Closing Date, a copy of such certification shall be furnished to
the
Master Servicer and, upon request, to any subsequent owner of the Mortgage
Loans.
The
Servicer shall deposit in the Custodial Account within two Business Days of
receipt, and retain therein, the following collections received by the Servicer
and payments made by the Servicer after the Closing Date or Servicing Transfer
Date, as applicable:
(i)
all
payments on account of principal on the Mortgage Loans, including all Principal
Prepayments;
(ii)
all
payments on account of interest on the Mortgage Loans adjusted to the Mortgage
Loan Remittance Rate;
(iii)
all
Liquidation Proceeds;
(iv)
all
Insurance Proceeds (other than amounts applied to the restoration or repair
of
the Mortgaged Property or immediately released to the Mortgagor in accordance
with prudent servicing practices);
(v)
all
Condemnation Proceeds that are not applied to the restoration or repair of
the
Mortgaged Property or released to the Mortgagor;
(vi)
with
respect to each Principal Prepayment in full or in part, the Prepayment Interest
Shortfall Amount, if any, for the month of distribution. Such deposit shall
be
made from the Servicer’s own funds, without reimbursement therefor, up to a
maximum amount per month of the Servicing Fee actually received for such month
for the Mortgage Loans;
(vii)
all
Monthly Advances made by the Servicer pursuant to Section 4.03;
(viii)
any
amounts required to be deposited by the Servicer in connection with the
deductible clause in any blanket hazard insurance policy;
(ix)
any
amounts received with respect to or related to any REO Property or REO
Disposition Proceeds;
(x)
any
Prepayment Penalty Amounts; and
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(xi)
any
other
amount required hereunder to be deposited by the Servicer in the Custodial
Account.
The
foregoing requirements for deposit into the Custodial Account shall be
exclusive, it being understood and agreed that, without limiting the generality
of the foregoing, payments in the nature of the Servicing Fee and Ancillary
Income need not be deposited by the Servicer into the Custodial
Account.
Any
interest paid on funds deposited in the Custodial Account by the depository
institution shall accrue to the benefit of the Servicer and the Servicer shall
be entitled to retain and withdraw such interest from the Custodial Account
pursuant to Section 3.04. Additionally, any other benefit derived from the
Custodial Account associated with the receipt, disbursement and accumulation
of
principal, interest, taxes, hazard insurance, mortgage insurance, etc. shall
accrue to the Servicer.
Section
3.04 Permitted
Withdrawals From Custodial Account.
The
Servicer shall, from time to time, withdraw funds from the Custodial Account
for
the following purposes:
(i)
to
make
payments to the Master Servicer in the amounts and in the manner provided for
in
Section 4.01;
(ii)
with
respect to each LPMI Loan, in the amount of the related LPMI Fee, to make
payments with respect to premiums for LPMI Policies in accordance with Section
3.07;
(iii)
in
the
event the Servicer has elected not to retain the Servicing Fee out of any
Mortgagor payments on account of interest or other recovery of interest with
respect to a particular Mortgage Loan (including late collections of interest
on
such Mortgage Loan, or interest portions of Insurance Proceeds, Condemnation
Proceeds or Liquidation Proceeds) prior to the deposit of such Mortgagor payment
or recovery in the Custodial Account, to pay to itself the related Servicing
Fee
from all such Mortgagor payments on account of interest or other such recovery
for interest with respect to that Mortgage Loan;
(iv)
to
pay
itself investment earnings on funds deposited in the Custodial
Account;
(v)
to
clear
and terminate the Custodial Account upon the termination of this Agreement;
(vi)
to
transfer funds to another Eligible Institution in accordance with Section 3.11
hereof;
(vii)
to
invest
funds in certain Eligible Investments in accordance with Section 3.11 hereof;
(viii)
to
reimburse itself to the extent of funds in the Custodial Account for Monthly
Advances (excluding Capitalization Reimbursement Amounts, other than as provided
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for
in Section 3.04(x)) of the Servicer’s funds made
pursuant to Section 4.03, the Servicer's right to reimburse itself pursuant
to
this subclause (viii) with respect to any Mortgage Loan being limited to amounts
received on or in respect of the related Mortgage Loan which represent late
recoveries of payments of principal or interest with respect to which a Monthly
Advance was made, it being understood that, in the case of any such
reimbursement, the Servicer’s right thereto shall be prior to the rights of the
Trust Fund, provided,
however,
that
following the final liquidation of a Mortgage Loan, the Servicer may reimburse
itself for previously unreimbursed Monthly Advances in excess of Liquidation
Proceeds or Insurance Proceeds with respect to such Mortgage Loan from any
funds
in the Custodial Account, it being understood, in the case of any such
reimbursement, that the Servicer’s right thereto shall be prior to the rights of
the Trust Fund. The Servicer may recover at any time from amounts on deposit
in
the Custodial Account the amount of any Monthly Advances that the Servicer
deems
nonrecoverable or that remain unreimbursed to the Servicer from related
Liquidation Proceeds after the final liquidation of the Mortgage
Loan;
(ix)
to
reimburse itself for unreimbursed Servicing Advances (excluding Capitalization
Reimbursement Amounts, other than as provided for in Section 3.04(x)), and
for
any unpaid Servicing Fees, the Servicer’s right to reimburse itself pursuant to
this subclause (ix) with respect to any Mortgage Loan being limited to related
Liquidation Proceeds, Condemnation Proceeds, Insurance Proceeds, REO Disposition
Proceeds and other amounts received in respect of the related REO Property,
and
such other amounts as may be collected by the Servicer from the Mortgagor or
otherwise relating to the Mortgage Loan, it being understood that, in the case
of any such reimbursement, the Servicer’s right thereto shall be prior to the
rights of the Trust Fund;
(x)
to
reimburse itself for any unreimbursed Capitalization Reimbursement Amount solely
from collections on account of principal;
(xi)
to
reimburse itself for remaining unreimbursed Servicing Advances with respect
to
any defaulted Mortgage Loan as to which the Servicer has determined that all
amounts that it expects to recover on behalf of the Trust Fund from or on
account of such Mortgage Loan have been recovered;
(xii)
to
reimburse itself for expenses incurred or reimbursable to the Servicer pursuant
to Sections 3.07, 3.12, 3.13, 3.14 and 6.03 to the extent not previously
reimbursed under clause (ix) of this Section 3.04; and
(xiii)
to
withdraw funds deposited in error.
Section
3.05 Establishment
of and Deposits to Escrow Account.
The
Servicer shall segregate and hold all funds collected and received pursuant
to a
Mortgage Loan constituting Escrow Payments separate and apart from any of its
own funds and general assets and shall establish and maintain one or more Escrow
Accounts, in the form of time deposit or demand accounts, titled as directed
by
the Master Servicer. Each Escrow Account shall be an Eligible Deposit Account
established with an Eligible Institution in a manner that shall provide maximum
available insurance thereunder. Funds deposited in the Escrow Account
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may
be drawn on by the Servicer in accordance with
Section 3.06. The creation of any Escrow Account shall be evidenced by a
certification in the form of Exhibit C. No later than 30 days after the Closing
Date, a copy of such certification shall be furnished to the Master Servicer
and, upon request, to any subsequent owner of the Mortgage Loans.
The
Servicer shall deposit in the Escrow Account or Accounts within two Business
Days of receipt, and retain therein:
(i)
all
Escrow Payments collected on account of the Mortgage Loans, for the purpose
of
effecting timely payment of any such items as required under the terms of this
Agreement; and
(ii)
all
amounts representing Insurance Proceeds or Condemnation Proceeds that are to
be
applied to the restoration or repair of any Mortgaged Property.
The
Servicer shall make withdrawals from the Escrow Account only to effect such
payments as are required under this Agreement, as set forth in Section 3.06.
The
Servicer shall retain any interest paid on funds deposited in the Escrow Account
by the depository institution, other than interest on escrowed funds required
by
law to be paid to the Mortgagor. Additionally, any other benefit derived from
the Escrow Account associated with the receipt, disbursement and accumulation
of
principal, interest, taxes, hazard insurance, mortgage insurance, etc. shall
accrue to the Servicer. To the extent required by law, the Servicer shall pay
interest on escrowed funds to the Mortgagor notwithstanding that the Escrow
Account may be non-interest bearing or that interest paid thereon is
insufficient for such purposes.
Section
3.06 Permitted
Withdrawals From Escrow Account.
Withdrawals
from the Escrow Account or Accounts may be made by the Servicer
only:
(i)
to
effect
timely payments of ground rents, taxes, assessments, water rates, sewer rents,
mortgage insurance premiums, condominium charges, fire and hazard insurance
premiums or other items constituting Escrow Payments for the related
Mortgage;
(ii)
to
refund
to any Mortgagor any funds found to be in excess of the amounts required under
the terms of the related Mortgage Loan;
(iii)
for
transfer to the Custodial Account and application to reduce the principal
balance of the Mortgage Loan in accordance with the terms of the related
Mortgage and Mortgage Note;
(iv)
to
reimburse the Servicer for any Servicing Advance made by the Servicer with
respect to a related Mortgage Loan, but only from amounts received on the
related Mortgage Loan which represent late collections of Escrow Payments;
(v)
for
application to restoration or repair of the Mortgaged Property in accordance
with the Xxxxxx Xxx Guides or other similar prudent accepted servicing
practices;
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(vi)
to
pay to
the Servicer, or any Mortgagor to the extent required by law, any interest
paid
on the funds deposited in the Escrow Account;
(vii)
to
remove
funds inadvertently placed in the Escrow Account by the Servicer;
and
(viii)
to
clear
and terminate the Escrow Account on the termination of this
Agreement.
Section
3.07 Maintenance
of PMI Policy and/or LPMI Policy; Claims.
The
Servicer shall comply with all provisions of applicable state and federal law
relating to the cancellation of, or collection of premiums with respect to,
PMI
Policies, including, but not limited to, the provisions of the Homeowners
Protection Act of 1998, and all regulations promulgated thereunder, as amended
from time to time.
With
respect to each Mortgage Loan (other than LPMI Loans) with a loan to value
ratio
at origination in excess of 80%, the Servicer shall maintain or cause the
Mortgagor to maintain (to the extent that the Mortgage Loan requires the
Mortgagor to maintain such insurance) in full force and effect a PMI Policy,
and
shall pay or shall cause the Mortgagor to pay the premium thereon on a timely
basis, until the LTV of such Mortgage Loan is reduced to 80%. In the event
that
such PMI Policy shall be terminated, the Servicer shall obtain from another
Qualified Insurer a comparable replacement policy, with a total coverage equal
to the remaining coverage of such terminated PMI Policy, at substantially the
same fee level. The Servicer shall not take any action which would result in
noncoverage under any applicable PMI Policy of any loss which, but for the
actions of the Servicer would have been covered thereunder. In connection with
any assumption or substitution agreements entered into or to be entered into
with respect to a Mortgage Loan, the Servicer shall promptly notify the insurer
under the related PMI Policy, if any, of such assumption or substitution of
liability in accordance with the terms of such PMI Policy and shall take all
actions which may be required by such insurer as a condition to the continuation
of coverage under such PMI Policy. If such PMI Policy is terminated as a result
of such assumption or substitution of liability, the Servicer shall obtain
a
replacement PMI Policy as provided above.
The
Servicer shall take all such actions as are necessary to service, maintain
and
administer the LPMI Loans in accordance with the LPMI Policy and to perform
and
enforce the rights of the insured under such LPMI Policy. Except as expressly
set forth herein, the Servicer shall have full authority on behalf of the Trust
Fund to do anything it reasonably deems appropriate or desirable in connection
with the servicing, maintenance and administration of the LPMI Policy. The
Servicer shall not modify or assume a Mortgage Loan covered by the LPMI Policy
or take any other action with respect to such Mortgage Loan which would result
in non-coverage under the LPMI Policy of any loss which, but for the actions
of
the Servicer, would have been covered thereunder. If the LPMI Insurer fails
to
pay a claim under the LPMI Policy as a result of breach by the Servicer of
its
obligations hereunder or under the LPMI Policy, the Servicer shall be required
to deposit in the Custodial Account on or prior to the next succeeding
Remittance Date an amount equal to such unpaid claim from its own funds without
any right to reimbursement from the Trust Fund. The Servicer shall cooperate
with the LPMI Insurer and the
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Master
Servicer and shall use its best efforts to
furnish all reasonable aid, evidence and information in the possession of the
Servicer to which the Servicer has access with respect to any LPMI Loan;
provided, however,
notwithstanding anything to the contrary contained in any LPMI Policy, the
Servicer shall not be required to submit any reports to the LPMI Insurer until
a
reporting date that is at least 15 days after the Servicer has received
sufficient loan level information from the Seller, the Master Servicer or the
LPMI Insurer to appropriately code its servicing system in accordance with
the
LPMI Insurer’s requirements.
In
connection with its activities as servicer, the Servicer agrees to prepare
and
present, on behalf of itself and the Trustee, claims to the insurer under any
PMI Policy or LPMI Policy in a timely fashion in accordance with the terms
of
such PMI Policy or LPMI Policy and, in this regard, to take such action as
shall
be necessary to permit recovery under any PMI Policy or LPMI Policy respecting
a
defaulted Mortgage Loan. Any amounts collected by the Servicer under any PMI
Policy or LPMI Policy shall be deposited in the Custodial Account, subject
to
withdrawal pursuant to Section 3.04.
Section
3.08 Fidelity
Bond and Errors and Omissions Insurance.
The
Servicer shall keep in force during the term of this Agreement a Fidelity Bond
and Errors and Omissions Insurance Policy. Such Fidelity Bond and Errors and
Omissions Insurance shall be maintained with recognized insurers and shall
be in
such form and amount as would permit the Servicer to be qualified as a Xxxxxx
Mae or Xxxxxxx Mac seller-servicer. The Servicer shall be deemed to have
complied with this provision if an affiliate of the Servicer has such errors
and
omissions and fidelity bond coverage and, by the terms of such insurance policy
or fidelity bond, the coverage afforded thereunder extends to the Servicer.
The
Servicer shall furnish to the Master Servicer or Trustee a copy of each such
bond and insurance policy if (i) the Master Servicer or Trustee so requests
and
(ii) the Servicer is not an affiliate of Xxxxxx Brothers Inc. at the time of
such request.
Section
3.09 Notification
of Adjustments.
With
respect to each Adjustable Rate Mortgage Loan, the Servicer shall adjust the
Mortgage Interest Rate on the related interest rate adjustment date and shall
adjust the Monthly Payment on the related mortgage payment adjustment date,
if
applicable, in compliance with the requirements of applicable law and the
related Mortgage and Mortgage Note. The Servicer shall execute and deliver
any
and all necessary notices required under applicable law and the terms of the
related Mortgage Note and Mortgage regarding the Mortgage Interest Rate and
Monthly Payment adjustments. The Servicer shall promptly, upon written request
therefor, deliver to the Master Servicer such notifications and any additional
applicable data regarding such adjustments and the methods used to calculate
and
implement such adjustments. Upon the discovery by the Servicer or the receipt
of
notice from the Master Servicer that the Servicer has failed to adjust a
Mortgage Interest Rate or Monthly Payment in accordance with the terms of the
related Mortgage Note, the Servicer shall immediately deposit in the Custodial
Account from its own funds the amount of any interest loss or deferral caused
thereby.
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Section
3.10 Completion
and Recordation of Assignments of Mortgage.
As
soon
as practicable after the Closing Date, the Servicing Transfer Date or the date
on which a Qualifying Substitute Mortgage Loan is delivered pursuant to Section
2.05 of the Trust Agreement, as applicable (but in no event more than 90 days
thereafter except to the extent delays are caused by the applicable public
recording office), the Servicer shall cause the endorsements on the Mortgage
Note (if applicable), and the Assignments of Mortgage (subject to Section
3.01(a)) to be completed in the name of the Trustee (or MERS, as
applicable).
Section
3.11 Protection
of Accounts.
The
Servicer may transfer the Custodial Account or any Escrow Account to a different
Eligible Institution from time to time; provided
that in
the event the Custodial Account or any Escrow Account is held in a depository
institution or trust company that ceases to be an Eligible Institution, the
Servicer shall transfer such Custodial Account or Escrow Account, as the case
may be, to an Eligible Institution. The Servicer shall give notice to the Master
Servicer and the NIMS Insurer of any change in the location of the Custodial
Account and deliver to the Master Servicer and the NIMS Insurer a certification
notice in the form of Exhibit B or Exhibit C, as applicable, with respect to
such Eligible Institution.
The
Servicer shall bear any expenses, losses or damages sustained by the Master
Servicer or the Trustee if the Custodial Account and/or the Escrow Account
are
not demand deposit accounts.
Amounts
on deposit in the Custodial Account and the Escrow Account may at the option
of
the Servicer be invested in Eligible Investments. Any such Eligible Investment
shall mature no later than the Business Day immediately preceding the related
Remittance Date; provided,
however,
that if
such Eligible Investment is an obligation of an Eligible Institution (other
than
the Servicer) that maintains the Custodial Account or the Escrow Account, then
such Eligible Investment may mature on the related Remittance Date. Any such
Eligible Investment shall be made in the name of the Servicer in trust for
the
benefit of the Trustee. All income on or gain realized from any such Eligible
Investment shall be for the benefit of the Servicer and may be withdrawn at
any
time by the Servicer. Any losses incurred in respect of any such investment
shall be deposited in the Custodial Account or the Escrow Account, by the
Servicer out of its own funds immediately as realized.
Section
3.12 Payment
of Taxes, Insurance and Other Charges.
With
respect to each Mortgage Loan that provides for Escrow Payments, the Servicer
shall maintain accurate records reflecting the status of ground rents, taxes,
assessments, water rates, sewer rents, and other charges which are or may become
a lien upon the Mortgaged Property and the status of PMI Policy and LPMI Policy
(if any) premiums and fire and hazard insurance coverage and shall obtain,
from
time to time, all bills for the payment of such charges (including renewal
premiums) and shall effect payment thereof prior to the applicable penalty
or
termination date, employing for such purpose deposits of the Mortgagor in the
Escrow Account which shall have been estimated and accumulated by the Servicer
in amounts sufficient for such purposes, as allowed under the terms of the
Mortgage. The Servicer shall not be required to
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maintain
records with respect to the payment of LPMI
Premiums unless the Servicer shall be required to make payment of such premiums
and such requirement shall be indicated on the Mortgage Loan Schedule with
respect to each applicable Mortgage Loan. The Servicer assumes full
responsibility for the timely payment of all such bills, shall effect timely
payment of all such charges irrespective of each Mortgagor’s faithful
performance in the payment of same or the making of the Escrow Payments, and
shall make Servicing Advances to effect such payments. With regard to any
Mortgage Loans for which the Mortgagor is not required to escrow Escrow Payments
with the Servicer, the Servicer shall use reasonable efforts consistent with
Accepted Servicing Practices to determine that any such payments are made by
the
Mortgagor at the time they first became due and shall insure that the Mortgaged
Property is not lost to a tax lien as a result of nonpayment and that such
Mortgage is not left uninsured and shall make Servicing Advances to effect
any
such delinquent payments to avoid the lapse of insurance coverage on the
Mortgaged Property or to avoid the imposition of a tax lien.
Section
3.13 Maintenance
of Hazard Insurance.
The
Servicer shall cause to be maintained for each Mortgage Loan hazard insurance
such that all buildings upon the Mortgaged Property are insured by a generally
acceptable insurer against loss by fire, hazards of extended coverage 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 greater of (i) the
outstanding principal balance of the Mortgage Loan and (ii) an amount such
that
the proceeds thereof shall be sufficient to prevent the Mortgagor or the loss
payee from becoming a co-insurer. It is understood and agreed that no earthquake
or other additional insurance is required to be maintained by the Servicer
in
connection with any Mortgage Loan or Mortgaged Property, other than pursuant
to
applicable laws and regulations that require the Servicer to cause such
additional insurance to be maintained.
If
upon
origination of the Mortgage Loan, the related Mortgaged Property was located
in
an area identified in the Federal Register by the Flood Emergency Management
Agency as having special flood hazards (and such flood insurance has been made
available) 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 equal to the
lesser of (i) the minimum amount required, under the terms of coverage, to
compensate for any damage or loss on a replacement cost basis (or the unpaid
balance of the mortgage if replacement cost coverage is not available for the
type of building insured) and (ii) the maximum amount of insurance which is
available under the Flood Disaster Protection Act of 1973, as amended. If at
any
time during the term of the Mortgage Loan, the Servicer determines in accordance
with applicable law and pursuant to the Xxxxxx Xxx Guides that a Mortgaged
Property is located in a special flood hazard area and is not covered by flood
insurance or is covered in an amount less than the amount required by the Flood
Disaster Protection Act of 1973, as amended, the Servicer shall notify the
related Mortgagor that the Mortgagor must obtain such flood insurance coverage,
and if said Mortgagor fails to obtain the required flood insurance coverage
within forty-five (45) days after such notification, the Servicer shall force
place the required flood insurance on the Mortgagor’s behalf.
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Section
3.14 Maintenance
of Mortgage Impairment Insurance Policy.
In
the
event that the Servicer shall obtain and maintain a blanket policy insuring
against losses arising from fire and hazards covered under extended coverage
on
all of the Mortgage Loans, then, to the extent such policy provides coverage
in
an amount equal to the amount required pursuant to Section 3.13 and otherwise
complies with all other requirements of Section 3.13, it shall conclusively
be
deemed to have satisfied its obligations as set forth in Section 3.13. Any
amounts collected by the Servicer under any such policy relating to a Mortgage
Loan shall be deposited in the Custodial Account or Escrow Account subject
to
withdrawal pursuant to Sections 3.04 or 3.06. Such policy may contain a
deductible clause, in which case, in the event that there shall not have been
maintained on the related Mortgaged Property a policy complying with Section
3.13, and there shall have been a loss which would have been covered by such
policy, the Servicer shall deposit in the Custodial Account at the time of
such
loss the amount not otherwise payable under the blanket policy because of such
deductible clause, such amount to be deposited from the Servicer’s funds,
without reimbursement therefor.
Section
3.15 Restoration
of Mortgaged Property.
The
Servicer need not obtain the approval of the Trustee or the Master Servicer
prior to releasing any Insurance Proceeds or Condemnation Proceeds to the
Mortgagor to be applied to the restoration or repair of the Mortgaged Property
if such release is in accordance with prudent servicing practices. At a minimum,
with respect to claims greater than $10,000, the Servicer shall comply with
the
following conditions in connection with any such release of Insurance Proceeds
or Condemnation Proceeds:
(i)
the
Servicer shall receive satisfactory independent verification of completion
of
repairs and issuance of any required approvals with respect thereto;
(ii)
the
Servicer shall take all steps necessary to preserve the priority of the lien
of
the Mortgage, including, but not limited to requiring waivers with respect
to
mechanics’ and materialmen’s liens; and
(iii)
pending
repairs or restoration, the Servicer shall place the Insurance Proceeds or
Condemnation Proceeds in the Escrow Account.
Section
3.16 Title,
Management and Disposition of REO Property.
In
the
event that title to any Mortgaged Property is acquired in foreclosure or by
deed
in lieu of foreclosure, the deed or certificate of sale shall be taken in the
name of the Trustee (or MERS, as applicable), or in the event (a) the Trustee
is
not authorized or permitted to hold title to real property in the state where
the REO Property is located, (b) the Servicer deems it contrary to the Trustee’s
interest to take title in the Trustee’s name or the name of MERS, or (c) the
Trustee would be adversely affected under the “doing business” or tax laws of
such state by so holding title, the deed or certificate of sale shall be taken
in the name of the Servicer, who hereby acknowledges that such title is being
taken as nominee for the Trustee.
The
Servicer shall manage, conserve, protect and operate each REO Property for
the
Trustee solely for the purpose of its prompt disposition and sale. The Servicer,
either itself or
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through
an agent selected by the Servicer, shall
manage, conserve, protect and operate the REO Property in the same manner that
it manages, conserves, protects and operates other foreclosed property for
its
own account, and in the same manner that similar property in the same locality
as the REO Property is managed. The Servicer shall attempt to sell the same
(and
may temporarily rent the same for a period not greater than one year, except
as
otherwise provided below) on such terms and conditions as the Servicer deems
to
be in the best interest of the Trustee. If the Servicer determines that it
is in
the best interest of the Trustee to not proceed with foreclosure or accept
a
deed in lieu of foreclosure, the Servicer shall have the right to do so,
whereupon the related Mortgage Loan shall be deemed to be finally liquidated
and
the Servicer shall have the right to release the lien of the Mortgage on the
related Mortgage Property and the Servicer shall be entitled to reimbursement
for all outstanding unreimbursed Servicing Advances and Monthly Advances from
the Custodial Account in accordance with Section 3.04(viii).
The
Servicer may permit an obligor to pay off a non-performing Mortgage Loan at
less
than its unpaid principal balance or charge-off all or a portion of such
non-performing Mortgage Loan if such discounted payoff or charge-off is in
accordance with Accepted Servicing Practices (without regard to Xxxxxx Mae
Guides) and the Servicer believes that such discounted payoff or charge-off
is
in the best interest of the Trust Fund; provided that in the case of any
proposed discounted payoff or proposed charge-off, the Servicer shall notify
the
Master Servicer of the proposed discounted payoff or charge-off; provided
further that any such discounted payoff or charge-off is incident to the default
or reasonably foreseeable default of such non-performing Mortgage Loan within
the meaning of Section 860F(a) of the Code. The Master Servicer shall be deemed
to have approved the discounted payoff or charge-off of any Mortgage Loan unless
the Master Servicer notifies the Servicer in writing, within five (5) Business
Days after its receipt of the related notice, that it disapproves of the
discounted payoff or charge-off, in which case the Servicer shall not proceed
with such discounted payoff or charge-off.
Notwithstanding
anything to the contrary contained in this Section 3.16, in connection with
a
foreclosure or acceptance of a deed in lieu of foreclosure, in the event the
Servicer has reasonable cause to believe that a Mortgaged Property is
contaminated by hazardous or toxic substances or wastes, or if the Trustee
or
the Master Servicer otherwise requests, an environmental inspection or review
of
such Mortgaged Property to be conducted by a qualified inspector shall be
arranged by the Servicer. Upon completion of the inspection, the Servicer shall
provide the Trustee and the Master Servicer with a written report of such
environmental inspection. In the event that the environmental inspection report
indicates that the Mortgaged Property is contaminated by hazardous or toxic
substances or wastes, the Servicer shall not proceed with foreclosure or
acceptance of a deed in lieu of foreclosure. In the event that the environmental
inspection report is inconclusive as to whether or not the Mortgaged Property
is
contaminated by hazardous or toxic substances or wastes, the Servicer shall
not,
without the prior approval of the Master Servicer, proceed with foreclosure
or
acceptance of a deed in lieu of foreclosure. In such instance, the Master
Servicer shall be deemed to have approved such foreclosure or acceptance of
a
deed in lieu of foreclosure unless the Master Servicer notifies the Servicer
in
writing, within two (2) Business Days after its receipt of written notice of
the
proposed foreclosure or deed in lieu of foreclosure from the Servicer, that
it
disapproves of the related foreclosure or acceptance of a deed in lieu of
foreclosure. The Servicer shall be reimbursed for all Servicing Advances made
pursuant to this paragraph with respect to the related Mortgaged Property from
the Custodial Account.
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The
Servicer shall use its Best Efforts to dispose of the REO Property as soon
as
possible and shall sell such REO Property in any event within three years after
title has been taken to such REO Property, unless (a) a REMIC election has
not
been made with respect to the arrangement under which the Mortgage Loans and
the
REO Property are held, and (b) the Servicer determines, and gives an appropriate
notice to the Master Servicer to such effect, that a longer period is necessary
for the orderly liquidation of such REO Property. If a period longer than three
years is permitted under the foregoing sentence and is necessary to sell any
REO
Property, (i) the Servicer shall report monthly to the Master Servicer as to
the
progress being made in selling such REO Property and (ii) if, with the written
consent of the Trustee, a purchase money mortgage is taken in connection with
such sale, such purchase money mortgage shall name the Servicer as mortgagee,
and such purchase money mortgage shall not be held pursuant to this Agreement,
but instead a separate participation agreement among the Servicer and Trustee
shall be entered into with respect to such purchase money mortgage.
Notwithstanding anything herein to the contrary, the Servicer shall not be
required to provide financing for the sale of any REO Property.
The
Servicer shall also maintain on each REO Property fire and hazard insurance
with
extended coverage in amount which is at least equal to the maximum insurable
value of the improvements which are a part of such property, liability insurance
and, to the extent required and available under the Flood Disaster Protection
Act of 1973, as amended, flood insurance in the amount required
above.
Notwithstanding
any other provisions of this Agreement, no REO Property acquired by the Trust
Fund shall be rented (or allowed to continue to be rented) or otherwise used
or
held by or on behalf of the Trust Fund in such a manner, or pursuant to any
terms or for a period that would: (i) cause such REO Property to fail to qualify
as “foreclosure property” within the meaning of Section 860G(a)(8) of the Code
or (ii) result in the imposition of any tax upon any REMIC included in the
Trust
Fund. Subject to the approval of the Master Servicer as described in this
paragraph, the disposition of REO Property shall be carried out by the Servicer
at such price, and upon such terms and conditions, as the Servicer deems to
be
in the best interests of the Trust Fund.
The
Servicer shall not be responsible for allowing tenants and lessees to occupy
a
Mortgaged Property if the eviction of such tenants and lessees is not permitted
under state or local law.
Prior
to
acceptance by the Servicer of an offer to sell any REO Property, the Servicer
shall notify the Master Servicer of such offer in writing which notification
shall set forth all material terms of said offer (each, a “Notice of Sale”). The
Master Servicer shall be deemed to have approved the sale of any REO Property
unless the Master Servicer notifies the Servicer in writing, within two (2)
Business Days after its receipt of the related Notice of Sale, that it
disapproves of the related sale, in which case the Servicer shall not proceed
with the sale. With respect to any REO Property, upon a REO Disposition, the
Servicer shall be entitled to retain from REO Disposition Proceeds a disposition
fee equal to $1,500.
The
Servicer shall withdraw from the Custodial Account funds necessary for the
proper operation, management and maintenance of the REO Property, including
the
cost of maintaining
-27-
any
hazard insurance pursuant to the Xxxxxx Xxx
Guides. The Servicer shall make monthly distributions on each Remittance Date
to
the Master Servicer of the net cash flow from the REO Property (which shall
equal the revenues from such REO Property net of the expenses described in
this
Section 3.16 and of any reserves reasonably required from time to time to be
maintained to satisfy anticipated liabilities for such expenses).
Section
3.17 Real
Estate Owned Reports.
Together
with the statement furnished pursuant to Section 4.02, the Servicer shall
furnish to the Master Servicer on or before the Remittance Date each month
a
statement with respect to any REO Property covering the operation of such REO
Property for the previous month and the Servicer’s efforts in connection with
the sale of such REO Property and any rental of such REO Property incidental
to
the sale thereof for the previous month. That statement shall be accompanied
by
such other information as the Master Servicer shall reasonably
request.
Section
3.18 MERS.
(a)
So
long
as the Trustee is a member of MERS, the Servicer shall use its Best Efforts
to
cause the Trustee to be identified as the owner of each MERS Mortgage Loan
on
the records of MERS for purposes of the system of recording transfers of
beneficial ownership of mortgages maintained by MERS.
(b)
The
Servicer shall maintain in good standing its membership in MERS. In addition,
the Servicer shall comply with all rules, policies and procedures of MERS,
including the Rules of Membership, as amended, and the MERS Procedures Manual,
as amended.
(c)
With
respect to all MERS Mortgage Loans serviced hereunder, the Servicer shall
promptly notify MERS as to any transfer of beneficial ownership of such Mortgage
Loans of which the Servicer has notice.
(d)
With
respect to all MERS Mortgage Loans serviced hereunder, the Servicer shall notify
MERS as to any transfer of servicing pursuant to Section 9.01 within 10 Business
Days of such transfer of servicing. The Servicer shall cooperate with the
Trustee, the Master Servicer and any successor servicer to the extent necessary
to ensure that such transfer of servicing is appropriately reflected on the
MERS
system.
Section
3.19 Waiver
of Prepayment Penalty Amounts.
Except
as
provided below, the Servicer or any designee of the Servicer shall not waive
any
Prepayment Penalty Amount with respect to any Mortgage Loan. If the Servicer
or
its designee fails to collect a Prepayment Penalty Amount at the time of the
related prepayment of any Mortgage Loan subject to such Prepayment Penalty
Amount, the Servicer shall pay to the Trust Fund at such time (by deposit to
the
Custodial Account) an amount equal to the amount of the Prepayment Penalty
Amount not collected; provided,
however,
the
Servicer shall not have any obligation to pay the amount of any uncollected
Prepayment Penalty Amount under this Section 3.19 if the failure to collect
such
amount is the result of inaccurate or incomplete information in the Prepayment
Penalty Amount Schedule provided by the Seller and which is included as part
of
the Mortgage Loan Schedule attached hereto as Exhibit A. The
Prepayment
-28-
Penalty
Amounts listed on the Prepayment Penalty
Amount Schedule attached hereto as Exhibit A are complete, true and accurate
and
may be relied on by the Servicer in its calculation of Prepayment Penalty
Amounts. If the Prepayment Penalty Amount data set forth on Exhibit A is
incorrect, then the Servicer shall have no liability for any loss resulting
from
calculation of Prepayment Penalty Amounts using the data provided.
Notwithstanding the above, the Servicer or its designee may waive a Prepayment
Penalty Amount without paying to the Trust Fund the amount of such Prepayment
Penalty Amount only if such Prepayment Penalty Amount (i) relates to a defaulted
Mortgage Loan or a reasonably foreseeable default, such waiver is standard
and
customary in servicing similar mortgage loans to the Mortgage Loan, and such
waiver, in the reasonable judgment of the Servicer would maximize recovery
of
total proceeds from the Mortgage Loan, taking into account the amount of such
Prepayment Charge and the related Mortgage Loan, or (ii) relates to a prepayment
charge the collection of which, if collected, would be a violation of applicable
laws.
ARTICLE
IV.
PAYMENTS
TO MASTER SERVICER
Section
4.01 Remittances.
On
each
Remittance Date, no later than 3:00 p.m. Eastern Standard Time, the Servicer
shall remit on a scheduled/scheduled basis by wire transfer of immediately
available funds to the Master Servicer (i) all amounts deposited in the
Custodial Account as of the close of business on the last day of the related
Due
Period (net of charges against or withdrawals from the Custodial Account
pursuant to Section 3.04), plus (ii) all Monthly Advances, if any, which the
Servicer is obligated to make pursuant to Section 4.03 (and which the Servicer
has not already deposited in the Custodial Account pursuant to Section
3.03(viii)), minus (iii) any amounts attributable to Principal Prepayments,
Liquidation Proceeds, Insurance Proceeds, Condemnation Proceeds or REO
Disposition Proceeds received after the applicable Prepayment Period, which
amounts shall be remitted on the following Remittance Date, together with any
additional interest required to be deposited in the Custodial Account in
connection with such Principal Prepayment in accordance with Section 3.03(vi),
and minus (iv)
any
amounts attributable to Monthly Payments collected but due on a Due Date or
Due
Dates subsequent to the first day of the month in which such Remittance Date
occurs, which amounts shall be remitted on the Remittance Date next succeeding
the Due Date related to such Monthly Payment.
With
respect to any remittance received by the Master Servicer after the Business
Day
on which such payment was due, the Servicer shall pay to the Master Servicer
interest on any such late payment at an annual rate equal to the Prime Rate,
adjusted as of the date of each change, plus two (2) percentage points, but
in
no event greater than the maximum amount permitted by applicable law. Such
interest shall be deposited in the Custodial Account by the Servicer on the
date
such late payment is made and shall cover the period commencing with the day
following such Business Day and ending with the Business Day on which such
payment is made, both inclusive. Such interest shall be remitted along with
the
distribution payable on the next succeeding Remittance Date. The payment by
the
Servicer of any such interest shall not be deemed an extension of time for
payment or a waiver by the Trustee or the Master Servicer of any Event of
Default.
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All
remittances required to be made to the Master Servicer shall be made to the
following wire account or to such other account as may be specified by the
Master Servicer from time to time:
Bank
of
New York
ABA#:
000-000-000
Account
Name: Aurora Loan Services LLC,
Master Servicing Payment Clearing Account
Account
Number: 8900620730
Beneficiary:
Aurora Loan Services LLC
For
further credit to: LXS 2007-20N
Section
4.02 Statements
to Master Servicer.
(a)
Not
later
than the tenth (10th)
calendar day of each month (or if such calendar day is not a Business Day,
the
immediately preceding Business Day), the Servicer shall furnish to the Master
Servicer (i) a monthly remittance advice in the format set forth in Exhibit
D-1
hereto, a monthly defaulted loan report in the format set forth in Exhibit
D-2
hereto (or in such other format mutually agreed between the Servicer and the
Master Servicer) and a monthly modified loan report in the format set forth
in
Exhibit D-3 hereto (or in such other format mutually agreed to between the
Servicer and the Master Servicer) relating to the period ending on the last
day
of the preceding calendar month and (ii) all such information required pursuant
to clause (i) above on a magnetic tape or other similar media reasonably
acceptable to the Master Servicer and the Servicer, whose agreement shall not
be
unreasonably withheld. The format of this monthly reporting may be amended
from
time to time to the extent necessary to comply with applicable law or the terms
of the Trust Agreement.
Not
later
than the seventeenth day of each month, the Servicer shall furnish to the Master
Servicer (a) a monthly payoff remittance advice regarding any Principal
Prepayments in full applied to the related Mortgage Loan on or after the
seventeenth day of the month preceding the month of such reporting date, but
on
or before the sixteenth day of the month of such reporting date, containing
such
information and in such format as is mutually acceptable to the Master Servicer
and the Servicer, and in any event containing sufficient information to permit
the Master Servicer to properly report Principal Prepayment in full information
to the Trustee under the Trust Agreement and (b) all such information required
pursuant to clause (a) above in electronic format, on magnetic tape or other
similar media reasonably acceptable to the Master Servicer.
To
the
extent that the Master Servicer has provided an “ARM 304” or other similar
report relating to the adjustment of Mortgage Interest Rates for any or all
of
the Mortgage Loans, the Servicer shall review such report and resolve any
Mortgage Interest Rate adjustment discrepancies with the Master Servicer prior
to the related Mortgage Interest Rate adjustment date. In connection therewith,
the Servicer shall provide the Master Servicer with such documentation as may
be
reasonable necessary to resolve such discrepancies.
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(b)
In
addition, not more than sixty (60) days after the end of each calendar year,
commencing December 31, 2007, the Servicer shall furnish to each Person who
was
an owner of the Mortgage Loans at any time during such calendar year as required
by applicable law or if not required by applicable law, at the request of such
owner as to the aggregate of remittances for the applicable portion of such
year.
The
Master Servicer may request that the Servicer provide, at the Master Servicer’s
expense, an appraisal or a broker price opinion on any Mortgage Loan which
is 90
days or more delinquent. The Servicer shall use its best efforts to deliver
such
appraisal or broker price opinion to the Master Servicer within 15 calendar
days
after such request.
Such
obligation of the Servicer shall be deemed to have been satisfied to the extent
that substantially comparable information shall be provided by the Servicer
pursuant to any requirements of the Internal Revenue Code as from time to time
are in force.
Beginning
with calendar year 2007, the Servicer shall provide the Master Servicer with
such information concerning the Mortgage Loans as is necessary for the Master
Servicer or the Trustee to prepare the Trust Fund’s federal income tax return as
the Master Servicer or the Trustee may reasonably request from time to
time.
(c)
The
Servicer
shall promptly notify the Trustee, the NIMS Insurer, the
Master
Servicer and the Depositor (i) of any legal proceedings pending against the
Servicer of the type described in Item 1117 (§
229.1117) of
Regulation AB and (ii) if the Servicer shall become (but only to the extent
not
previously disclosed to the NIMS Insurer, the Master Servicer and the Depositor)
at any time an affiliate of any of the parties listed on Exhibit I to this
Agreement.
If
so
requested by the Trustee, the Master Servicer or the Depositor on any date
following the date on which information was first provided to the Trustee,
the
NIMS Insurer and the Depositor pursuant to the preceding sentence, the Servicer
shall use its reasonable best efforts within five (5) Business Days, but in
any
event within ten (10) Business Days following such request, confirm in writing
the accuracy of the representations and warranties set forth in Section 6.01(j)
or, if such a representation and warranty is not accurate as of the date of
such
request, provide reasonable adequate disclosure of the pertinent facts, in
writing, to the requesting party.
The
Servicer shall provide to the Trustee,
the NIMS Insurer, the Master Servicer and the Depositor
prompt
notice of the occurrence of any of the following: any event of default under
the
terms of this Agreement, any merger, consolidation or sale of substantially
all
of the assets of the Servicer, the Servicer’s engagement of any Subservicer,
Subcontractor to perform or assist in the performance of any of the Servicer’s
obligations under this Agreement, any material litigation involving the
Servicer, and any affiliation or other significant relationship between the
Servicer and other transaction parties.
(d)
Not
later
than the tenth calendar day of each month (or if such calendar day is not a
Business Day, the immediately preceding Business Day), the Servicer shall
provide to the Master Servicer notice of the occurrence of any material
modifications, extensions or waivers of terms, fees, penalties or payments
relating to the Mortgage Loans during the related Due Period or that have
cumulatively become material over time (Item 1121(a)(11) of Regulation AB)
along
-31-
with
all information, data, and materials related
thereto as may be required to be included in the related Distribution Report
on
Form 10-D.
Section
4.03 Monthly
Advances by Servicer.
On
the
Business Day immediately preceding each Remittance Date, the Servicer shall
deposit in the Custodial Account from its own funds or from amounts held for
future distribution, or both, an amount equal to the aggregate of all Monthly
Advances relating to Monthly Payments which were due on the Mortgage Loans
during the applicable Due Period and which were delinquent at the close of
business on the immediately preceding Determination Date or which were deferred
pursuant to Section 3.01. Any amounts held for future distribution and so used
shall be replaced by the Servicer by deposit in the Custodial Account on or
before any future Remittance Date if funds in the Custodial Account on such
Remittance Date shall be less than remittances to the Master Servicer required
to be made on such Remittance Date. The Servicer shall keep appropriate records
of such amounts and will provide such records to the Master Servicer upon
request. The Servicer’s obligation to make such Monthly Advances as to any
Mortgage Loan will continue through the last Monthly Payment due prior to the
payment in full of the Mortgage Loan, or through the last Remittance Date prior
to the Remittance Date for the distribution of all Liquidation Proceeds and
other payments or recoveries (including Insurance Proceeds and Condemnation
Proceeds) with respect to the Mortgage Loan unless the Servicer deems such
Monthly Advances to be unrecoverable; provided that, if requested by the Master
Servicer, such determination that a Monthly Advance is unrecoverable shall
be
evidenced by an Officer’s Certificate of the Servicer delivered to the Master
Servicer. Notwithstanding
anything in this Section to the contrary, the Servicer’s obligation to make
Monthly Advances on the Mortgage Loans in the aggregate for a Remittance Date
shall be reduced by any Capitalization Reimbursement Amounts reimbursed to
the
Servicer during the related Due Period.
ARTICLE
V.
GENERAL
SERVICING PROCEDURES
Section
5.01 Servicing
Compensation.
As
consideration for servicing the Mortgage Loans subject to this Agreement, the
Servicer shall retain (i) the relevant Servicing Fee for each Mortgage Loan
remaining subject to this Agreement during any month and (ii) Ancillary Income.
In addition, if at any time the Servicer is the Retained Interest Holder with
respect to any Mortgage Loans, then the Servicer, as the Retained Interest
Holder, shall retain an amount equal to the Retained Interest relating to such
Mortgage Loans; provided, that (i) the Trustee and the Master Servicer shall
have no obligation to make payment of the Retained Interest to the Servicer
and
(ii) the Servicer’s right to retain the Retained Interest is limited to (and the
Retained Interest may only be retained from) the interest portion (including
recoveries with respect to interest from Liquidation Proceeds) of the Monthly
Payments collected by the Servicer with respect to those Mortgage Loans for
which payment is in fact made of the entire amount of the Monthly Payment.
The
Servicing Fee shall be payable monthly. The Servicing Fees shall be payable
only
at the time of and with respect to those Mortgage Loans for which payment is
in
fact made of the entire amount of the Monthly Payment or as otherwise provided
in Section 3.04. The obligation of the Trust Fund to pay the
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Servicing
Fees is limited as provided in Section
3.04. The aggregate of the Servicing Fees payable to the Servicer for any month
with respect to the Mortgage Loans shall be reduced by any Prepayment Interest
Shortfall Amount with respect to such month. Any Prepayment Interest Excess
Amount shall be retained by, or paid to, the Servicer as a part of the Servicing
Fee.
The
Servicer shall be required to pay all expenses incurred by it in connection
with
its servicing activities hereunder and shall not be entitled to reimbursement
thereof except as specifically provided for herein.
Section
5.02 Report
on Attestation of Compliance with Applicable Servicing
Criteria.
The
Servicer shall cause, on or before March 15th
of each
year, beginning in 2008, at its own expense, a firm of independent public
accountants (who may also render other services to Servicer), which is a member
of the American Institute of Certified Public Accountants, to furnish to the
Seller, the Trustee, the Depositor and the Master Servicer (i) year-end audited
(if available) financial statements of the Servicer and (ii) a report to the
effect that such firm that attests to, and reports on, the assessment made
by
such asserting party pursuant to Section 5.04 below, which report shall be
made
in accordance with standards for attestation engagements issued or adopted
by
the Public Company Accounting Oversight Board. In addition, the Servicer shall,
on or before March 15th of each year, beginning in 2008, at its own expense,
furnish to the Seller, the NIMS Insurer, the Trustee, the Depositor and Master
Servicer a report meeting the requirements of clause (ii) above regarding the
attestation of any Subservicer or Subcontractor which is “participating
in the servicing function” within the meaning of Item 1122 of Regulation
AB.
Section
5.03 Annual
Officer’s Certificate.
(a)
The
Servicer shall deliver on or before March 15th of each year, beginning in 2008,
at its own expense, to the Seller, the NIMS Insurer, the Trustee, the Depositor
and the Master Servicer with respect to the period ending on the immediately
preceding December 31, a Servicing Officer’s certificate in the form of Exhibit
J hereto, stating, as to each signer thereof, that (1) a review of the
activities of the Servicer during such preceding calendar year or portion
thereof and of its performance under this Agreement for such period has been
made under such Servicing Officer’s supervision and (2) to the best of such
officers’ knowledge, based on such review, the Servicer has fulfilled all of its
obligations under this Agreement in all material respects throughout such year
(or applicable portion thereof), or, if there has been a failure to fulfill
any
such obligation in any material respect, specifically identifying each such
failure known to such Servicing Officer and the nature and status thereof,
including the steps being taken by the Servicer to remedy such
default.
(b)
For
so
long as a certificate under the Xxxxxxxx-Xxxxx Act of 2002, as amended,
("Xxxxxxxx-Xxxxx") is required to be given on behalf of the Trust Fund, no
later
than March 15th
(or if
not a Business Day, the immediately preceding Business Day) of each calendar
year, beginning with March 15, 2008, a Servicing Officer shall execute and
deliver an Officer's Certificate to the Master Servicer, the Trustee and the
Depositor for the benefit of the Trust Fund, the Master Servicer, the Trustee
and the Depositor and their officers, directors and affiliates, in the form
of
Exhibit E hereto.
-33-
(c)
The
Servicer shall indemnify and hold harmless the Seller, the NIMS Insurer, the
Master Servicer, the Trustee, the Depositor and their respective officers,
directors, agents and affiliates from and against any losses, damages,
penalties, fines, forfeitures, reasonable legal fees and related costs,
judgments and other costs and expenses arising out of or based upon a breach
by
the Servicer or any of its officers, directors, agents or affiliates of its
obligations under this Section 5.03 or the negligence, bad faith or willful
misconduct of the Servicer in connection therewith. If the indemnification
provided for herein is unavailable or insufficient to hold harmless the Master
Servicer, the Trustee and/or the Depositor, then the Servicer agrees that it
shall contribute to the amount paid or payable by the Master Servicer, the
Trustee and/or the Depositor as a result of the losses, claims, damages or
liabilities of the Master Servicer, the Trustee and/or the Depositor in such
proportion as is appropriate to reflect the relative fault of the Master
Servicer, the Trustee and/or the Depositor on the one hand and the Servicer
on
the other in connection with a breach of the Servicer’s obligations under this
Section 5.03 or the Servicer’s negligence, bad faith or willful misconduct in
connection therewith.
Section
5.04 Report
on Assessment of Compliance with Applicable Servicing Criteria.
On
or
before March 15th of each calendar year, beginning with March 15, 2008, the
Servicer shall deliver to the Seller, the Trustee, the Master Servicer,
the
NIMS
Insurer
and the
Depositor a report regarding its assessment of compliance with the servicing
criteria identified in Exhibit H attached hereto, as of and for the fiscal
year
of the Trust (which, unless otherwise identified to the Servicer in writing,
shall be the calendar year) for the
year
prior to the year of delivery of the report, with respect to asset-backed
security transactions taken as a whole
that are
backed by the same asset type backing such asset-backed securities. Each such
report shall include (a) a statement of the party’s responsibility for assessing
compliance with the servicing criteria applicable to such party, (b) a statement
that such party used the criteria identified in Item 1122(d) of Regulation
AB (§
229.1122(d)) to assess compliance with the applicable servicing criteria, (c)
disclosure of any material instance of noncompliance identified by such party,
and (d) a statement that a registered public accounting firm has issued an
attestation report on such party’s assessment of compliance with the applicable
servicing criteria, which report shall be delivered by the Servicer as provided
in Section 5.02.
Section
5.05 Transfers
of Mortgaged Property.
The
Servicer shall use its best efforts to enforce any “due-on-sale” provision
contained in any Mortgage or Mortgage Note and to deny assumption by the person
to whom the Mortgaged Property has been or is about to be sold whether by
absolute conveyance or by contract of sale, and whether or not the Mortgagor
remains liable on the Mortgage and the Mortgage Note. When the Mortgaged
Property has been conveyed by the Mortgagor, the Servicer shall, to the extent
it has knowledge of such conveyance, exercise its rights to accelerate the
maturity of such Mortgage Loan under the “due-on-sale” clause applicable
thereto, provided,
however,
that
the Servicer shall not exercise such rights if prohibited by law from doing
so
or if the exercise of such rights would impair or threaten to impair any
recovery under the related PMI Policy or LPMI Policy, if any.
If
the
Servicer reasonably believes it is unable under applicable law to enforce such
“due-on-sale” clause, the Servicer shall make
all
commercially reasonable efforts
to enter
into (i) an
-34-
assumption
and modification agreement with the person
to whom such property has been conveyed, pursuant to which such person becomes
liable under the Mortgage Note and the original Mortgagor remains liable thereon
or (ii) in the event the Servicer is unable under applicable law to require
that
the original Mortgagor remain liable under the Mortgage Note and the Servicer
has the prior consent of the primary mortgage guaranty insurer, a substitution
of liability agreement with the owner of the Mortgaged Property pursuant to
which the original Mortgagor is released from liability and the owner of the
Mortgaged Property is substituted as Mortgagor and becomes liable under the
Mortgage Note; provided that no such substitutions should be permitted unless
such person satisfies the underwriting criteria of the Servicer and has a credit
risk rating at least equal to that of the original Mortgagor. The Mortgage
Loan,
as assumed, shall conform in all respects to the requirements, representations
and warranties of this Agreement. The Servicer shall notify the Master Servicer
that any such assumption or substitution agreement has been contemplated by
forwarding to the Master Servicer a copy of such assumption or substitution
agreement (indicating the Mortgage File to which it relates). The Servicer
shall
forward an original copy of such agreement to the Custodian to be held by the
Custodian with the other documents related to such Mortgage Loan. The Servicer
shall be responsible for recording any such assumption or substitution
agreements. In connection with any such assumption or substitution agreement,
the Monthly Payment on the related Mortgage Loan shall not be changed but shall
remain as in effect immediately prior to the assumption or substitution, the
Mortgage Interest Rate, the stated maturity or the outstanding principal amount
of such Mortgage Loan shall not be changed nor shall any required monthly
payments of principal or interest be deferred or forgiven. Any assumption fee
collected by the Servicer for entering into an assumption agreement shall be
retained by the Servicer as additional servicing compensation. In connection
with any such assumption, none of the Mortgage Interest Rate borne by the
related Mortgage Note, the term of the Mortgage Loan or the outstanding
principal amount of the Mortgage Loan shall be changed.
ARTICLE
VI.
REPRESENTATIONS,
WARRANTIES
AND
AGREEMENTS
Section
6.01 Representations,
Warranties and Agreements of the Servicer.
The
Servicer, as a condition to the consummation of the transactions contemplated
hereby, hereby makes the following representations and warranties to the Seller,
the Master Servicer, the Depositor and the Trustee as of the Closing
Date:
(a)
Due
Organization and Authority.
The
Servicer is a limited liability company duly organized, validly existing and
in
good standing under the laws of the jurisdiction of its organization and has
all
licenses necessary to carry on its business as now being conducted and is
licensed, qualified and in good standing in each state where a Mortgaged
Property is located if the laws of such state require licensing or qualification
in order to conduct business of the type conducted by the Servicer, and in
any
event the Servicer is in compliance with the laws of any such state to the
extent necessary to ensure the enforceability of the terms of this Agreement;
the Servicer has the full power and authority to execute and deliver this
Agreement and to perform in accordance herewith; the execution, delivery and
performance of this Agreement (including all
-35-
instruments
of transfer to be delivered pursuant to
this Agreement) by the Servicer and the consummation of the transactions
contemplated hereby have been duly and validly authorized; this Agreement
evidences the valid, binding and enforceable obligation of the Servicer and
all
requisite action has been taken by the Servicer to make this Agreement valid
and
binding upon the Servicer in accordance with its terms;
(b)
Ordinary
Course of Business.
The
consummation of the transactions contemplated by this Agreement are in the
ordinary course of business of the Servicer;
(c)
No
Conflicts.
Neither
the execution and delivery of this Agreement, the acquisition of the servicing
responsibilities by the Servicer or the transactions contemplated hereby, nor
the fulfillment of or compliance with the terms and conditions of this
Agreement, will conflict with or result in a breach of any of the terms,
conditions or provisions of the Servicer’s organizational documents or any legal
restriction or any agreement or instrument to which the Servicer is now a party
or by which it is bound, or constitute a default or result in an acceleration
under any of the foregoing, or result in the violation of any law, rule,
regulation, order, judgment or decree to which the Servicer or its property
is
subject, or impair the ability of the Servicer to service the Mortgage Loans,
or
impair the value of the Mortgage Loans;
(d)
Ability
to Perform.
The
Servicer does not believe, nor does it have any reason or cause to believe,
that
it cannot perform each and every covenant contained in this
Agreement;
(e)
No
Litigation Pending.
There
is no action, suit, proceeding or investigation pending (or, in the case of
government authorities, known to be contemplated) or threatened against the
Servicer or any Subservicer which, either in any one instance or in the
aggregate, may result in any material adverse change in the business,
operations, financial condition, properties or assets of the Servicer or any
Subservicer, or in any material impairment of the right or ability of the
Servicer or any Subservicer to carry on its business substantially as now
conducted, or in any material liability on the part of the Servicer or any
Subservicer, or which would draw into question the validity of this Agreement
or
of any action taken or to be taken in connection with the obligations of the
Servicer contemplated herein, or which would be likely to impair materially
the
ability of the Servicer to perform under the terms of this
Agreement;
(f)
No
Consent Required.
No
consent, approval, authorization or order of any court or governmental agency
or
body is required for the execution, delivery and performance by the Servicer
of
or compliance by the Servicer with this Agreement;
(g)
Ability
to Service.
The
Servicer is an approved seller/servicer of conventional residential mortgage
loans for Xxxxxx Xxx or Xxxxxxx Mac, with the facilities, procedures and
experienced personnel necessary for the sound servicing of mortgage loans of
the
same type as the Mortgage Loans. The Servicer is in good standing to service
mortgage loans for either Xxxxxx Mae or Xxxxxxx Mac. The Servicer is a member
in
good standing of the MERS system;
(h)
No
Untrue Information.
Neither
this Agreement nor any statement, report or other document furnished or to
be
furnished pursuant to this Agreement or in connection with the transactions
contemplated hereby contains any untrue statement of fact or omits to state
a
fact necessary to make the statements contained therein not
misleading;
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(i)
No
Commissions to Third Parties.
The
Servicer has not dealt with any broker or agent or anyone else who might be
entitled to a fee or commission in connection with this transaction other than
the Seller; and
(j)
Additional
Representations and Warranties of the Servicer.
Except
as disclosed in writing to the Seller, the Master Servicer, the Depositor and
the Trustee prior to the Closing Date: (i)
the
Servicer is not aware and has not received notice that any default, early
amortization or other performance triggering event has occurred as to any other
securitization due to any act or failure to act of the Servicer; (ii)
the
Servicer has not been terminated as servicer in a residential mortgage loan
securitization, either due to a servicing default or to application of a
servicing performance test or trigger; (iii) no
material noncompliance
with the applicable servicing criteria with respect to other securitizations
of
residential mortgage loans involving the Servicer as servicer
has been
disclosed or reported by the Servicer; (iv) no material
changes to the Servicer’s policies or procedures with respect to the servicing
function it will perform under this Agreement for mortgage loans of a type
similar to the Mortgage Loans
have
occurred during the three-year period immediately preceding the Closing Date;
(v) there are no aspects of the Servicer’s financial condition that could have a
material adverse effect on the performance by the
Servicer of its servicing obligations under this Agreement
and (vi)
there are no affiliations, relationships or transactions relating to the
Servicer or any Subservicer with any party listed on Exhibit I
hereto.
Section
6.02 Remedies
for Breach of Representations and Warranties of the Servicer.
It
is
understood and agreed that the representations and warranties set forth in
Section 6.01 shall survive the engagement of the Servicer to perform the
servicing responsibilities as of the Closing Date or Servicing Transfer Date,
as
applicable, hereunder and the delivery of the Servicing Files to the Servicer
and shall inure to the benefit of the Seller, the Master Servicer, the Depositor
and the Trustee. Upon discovery by either the Servicer, the Master Servicer,
the
Trustee or the Seller of a breach of any of the foregoing representations and
warranties which materially and adversely affects the ability of the Servicer
to
perform its duties and obligations under this Agreement or otherwise materially
and adversely affects the value of the Mortgage Loans, the Mortgaged Property
or
the priority of the security interest on such Mortgaged Property or the interest
of the Seller or the Trustee, the party discovering such breach shall give
prompt written notice to the other.
Within
60
days of (or, in the case of any breach of a representation or warranty set
forth
in Section 6.01(j), 10 days) the earlier of either discovery by or notice to
the
Servicer of any breach of a representation or warranty set forth in Section
6.01
which materially and adversely affects the ability of the Servicer to perform
its duties and obligations under this Agreement or otherwise materially and
adversely affects the value of the Mortgage Loans, the Mortgaged Property or
the
priority of the security interest on such Mortgaged Property, the Servicer
shall
use its Best Efforts promptly to cure such breach in all material respects
and,
if such breach cannot be cured, the Servicer shall, at the Trustee’s or the
Master Servicer’s option, assign the Servicer’s rights and obligations under
this Agreement (or respecting the affected Mortgage Loans) to a successor
Servicer. Such assignment shall be made in accordance with Sections 9.01 and
9.02.
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In
addition, the Servicer shall indemnify the Seller, the Trustee and the Master
Servicer (and each of their respective directors, officers, employees and
agents) and the Trust Fund, and hold each of them harmless against any Costs
resulting from any claim, demand, defense or assertion based on or grounded
upon, or resulting from, a breach of the Servicer representations and warranties
contained in this Agreement. It is understood and agreed that the remedies
set
forth in this Section 6.02 constitute the sole remedies of the Seller, the
Master Servicer and the Trustee respecting a breach of the foregoing
representations and warranties.
Any
cause
of action against the Servicer relating to or arising out of the breach of
any
representations and warranties made in Section 6.01 shall accrue upon (i)
discovery of such breach by the Servicer or notice thereof by the Seller or
the
Master Servicer to the Servicer, (ii) failure by the Servicer to cure such
breach within the applicable cure period, and (iii) demand upon the Servicer
by
the Seller or the Master Servicer for compliance with this
Agreement.
Section
6.03 Additional
Indemnification by the Servicer; Third Party Claims.
(a)
The
Servicer
shall
indemnify the Seller, the Depositor, the Trustee, the Master Servicer, the
NIMS
Insurer,
the Trust Fund and each of their respective directors, officers, employees
and
agents and the Trust Fund and shall hold each of them harmless from and against
any losses, damages, penalties, fines, forfeitures, legal fees and expenses
and
related costs, judgments, and any other costs, fees and expenses that any of
them may sustain arising out of or based upon:
(A) any
failure by the Servicer, any Subservicer or any Subcontractor to
deliver any information, report, certification, accountants’ letter or other
material when and as required under this Agreement, including any report under
Sections 5.02, 5.03 or 5.04 or any failure by the Servicer to identify pursuant
to Section 7.04(c) any Subcontractor that is a Participating Entity;
(B) the
failure of the Servicer
to
perform its duties and service the Mortgage Loans in material compliance with
the terms of this Agreement or
(C) the
failure of the Servicer
to cause
any event to occur or not to occur which would have occurred or would not have
occurred, as applicable, if the Servicer were applying Accepted Servicing
Practices under this Agreement.
In
the
case of any failure of performance described in clause (a)(A) of this Section
6.03, the Servicer shall promptly reimburse the Trustee, the Master Servicer
or
the Depositor, as applicable, and each Person responsible for the preparation,
execution or filing of any report required to be filed with the Commission
with
respect to the transaction relating to this Agreement, or for execution of
a
certification pursuant to Rule 13a-14(d) or Rule 15d-14(d) under the
Securities
Exchange Act of 1934, as amended (the “Exchange Act”)
with
respect to this transaction, for all costs reasonably incurred by each such
party in order to obtain the information,
report, certification, accountants’ letter or other material not delivered as
required by the Servicer, any
Subservicer or any Subcontractor.
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The
Servicer shall immediately notify the Seller, the Depositor, the Master
Servicer, the Trustee, the NIMS Insurer, the Depositor, the Trustee and the
Trust Fund or any other relevant party if a claim is made by a third party
with
respect to this Agreement or the Mortgage Loans, assume (with the prior written
consent of the indemnified party in the event of an indemnified claim) the
defense of any such claim and pay all expenses in connection therewith,
including counsel fees, promptly pay, discharge and satisfy any judgment or
decree which may be entered against it or any other party in respect of such
claim and follow any written instructions received from such indemnifying party
in connection with such claim. Subject to the Servicer’s indemnification
pursuant to Section 6.02, or the failure of the Servicer to service and
administer the Mortgage Loans in material compliance with the terms of this
Agreement, the Trust Fund shall indemnify the Servicer and hold the Servicer
harmless against any and all Costs that the Servicer may sustain in connection
with any legal action relating to this Agreement, the Certificates or the
origination or Servicing of the Mortgage Loans by any prior owner or servicer,
other than any Costs incurred by reason of the Servicer’s willful misfeasance,
bad faith or negligence in the performance of duties hereunder or by reason
of
its reckless disregard of obligations and duties hereunder.
Section
6.04 Indemnification
with Respect to Certain Taxes and Loss of REMIC Status.
In
the
event that any REMIC fails to qualify as a REMIC, loses its status as a REMIC,
or incurs federal, state or local taxes as a result of a prohibited transaction
or prohibited contribution under the REMIC Provisions due to the negligent
performance by the Servicer of its duties and obligations set forth herein,
the
Servicer shall indemnify the Holder of the related Residual Certificate, the
Master Servicer, the Trustee and the Trust Fund (and each of their respective
directors, officers, employees and agents) against any and all losses, claims,
damages, liabilities or expenses (“Losses”) resulting from such negligence;
provided,
however,
that the
Servicer shall not be liable for any such Losses attributable to the action
or
inaction of the Trustee, the Depositor or the Holder of such Residual
Certificate, as applicable, nor for any such Losses resulting from
misinformation provided by the Holder of such Residual Certificate on which
the
Servicer has relied. The foregoing shall not be deemed to limit or restrict
the
rights and remedies of the Holder of such Residual Certificate, the Master
Servicer, the Trustee and the Trust Fund now or hereafter existing at law or
in
equity or otherwise. Notwithstanding the foregoing, however, in no event shall
the Servicer have any liability (1) for any action or omission that is taken
in
accordance with and in compliance with the express terms of, or which is
expressly permitted by the terms of, this Agreement, (2) for any Losses other
than arising out of a negligent performance by the Servicer of its duties and
obligations set forth herein, and (3) for any special or consequential damages
to Certificateholders (in addition to payment of principal and interest on
the
Certificates).
Section
6.05 Reporting
Requirements of the Commission and Indemnification.
Notwithstanding
any other provision of this Agreement, the Servicer acknowledges and agrees
that
the purpose of Sections 4.02(c) and (d), 5.02, 5.03, 5.04, 6.01(j), 6.03 and
7.04 of this Agreement is to facilitate compliance by the Trustee, the Master
Servicer and the Depositor with the provisions of Regulation AB. Therefore,
the
Servicer agrees that (a) the obligations of the Servicer hereunder shall be
interpreted in such a manner as to accomplish that purpose, (b) such obligations
may change over time due to interpretive advice or guidance of the Commission,
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convention
or consensus among active participants in the
asset-backed securities markets, advice of counsel, or otherwise in respect
of
the requirements of Regulation AB, (c) the Servicer shall agree to enter into
such amendments to this Agreement as may be necessary, in the judgment of the
Depositor, the Master Servicer and their respective counsel, to comply with
such
interpretive advice or guidance, convention, consensus, advice of counsel,
or
otherwise, (d) the Servicer shall otherwise comply with requests made by the
Trustee, the Master Servicer or the Depositor for delivery of additional or
different information as such parties may determine in good faith is necessary
to comply with the provisions of Regulation AB and (e) the
Servicer shall (i) agree to such modifications and enter into such amendments
to
this Agreement as may be necessary, in the judgment of the Depositor, the Master
Servicer and their respective counsel, to comply with any such clarification,
interpretive guidance, convention or consensus and (ii) promptly
upon request provide to the Depositor for inclusion in any periodic report
required to be filed under the Exchange Act, such items of information regarding
this Agreement and matters related to the Servicer, (collectively, the “Servicer
Information”), provided
that
such
information shall be required to be provided by the Servicer only to the extent
that such shall be determined by the Depositor in its sole discretion and its
counsel to be necessary or advisable to comply with any Commission and industry
guidance and convention. For
the
purposes of clarification, any modifications or amendments of the obligations
of
the Servicer under this agreement made pursuant to this Section 6.05 shall
be
made in writing and upon mutual agreement with the Servicer (provided that
such
agreement will not unreasonably withheld) and in accordance with Section 9.12
of
this Agreement.
The
Servicer hereby agrees to indemnify and hold harmless the Depositor, the
Trustee, the Master Servicer, their respective officers and directors and each
person, if any, who controls the Depositor or Master Servicer within the meaning
of Section 15 of the Securities Act of 1933, as amended (the “Act”), or Section
20 of the Exchange Act, from and against any and all losses, claims, expenses,
damages or liabilities to which the Depositor, the Trustee, the Master Servicer,
their respective officers or directors and any such controlling person may
become subject under the Act or otherwise, as and when such losses, claims,
expenses, damages or liabilities are incurred, insofar as such losses, claims,
expenses, damages or liabilities (or actions in respect thereof) arise out
of or
are based upon any untrue statement or alleged untrue statement of any material
fact contained in the Servicer Information or arise out of, or are based upon,
the omission or alleged omission to state therein any material fact required
to
be stated therein or necessary to make the statements therein, in light of
the
circumstances under which they were made, not misleading, and will reimburse
the
Depositor, the Trustee, the Master Servicer, their respective officers and
directors and any such controlling person for any legal or other expenses
reasonably incurred by it or any of them in connection with investigating or
defending any such loss, claim, expense, damage, liability or action, as and
when incurred; provided,
however,
that
the Servicer shall be liable only insofar as such untrue statement or alleged
untrue statement or omission or alleged omission relates solely to the
information in the Servicer Information furnished to the Depositor, the Trustee
or Master Servicer by or on behalf of the Servicer specifically in connection
with this Agreement.
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ARTICLE
VII.
THE
SERVICER
Section
7.01 Merger
or Consolidation of the Servicer.
The
Servicer shall keep in full effect its existence, rights and franchises as
a
limited liability company, and shall obtain and preserve its qualification
to do
business as a foreign entity in each jurisdiction in which such qualification
is
or shall be necessary to protect the validity and enforceability of this
Agreement or any of the Mortgage Loans and to perform its duties under this
Agreement.
Any
Person into which the Servicer may be merged or consolidated, or any corporation
(or limited liability company) resulting from any merger, conversion or
consolidation to which the Servicer shall be a party, or any Person succeeding
to the business of the Servicer, shall be the successor of the Servicer
hereunder, without the execution or filing of any paper or any further act
on
the part of any of the parties hereto, anything herein to the contrary
notwithstanding, provided,
however,
that
the successor or surviving Person shall be an institution (i) having a net
worth
of not less than $25,000,000, and (ii) which is a Xxxxxx Xxx or Xxxxxxx Mac
approved servicer in good standing.
Section
7.02 Limitation
on Liability of the Servicer and Others.
Neither
the Servicer nor any of the directors, officers, employees or agents of the
Servicer shall be under any liability to the Seller, the Master Servicer or
the
Trustee for any action taken or for refraining from the taking of any action
in
good faith pursuant to this Agreement, or for errors in judgment; provided,
however,
that
this provision shall not protect the Servicer or any such person against any
breach of warranties or representations made herein, or failure to perform
its
obligations in strict compliance with any standard of care set forth in this
Agreement, or any liability which would otherwise be imposed by reason of any
breach of the terms and conditions of this Agreement. The Servicer and any
director, officer, employee or agent of the Servicer may rely in good faith
on
any document of any kind prima facie properly executed and submitted by any
Person respecting any matters arising hereunder. The Servicer shall not be
under
any obligation to appear in, prosecute or defend any legal action which is
not
incidental to its duties to service the Mortgage Loans in accordance with this
Agreement and which in its opinion may involve it in any expense or liability,
provided,
however,
that
the Servicer may, with the consent of the Master Servicer, undertake any such
action which it may deem necessary or desirable in respect of this Agreement
and
the rights and duties of the parties hereto. In such event, the Servicer shall
be entitled to reimbursement from the Trust Fund for the reasonable legal
expenses and costs of such action.
Section
7.03 Limitation
on Resignation and Assignment by the Servicer.
The
Seller has entered into this Agreement with the Servicer in reliance upon the
independent status of the Servicer, and the representations as to the adequacy
of its servicing facilities, plant, personnel, records and procedures, its
integrity, reputation and financial standing, and the continuance thereof.
Therefore, the Servicer shall neither assign its rights under this Agreement
or
the servicing hereunder nor delegate its duties hereunder or any portion
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thereof,
or sell or otherwise dispose of all or
substantially all of its property or assets without, in each case, the prior
written consent of the Seller (as owner of the servicing rights relating to
the
Mortgage Loans) and the Master Servicer, which consent, in the case of an
assignment of rights or delegation of duties, shall be granted or withheld
in
the discretion of the Seller and the Master Servicer, and which consent, in
the
case of a sale or disposition of all or substantially all of the property or
assets of the Servicer, shall not be unreasonably withheld; provided, that
in
each case, there must be delivered to the Master Servicer and the Trustee a
letter from each Rating Agency to the effect that such transfer of servicing
or
sale or disposition of assets will not result in a qualification, withdrawal
or
downgrade of the then-current rating of any of the Certificates.
Notwithstanding the foregoing, the Servicer, without the consent of the Seller
(as
owner
of the servicing rights relating to the Mortgage Loans),
the
Master Servicer or the Trustee, may retain third party contractors to perform
certain servicing and loan administration functions, including without
limitation, hazard insurance administration, tax payment and administration,
flood certification and administration, collection services and similar
functions; provided, that the retention of such contractors by Servicer shall
not limit the obligation of the Servicer to service the Mortgage Loans pursuant
to the terms and conditions of this Agreement.
The
Servicer shall not resign from the obligations and duties hereby imposed on
it
except by mutual consent of the Servicer and the Master Servicer or upon the
determination that its duties hereunder are no longer permissible under
applicable law and such incapacity cannot be cured by the Servicer. Any such
determination permitting the resignation of the Servicer shall be evidenced
by
an Opinion of Counsel to such effect delivered to the Master Servicer and the
Trustee which Opinion of Counsel shall be in form and substance acceptable
to
the Master Servicer and the Trustee. No such resignation shall become effective
until a successor shall have assumed the Servicer’s responsibilities and
obligations hereunder in the manner provided in Section 9.01.
Without
in any way limiting the generality of this Section 7.03, in the event that
the
Servicer either shall assign this Agreement or the servicing responsibilities
hereunder or delegate its duties hereunder or any portion thereof or sell or
otherwise dispose of all or substantially all of its property or assets, without
the prior written consent of the Seller, the Trustee and the Master Servicer,
then the Seller, the Trustee or the Master Servicer shall have the right to
terminate this Agreement upon notice given as set forth in Section 8.01, without
any payment of any penalty or damages and without any liability whatsoever
to
the Servicer or any third party.
Section
7.04 Subservicing
Agreements and Successor Subservicer.
(a)
The
Servicer shall not hire or otherwise utilize the services of any Subservicer
to
fulfill any of the obligations of the Servicer as servicer under this Agreement
unless the Servicer complies with the provisions of paragraph (b) of this
Section 7.04 and the proposed Subservicer (i) is an institution which is an
approved Xxxxxx Xxx or Xxxxxxx Mac Seller/Servicer as indicated in writing,
(ii)
represents and warrants that it is in compliance with the laws of each state
as
necessary to enable it to perform its obligations under such subservicing
agreement and (iii) is acceptable to the NIMS Insurer. The Servicer shall not
hire or otherwise utilize the services of any Subcontractor, and shall not
permit any Subservicer to hire or otherwise utilize the services of any
Subcontractor, to fulfill any of the obligations of the Servicer as servicer
under this Agreement unless the Servicer complies with the provisions of
paragraph (c) of this Section 7.04.
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(b)
The
Servicer shall give prior written notice to the Trustee, the Master Servicer,
the Depositor and the NIMS Insurer of the appointment of any Subservicer and
shall furnish to the Trustee, Master Servicer, the Depositor and the NIMS
Insurer a copy of any related subservicing agreement. For purposes of this
Agreement, the Servicer shall be deemed to have received payments on Mortgage
Loans immediately upon receipt by any Subservicer of such payments. Any such
subservicing agreement shall be acceptable
to the
NIMS Insurer and be consistent with and not violate the provisions of this
Agreement. Each subservicing agreement shall provide that a successor Servicer
shall have the option to terminate such agreement without payment of any fees
if
the predecessor Servicer is terminated or resigns. The Servicer shall cause
any
Subservicer used by the Servicer (or by any Subservicer) to comply with the
provisions of this Section 7.04 and with Sections 4.02(c), 5.02, 5.03(a),
5.03(b), 5.04, 6.01(j) and 6.03 and Exhibit H of this Agreement to the same
extent as if such Subservicer were the Servicer. The Servicer shall be
responsible for obtaining from each Subservicer and delivering to the Trustee,
the Master Servicer, the NIMS Insurer, the Master Servicer and the Depositor
any
servicer compliance statement required to be delivered by such Subservicer
under
Section 5.03(a), any reports on assessment of compliance and attestation
required to be delivered by such Subservicer under Sections 5.02 and 5.04 and
any certification required to be delivered under 5.03(b) to the Person that
will
be responsible for signing the Sarbanes Certification under Section 5.04 as
and
when required to be delivered hereunder.
(c)
On
or
prior to March 15th
of each
year, beginning in 2008, the Servicer shall provide written notice to the Master
Servicer and the Depositor of (A) which (if any) Subcontractors are
Participating Entities, and (B) which elements of the servicing criteria set
forth under Item 1122(d) of Regulation AB will be addressed in assessments
of
compliance provided by each Subcontractor identified pursuant to clause (A)
of
this paragraph.
As
a
condition to the utilization of any Subcontractor determined to be a
Participating Entity, the Servicer shall cause any such Subcontractor used
by
the Servicer (or by any Subservicer) for the benefit of the Trustee, the NIMS
Insurer, the Master Servicer and the Depositor to comply with the provisions
of
Sections 4.02(c), 5.02, 5.04, 6.01(j) and 6.03 and Exhibit H of this Agreement
to the same extent as if such Subcontractor were the Servicer. The Servicer
shall be responsible for obtaining from each Subcontractor and delivering to
the
Trustee, the NIMS Insurer, the Master Servicer and the Depositor any assessment
of compliance and attestation required to be delivered by such Subcontractor
under Sections 5.02 and 5.04, in each case as and when required to be delivered.
The
Servicer acknowledges that a Subservicer or Subcontractor that performs services
with respect to mortgage loans involved in this transaction in addition to
the
Mortgage Loans may be determined by the Depositor to be a Participating Entity
on the basis of the aggregate balance of such mortgage loans, without regard
to
whether such Subservicer or Subcontractor would be a Participating Entity with
respect to the Mortgage Loans viewed in isolation. The Servicer shall (A)
respond as promptly as practicable to any good faith request by the Trustee,
the
Master Servicer or the Depositor for information regarding each Subservicer
and
each Subcontractor and (B) cause each Subservicer and each Subcontractor with
respect to which the Trustee, the Master Servicer or the Depositor requests
delivery of an assessment of compliance and accountants’ attestation to deliver
such within the time required under Section 5.04.
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Notwithstanding
any subservicing agreement or the provisions of this Agreement relating to
agreements or arrangements between the Servicer and a Subservicer, Subcontractor
or other third party or reference to actions taken through a Subservicer, a
Subcontractor, another third party or otherwise, the Servicer shall remain
obligated and primarily liable to the Trust Fund, the Trustee, the Master
Servicer, the NIMS Insurer and the Certificateholders for the servicing and
administering of the Mortgage Loans in accordance with the provisions hereof
without diminution of such obligation or liability by virtue of any
subservicing, subcontracting or other agreements or arrangements or by virtue
of
indemnification from a Subservicer, Subcontractor or a third party and to the
same extent and under the same terms and conditions as if the Servicer alone
were servicing the Mortgage Loans, including with respect to compliance with
Item 1122 of Regulation AB. The Servicer shall be entitled to enter into any
agreement with a Subservicer, Subcontractor or a third party for indemnification
of the Servicer by such Subservicer, Subcontractor or third party and nothing
contained in the Agreement shall be deemed to limit or modify such
indemnification.
ARTICLE
VIII.
TERMINATION
Section
8.01 Termination
for Cause.
This
Agreement shall be terminable at the option of the Seller or the Master Servicer
if any of the following events of default exist on the part of the
Servicer:
(i)
any
failure by the Servicer to remit to the Master Servicer any payment required
to
be made under the terms of this Agreement which continues unremedied for a
period of two Business Days after the date upon which written notice of such
failure, requiring the same to be remedied, shall have been given to the
Servicer by the Master Servicer; or
(ii)
any
failure by the Servicer to duly perform, within the required time period and
without notice, its obligations to provide any certifications required pursuant
to Sections 5.02, 5.03 or 5.04 (including with respect to such certifications
required to be provided by any Subservicer or Subcontractor pursuant to Section
7.04), which failure continues unremedied for a period of ten (10) days from
the
date of delivery required with respect to such certification; or
(iii)
except
with respect to those items listed in clause (ii) above, any failure by the
Servicer to duly perform, within the required time period, without notice or
grace period, its obligations to provide the information, data and materials
required to be provided hereunder pursuant to Sections 4.02(c), 4.02(d), 6.01(j)
and 7.04, including any items required to be included in any Exchange Act
report; or
(iv)
failure
by the Servicer duly to observe or perform in any material respect any other
of
the covenants or agreements on the part of the Servicer set forth in this
Agreement which continues unremedied for a period of 30 days; or
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(v)
failure
by the Servicer to maintain its license to do business or service residential
mortgage loans in any jurisdiction, if required by such jurisdiction, where
the
Mortgaged Properties are located; or
(vi)
a
decree
or order of a court or agency or supervisory authority having jurisdiction
for
the appointment of a conservator or receiver or liquidator in any insolvency,
readjustment of debt, including bankruptcy, marshaling of assets and liabilities
or similar proceedings, or for the winding-up or liquidation of its affairs,
shall have been entered against the Servicer and such decree or order shall
have
remained in force undischarged or unstayed for a period of 60 days;
or
(vii)
the
Servicer shall consent to the appointment of a conservator or receiver or
liquidator in any insolvency, readjustment of debt, marshaling of assets and
liabilities or similar proceedings of or relating to the Servicer or of or
relating to all or substantially all of its property; or
(viii)
the
Servicer shall admit in writing its inability to pay its debts generally as
they
become due, file a petition to take advantage of any applicable insolvency,
bankruptcy or reorganization statute, make an assignment for the benefit of
its
creditors, voluntarily suspend payment of its obligations or cease its normal
business operations for three Business Days; or
(ix)
the
Servicer ceases to meet the qualifications of a Xxxxxx Xxx or Xxxxxxx Mac
seller/servicer; or
(x)
the
Servicer attempts to assign the servicing of the Mortgage Loans or its right
to
servicing compensation hereunder or the Servicer attempts to sell or otherwise
dispose of all or substantially all of its property or assets or to assign
this
Agreement or the servicing responsibilities hereunder or to delegate its duties
hereunder or any portion thereof (to other than a third party in the case of
outsourcing routine tasks including, but not limited to, taxes, insurance,
property inspection, reconveyance, collection or brokering REO Property), in
each case without complying fully with the provisions of Section
7.03.
In
each
and every such case, so long as an event of default shall not have been
remedied, in addition to whatever rights the Seller, the Trustee or the Master
Servicer may have at law or equity to damages, including injunctive relief
and
specific performance, the Seller or the Master Servicer, by notice in writing
to
the Servicer, may terminate all the rights and obligations of the Servicer
under
this Agreement and in and to the servicing contract established hereby and
the
proceeds thereof.
Upon
receipt by the Servicer of such written notice, all authority and power of
the
Servicer under this Agreement, whether with respect to the Mortgage Loans or
otherwise, shall pass to and be vested in a successor Servicer appointed by
the
Seller and the Master Servicer. Upon written request from the Seller, the
Servicer shall prepare, execute and deliver to the successor entity designated
by the Seller any and all documents and other instruments, place in such
successor’s possession all Servicing Files relating to the Seller’s Mortgage
Loans, and do or cause to be done all other acts or things necessary or
appropriate to effect the purposes of such notice of termination, including
but
not limited to the transfer and endorsement or assignment of
-45-
the
Mortgage Loans and related documents, at the
Servicer’s sole expense. The Servicer shall cooperate with the Seller and the
Master Servicer and such successor in effecting the termination of the
Servicer’s responsibilities and rights hereunder, including without limitation,
the transfer to such successor for administration by it of all cash amounts
which shall at the time be credited by the Servicer to the Custodial Account
or
Escrow Account or thereafter received with respect to the Mortgage
Loans.
By
a
written notice, the Seller and the Master Servicer may waive any default by
the
Servicer in the performance of its obligations hereunder and its consequences.
Upon any waiver of a past default, such default shall cease to exist, and any
Event of Default arising therefrom shall be deemed to have been remedied for
every purpose of this Agreement. No such waiver shall extend to any subsequent
or other default or impair any right consequent thereon except to the extent
expressly so waived.
Upon
a
termination for cause pursuant to Section 8.01, all unreimbursed Servicing
Fees,
Servicing Advances and Monthly Advances still owing the Servicer shall be paid
by the Trust Fund as such amounts are received from the related Mortgage
Loans.
Section
8.02 Termination
Without Cause.
This
Agreement shall terminate upon: (i) the later of (a) the distribution of the
final payment or liquidation proceeds on the last Mortgage Loan to the Master
Servicer (or advances by the Servicer for the same), and (b) the disposition
of
all REO Property acquired upon foreclosure of the last Mortgage Loan and the
remittance of all funds due hereunder, (ii) mutual consent of the Servicer,
the
Seller (as owner of the servicing rights relating to the Mortgage Loans), the
Trustee and the Master Servicer in writing or (iii) at the sole discretion
of
the Seller (acting in its capacity as owner of the servicing rights relating
to
the Mortgage Loans). Any such termination pursuant to clause (iii) above shall
be with 30 days’ prior notice, in writing and delivered to the Trustee, the
Master Servicer and the Servicer by registered mail to the addresses set forth
in Section 9.03 of this Agreement (in the case of the Servicer) or in the Trust
Agreement (in the case of the Trustee or the Master Servicer). The Servicer
shall comply with the termination procedures set forth in Sections 7.03, 8.01
and 9.01 hereof. The Master Servicer or the Trustee shall have no right to
terminate the Servicer pursuant to this Section 8.02. In connection with a
termination by the Seller pursuant to clause (iii) of this Section 8.02, the
Servicer shall be reimbursed for all unreimbursed out-of-pocket Servicing
Advances, Monthly Advances and Servicing Fees and other reasonable and necessary
out-of-pocket costs associated with any transfer of servicing at the time of
such transfer of servicing. Any invoices received by the Servicer after
termination will be forwarded to the Seller or the successor servicer for
payment within thirty (30) days of receipt from the Servicer.
-46-
ARTICLE
IX.
MISCELLANEOUS
PROVISIONS
Section
9.01 Successor
to the Servicer.
Simultaneously
with the termination of the Servicer’s responsibilities and duties under this
Agreement (a) pursuant to Sections 6.02, 7.03, 8.01 or 8.02(ii), the Master
Servicer shall (i) succeed to and assume all of the Servicer’s responsibilities,
rights, duties and obligations under this Agreement, or (ii) appoint a successor
having the characteristics set forth in clauses (i) and (ii) of Section 7.01
and
which shall succeed to all rights and assume all of the responsibilities, duties
and liabilities of the Servicer under this Agreement simultaneously with the
termination of the Servicer’s responsibilities, duties and liabilities under
this Agreement; or (b) pursuant to a termination under Section 8.02(iii), the
Seller (as owner of the servicing rights relating to the Mortgage Loans) shall
appoint a successor having the characteristics set forth in clauses (i) and
(ii)
of Section 7.01 and which shall succeed to all rights and assume all of the
responsibilities, duties and liabilities of the Servicer under this Agreement
simultaneously with the termination of the Servicer’s responsibilities, duties
and liabilities under this Agreement (with respect to those related Mortgage
Loans). Any successor to the Servicer shall be subject to the approval of the
Master Servicer and, to the extent required by the Trust Agreement, the Trustee
and such successor, shall be a member in good standing of the MERS system (if
any of the Mortgage Loans are MERS Eligible Mortgage Loans, unless such Mortgage
Loans are withdrawn from MERS and Assignments of Mortgage are recorded in favor
of the Trustee at the expense of the successor Servicer). Any approval of a
successor servicer by the Master Servicer and, to the extent required by the
Trust Agreement, the Trustee, shall, if the successor servicer is not at that
time a servicer of other Mortgage Loans for the Trust Fund, be conditioned
upon
the receipt by the Master Servicer and the Trustee of a letter from each Rating
Agency to the effect that such transfer of servicing will not result in a
qualification, withdrawal or downgrade of the then-current rating of any of
the
Certificates. In connection with such appointment and assumption, the Master
Servicer or the Seller, as applicable, may make such arrangements for the
compensation of such successor out of payments on Mortgage Loans as it and
such
successor shall agree, provided,
however,
that no
such compensation shall be in excess of that permitted the Servicer under this
Agreement. In the event that the Servicer’s duties, responsibilities and
liabilities under this Agreement should be terminated pursuant to the
aforementioned sections, the Servicer shall discharge such duties and
responsibilities during the period from the date it acquires knowledge of such
termination until the effective date thereof with the same degree of diligence
and prudence which it is obligated to exercise under this Agreement, and shall
take no action whatsoever that might impair or prejudice the rights or financial
condition of its successor. The resignation or removal of the Servicer pursuant
to the aforementioned sections shall not become effective until a successor
shall be appointed pursuant to this Section 9.01 and shall in no event relieve
the Servicer of the representations and warranties made pursuant to Sections
6.01 and the remedies available to the Master Servicer and the Seller under
Section 6.02 and 6.03, it being understood and agreed that the provisions of
such Sections 6.01, 6.02 and 6.03 shall be applicable to the Servicer
notwithstanding any such resignation or termination of the Servicer, or the
termination of this Agreement. Neither the Master Servicer, in its capacity
as
successor servicer, nor any other successor servicer, shall be responsible
for
the lack of
-47-
information
and/or documents that are not transferred
to it by the Servicer and that it cannot otherwise obtain through reasonable
efforts.
Within
a
reasonable period of time, but in no event longer than 30 days of the
appointment of a successor entity, the Servicer shall prepare, execute and
deliver to the successor entity any and all documents and other instruments,
place in such successor’s possession all Servicing Files, and do or cause to be
done all other acts or things necessary or appropriate to effect the purposes
of
such notice of termination, including but not limited to the transfer and
endorsement of the Mortgage Notes and related documents, and the preparation
and
recordation of Assignments of Mortgage. The Servicer shall cooperate with the
Trustee, the Master Servicer or the Seller, as applicable, and such successor
in
effecting the termination of the Servicer’s responsibilities and rights
hereunder and the transfer of servicing responsibilities to the successor
Servicer, including without limitation, the transfer to such successor for
administration by it of all cash amounts which shall at the time be credited
by
the Servicer to the Custodial Account or Escrow Account or thereafter received
with respect to the Mortgage Loans. Notwithstanding anything to the contrary
set
forth herein, the Servicer shall not be prohibited from retaining copies of
the
Mortgage Loan documents, Servicing Files and other records related to the
Mortgage Loans as the Servicer reasonably deems necessary.
Any
successor appointed as provided herein shall execute, acknowledge and deliver
to
the Trustee, the Servicer, the Master Servicer and the Seller an instrument
(i)
accepting such appointment, wherein the successor shall make the representations
and warranties set forth in Section 6.01 (including a representation that the
successor Servicer is a member of MERS, unless none of the Mortgage Loans are
MERS Mortgage Loans or MERS Eligible Mortgage Loans or any such Mortgage Loans
have been withdrawn from MERS and Assignments of Mortgage are recorded in favor
of the Trustee) and provide for the same remedies set forth in Section 6.02,
6.03 and 6.04 herein and (ii) an assumption of the due and punctual performance
and observance of each covenant and condition to be performed and observed
by
the Servicer under this Agreement, whereupon such successor shall become fully
vested with all the rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer, with like effect as if originally named as a party
to this Agreement. Any termination or resignation of the Servicer or termination
of this Agreement pursuant to Sections 6.02, 7.03, 8.01 or 8.02 shall not affect
any claims that the Master Servicer or the Trustee may have against the Servicer
arising out of the Servicer’s actions or failure to act prior to any such
termination or resignation. In addition, in the event any successor servicer
is
appointed pursuant to Section 8.02(iii) of this Agreement, such successor
servicer must satisfy the conditions relating to the transfer of servicing
set
forth in the Trust Agreement.
The
Servicer shall deliver promptly to the successor servicer the funds in the
Custodial Account and Escrow Account (and any funds thereafter received by
it
with respect to the Mortgage Loans) and all Mortgage Loan documents and related
documents and statements held by it hereunder and the Servicer shall account
for
all funds and shall execute and deliver such instruments and do such other
things as may reasonably be required to more fully and definitively vest in
the
successor all such rights, powers, duties, responsibilities, obligations and
liabilities of the Servicer.
-48-
Upon
a
successor’s acceptance of appointment as such, the Servicer shall notify the
Depositor, the Trustee, the Seller and Master Servicer of such appointment
in
accordance with the procedures set forth in Section 9.03.
Section
9.02 Costs.
Xxxxxx
Holdings shall pay the legal fees and expenses of its attorneys. Costs and
expenses incurred in connection with the transfer of the servicing
responsibilities, including fees for delivering Servicing Files, shall be paid
by Xxxxxx Holdings. Subject to Sections 2.02 and 3.01(a), the Depositor shall
pay the costs associated with the preparation, delivery and recording of
Assignments of Mortgages.
Section
9.03 Notices.
All
demands, notices and communications hereunder shall be in writing and shall
be
effective: (a) upon delivery by hand or facsimile; (b) one day after being
deposited with a nationally recognized overnight delivery service; (c) three
days after being deposited in the United
States mail, first-class, postage prepaid, registered or certified, return
receipt requested--in each case addressed to such party as follows (or to such
other address as hereafter may be designated in writing by such Party to the
other Party):
(i) if
to the
Seller:
Xxxxxx
Brothers Holdings Inc.
000
Xxxxxxx Xxxxxx, 00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Attention:
Contract Finance (LXS 0000-00X)
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
with
a
copy to:
Dechert
LLP
0000
Xxxx
Xxxxxx
Xxxxxxxxxxxx,
Xxxxxxxxxxxx 00000-0000
Attention:
Xxxxxx X. Xxxxxxx, Esq.
(ii) if
to the
Servicer:
Aurora
Loan Services LLC
00000
Xxxx Xxxxxxx Xxxxx
Xxxxxxxxx,
Xxxxxxxx 00000
Attention:
Xxx Xxxxxx (LXS 0000-00X)
Telephone:
(000) 000-0000
Facsimile:
(000) 000-0000
with
a
copy to:
-49-
Aurora
Loan Services LLC
0000
Xxxxxxx Xxxx
Xxxxxxxxxxx,
Xxxxxxxx 00000
Attention:
Manager, Loan Administration, LXS 0000-00X
Telephone
No.: (000) 000-0000
Telecopier
No.: (000) 000-0000
(iii) if
to the
Master Servicer:
Aurora
Loan Services LLC
00000
Xxxx Xxxxxxx Xxxxx
Xxxxxxxxx,
Xxxxxxxx 00000
Attention:
Xxxxxxx Xxxx, Master Servicing, LXS 0000-00X
Telephone:
(000) 000-0000
Telecopier:
(000) 000-0000
(iv) if
to the
Trust Fund or the Trustee:
U.S.
Bank
National Association
Xxx
Xxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxx,
Xxxxxxxxxxxxx 00000
Attention:
Structured Finance - LXS 2007-20N
(v) if
to the
Depositor:
Structured
Asset Securities Corporation
000
Xxxxxxx Xxxxxx
00xx
Xxxxx
Xxx
Xxxx,
Xxx Xxxx 00000
Any
such
demand, notice or communication hereunder shall be deemed to have been received
on the date delivered to or received at the premises of the addressee.
Notwithstanding anything to the contrary in this Agreement, the Servicer shall
not be obligated to provide notices pursuant to this Agreement to any NIMS
Insurer or any other party whose address is not provided in this Section 9.03
until 30 days after the Servicer has received notice of the appointment of
such
NIMS Insurer or such other party (including the name, address, telephone number
and facsimile number of such party).
Section
9.04 Severability
Clause.
Any
part,
provision, representation or warranty of this Agreement which is prohibited
or
which is held to be void or unenforceable shall be ineffective to the extent
of
such prohibition or unenforceability without invalidating the remaining
provisions hereof. Any part, provision, representation or warranty of this
Agreement which is prohibited or unenforceable or is held to be void or
unenforceable in any jurisdiction shall be ineffective, as to such jurisdiction,
to the extent of such prohibition or unenforceability without invalidating
the
remaining provisions hereof, and any such prohibition or unenforceability in
any
jurisdiction as to any Mortgage Loan
-50-
shall
not invalidate or render unenforceable such
provision in any other jurisdiction. To the extent permitted by applicable
law,
the parties hereto waive any provision of law which prohibits or renders void
or
unenforceable any provision hereof. If the invalidity of any part, provision,
representation or warranty of this Agreement shall deprive any party of the
economic benefit intended to be conferred by this Agreement, the parties shall
negotiate, in good-faith, to develop a structure the economic effect of which
is
as close as possible to the economic effect of this Agreement without regard
to
such invalidity.
Section
9.05 No
Personal Solicitation.
From
and
after the Closing Date, the Servicer hereby agrees that it will not take any
action or permit or cause any action to be taken by any of its agents or
affiliates, or by any independent contractors on the Servicer’s behalf, to
personally, by telephone or mail, solicit the borrower or obligor under any
Mortgage Loan (on a targeted basis) for any purposes of prepayment, refinancing
or modification of the related Mortgage Loan, provided,
however,
that
this limitation shall not prohibit the Servicer from soliciting such Mortgagor
for purposes of prepayment, refinance or modification of any loan owned or
serviced by the Servicer other than a Mortgage Loan. Notwithstanding the
foregoing, it is understood and agreed that, among other marketing activities,
promotions and solicitations (including, without limitation, those for purposes
of prepayment, refinance or modification) undertaken by the Servicer which
are
directed to the general public at large or which are directed generally to
a
segment of the then existing customers of the Servicer or any of its affiliates
(including, without limitation, the mailing of promotional materials to the
Servicer’s or its affiliates’ deposit customers by inserting such materials into
customer account statements, billing statements and coupon books, mass mailings
based on commercially acquired mailing lists and newspaper, radio and television
advertisements, solicitations included on the Servicer’s website and voice
response system and solicitations made on the basis of information acquired
by
the Servicer or its affiliates that indicates that a borrower may be planning
to
refinance) shall not constitute solicitation under this section. In the event
the Servicer does refinance any Mortgage Loan as a result of a violation of
the
requirements set forth in this Section 9.05, the Servicer hereby agrees to
pay
to the Trust Fund an amount equal to the difference, if any, between the amount
that the Trust Fund would have received if it had sold the Mortgage Loan to
a
third party, and the proceeds received by the Trust Fund as a result of such
refinancing.
Section
9.06 Counterparts.
This
Agreement may be executed simultaneously in any number of counterparts. Each
counterpart shall be deemed to be an original, and all such counterparts shall
constitute one and the same instrument.
Section
9.07 Place
of Delivery and Governing Law.
This
Agreement shall be deemed in effect when a fully executed counterpart thereof
is
received by the Seller in the State of New York and shall be deemed to have
been
made in the State of New York. THIS
AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE
STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER
THAN SECTION 5-1401
-51-
OF
THE GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS,
RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE
WITH SUCH LAWS.
Section
9.08 Further
Agreements.
The
Seller and the Servicer each agree to execute and deliver to the other such
reasonable and appropriate additional documents, instruments or agreements
as
may be necessary or appropriate to effectuate the purposes of this
Agreement.
Section
9.09 Intention
of the Parties.
It
is the
intention of the parties that the Seller is conveying, and the Servicer is
receiving only a contract for servicing the Mortgage Loans. Accordingly, the
parties hereby acknowledge that the Trust Fund remains the sole and absolute
owner of the Mortgage Loans and all rights (other than the servicing rights)
related thereto.
Section
9.10 Successors
and Assigns; Assignment of Servicing Agreement.
This
Agreement shall bind and inure to the benefit of and be enforceable by the
Servicer, the Seller, the Trustee and the Master Servicer and their respective
successors and assigns. This Agreement shall not be assigned, pledged or
hypothecated by the Servicer to a third party except in accordance with Section
7.03.
Section
9.11 Assignment
by the Seller.
The
Seller shall have the right, upon notice to but without the consent of the
Servicer, to assign, in whole or in part, its interest under this Agreement
to
the Depositor, which in turn shall assign such rights to the Trustee, and the
Trustee then shall succeed to all rights of the Seller under this Agreement.
All
references to the Seller in this Agreement shall be deemed to include its
assignee or designee and any subsequent assignee or designee, specifically
including the Trustee, except with respect to the Seller’s retained servicing
rights pursuant to Section 8.02(iii).
The
Seller shall have the right, upon notice to but without the consent of the
Servicer or the Trustee, to assign, in whole or in part, its retained servicing
rights. All references to the Seller in this Agreement, in its capacity as
an
owner of servicing rights, shall be deemed to include the assignee or designee
and any subsequent assignee or designee, of the Seller’s rights arising pursuant
to Section 8.02(iii).
Section
9.12 Amendment.
This
Agreement may be amended from time to time by the mutual written agreement
signed by the Master Servicer, the Seller and the Servicer; provided
that the
party requesting such amendment shall, at its own expense, provide the Trustee,
the Master Servicer and the Seller with an Opinion of Counsel that such
amendment will not materially adversely affect the interest of the
Certificateholders in the Mortgage Loans; provided
further
that
notice shall be provided to each Rating Agency prior to any amendment to the
loan modification provisions set forth in Section 3.01. Any such amendment
shall
be deemed not to adversely affect in any
-52-
material
respect any the interest of the
Certificateholders in the Mortgage Loans, if the Trustee receives written
confirmation from each Rating Agency that such amendment will not cause such
Rating Agency to reduce, qualify or withdraw the then current rating assigned
to
the Certificates (and any Opinion of Counsel requested by the Trustee, the
Master Servicer and the Seller in connection with any such amendment may rely
expressly on such confirmation as the basis therefor).
Section
9.13 Waivers.
No
term
or provision of this Agreement may be waived or modified unless such waiver
or
modification is in writing and signed by the party against whom such waiver
or
modification is sought to be enforced.
Section
9.14 Exhibits.
The
exhibits to this Agreement are hereby incorporated and made a part hereof and
are an integral part of this Agreement.
Section
9.15 General
Interpretive Principles.
For
purposes of this Agreement, except as otherwise expressly provided or unless
the
context otherwise requires:
(a)
the
terms
defined in this Agreement have the meanings assigned to them in this Agreement
and include the plural as well as the singular, and the use of any gender herein
shall be deemed to include the other gender;
(b)
accounting
terms not otherwise defined herein have the meanings assigned to them in
accordance with generally accepted accounting principles;
(c)
references
herein to “Articles,” “Sections,” “Subsections,” “Paragraphs” and other
subdivisions without reference to a document are to designated Articles,
Sections, Subsections, Paragraphs and other subdivisions of this
Agreement;
(d)
a
reference to a Subsection without further reference to a Section is a reference
to such Subsection as contained in the same Section in which the reference
appears, and this rule shall also apply to Paragraphs and other
subdivisions;
(e)
the
words
“herein,” “hereof,” “hereunder” and other words of similar import refer to this
Agreement as a whole and not to any particular provision; and
(f)
the
term
“include” or “including” shall mean by reason of enumeration.
Section
9.16 Intended
Third Party Beneficiaries.
Notwithstanding
any provision herein to the contrary, the parties to this Agreement agree that
it is appropriate, in furtherance of the intent of such parties as set forth
herein, that the Trustee, the Depositor and the NIMS Insurer receive the benefit
of the provisions of this
-53-
Agreement
as intended third party beneficiaries of
this Agreement to the extent of such provisions. The Servicer shall have the
same obligations to the Trustee, the Depositor and the NIMS Insurer as if they
were parties to this Agreement, and the Trustee (acting through the Master
Servicer), the Depositor and the NIMS Insurer shall have the same rights and
remedies to enforce the provisions of this Agreement as if they were parties
to
this Agreement. The Servicer shall only take direction from the Master Servicer
(if direction by the Master Servicer is required under this Agreement) unless
otherwise directed by this Agreement or the Credit Risk Management Agreement.
Notwithstanding the foregoing, all rights of the Trustee and the Depositor
hereunder (other than the right to indemnification) and all rights and
obligations of the Master Servicer and the Servicer hereunder (other than the
right to indemnification) shall terminate upon the termination of the Trust
Fund
pursuant to the Trust Agreement and all rights of the NIMS Insurer set forth
in
this Agreement (other than the right of indemnification) shall exist only so
long as the NIM Securities remain outstanding or the NIMS Insurer is owed
amounts in respect of its guarantee of payment on such NIM
Securities.
Section
9.17 Reproduction
of Documents.
This
Agreement and all documents relating thereto, including, without limitation,
(i)
consents, waivers and modifications which may hereafter be executed, (ii)
documents received by any party at the closing, and (iii) financial statements,
certificates and other information previously or hereafter furnished, may be
reproduced by any photographic, photostatic, microfilm, micro-card, miniature
photographic or other similar process. The parties agree that any such
reproduction shall be admissible in evidence as the original itself in any
judicial or administrative proceeding, whether or not the original is in
existence and whether or not such reproduction was made by a party in the
regular course of business, and that any enlargement, facsimile or further
reproduction of such reproduction shall likewise be admissible in
evidence.
Section
9.18 Protection
of Confidential Information.
The
Servicer shall keep confidential and shall not divulge to any party, without
the
Seller’s prior written consent, any nonpublic information pertaining to the
Mortgage Loans or any borrower thereunder, except to the extent that it is
appropriate for the Servicer to do so in working with legal counsel, auditors,
taxing authorities or other governmental agencies or it is otherwise in
accordance with Accepted Servicing Practices.
-54-
IN
WITNESS WHEREOF, the Servicer, the Seller and the Master Servicer have caused
their names to be signed hereto by their respective officers thereunto duly
authorized as of the date first above written.
|
XXXXXX
BROTHERS HOLDINGS INC.,
as
Seller
|
||
| |
|
|
| By: | ||
|
Name: Xxxxxxx Xxxxxxxx |
||
| Title: Authorized Signatory | ||
|
AURORA
LOAN SERVICES LLC,
as
Servicer
|
||
| |
|
|
| By: | ||
|
Name: Xxxxx X. Xxxxxx |
||
| Title: Assistant Vice President | ||
|
AURORA
LOAN SERVICES LLC,
as
Master Servicer
|
||
| |
|
|
| By: | ||
|
Name: Xxxxxxx Xxxx |
||
| Title: Vice President | ||
Acknowledged
By:
U.S.
BANK
NATIONAL ASSOCIATION
as
Trustee and not individually
By:
Title:
EXHIBIT
A
MORTGAGE
LOAN SCHEDULE
[INTENTIONALLY
OMITTED]
EXHIBIT
B
CUSTODIAL
ACCOUNT CERTIFICATION NOTICE
_________,
2007
To:
Owner/Trustee/Master
Servicer
Street
Address
As
Servicer under the Servicing Agreement, dated as of [month/date/year] among
Aurora Loan Services LLC, as Servicer, [Seller name], as Seller and you, as
Master Servicer (the “Agreement”), we hereby certify to you that we have
established an account at [insert name of financial institution], as a Custodial
Account pursuant to Section [section number] of the Agreement, to be designated
as “Aurora Loan Services LLC, in trust for [account name]. All deposits in the
account shall be subject to withdrawal therefrom by order signed by the
Servicer.
|
AURORA
LOAN SERVICES LLC
|
||
| |
|
|
| By: | ||
|
Name:
|
||
|
Title:
|
||
B-1
EXHIBIT
C
ESCROW
ACCOUNT CERTIFICATION NOTICE
_________,
2007
To:
Owner/Trustee/Master
Servicer
Street
Address
As
Servicer under the Servicing Agreement, dated as of [month/date/year] among
Aurora Loan Services LLC, as Servicer, [Seller name]., as Seller and you, as
Master Servicer (the “Agreement”), we hereby certify to you that we have
established an account at [insert name of financial institution], as an Escrow
Account pursuant to Section [section number] of the Agreement, to be designated
as “Aurora Loan Services LLC, in trust for [account name]. All deposits in the
account shall be subject to withdrawal therefrom by order signed by the
Servicer.
|
AURORA
LOAN SERVICES LLC
|
||
| |
|
|
| By: | ||
|
Name:
|
||
|
Title:
|
||
X-0
XXXXXXX
X-0
FORM
OF
MONTHLY REMITTANCE ADVICE
|
FIELD
NAME
|
DESCRIPTION
|
FORMAT
|
|
INVNUM
|
INVESTOR
LOAN NUMBER
|
Number
no decimals
|
|
SERVNUM
|
SERVICER
LOAN NUMBER, REQUIRED
|
Number
no decimals
|
|
BEGSCHEDBAL
|
BEGINNING
SCHEDULED BALANCE FOR SCHED/SCHED
|
Number
two decimals
|
|
BEGINNING
TRAIL BALANCE FOR ACTUAL/ACTUAL,
|
||
|
REQUIRED
|
||
|
SCHEDPRIN
|
SCHEDULED
PRINCIPAL AMOUNT FOR SCHEDULED/SCHEDULED
|
Number
two decimals
|
|
ACTUAL
PRINCIPAL COLLECTED FOR ACTUAL/ACTUAL,
|
||
|
REQUIRED,
.00 IF NO COLLECTIONS
|
||
|
CURT1
|
CURTAILMENT
1 XXXXXX, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
CURT1DATE
|
CURTAILMENT
1 DATE, BLANK IF NOT APPLICABLE
|
DD-MMM-YY
|
|
CURT1ADJ
|
CURTAILMENT
1 ADJUSTMENT, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
CURT2
|
CURTAILMENT
2 XXXXXX, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
CURT2DATE
|
CURTAILMENT
2 DATE, BLANK IF NOT APPLICABLE
|
DD-MMM-YY
|
|
CURT2ADJ
|
CURTAILMENT
2 ADJUSTMENT, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
LIQPRIN
|
PAYOFF,
LIQUIDATION PRINCIPAL, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
OTHPRIN
|
OTHER
PRINCIPAL, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
PRINREMIT
|
TOTAL
PRINCIPAL REMITTANCE AMOUNT, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
INTREMIT
|
NET
INTEREST REMIT, INCLUDE PAYOFF INTEREST,
|
Number
two decimals
|
|
.00
IF NOT APPLICABLE
|
||
|
TOTREMIT
|
TOTAL
REMITTANCE AMOUNT, .00 IF NOT APPLICABLE
|
Number
two decimals
|
|
ENDSCHEDBAL
|
ENDING
SCHEDULED BALANCE FOR SCHEDULED/SCHEDULED
|
Number
two decimals
|
|
ENDING
TRIAL BALANCE FOR ACTUAL/ACTUAL
|
||
|
.00
IF PAIDOFF, LIQUIDATED OR FULL CHARGEOFF
|
||
|
ENDACTBAL
|
ENDING
TRIAL BALANCE
|
Number
two decimals
|
|
.00
IF PAIDOFF, LIQUIDATED OR FULL CHARGEOFF
|
||
|
ENDDUEDATE
|
ENDING
ACTUAL DUE DATE, NOT LAST PAID INSTALLMENT
|
DD-MMM-YY
|
|
ACTCODE
|
60
IF PAIDOFF, BLANK IF NOT APPLICABLE
|
Number
no decimals
|
|
ACTDATE
|
ACTUAL
PAYOFF DATE, BLANK IF NOT APPLICABLE
|
DD-MMM-YY
|
|
INTRATE
|
INTEREST
RATE, REQUIRED
|
Number
seven decimals
|
|
Example
.0700000 for 7.00%
|
||
|
SFRATE
|
SERVICE
FEE RATE, REQUIRED
|
Number
seven decimals
|
|
Example
.0025000 for .25%
|
||
|
PTRATE
|
PASS
THRU RATE, REQUIRED
|
Number
seven decimals
|
|
Example
.0675000 for 6.75%
|
||
|
PIPMT
|
P&I
CONSTANT, REQUIRED
|
Number
two decimals
|
|
.00
IF PAIDOFF
|
X-0-0
XXXXXXX
X-0
XXXXXXXX
XXXXXX FOR MONTHLY DEFAULTED LOAN REPORT
|
A
|
Servicer
loan number
|
VARCHAR2(15)
|
Individual
number that uniquely identifies loan as defined by
servicer.
|
|
B
|
Loan
type
|
VARCHAR2(2)
1=FHA
Residential
2=VA
Residential
3=Conventional
w/o PMI
4=Commercial
5=FHA
Project
6=Conventional
w/PMI
7=HUD
235/265
9=Farm
Loan
|
Type
of loan being serviced generally defined by the existence of
certain types
of insurance. (ie: FHA, VA, conventional insured, conventional
uninsured,
SBA, etc.)
|
|
C
|
Actual
due date
|
DATE(MM/DD/YYYY)
|
Actual
due date of the next outstanding payment amount due from the
mortgagor.
|
|
D
|
Delinquency
flag
|
VARCHAR2(2)
Y=
90+ delinq. Not in FC, Bky
or
Loss mit
N=Less
than 90 days
delinquent
|
Servicer
defined indicator that identifies that the loan is delinquent
but is not
involved in loss mitigation, foreclosure, bankruptcy or
REO.
|
|
E
|
Foreclosure
flag
|
VARCHAR2(2)
Y=Active
foreclosure
N=No
active foreclosure
|
Servicer
defined indicator that identifies that the loan is involved in
foreclosure
proceedings.
|
|
F
|
Bankruptcy
flag
|
VARCHAR2(2)
Y=Active
Bankruptcy
N=No
Active Bankruptcy
|
Servicer
defined indicator that identifies that the property is an asset
in an
active bankruptcy case.
|
|
G
|
Loss
mit flag
|
VARCHAR2(2)
Y=
Active loss mitigation
N=No
active loss mitigation
|
Servicer
defined indicator that identifies that the loan is involved in
completing
a loss mitigation alternative.
|
|
H
|
Post
Foreclosure Flag
|
R=REO
C=Claims
T=Third
Party
N=
No FC sale held
|
Servicer
defined indicator that identifies that the property is in REO/Claims
or
went to a Third Party at FC sale
|
|
I
|
Foreclosure
attorney referral date
|
DATE(MM/DD/YYYY)
|
Actual
date that the loan was referred to local counsel to begin foreclosure
proceedings.
|
|
J
|
Actual
first legal date
|
DATE(MM/DD/YYYY)
|
Actual
date that foreclosure counsel filed the first legal action as
defined by
state statute.
|
D-2-1
|
K
|
Date
FC sale scheduled
|
DATE(MM/DD/YYYY)
|
Date
that the foreclosure sale is either project or scheduled to be
held.
|
|
L
|
Foreclosure
actual sale held date
|
DATE(MM/DD/YYYY)
|
Actual
date that the foreclosure sale was held.
|
|
M
|
3rd
Party Sale
|
VARCHAR2(7)
Y=
Sold to a 3rd Party at FC sale
N=
Sold back to noteholder at
FC
sale
|
Servicer
defined indicator that idenities that the loan was sold to a
3rd Party at
Foreclosure Sale
|
|
N
|
Bankruptcy
filed date
|
DATE(MM/DD/YYYY)
|
Actual
date that the bankruptcy petition is filed with the
court.
|
|
O
|
Bankruptcy
chapter
|
VARCHAR2(2)
7=
Chapter 7 filed
11=
Chapter 11 filed
12=
Chapter 12 filed
13=
Chapter 13 filed
|
Chapter
of bankruptcy filed.
|
|
P
|
Post
petition due date
|
DATE(MM/DD/YYYY)
|
The
post petition due date of a loan involved in a chapter 13
bankruptcy.
|
|
Q
|
Pre
and Post Payments paid by trustee
|
VARCHAR2(2)
Y=Trustee
Pays both
N=No
Trustee only pays Pre
Payments
|
To
identify if the trustee makes the pre and post petition payments
throughout the Bankruptcy.
|
|
R
|
Bankruptcy
discharge date
|
DATE(MM/DD/YYYY)
|
Actual
date that the Discharge Order is entered in the bankruptcy
docket.
|
|
S
|
BK
Relief/Dismissal Granted date
|
DATE(MM/DD/YYYY)
|
Actual
date that the dismissal or relief from stay order is entered
by the
bankruptcy court.
|
|
T
|
Loss
mit approval date
|
DATE(MM/DD/YYYY)
|
The
date determined that the servicer and mortgagor agree to pursue
a defined
loss mitigation alternative.
|
|
U
|
Loss
mit type
|
VARCHAR2(2)
CH=
Charge off
DI=
Deed in lieu
FB=
Forbearance plan/repay
MO=Modification
PC=Partial
claim
SH=Short
sale
VA=VA
refunding
SL=
Solication of Loss Mit
|
The
defined loss mitigation alternative identified on the loss mit
approval
date.
|
|
V
|
Repay
first due date
|
DATE(MM/DD/YYYY)
|
The
due date of the first scheduled payment due under a forbearance
or
repayment plan agreed to by both the mortgagor and
servicer.
|
D-2-2
|
W
|
Repay
next due date
|
DATE(MM/DD/YYYY)
|
The
due date of the next outstanding payment due under a forbearance
or
repayment plan agreed to by both the mortgagor and servicer.
|
|
X
|
REO
original list date
|
DATE(MM/DD/YYYY)
|
The
initial/first date that the property was listed with an agent
as an
REO.
|
|
Y
|
REO
original list price
|
NUMBER(15,2)
|
The
initial/first price that was used to list the property with an
agent as an
REO.
|
|
Z
|
REO
current list price
|
NUMBER(15,2)
|
The
current list price of the REO
|
|
AA
|
REO
sales price
|
NUMBER(10,2)
|
The
actual REO sales price
|
|
AB
|
REO
offer accepted
|
DATE(MM/DD/YYYY)
|
The
actual date that the REO offer was accepted.
|
|
AC
|
REO
actual closing date
|
DATE(MM/DD/YYYY)
|
The
actual date that the sale of the REO property closed
escrow.
|
|
AD
|
REO
net proceeds received
|
NUMBER(10,2)
|
The
actual REO sales price less closing costs paid. The net sales
proceeds are
identified within the HUD1 settlement statement.
|
|
AE
|
Eviction
start date
|
DATE(MM/DD/YYYY)
|
Actual
date that the eviction proceedings are commenced by local
counsel.
|
|
AF
|
Eviction
complete date
|
DATE(MM/DD/YYYY)
|
Actual
date that the eviction proceedings are completed by local
counsel.
|
|
AG
|
MI
claim filed date
|
DATE(MM/DD/YYYY)
|
Actual
date that the claim was submitted to the PMI company.
|
|
AH
|
MI
claim amount filed
|
NUMBER(15,2)
|
The
amount of the claim that was filed by the servicer with the PMI
company.
|
|
AI
|
MI
claim funds received date
|
DATE(MM/DD/YYYY)
|
Actual
date that funds were received from the PMI company as a result
of
transmitting an MI claim.
|
|
AJ
|
MI
claim amount paid
|
NUMBER(15,2)
|
The
amount of the claim that the MI company paid.
|
|
AK
|
MI
Interest Paid to Date
|
DATE
(MM/DD/YYYY)
|
The
date through which MI paid interest
|
|
AL
|
Clear
Title Date
|
DATE
(MM/DD/YYYY)
|
Actual
date that the property became marketable.
|
|
AM
|
FHA
27011A transmitted date
|
DATE(MM/DD/YYYY)
|
Actual
date that the FHA 27011A claim was submitted to
HUD.
|
D-2-3
|
AN
|
FHA
Part A funds received date
|
DATE(MM/DD/YYYY)
|
Actual
date that funds were received from HUD as a result of transmitting
the
27011A claim.
|
|
AO
|
FHA
27011 B transmitted date
|
DATE(MM/DD/YYYY)
|
Actual
date that the FHA 27011B claim was submitted to HUD.
|
|
AP
|
FHA
Part B Funds Received Date
|
DATE(MM/DD/YYYY)
|
|
|
AQ
|
VA
XXX submitted date
|
DATE(MM/DD/YYYY)
|
Actual
date that the Notice of Election to Convey was submitted to the
VA.
|
|
AR
|
VA
first funds received date
|
DATE(MM/DD/YYYY)
|
The
date that the funds from the specified bid were received by the
servicer
from the VA.
|
|
AS
|
VA
first funds received amount
|
NUMBER(15,2)
|
The
amount of funds received by the servicer from VA as a result
of the
specified bid.
|
|
AT
|
Title
approval letter received date
|
DATE(MM/DD/YYYY)
|
The
actual date that the title approval was received as set forth
in the HUD
title approval letter.
|
|
AU
|
VA
claim submitted date
|
DATE(MM/DD/YYYY)
|
The
actual date that the expense claim was submitted by the servicer
to the
VA.
|
|
AV
|
VA
claim funds received date
|
DATE(MM/DD/YYYY)
|
The
actual date that funds were received by the servicer from the
VA for the
expense claim submitted by the servicer.
|
|
AW
|
VA
Claim funds received amount
|
NUMBER(15,2)
|
The
amount of funds received by the servicer from VA as a result
of the
specified bid.
|
|
AX
|
Current
Value
|
NUMBER(10,2)
|
The
most recent value of the property.
|
|
AY
|
Current
Value Source
|
VARCHAR2(15)
BPO=
Broker's Price Opinion
Appraisal=Appraisal
Blank
= Assumed BPO if
Value
and Date reported
|
Name
of vendor or management company that provided the
value.
|
|
AZ
|
Current
Value date
|
DATE(MM/DD/YYYY)
|
The
most recent value date of the property.
|
|
BA
|
Current
Occupancy status
|
VARCHAR2(1)
O=Owner
occupied
T=Tenant
occupied
U=Unknown
V=Vacant
|
The
most recent status of the property regarding who if anyone is
occupying
the property. Typically a result of a routine property
inspection.
|
D-2-4
|
BB
|
Date
of last property inspection
|
DATE(MM/DD/YYYY
)
|
The
date of the most recent property inspection
|
|
BC
|
Property
condition
|
VARCHAR2(2)
1=
Excellent
2=Good
3=Average
4=Fair
5=Poor
6=Very
poor
|
Physical
condition of the property as most recently reported to the servicer
by
vendor or property management company.
|
|
BD
|
Reason
for default
|
VARCHAR2(3)
001=Death
of principal mtgr
002=Illness
of principal mtgr
003=Illness
of mtgr's family
member
004=Death
of mtgr's family
member
005=Marital
difficulties
006=Curtailment
of income
007=Excessive
obligations
008=Abandonment
of
property
009=Distant
employee
transfer
011=Property
problem/Natural
Disaster
012=Inability
to sell property
013=Inability
to rent property
014=Military
service
015=Other
016=Unemployment
017=Business
failure
019=Casualty
loss
022=Energy-Environment
costs
023=
Servicing problems
026=
Payment adjustment
027=Payment
dispute
029=Transfer
ownership
pending
030=Fraud
031=Unable
to contact
borrower
INC=Incarceration
|
Cause
of delinquency as identified by mortgagor. (Standard FNMA Reasons
for
Default)
|
|
BE
|
Corporate
expense balance
|
NUMBER(10,2)
|
Total
of all cumulative expenses advanced by the servicer for non-escrow
expenses such as but not limited to: FC fees and costs, bankruptcy
fees
and costs, property preservation and property
inspections.
|
D-2-5
|
BF
|
Escrow
balance
|
NUMBER(10,2)
|
The
positive or negative account balance that is dedicated to payment
of
hazard insurance, property taxes, MI, etc. (escrow items
only)
|
|
BG
|
Escrow
advance balance
|
NUMBER(10,2)
|
The
positive or negative account balance that is dedicated to payment
of
hazard insurance, property taxes, MI, etc. (escrow items
only)
|
|
BH
|
Suspense
balance
|
NUMBER(10,2)
|
Money
submitted to the servicer, credited to the mortgagor's account
but not
allocated to principal, interest, escrow, etc.
|
|
BI
|
Restricted
escrow balance
|
NUMBER(10,2)
|
Money
held in escrow by the mortgage company through completion of
repairs to
property.
|
|
BJ
|
VA
LGC/ FHA Case number
|
VARCHAR2(15)
|
Number
that is assigned individually to the loan by either HUD or VA
at the time
of origination. The number is located on the Loan Guarantee Certificate
(LGC) or the Mortgage Insurance Certificate (MIC).
|
|
BK
|
Senior
Lien Balance
|
NUMBER(10,2)
|
Current
Principal Balance on First lien or Original Principal Balance
|
|
BL
|
Litigation
in process
|
VARCHAR2(7)
Y=Active
N=No
active
|
Any
delinquent loan that is not able to be Foreclosed on or the REO
is not
marketable
|
|
BM
|
Loan
Liquidated
|
VARCHAR2
CH-Charge
off
SS-Short
sale
REO-REO
VA-VA
Refunding
|
Type
of liquidation within the last 30 days.
|
|
BN
|
Date
of Liquidation
|
DATE(MM/DD/YYYY)
|
Date
the CH, SS, REO or VA was liquidation off of servicer
system.
|
|
BO
|
Bankruptcy
Loss
|
NUMBER(10,2)
|
Cramdown
amount associated with the
|
|
BP
|
%
of MI coverage
|
NUMBER(6,5)
|
%
of Coverage of MI
|
|
BQ
|
MI
Carrier
|
Name
of the MI Company
|
|
|
BR
|
MI
Certification Number
|
VARCHAR2(15)
|
MI
Cerftificaiton Number
|
|
BS
|
%
of Pool MI Coverage
|
NUMBER(6,5)
|
|
D-2-6
|
BT
|
Pool
MI Carrier
|
|
|
|
BU
|
Pool
MI Certification Number
|
VARCHAR2(15)
|
|
|
BV
|
VA
Interest Cutoff Date
|
DATE(MM/DD/YYYY)
|
The
date in which VA has determine the Cut off date
|
|
BW
|
Investor
number
|
NUMBER
(10,2)
|
Unique
number assigned to a group of loans in the servicing system.
|
|
BX
|
Estimated
(Loss)/Gain
|
NUMBER
(10,2)
|
The
projected loss at REO
|
D-2-7
EXHIBIT
D-3
FORM
OF
MODIFIED LOAN REPORT
|
Data
Reporting Field
|
Description
|
|
1.
Modified Beginning Balance
|
Beginning
balance owed by the borrower as of the Modification Effective
Date.
|
|
2.
Modification Effective Date
|
Date
on which the loan modification becomes effective.
|
|
3.
Ending Actual Balance
|
Actual
outstanding principal balance as of the monthly cutoff
date.
|
|
4.
Ending Scheduled Balance
|
Scheduled
principal balance as of the monthly cutoff date.
|
|
5.
Total Capitalized Amount
|
Total
amount owing under the loan and added to the Ending Actual
Balance.
|
|
6.
Pre-Modification Interest Rate
|
Interest
rate of the loan immediately preceding the Modification Effective
Date.
|
|
7.
Post-Modification Interest Rate
|
Interest
rate of the loan as of the Modification Effective Date.
|
|
8.
Pre-Modification P&I Payment
|
Total
principal and interest payment amount preceding the Modification
Effective
Date.
|
|
9.
Post-Modification P&I Payment
|
Total
principal and interest payment amount as of the Modification
Effective
Date.
|
|
10.
Pre-Modification Maturity Date
|
Original
maturity date of the loan. (If there is more than one modification
over
the life of the loan, subsequent “pre-modification maturity date” would
reflect the value immediately preceding the most recent Modification
Effective Date reported.)
|
|
11.
Post-Modification Maturity Date
|
Maturity
date of the loan as of the Modification Effective Date.
|
|
12.
Pre-Modification Interest Reset Period*
|
Original
duration of the interest reset period of the loan.
|
|
13.
Post- Modification Interest Reset Period*
|
Duration
of the Interest Reset Period of the loan as of the Modification
Effective
Date.
|
D-3-1
|
14.
Pre-Modification Initial Reset Date*
|
First
interest reset date under the original terms of the
loan.
|
|
15.
Post-Modification Initial Reset Date, and Next Reset Date*
|
Initial
Reset Date as of the Modification Effective Date, and the subsequent
reset
date.
|
|
16.
Fixed to ARM (Y/N)
|
Change
in loan status from fixed rate to ARM.
|
|
17.
ARM to Fixed (Y/N)
|
Change
in loan status from ARM to fixed rate.
|
|
18.
IO to Fully Amortizing (Y/N)
|
Change
in loan status from IO to fully amortizing.
|
|
19.
Fully Amortizing to IO (Y/N)
|
Change
in loan status from fully amortizing to IO.
|
|
20.
Balloon Payment Amount
|
Amount
of balloon principal payment due.
|
|
21.
Balloon Payment Date
|
Date
on which Balloon Payment Amount is due.
|
|
22.
Forgiven Principal Amount
|
Amount
of principal forgiven.
|
|
23.
Forgiven Interest Amount
|
Gross
amount of interest forgiven.
|
|
*Applicable
to adjustable-rate mortgages only.
|
D-3-2
EXHIBIT
E
[Date]
FORM
OF
ANNUAL CERTIFICATION
|
Re:
|
The
Servicing Agreement dated as of November 1, 2007 (the “Agreement”), by and
among Xxxxxx Brothers Holdings Inc., Aurora Loan Services LLC (the
“Servicer,” in such capacity and the “Master Servicer,” in such capacity),
and acknowledged by U.S. Bank National Association, as Trustee (the
“Trustee”).
|
I,
[identify the certifying individual], the [title] of the Servicer, certify
to
the Trustee, the Master Servicer and Structured Asset Securities Corporation
(the “Depositor”), and their officers, with the knowledge and intent that they
will rely upon this certification, that:
(1) I
have
reviewed the servicer compliance statement of the Servicer provided in
accordance with Item 1123 of Regulation AB (the “Compliance Statement”), the
report on assessment of the Company’s compliance with the servicing criteria set
forth in Item 1122(d) of Regulation AB (the “Servicing Criteria”), provided in
accordance with Rules 13a-18 and 15d-18 under Securities Exchange Act of 1934,
as amended (the “Exchange Act”) and Item 1122 of Regulation AB (the “Servicing
Assessment”), the registered public accounting firm’s attestation report
provided in accordance with Rules 13a-18 and 15d-18 under the Exchange Act
and
Section 1122(b) of Regulation AB (the “Attestation
Report”), and all servicing reports, officer’s certificates and other
information relating to the servicing of the Mortgage Loans by the Servicer
during 200[ ] that were delivered by the Servicer to any of the Depositor,
the
Master Servicer and the Trustee pursuant to the Agreement (collectively, the
“Company Servicing Information”);
(2) Based
on
my knowledge, the Company Servicing Information, taken as a whole, does not
contain any untrue statement of a material fact or omit to state a material
fact
necessary to make the statements made, in the light of the circumstances under
which such statements were made, not misleading with respect to the period
of
time covered by the Company Servicing Information;
(3) Based
on
my knowledge, all of the Company Servicing Information required to be provided
by the Company under the Agreement has been provided to the Depositor, the
Master Servicer and the Trustee;
(4) I
am
responsible for reviewing the activities performed by the Servicer as servicer
under the Agreement, and based on my knowledge and the compliance review
conducted in preparing the Compliance Statement and except as disclosed in
the
Compliance Statement, the Servicing Assessment or the Attestation Report, the
Servicer has fulfilled its obligations under the Agreement in all material
respects; and
E-1
(5) The
Compliance Statement required to be delivered by the Servicer pursuant to the
Agreement, and the Servicing Assessment and Attestation Report required to
be
provided by the Servicer and by any Subservicer or Subcontractor pursuant to
the
Agreement, have been provided to the Depositor, the Master Servicer and the
Trustee. Any material instances of noncompliance described in such reports
have
been disclosed to the Depositor, the Master Servicer and the Trustee. Any
material instance of noncompliance with the Servicing Criteria has been
disclosed in such reports.
| Date: _________________________ | ||
| |
|
|
| By: | ||
|
Name:
|
||
| Title: | ||
E-2
EXHIBIT
F
Assignment
and Assumption Agreement
[INTENTIONALLY
OMITTED]
F-1
EXHIBIT
G
XXXXXX
MAE GUIDE NO. 95-19
Reference
· Selling This
announcement amends the guide(s) indicated.
· Servicing Please
keep it for reference until we issue a formal change.
Subject “Full-File”
Reporting to Credit Repositories
Part
IV,
Section 107, of the servicing Guide currently requires servicers to report
only
90-day delinquencies to the four major credit repositories. To ensure that
the
repositories have up-to-date information for both servicing and origination
activity, we have decided to begin requiring -- as of the month ending March
31,
1996 —
servicers to provide the credit repositories a “full-file” status report for the
mortgages they service for us.
“Full-file”
reporting requires that servicers submit a monthly report to each of the credit
repositories to describe the exact status for each mortgage they service for
us.
The status reported generally should be the one in effect as of the last
business day of each month. Servicers may, however, use a slightly later cut-off
date — for
example, at the and of the first week of a month — to assure
that
payment corrections, returned checks, and other adjustments related to the
previous month’s activity can be appropriately reflected in their report for
that month. Statuses that must be reported for any given mortgage include the
following: new origination, current, delinquent (30-, 60-, 90-days, etc.),
foreclosed, and charged-off. (The credit repositories will provide the
applicable codes for reporting these statuses to them.) A listing of each of
the
major repositories to which “full-file” status reports must be sent is
attached.
Servicers
are responsible for the complete and accurate reporting of mortgage status
information to the repositories and for resolving any disputes that arise about
the information they report. Servicers must respond promptly to any inquiries
from borrowers regarding specific mortgage status information about them that
was reported to the credit repositories.
Servicers
should contact their Customer Account Team in their lead Xxxxxx Xxx regional
office if they have any questions about this expanded reporting
requirement.
Xxxxxx
X.
Engeletad
Senior
Vice President - Mortgage and Lender Standards
11/20/95
G-1
XXXXXX
XXX GUIDE 95-19
ATTACHMENT
1
ANNOUNCEMENT
Major
Credit Repositories
A
"full-file" status report for each mortgage serviced for Xxxxxx Mae must be
sent
to the following repositories each month (beginning with the month ending March
31, 1996):
|
Company
|
Telephone
Number
|
|
|
Consumer
Credit Associates, Inc.
|
Call
(000) 000-0000, either extension 150,
101, or 112, for all inquiries.
|
|
|
000
Xxxxxxxxxxxx Xxxxxx, Xxxxx 000
|
||
|
Xxxxxxx,
Xxxxx 00000-0000
|
||
|
Equifax
|
Members
that have an account number may call their local sales representative
for
all inquiries; lenders that need to set up an account should call
(000)
000-0000 and select the customer assistance option.
|
|
|
TRW
Information Systems & Services
|
Call
(000) 000-0000 for all inquiries, current
members should select option 3;
|
|
|
000
XXX Xxxxxxx
|
lenders
that need to set up an account should
select Option 4.
|
|
|
Xxxxx,
Xxxxx 00000
|
||
|
|
||
|
Trans
Union Corporation
|
Call
(000) 000-0000 to get the name of the
local bureau to contact about setting
|
|
|
555
West Xxxxx
|
up
an account or obtaining other information.
|
|
|
Xxxxxxx,
Xxxxxxxx 00000
|
||
|
11/20/95
|
G-2
EXHIBIT
H
SERVICING
CRITERIA TO BE ADDRESSED IN REPORT ON
ASSESSMENT
OF COMPLIANCE
The
Servicer shall address, at a minimum, the criteria identified as below as
“Applicable Servicing Criteria”, as identified by a xxxx in the column titled
“Applicable Servicing Criteria”:
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
|
General
Servicing Considerations
|
|
|
1122(d)(1)(i)
|
Policies
and procedures are instituted to monitor any performance or other
triggers
and events of default in accordance with the transaction
agreements.
|
X
|
|
1122(d)(1)(ii)
|
If
any material servicing activities are outsourced to third parties,
policies and procedures are instituted to monitor the third party’s
performance and compliance with such servicing activities.
|
X
|
|
1122(d)(1)(iii)
|
Any
requirements in the transaction agreements to maintain a back-up
servicer
for the mortgage loans are maintained.
|
|
|
1122(d)(1)(iv)
|
A
fidelity bond and errors and omissions policy is in effect on the
party
participating in the servicing function throughout the reporting
period in
the amount of coverage required by and otherwise in accordance
with the
terms of the transaction agreements.
|
X
|
|
|
Cash
Collection and Administration
|
|
|
1122(d)(2)(i)
|
Payments
on mortgage loans are deposited into the appropriate custodial
bank
accounts and related bank clearing accounts no more than two business
days
following receipt, or such other number of days specified in the
transaction agreements.
|
X
|
|
1122(d)(2)(ii)
|
Disbursements
made via wire transfer on behalf of an obligor or to an investor
are made
only by authorized personnel.
|
X
|
|
1122(d)(2)(iii)
|
Advances
of funds or guarantees regarding collections, cash flows or distributions,
and any interest or other fees charged for such advances, are made,
reviewed and approved as specified in the transaction
agreements.
|
X
|
|
1122(d)(2)(iv)
|
The
related accounts for the transaction, such as cash reserve accounts
or
accounts established as a form of overcollateralization, are separately
maintained (e.g., with respect to commingling of cash) as set forth
in the
transaction agreements.
|
X
|
|
1122(d)(2)(v)
|
Each
custodial account is maintained at a federally insured depository
institution as set forth in the transaction agreements. For purposes
of
this criterion, “federally insured depository institution” with respect to
a foreign financial institution means a foreign financial institution
that
meets the requirements of Rule 13k-1(b)(1) of the Securities Exchange
Act.
|
X
|
|
1122(d)(2)(vi)
|
Unissued
checks are safeguarded so as to prevent unauthorized
access.
|
X
|
|
1122(d)(2)(vii)
|
Reconciliations
are prepared on a monthly basis for all asset-backed securities
related
bank accounts, including custodial accounts and related bank clearing
accounts. These reconciliations are (A) mathematically accurate;
(B)
prepared within 30 calendar days after the bank statement cutoff
date, or
such other number of days specified in the transaction agreements;
(C)
reviewed and approved by someone other than the person who prepared
the
reconciliation; and (D) contain explanations for reconciling items.
These
reconciling items are resolved within 90 calendar days of their
original
identification, or such other number of days specified in the transaction
agreements.
|
X
|
H-1
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
|
Investor
Remittances and Reporting
|
|
|
1122(d)(3)(i)
|
Reports
to investors, including those to be filed with the Commission,
are
maintained in accordance with the transaction agreements and applicable
Commission requirements. Specifically, such reports (A) are prepared
in
accordance with timeframes and other terms set forth in the transaction
agreements; (B) provide information calculated in accordance with
the
terms specified in the transaction agreements; (C) are filed with
the
Commission as required by its rules and regulations; and (D) agree
with
investors’ or the trustee’s records as to the total unpaid principal
balance and number of mortgage loans serviced by the
Servicer.
|
X
|
|
1122(d)(3)(ii)
|
Amounts
due to investors are allocated and remitted in accordance with
timeframes,
distribution priority and other terms set forth in the transaction
agreements.
|
X
|
|
1122(d)(3)(iii)
|
Disbursements
made to an investor are posted within two business days to the
Servicer’s
investor records, or such other number of days specified in the
transaction agreements.
|
X
|
|
1122(d)(3)(iv)
|
Amounts
remitted to investors per the investor reports agree with cancelled
checks, or other form of payment, or custodial bank
statements.
|
X
|
|
|
Pool
Asset Administration
|
|
|
1122(d)(4)(i)
|
Collateral
or security on mortgage loans is maintained as required by the
transaction
agreements or related mortgage loan documents.
|
X
|
|
1122(d)(4)(ii)
|
Mortgage
loan and related documents are safeguarded as required by the transaction
agreements
|
X
|
|
1122(d)(4)(iii)
|
Any
additions, removals or substitutions to the asset pool are made,
reviewed
and approved in accordance with any conditions or requirements
in the
transaction agreements.
|
X
|
|
1122(d)(4)(iv)
|
Payments
on mortgage loans, including any payoffs, made in accordance with
the
related mortgage loan documents are posted to the Servicer’s obligor
records maintained no more than two business days after receipt,
or such
other number of days specified in the transaction agreements, and
allocated to principal, interest or other items (e.g., escrow)
in
accordance with the related mortgage loan documents.
|
X
|
|
1122(d)(4)(v)
|
The
Servicer’s records regarding the mortgage loans agree with the Servicer’s
records with respect to an obligor’s unpaid principal
balance.
|
X
|
|
1122(d)(4)(vi)
|
Changes
with respect to the terms or status of an obligor's mortgage loans
(e.g.,
loan modifications or re-agings) are made, reviewed and approved
by
authorized personnel in accordance with the transaction agreements
and
related pool asset documents.
|
X
|
|
1122(d)(4)(vii)
|
Loss
mitigation or recovery actions (e.g., forbearance plans, modifications
and
deeds in lieu of foreclosure, foreclosures and repossessions, as
applicable) are initiated, conducted and concluded in accordance
with the
timeframes or other requirements established by the transaction
agreements.
|
X
|
|
1122(d)(4)(viii)
|
Records
documenting collection efforts are maintained during the period
a mortgage
loan is delinquent in accordance with the transaction agreements.
Such
records are maintained on at least a monthly basis, or such other
period
specified in the transaction agreements, and describe the entity’s
activities in monitoring delinquent mortgage loans including, for
example,
phone calls, letters and payment rescheduling plans in cases where
delinquency is deemed temporary (e.g., illness or
unemployment).
|
X
|
|
1122(d)(4)(ix)
|
Adjustments
to interest rates or rates of return for mortgage loans with variable
rates are computed based on the related mortgage loan
documents.
|
X
|
H-2
|
Servicing
Criteria
|
Applicable
Servicing
Criteria
|
|
|
Reference
|
Criteria
|
|
|
1122(d)(4)(x)
|
Regarding
any funds held in trust for an obligor (such as escrow accounts):
(A) such
funds are analyzed, in accordance with the obligor’s mortgage loan
documents, on at least an annual basis, or such other period specified
in
the transaction agreements; (B) interest on such funds is paid,
or
credited, to obligors in accordance with applicable mortgage loan
documents and state laws; and (C) such funds are returned to the
obligor
within 30 calendar days of full repayment of the related mortgage
loans,
or such other number of days specified in the transaction
agreements.
|
X
|
|
1122(d)(4)(xi)
|
Payments
made on behalf of an obligor (such as tax or insurance payments)
are made
on or before the related penalty or expiration dates, as indicated
on the
appropriate bills or notices for such payments, provided that such
support
has been received by the servicer at least 30 calendar days prior
to these
dates, or such other number of days specified in the transaction
agreements.
|
X
|
|
1122(d)(4)(xii)
|
Any
late payment penalties in connection with any payment to be made
on behalf
of an obligor are paid from the servicer’s funds and not charged to the
obligor, unless the late payment was due to the obligor’s error or
omission.
|
X
|
|
1122(d)(4)(xiii)
|
Disbursements
made on behalf of an obligor are posted within two business days
to the
obligor’s records maintained by the servicer, or such other number of days
specified in the transaction agreements.
|
X
|
|
1122(d)(4)(xiv)
|
Delinquencies,
charge-offs and uncollectible accounts are recognized and recorded
in
accordance with the transaction agreements.
|
X
|
|
1122(d)(4)(xv)
|
Any
external enhancement or other support, identified in Item 1114(a)(1)
through (3) or Item 1115 of Regulation AB, is maintained as set
forth in
the transaction agreements.
|
|
|
|
|
|
H-3
EXHIBIT
I
TRANSACTION
PARTIES
Trustee:
U.S. Bank National Association
Master
Servicer: Aurora Loan Services LLC
Certificate
Insurer: N/A
Interest
Rate Cap and Swap Counterparty: ABN AMRO Bank, N.V.
Deferred
Interest Cap Counterparty: N/A
Servicers:
Countrywide Home Loans Servicing LP. and Aurora Loan Services LLC
Originators:
American Home Mortgage Corp., Countrywide Home Loans, Inc., GreenPoint Mortgage
Funding, Inc., Xxxxxx Brothers Bank, FSB and Quicken Loans, Inc.
Custodians:
Deutsche Bank National Trust Company, LaSalle Bank National Association and
U.S.
Bank National Association
Seller:
Xxxxxx Brothers Holdings Inc.
I-1
EXHIBIT
J
FORM
OF
ANNUAL OFFICER’S CERTIFICATE
Via
Overnight Delivery
[DATE]
To:
Aurora
Loan Services LLC
00000
Xxxx Xxxxxxx Xxxxx
Xxxxxxxxx,
XX 00000
Attention:
Compliance Coordinator
(LXS
2007-20N)
|
RE:
|
Annual
officer’s certificate delivered pursuant to Section 5.03 of that certain
servicing agreement, dated as of November 1, 2007 (the “Agreement”), by
and among Xxxxxx Brothers Holdings Inc., Aurora Loan Services LLC,
as
servicer (the “Servicer”) and as master servicer, and acknowledged by U.S.
Bank National Association, as Trustee, relating to the issuance of
the
Xxxxxx XS Trust Mortgage Pass-Through Certificates, Series
2007-20N
|
[_______],
the undersigned, a duly authorized [_______] of [the Servicer][Name of
Subservicer], does hereby certify the following for the [calendar year][period
beginning on the Cut-off Date and] ending on December 31, 20[__] (the “Reporting
Period”):
|
1.
|
A
review of the activities of the Servicer during the Reporting Period
and
of its performance under the Agreement has been made under my
supervision.
|
|
2.
|
To
the best of my knowledge, based on such review, the Servicer has
fulfilled
all of its obligations under the Agreement in all material respects
throughout such Reporting Period [except as set forth below: [Identify
failure, nature and status thereof, and steps to remedy]
].
|
Certified
By:
______________________________
Name:
Title:
J-1
