Exhibit 4.2
SUBSERVICING AGREEMENT
THIS SUBSERVICING AGREEMENT ("Agreement"), entered into this 1st day of
July, 1998, between The CIT Group/Consumer Finance, Inc., having an office and
place of business at 000 XXX Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx (hereinafter referred
to as "Master Servicer"), and The CIT Group/Sales Financing, Inc. having an
office and place of business at 000 XXX Xxxxx, Xxxxxxxxxx, Xxx Xxxxxx,
(hereinafter referred to as "Subservicer").
W I T N E S S E T H:
WHEREAS, Master Servicer originated or purchased certain mortgage loans,
and has sold such mortgage loans to an affiliate, which in turn sold such
Mortgage Loans to a trust, which issued certain securities known as Home Equity
Loan Asset Backed Certificates, Series 1998-1;
WHEREAS, Master Servicer is obligated to service such mortgage loans;
WHEREAS, Subservicer desires to subservice such mortgage loans in
accordance with the terms and conditions set forth herein, and Master Servicer
desires to retain Subservicer for such purpose;
NOW, THEREFORE, in consideration of the mutual covenants and agreements
herein contained, it is agreed by and between Master Servicer and Subservicer,
as follows:
ARTICLE I.
Meaning of Terms
Unless otherwise defined herein, all capitalized terms in this Agreement
have the meanings given to them in the Pooling and Servicing Agreement dated as
of July 1, 1998 (the "Pooling and Servicing Agreement").
ARTICLE II.
Subservicer Obligations
The Master Servicer hereby delegates to the Subservicer and the
Subservicer agrees to perform all of the Master Servicer's servicing obligations
with respect to the Mortgage Loans, as set forth in the Pooling and Servicing
Agreement, except that Master Servicer shall, and Subservicer shall not be
obligated to: (1) confirm that Mortgages have been recorded, (2) confirm that
title policies have been issued on Mortgage Loans for which Master Servicer has
requested title insurance, (3) record mortgage releases and similar documents,
(4) maintain loan files, and (5) conduct collection and foreclosure activities.
Subservicer shall 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 mortgage servicing practices of prudent
lending institutions.
ARTICLE III.
Subservicer Cannot Resign
Without Master Servicer's prior written consent, Subservicer agrees that
it cannot resign as Subservicer under this Agreement.
ARTICLE IV.
Modification of Subservicer Obligations or Termination of Subservicer
In addition to those services Master Servicer will perform as set forth
above, the Master Servicer may elect, subject to the provisions of this Article
IV, to relieve Subservicer of certain other servicing obligations required by
the Pooling and Servicing Agreement. Subject to the provisions of this Article
IV, Master Servicer may also terminate all of Subservicer's obligations under
this Agreement. The Master Servicer cannot materially decrease Subservicer's
obligations in connection with lockbox arrangements or payment processing or
terminate all of Subservicer's obligations, unless the Rating Agency Condition
is satisfied. In addition, if a Termination Event has occurred and is
continuing, the Trustee may terminate the Master Servicer under the Pooling and
Servicing Agreement and the Subservicer under this Agreement. This Agreement
shall terminate in the event that Master Servicer is no longer acting as Master
Servicer under the Pooling and Servicing Agreement.
ARTICLE V.
Subservicer's Fee
Master Servicer shall pay a fee or other compensation to Subservicer for
each Mortgage Loan serviced hereunder in an amount as may be mutually agreed to
by Master Servicer and Subservicer.
ARTICLE VII.
Governing Law
This Agreement shall be interpreted and construed in accordance with the
laws of the State of New Jersey, without regard to its internal conflict of laws
rules.
ARTICLE VII.
Miscellaneous
The parties shall, at their own expense, execute all other documents and
take all other steps requested by each other from time to time to perform the
covenants and obligations herein and effectuate the intent hereof. The
provisions of this Agreement cannot be waived or modified except in a written
document signed by the Subservicer and the Master Servicer.
Subservicer's representations and warranties shall survive the termination
of this Agreement. This Agreement may be executed in counterparts, all of which
taken together shall
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constitute one and the same instrument. Headings and titles are for convenience
only and shall not influence the construction or interpretation of this
Agreement. When used herein, the term "include" or "including" shall mean
without limitation by reason of enumeration.
IN WITNESS WHEREOF, Master Servicer and Subservicer have executed this
Agreement as of the date set forth above.
THE CIT GROUP/CONSUMER FINANCE, INC.
(Master Servicer)
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------------------
Its: Senior Vice President
THE CIT GROUP/SALES FINANCING, INC.
(Subservicer)
By: /s/ Guy N. Veni
-------------------------------------
Its: Executive Vice President
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