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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K
(Mark one)
/X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the fiscal year ended December 31, 2003
OR
/ / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission File Number: 333-91334-04
Bear Stearns Asset Backed Securities Trust
Asset-Backed Certificates
Series 2003-AC2
(Exact name of registrant as specified in its charter)
New York 54-2120429
54-2120430
54-2120431
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
c/o Wells Fargo Bank, N.A.,
9062 Old Annapolis Road
Columbia, MD 21045
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (410) 884-2000
Securities registered pursuant to Section 12(b) of the Act:
NONE.
Securities registered pursuant to Section 12(g) of the Act:
NONE.
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period
that the registrant was required to file such reports), and (2) has been
subject to such filing requirements for the past 90 days.
Yes X No ___
Indicate by check mark if disclosure of delinquent filers pursuant to
Item 405 of Regulation S-K ( 229.405 of this chapter) is not contained
herein, and will not be contained, to the best of registrant's knowledge,
in definitive proxy or information statements incorporated by reference
in Part III of this Form 10-K or any amendment to this Form 10-K.
Not applicable.
Indicate by check mark whether the registrant is an accelerated filer
(as defined in Exchange Act Rule 12b-2).
Yes___ No X
State the aggregate market value of the voting and non-voting common
equity held by non-affiliates computed by reference to the price at which
the common equity was last sold, or the average bid and asked price of
such common equity, as of the last business day of the registrant's most
recently completed second fiscal quarter.
Not applicable.
Indicate the number of shares outstanding of each of the registrant's
classes of common stock, as of the latest practicable date.
Not applicable.
List hereunder the following documents if incorporated by reference and
the Part of the Form 10-K (e.g. Part I, Part II, etc.) into which the
document is incorporated: (1)Any annual report to security holders; (2)
Any proxy or information statement; and (3)Any prospectus filed pursuant
to Rule 424(b) or (c) under the Securities Act of 1933. The listed
documents should be clearly described for identification purposes (e.g.
annual report to security holders for fiscal year ended December 24, 1980).
Not applicable.
PART I
Item 1. Business.
Omitted.
Item 2. Properties.
See Item 15(a), Exhibits 99.1, 99.2, and 99.3, for information
provided in lieu of information required by Item 102 of
Regulation S-K.
Item 3. Legal Proceedings.
The registrant knows of no material pending legal proceedings
involving the trust created under the Pooling and Servicing
Agreement (the Trust), the Trustee, the Servicer or the
registrant with respect to the Trust other than routine
litigation incidental to the duties of the respective parties.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
PART II
Item 5. Market for Registrant's Common Equity and Related Stockholder
Matters.
No established public trading market for the Certificates exists.
Records provided to the Trust by the DTC and the Trustee
indicate that as of December 31, 2003, the number of holders of
record for each class of Certificate were as follows:
Class A-1 3
Class A-2 3
Class A-3 12
Class A-4 3
Class A-IO 5
Class B-1 3
Class B-2 4
Class C 1
Class M-1 4
Class M-2 4
Class P 1
Class R-1 1
Class R-2 1
Class R-3 1
Total: 46
Item 6. Selected Financial Data.
Omitted.
Item 7. Management's Discussion and Analysis of Financial Condition and
Results of Operation.
Omitted.
Item 7A. Quantitative and Qualitative Disclosures about Market Risk.
Not applicable.
Item 8. Financial Statements and Supplementary Data.
See Item 15(a), Exhibits 99.1, 99.2, 99.3, for information
provided in lieu of information required by Item 302 of
Regulation S-K.
Item 9. Changes in and Disagreements with Accountants on Accounting and
Financial Disclosure.
None.
Item 9A. Controls and Procedures.
Not applicable.
PART III
Item 10. Directors and Executive Officers of the Registrant.
Not applicable.
Item 11. Executive Compensation.
Not applicable.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Not applicable.
Item 13. Certain Relationships and Related Transactions.
Not applicable.
Item 14. Principal Accounting Fees and Services.
Not applicable.
PART IV
Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K.
(a) Exhibits
(31.1) Rule 13a-14(a)/15d-14(a) Certification
(99.1) Annual Independent Accountants' Servicing Reports concerning
servicing activities for the year ended December 31, 2003.
a) EMC Mortgage Corp, as Servicer
b) HomeQ Servicing Corporation, as Servicer
c) National City Mortgage Co, as Servicer
d) Union Federal Bank, as Servicer
(99.2) Report of Management as to Compliance with Minimum Servicing
Standards for the year ended December 31, 2003.
a) EMC Mortgage Corp, as Servicer
b) HomeQ Servicing Corporation, as Servicer
c) National City Mortgage Co, as Servicer
d) Union Federal Bank, as Servicer
(99.3) Annual Statements of Compliance under the Pooling and Servicing
Agreements for the year ended December 31, 2003.
a) EMC Mortgage Corp, as Servicer
b) HomeQ Servicing Corporation, as Servicer
c) National City Mortgage Co, as Servicer
d) Union Federal Bank, as Servicer
(99.4) Aggregate Statement of Principal and Interest Distributions to
Certificate Holders.
(b) On November 04, 2003, December 09, 2003, and January 08, 2004
reports on Form 8-K were filed by the Company in order to provide
the statements for the monthly distributions to holders of the
Certificates. No other reports on Form 8-K have been filed during
the last quarter of the period covered by this report.
On January 08, 2004 a report on Form 8-K/A was filed by the Company
for October 2003 distribution.
(c) Not applicable.
(d) Omitted.
(99.5) Reliance Certifications Mandated under the Pooling and Servicing
Agreement for the year ended December 31, 2003
a) EMC Mortgage Corp, as Servicer
b) HomeQ Servicing Corporation, as Servicer
c) National City Mortgage Co, as Servicer
d) Union Federal Bank, as Servicer
Filed herewith.
Certification has been received.
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized:
Bear Stearns Asset Backed Securities Trust
Asset-Backed Certificates
Series 2003-AC2
(Registrant)
Signed: Wells Fargo Bank, N.A. as Master Servicer
By: Brett Handelman, Vice President
By: /s/ Brett Handelman, Vice President
Dated: March 30, 2004
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO
SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED
SECURITIES PURSUANT TO SECTION 12 OF THE ACT.
(a)(i) No annual report is provided to the Certificateholders other than
with respect to aggregate principal and interest distributions.
(a)(ii) No proxy statement, form of proxy or other proxy soliciting
material has been sent to any Certificateholder with respect to any
annual or other meeting of Certificateholders.
Exhibit Index
Exhibit No.
Ex-31.1 Rule 13a-14(a)/15d-14(a) Certification
I, Brett Handelman, certify that:
1. I have reviewed this annual report on Form 10-K, and all reports on
Form 8-K containing distribution or servicing reports filed in
respect of periods included in the year covered by this annual report,
of Bear Stearns Asset Backed Securities Trust Asset-Backed
Certificates, Series 2003-AC2 Trust;
2. Based on my knowledge, the information in these reports, 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 light of the circumstances under which such statements were made,
not misleading as of the last day of the period covered by this
annual report;
3. Based on my knowledge, the distribution or servicing information
required to be provided to the Trustee by the Servicer under the
Pooling and Servicing or similar, agreement, for inclusion in these
reports is included in these reports;
4. I am responsible for reviewing the activities performed by the master
servicer under the pooling and servicing, or similar, agreement, and
based on upon my knowledge and the annual compliance review required
under that agreement, and except as disclosed in the reports, the
master servicer has fulfilled its obligations under that agreement;
and
5. The reports disclose all significant deficiencies relating to the
servicer's compliance with the minimum servicing standards based upon
the report provided by an independent public accountant, after
conducting a review in compliance with the Uniform Single Attestation
Program for Mortgage Bankers or similar procedure, as set forth in
the pooling and servicing, or similar, agreement, that is included in
these reports.
In giving the certifications above, I have reasonably relied on
information provided to me by the following unaffiliated parties: EMC
Mortgage Corp as Servicer, HomeQ Servicing Corporation as Servicer,
National City Mortgage Co as Servicer, Union Federal Bank as
Servicer.
Date: March 30, 2004
/s/ Brett Handelman
Signature
Vice President
Title
Ex-99.1 (a)
(logo) Deloitte
Deloitte & Touche LLP
750 College Road East
Third Floor
Princeton, NJ 08540
USA
Tel: +16095143600
www.deloitte.com
INDEPENDENT ACCOUNTANTS' REPORT
Board of Directors and Stockholder
EMC Mortgage Corporation
We have examined EMC Mortgage Corporation (the "Company") (a wholly owned
subsidiary of The Bear Stearns Companies Inc.) compliance with its established
servicing standards described in the accompanying Management's Assertion, dated
February 13, 2004, as of and for the year ended November 30, 2003. Management
is responsible for compliance with those minimum servicing standards.
Our responsibility is to express an opinion on the Company's compliance
based on our examination.
Our examination was conducted in accordance with attestation standards
established by the American Institute of Certified Public Accountants and,
accordingly, included examining, on a test basis, evidence about the Company's
compliance with its minimum servicing standards and performing such other
procedures as we considered necessary in the circumstances. We believe that our
examination provides a reasonable basis for our opinion. Our examination does
not provide a legal determination on the Company's compliance with the minimum
servicing standards.
Our examination disclosed the following material noncompliance with the
reconciliation of custodial bank accounts applicable to the Company during the
year ended November 30, 2003. In two of the twenty-two custodial bank accounts
selected for testing, the reconciliations included three items totaling
approximately $258,000 that were older than ninety days.
In our opinion, except for the material noncompliance described in the preceding
paragraph, the Company complied, in all material respects, with the
aforementioned minimum servicing standards as of and for the year ended
November 30, 2003, as
set forth in Appendix I.
/s/ Deloite & Touche LLP
February 13,2004
Member of
Deloitte Touche Tohmatsu
Ex-99.1 (b)
(Logo) KPMG
KPMG LLP
Suite 2300
401 South Tryon Street
Three First Union Center
Charlotte, NC 28202-1911
Independent Accountants' Report
The Board of Directors
HomEq Servicing Corporation:
We have examined management's assertion, included in the accompanying Management
Assertion, that HomEq Servicing Corporation (the Company) complied with the
minimum servicing standards set forth in the Mortgage Bankers Association of
America's Uniform Single Attestation Program for Mortgage Bankers as of and for
the year ended December 31, 2003. Management is responsible for the Company's
compliance with those minimum servicing standards. Our responsibility is to
express an opinion on management's assertion about the Company's compliance
based on our examination.
Our examination was conducted in accordance with attestation standards
established by the American Institute of Certified Public Accountants and,
accordingly, included examining, on a test basis, evidence about the Company's
compliance with the minimum servicing standards specified above and performing
such other procedures as we considered necessary in the circumstances. We
believe that our examination provides a reasonable basis for our opinion. Our
examination does not provide a legal determination on the Company's compliance
with the minimum servicing standards.
In our opinion, management's assertion that the Company complied with the
aforementioned minimum servicing standards during the year ended December 31,
2003 is fairly stated, in all material respects.
/s/ KPMG
March 12,2004
Ex-99.1 (c)
(LOGO) ERNST & YOUNG
Ernst & Young LLP
1300 Huntington Building
925 Euclid Avenue
Cleveland, Ohio 44115
Phone: (216) 861-5000
www.ey.com
Report on Management's Assertion on Compliance
with the Specified Minimum Servicing Standards Set Forth in the
Uniform Single Attestation Program for Mortgage Bankers
Report of Independent Accountatns
Board of Directors
National City Mortgage Co.
We have examined management's assertion, inc1uded in the accompanying report
titled Report of Management, that National City Mortgage Co. (NCM) complied with
the servicing standards identified in Exhibit A to the Report of Management (the
specific minimum servicing standards) as set forth in the Mortgage Bankers
Association of America's Uniform Single Attestation Program for Mortgage Bankers
(USAP) during the year-ended December 31, 2003. Management is responsible for
NCM's compliance with the specified minimum servicing standards. Our
responsibility is to express an opinion on management's assertions about NCM's
compliance based on our examination.
Our examination was made in accordance with attestation standards established by
the American Institute of Certified Public Accountants and, accordingly,
included examining, on a test basis, evidence about NCM's compliance with the
specified minimum servicing standards and performing such other procedures as we
considered necessary in the circumstances. We believe that our examination
provides a reasonable basis for our opinion. Our examination does not provide a
legal determination on NCM's compliance with specified minimum servicing
standards.
In our opinion, management's assertion that NCM complied with the aforementioned
specified minimum servicing standards during the year ended December 31, 2003,
is fairly stated, in all material respects.
/s/ Ernst & Young LLP
February 25, 2004
A Member Practive of Ernst & Young Global
Ex-99.1 (d)
(logo) ERNST & YOUNG
Ernst & Young LLP
111 Monument Circle, Suite 2600
P.O. Box 44972
Indianapolis, Indiana 46204-2094
Phone: (317) 681-7000
Fax: (317) 681-7216
Report on Management's Assertion on Compliance with the Specified Minimum
Servicing Standards Set Forth in the Uniform Single Attestation Program for
Mortgage Bankers
Report of Independent Accountants
The Board of Directors
Union Federal Bank of Indianapolis
We have examined management's assertion, included in the accompanying report
titled Report of Management, that Union Federal Bank of Indianapolis and
Subsidiaries (the Bank) complied with the servicing standards identified in
Exhibit A to the Report of Management (the "specified minimum servicing
standards") as set forth in the Mortgage Bankers Association of America's
Uniform Single Attestation Program for Mortgage Bankers (USAP) during the
year ended December 31, 2003. Management is responsible for the Bank's
compliance with those specified minimum servicing standards. Our responsibility
is to express an opinion on management's assertions about the Bank's compliance
based on our examination.
Our examination was made in accordance with attestation standards established
by the American Institute of Certified Public Accountants and, accordingly,
included examinjng, on a test basis, evidence about the Bank's compliance with
the specified minimum servicing standards and performing such other procedures
as we considered necessary in the circumstances. We believe that our
examination provides a reasonable basis for our opinion. Our examination does
not provide a legal determination on the Bank's compliance with the specified
minimum servicing standards.
In our opinion, management's assertion, that the Bank complied with the
aforementioned specified minimum servicing standards during the year ended
December 31, 2003, is fairly stated, in all material respects.
/s/ Ernst & Young LLP
Ernst & Young LLP
February 26, 2004
Ex-99.2 (a)
EMC (logo)
Mortgage Corporation
MANAGEMENT'S ASSERTION
As of and for the year ended November 30, 2003, EMC Mortgage Corporation (the
"Company") (a wholly owned subsidiary of The Bear Stearns Companies, Inc.), has
complied, in all material respects, except as described in the following
paragraph, with the Company's established minimum servicing standards for
residential mortgage loans as set forth in Appendix I (the "Standards").
The Standards are based on the Mortgage Bankers Association of America's
Uniform Single Attestation Program for Mortgage Bankers.
In two of the twenty-two custodial bank accounts selected for testing, the
reconciliations included three items totaling approximately $258,000 that were
older than ninety days. As of and for this same period, the Company had in
effect a fidelity bond in the amount of $200,000,000 and $100,000,000 for the
periods from December 1, 2002 to September 29, 2003 and from September 30, 2003
to November 30, 2003, respectively, and an errors and omissions policy in the
amount of $10,000,000 and $15,000,000 for the periods from December 1, 2002 to
February 24, 2003 and from February 25, 2003 to November 30, 2003, respectively.
/s/ Ralene Ruyle 2-13-04
Ralene Ruyle, President Date
/s/ Scott D. Samlin, 2-13-04
Scott D. Samlin, Executive Vice President Date
/s/ Dana Dillard 2-13-04
Dana Dillard, Senior Vice President Date
Two MacArthur Ridge, 909 Hidden Ridge Drive, Suite 200
Irving, Texas 75038
Mailing Address: P.O. Box 141358, Irving, Texas 75014-1358
MBA
Member
Mortgage Bankers
Association of America (logo)
APPENDIX I
MINIMUM SERVICING STANDARDS AS SET FORTH IN THE MORTGAGE BANKERS ASSOCIATION
OF AMERICA'S UNIFORM SINGLE ATTESTATION PROGRAM FOR MORTGAGE BANKERS
I. CUSTODIAL BANK ACCOUNTS
1. Reconciliations shall be prepared on a monthly basis for all custodial bank
accounts and related bank clearing accounts. These reconciliations shall:
. be mathematically accurate;
. be prepared within forty-five (45) calendar days after the cutoff
date;
. be reviewed and approved by someone other than the person who
prepared the reconciliation; and
. document explanations for reconciling items. These reconciling
items shall be resolved within ninety (90) calendar days of their
original identification.
2. Funds of the servicing entity shall be advanced in cases where there is an
overdraft in an investor's or a mortgagor's account.
3. Each custodial account shall be maintained at a federally insured depository
institution in trust for the applicable investor.
4. Escrow funds held in trust for a mortgagor shall be returned to the mortgage
within thirty (30) calendar days of payoff of the mortgage loan.
II. MORTGAGE PAYMENTS
1. Mortgage payments shall be deposited into the custodial bank accounts and
related bank clearing accounts within two business days of receipt.
2. Mortgage payments made in accordance with the mortgagor's loan documents
shall be posted to the applicable mortgagor records within two business
days of receipt.
3. Mortgage payments shall be allocated to principal, interest, insurance,
taxes or other escrow items in accordance with the mortgagor's loan
documents.
4. Mortgage payments identified as loan payoffs shall be allocated in
accordance with the mortgagor's loan documents.
III. DISBURSEMENTS
1. Disbursements made via wire transfer on behalf of a mortgagor or investor
shall be made only by authorized personnel.
2. Disbursements made on behalf of a mortgagor or investor shall be posted
within two business days to the mortgagor's or investor's records maintained
by the servicing entity.
3. Tax and insurance payments shall be made on or before the penalty or
insurance policy expiration dates, as indicated on tax bills and insurance
premium notices, respectively, provided that such support has been received
by the servicing entity at least thirty (30) calendar days prior to these
dates.
4. Any late payment penalties paid in conjunction with the payment of any tax
bill or insurance premium notice shall be paid from the servicing entity's
funds and not charged to the mortgagor, unless the late payment was due to
the mortgagor's error or omission.
5. Amounts remitted to investors per the servicer's investor reports shall
agree with cancelled checks, or other form of payment, or custodial bank
statements.
6. Unused checks shall be safeguarded so as to prevent unauthorized access.
IV. INVESTOR ACCOUNTING AND REPORTING
1. The servicing entity's investor reports shall agree with, or reconcile to,
investors' records on a monthly basis as to the total unpaid principal
balance and number of loans serviced by the servicing entity.
V. MORTGAGE LOAN ACCOUNTING
1. The servicing entity's mortgage loan records shalagree with, or
reconcile to, the records of mortgagors with respect to the unpaid
principal balance on a monthly basis.
2. Adjustments on ARM loans shall be computed based on the related mortgage
note and any ARM rider.
3. Escrow accounts shall be analyzed, in accordance with the mortgagor's loan
documents, on at least an annual basis.
4. Interest on escrow accounts shall be paid, or credited, to mortgagors in
accordance with the applicable state laws.
VI. DELINQUENCIES
1. Records documenting collection efforts shall be maintained during the
period a loan is in default and shall be updated at least monthly. Such
records shall describe the entity's activities in monitoring delinquent
loans including, for example, phone calls, letters and mortgage payment
rescheduling plans in cases where the delinquency is deemed temporary
(e.g., illness or unemployment).
VII. INSURANCE POLICIES
1. A fidelity bond and errors and omissions policy shall be in effect on the
servicing entity throughout the reporting period in the amount of coverage
represented to investors in management's assertion.
Ex-99.2 (b)
HOMEQ SERVICING
Management Assertion
As of and for the year ended December 31. 2003. HomEq Servicing Corporation (the
"Company") complied in all material respects with the minimum servicing
standards set forth in the Mortgage Bankers Association of America's Uniform
Single Attestation Program for Mortgage Bankers. As of and for this same
period, the Company had in effect a fidelity bond and errors and omissions
policy in the amounts of $200 million and $20 million, respectively.
HomeEq serving corporation
/s/ Arthur Q. Lyon
March 12, 2004
Arthur Q. Lyon
President
/s/ Keith G. Becher
March 12, 2004
Keith G Becher
Chief Operating officer
WACHOVIA.
Ex-99.2 (c)
Management's Assertion on Compliance with the Specified Minimum
Servicing Standards Set Forth in the Uniform Single Attestation Program
for Mortgage Bankers
Report of Management
We, as members of management of National City Mortgage Co. (NCM), are
responsible for complying with the servicing standards identified in the
attached Exhibit A (the specified minimum servicing standards) as set forth in
the Mortgage Bankers Association of America's Uniform Single Attestation
Program for Mortgage Bankers (USAP). We are also responsible for
establishing and maintaining effective internal control over compliance with
these specified minimum servicing standards. We have performed our
evaluation of NCM's compliance with the specified minimum servicing
standards as of December 31, 2003 and for the year then ended. Based on this
evaluation, we assert thet during the year ended December 31, 2003, NCM
complied, in all material respects, with the specified minimum servicing
standards set forth in the USAP.
As of December 31, 2003 and for the year then ended, NCM had in effect a
fidelity bond policy in the amount of $200 million and an errors and omissions
policy in the amount of $200 million.
/s/ Steven M. Scheid
Steven M. Scheid, Senior Vice President
February 25, 2004
Exhibit A
Specified Minimum Servicing Standards
I. Custodial Bank Accounts
1. Reconciliations shall be prepared on a monthly basis for all custodial
bank accounts and related bank clearing accounts. These reconciliations
shall:
a. be mathematically accurate;
b. be prepared within forty-five (45) calendar days after the cutoff date.
The cutoff date is the date as of which a bank account is reconciled
every month. It may, or may not, coincide with a prescribed investor
reporting date but shall be consistent from period to period;
c. be reviewed and approved by someone other than the person who prepared
the reconciliation; and
d. document explanations for reconciling items. These reconciling items
shall be resolved within ninety (90) calendar days of their original
identification.
2. Funds of the servicing entity shall be advanced in cases where there is an
overdraft in an investor's or a mortgagor's account.
3. Each custodial account shall be maintained at a federally insured
depository institution in trust for the applicable investor.
4. Escrow funds held in trust for a mortgagor shall be returned to the
mortgagor within thirty (30) calendar days of payoff of the mortgage loan.
II. Mortgage Payments
1. Mortgage payments shall be deposited into the custodial bank accounts and
related bank clearing accounts within two (2) business days of receipt.
2. Mortgage payments made in accordance with the mortgagor's loan documents
shall be posted to the applicable mortgagor records within two (2)
business days of receipt.
3. Mortgage payments shall be allocated to principal, interest, insurance,
taxes or other escrow items in accordance with the mortgagor's loan
documents.
4. Mortgage payments identified as loan payoffs shall be allocated in
accordance with the mortgagor's loan documents.
Exhibit A
Specified Minimum Servicing Standards (continued)
III. Disbursements
1. Disbursements made via wire transfer on behalf of a mortgagor or investor
shall be made only by authorized personnel.
2. Disbursements made on behalf of a mortgagor or investor shall be posted
within two (2) business days to the mortgagor's or investor's records
maintained by the servicing entity.
3. Tax and insurance payments shall be made on or before the penalty or
insurance policy expiration dates, as indicated on tax bills and insurance
premium notices, respectively, provided that such support has been
received by the servicing entity at least thirty (30) calendar days prior
to these dates.
4. Any late payment penalties paid in conjunction with the payment of any tax
bill or insurance premium notice shall be paid from the servicing
entity's funds and not charged to the mortgagor, unless the late payment
was due to the mortgagor's error or omission.
5. Amounts remitted to investors per the servicer's investor reports shall
agree with cancelled checks, or other form of payment, or custodial bank
statements.
6. Unissued checks shall be safeguarded so as to prevent unauthorized access.
IV. Investor Accouting and Reporting
1. The servicing entity's investor reports shall agree with, or reconcile to,
investors' records on a monthly basis as to the total unpaid principal
balance and number of loans serviced by the servicing entity.
V. Mortgagor Loan Accounting
1. The servicing entity's mortgage loan records shall agree with, or
reconcile to, the records of mortgagors with respect to the unpaid
principal balance on a monthly basis.
2. Adjustments on adjustable rate mortgage (ARM) loans shall be computed
based on the related mortgage note and any ARM rider.
3. Escrow accounts shall be analyzed, in accordance with the mortgagor's loan
documents, on at least an annual basis.
Exhibit A
Specified Minimum Servicing Standards (continued)
V. Mortgagor Loan Accounting (continued)
4. Interest on escrow accounts shall be paid, or credited, to mortgagors in
accordance with the applicable state laws.
VI. Delinquencies
1. Records documenting collection efforts shall be maintained during the
period a loan is in default and shall be updated at least monthly. Such
records shall describe the entity's activities in monitoring delinquent
loans including, for example, phone calls, letters and mortgage payment
rescheduling plans in cases where the delinquency is deemed temporary
(i.e., illness or unemployment).
VII. Insurance Policies
1. A fidelity bond and errors and omissions policy shall be in effect on the
servicing entity throughout the reporting period in the amount of coverage
represented to investors in management's assertion.
Ex-99.2 (d)
(logo) Union Federal Bank
all your bank should be
Management's Assertion on Compliance with Minimum Servicing
Standards Set Forth in the Uniform Single Attestation Program for
Mortgage Bankers
Report of Management
We, as members of management of Union Federal Bank of Indianapolis and
Subsidiaries (the Bank), are responsible for complying with the minimum
servicing standards as set forth in the Mortgage Banks Association of
America's Uniform Single Attestation Program for Mortgage Bankers (USAP). We
are also responsible for establishing and maintaining effective internal control
over compliance with these standards. We have performed an evaluation of the
Bank's compliance with the minimum servicing standards as set forth in the USAP
as of December 31, 2003 and for the year then ended. Based on this evaluation,
we assert that during the year ended December 31, 2003, the Bank complied, in
all material respects, with the minimum servicing standards set forth in the
USAP.
For the six month periods ended June 30, 2003 and December 31, 2003, the Bank
had in effect a mortgage errors and omissions policy in the amount of
$15,500,000 and $20,000.000, respectively. From January 1,2003 to December 30,
2003, the Bank had in effect a fidelity bond in the amount of $15,000,000.
Effective December 31,2003 the Bank increased the amount of the fidelity bond to
$20,000,000.
/s/ Alvin T. Stolen III
Alvin T. Stolen III
President and Chief Executive
/s/ Vincent J. Otto
Vincent J. Otto
Executive Vice President
February 26, 2004
I
Official Bank of the Indianapolis Colts.
Ex-99.3 (a)
Exhibit" A"
Wells Fargo Bank Minnesota, N.A.
9062 Old Annapolis Rd.
Columbia, MD 21045
Attention: Master Servicing
RE: Officer's Certificate
Dear Master Servicer:
The undersigned Officer certifies the following for the 2003 fiscal year:
(A) I have reviewed the activities and performance of the Servicer during the
preceding fiscal year under the ten DS of the Servicing Agreement, Trust
Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide and to
the best of these Officers' knowledge, the Servicer has fulfilled all of its
duties, responsibilities or obligations under these Agreements throughout such
year, or if there has been a default or failure of the servicer to perform any
of such duties, responsibilities or obligations, a description of each default
or failure and the nature and status thereof has been reported to Wells Fargo
Bank Minnesota, N.A.;
(B) I have confirmed that the Servicer is currently an approved FNMA or FHLMC
servicer in good standing;
(C) I have confirmed that the Fidelity Bond, the Errors and Omissions Insurance
Policy and any other bonds required under the terms of the Servicing Agreement,
Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide
are in full force and effect;
(D) All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if
applicable) and Primary Mortgage Insurance Policy (if applicable), with respect
to each Mortgaged Property, have been paid and that all such insurance policies
are in full force and effect;
(E) All real estate taxes, governmental assessments and any other expenses
accrued and due, that if not paid could result in a lien or encumbrance on any
Mortgaged Property, have been paid, or if any such costs or expenses have not
been paid with respect to any Mortgaged Property, the reason for the non-payment
has been reported to Wells Fargo Bank Minnesota, N.A.;
(F) All Custodial Accounts have been reconciled and are properly funded; and
(G) All annual reports of Foreclosure and Abandonment of Mortgage Property
required per section 6050H, 6050J and 6050P of the Internal Revenue Code,
respectively, have been prepared and filed. Certified by
/s/ Daua Dillarard
Officer
Senior Vice President
Title
February 27 -2003
EMC
Addendum to Officer's Certificate
The following exceptions were noted regarding notation "0" and "E" of EMC
Mortgage Corporation's Officer Certificate and attestation to activities
performed during the preceding fiscal year end of November 30, 2003.
All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if
applicable) and Primary Mortgage Insurance Policy (if applicable), with respect
to each Mortgaged Property, have been paid and that all such insurance policies
are in full force and effect;
When a loss occurs, a Mortgaged Property will be insured by EMC Mortgage
Corporation's force place carrier in the event the homeowner's Primary Mortgage
Insurance Policy has not been renewed. Currently there are 233 loans serviced by
EMC Mortgage Corporation that are in a forced place insurance cycle. EMC
Mortgage Corporation has been cooperating with the seller on five of these loans
with aforementioned force placed insurance to reinstate the homeowner's Primary
Mortgage Insurance Policy.
All real estate taxes, governmental assessments and any other expenses accrued
and due, that if not paid could result in a lien or encumbrance on any Mortgaged
Property, have been paid, or if any such costs or expenses have not been paid
with respect to any Mortgaged Property, the reason for the non- payment has been
reported to Wells Fargo Bank Minnesota, N.A.;
All taxes on loans serviced by EMC Mortgage Corporation have been paid according
to the agreed up policies and procedures of HUD, Fannie Mae, Freddie Mac and
Ginnie Mae as well as EMC Mortgage Corporation's own internal policies. EMC
Mortgage Corporation is currently researching 50 delinquent tax bills -including
such matters as taxes on secondary liens, mobile homes assessed as personal
property, newly acquired loans and homeowner association dues.
Two MacArthur Ridge 909 Hidden Ridge Drive, Suite 200 Irving, Texas 75038
Mailing Address: P.O. Box 141358, Irving, Texas 75014-1358
Member Mortgage Bankers MBA Association of America
Ex-99.3(b)
FROM CERTIFICATION TO BE
PROVIDED BY THE SERVICER
I, Arthur Lyon, certify to Wells Fargo Bank, MN, NA, and its officers,
directors, agents and affiliates, and with the knowledge and intent that they
will rely upon this certification, that:
(i) Based on such Officer's knowledge, the information relating to the Mortgage
Loans and the servicing thereof submitted by the Servicer to Wells Fargo
Bank, MN, NA which is used in connection with preparation of the reports on
Form 8-K and the annual report on Form l0-K filed with the SEC with respect
to the Transaction, 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 light of the circumstances under which such statements
were made, not misleading as of the date of this certification
The servicing information required to be provided to Wells Fargo Bank, MN,
NA by the Servicer under applicable Servicing Agreements has been provided
to Wells Fargo Bank, MN, NA;
Such Officer is responsible for reviewing the activities performed by the
Servicer under applicable Servicing Agreements and based upon the review
required under applicable Servicing Agreements, and except as disclosed in
the Annual Statement of Compliance, the Annual Independent Public
Accountant's Servicing Report and all servicing reports, officer's
certificates and other information relating to the servicing of the Mortgage
Loans submitted to Wells Fargo Bank, MN, NA, the Servicer has, as of
the date of this certification fulfilled its obligations under applicable
Servicing Agreements; and
Such Officer has disclosed to Wells Fargo Bank, MN, NA all significant
deficiencies relating to the Servicer's compliance with the minimum
servicing standards in accordance with a review conducted in compliance with
the Uniform Single Attestation Program for Mortgage Bankers or similar
standard as set forth under applicable Servicing Agreements.
IN WITNESS WHEREOF, the undersigned has caused this Officer's Certificate to be
duly executed as of 3/12/04
HomEq Servicing Corporation
By: /s/ Arthur Lyon
Arthur Lyon
President
Ex-99.3 (C)
National City Mortgage Co.
232 Newmark Drive. Miamisburg, Ohio 45342
Mortgage Telephone (937) 910-1200
Mailing Address:
P.O. Box 1820
Dayton, Ohio 45401-1820
EMC
C/o Wells Fargo Bank Minnesota NA
Attn: Mike Williams
9062 Old Annapolis Road
Columbia, Maryland 21045
RE: Officer's Certification -National City Mortgage Investor Number 436
Dear Master Servicer:
The undersigned Officer certifies the following for the 2003 fiscal year:
a. I have reviewed the activities and performance of the Servicer during the
preceding fiscal year
under the terms of the Servicing Agreement, Trust Agreement, Pooling and
Servicing Agreement and/or Seller/Servicer Guide and to the best of this
Officer's knowledge, the Servicer has fulfilled all of its duties,
responsibilities or obligations under these Agreements throughout such year, or
if there has been a default or failure of the servicer to perform any of such
duties, responsibilities or obligations, a description of each default or
failure and the nature and status thereof has been reported to EMC c/o Wells
Fargo Bank Minnesota NA;
b. I have confirmed that the Servicer is currently an approved FNMA or FHLMC
servicer in good standing;
c. I have confirmed that the Fidelity Bond, the Errors and Omissions Insurance
Policy and any other bonds required under the terms of the Servicing Agreement,
Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide
are in full force and effect;
d. All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if
applicable) and Primary Mortgage Insurance Policy (if applicable), with respect
to each Mortgaged Property, have been paid and that all such insurance policies
are in full force and effect;
e. All real estate taxes, governmental assessments and any other expenses
accrued and due, that if not paid could result in a lien or encumbrance on any
Mortgaged Property, have been paid, or if any such costs or expenses have not
been paid with respect to any Mortgaged Property, the reason for the non-payment
has been reported to EMC c/o Wells Fargo Bank Minnesota NA;
f. All custodial accounts have been reconciled and are properly funded; and
g. All annual reports of Foreclosure and Abandonment of Mortgaged Property
required per section 6050H, 6050J and 6050P of the Internal Revenue Code,
respectively, have been prepared and filed.
Certified By:
/s/ Mary Beth Criswell
Officer Mary Beth Criswell
Vice President
Title
February 13, 2004
Date
No one Cares More!
Ex-99.3 (d)
Exhibit "A"
Wells Fargo Bank Minnesota, N.A.
9062 Old Annapolis Rd.
Columbia, MD 21045
Attention: Master Servicing
RE: Officer's Certificate
Dear Master Servicer:
The undersigned Officer certifies the following for the 2003 fiscal year:
(A) I have reviewed the activities and performance of the Servicer during the
preceding fiscal year under the terms of the Servicing Agreement, Trust
Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide and
to the best of these Officers' knowledge, the Servicer has fulfilled all of
its duties, responsibilities or obligations under these Agreements
throughout such year, or if there has been a default or failure of the
servicer to perform any of such duties, responsibilities or obligations, a
description of each default or failure and the nature and status thereof has
been reported to Wells Fargo Bank Minnesota, N.A.;
(B) I have confirmed that the Servicer is currently an approved FNMA or FHLMC
servicer in good standing;
(C) I have confirmed that the Fidelity Bond, the Errors and Omissions Insurance
Policy and any other bonds required under the terms of the Servicing
Agreement, Trust Agreement, Pooling and Servicing Agreement and/or Seller/
Servicer Guide are in full force and effect;
(D) All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if
applicable) and Primary Mortgage Insurance Policy (if applicable), with
respect to each Mortgaged Property, have been paid and that all such
insurance policies are in full force and effect;
(E) All real estate taxes, governmental assessments and any other expenses
accrued and due, that if not paid could result in a lien or encumbrance on
any Mortgaged Property, have been paid, or if any such costs or expenses
have not been paid with respect to any Mortgaged Property, the reason for
the non-payment has been reported to Wells Fargo Bank Minnesota, N.A.;
(F) All Custodial Accounts have been reconciled and are properly funded; and
(G) All annual reports of Foreclosure and Abandonment of Mortgage Property
required per section 6050H, 6050J and 6050P of the Internal Revenue Code,
respectively, have been prepared and filed.
Certified By:
/s/ Angela Thompson
Assistant Vice President
Title
2/13/04
Date
Ex-99.4
Schedule of Year-To-Date Principal and Interest Distributions to
Certificateholders
Class Interest Principal Losses Ending Balance
A-1 2,653,616.83 26,441,400.97 0.00 73,558,599.03
A-2 927,516.71 9,254,490.33 0.00 25,745,509.66
A-3 1,968,475.22 40,824,465.45 0.00 60,171,534.55
A-4 1,780,000.00 0.00 0.00 53,400,000.00
A-IO 1,675,000.00 0.00 0.00 0.00
B-1 180,789.08 1,689,869.94 0.00 4,701,130.06
B-2 221,478.01 0.00 0.00 6,992,440.00
C 1,769,795.22 0.00 0.00 0.00
M-1 542,663.16 4,865,217.78 0.00 13,534,782.22
M-2 434,582.83 3,538,652.69 0.00 9,844,347.31
P 59,186.12 0.00 0.00 100.00
R-1 0.00 0.00 0.00 0.00
R-2 0.00 0.00 0.00 0.00
R-3 0.00 0.00 0.00 0.00