REMIC Elections In the opinion of Cleary Gottlieb, Steen & Hamilton, the Trust will constitute a Double REMIC Series for federal income tax purposes. Separate REMIC elections will be made for the Pooling REMIC and the Issuing REMIC. Regular Securities The Regular Securities will be treated as debt instruments issued by the Issuing REMIC for federal income tax purposes. Income on the Regular Securities must be reported under an accrual method of accounting. The Class EN and EP Securities are Principal Only Securities. Principal Only Securities are treated for federal income tax purposes as having been issued with an amount of original issue discount ("OID") equal to the difference between their principal balance and their issue price. The Class FN, PI, SA, SB, SD, SN and UB Securities are "Interest Weighted Securities" as described in "Certain Federal Income Tax Consequences – Tax Treatment of Regular Securi- ties – Interest Weighted Securities and Non-VRDI Securities" in the Base Offering Circular. Although the tax treatment of Interest Weighted Securities is not entirely certain, Holders of the Interest Weighted Securities should expect to accrue all income on these Securities (other than income attributable to market discount or de minimis market discount) under the OID  rules based on the expected payments on these securities at the prepayment assumption described below. The  Class  WZ,  ZB,  ZN  and  ZW  Securities  are  Accrual  Securities.  Holders  of  Accrual Securities are required to accrue all income from their Securities (other than income attributa- ble to market discount or de minimis market discount) under the OID  rules based on the expected payments on the Accrual Securities at the prepayment assumption described below. Other than the Securities  described in the preceding three  paragraphs, based on antici- pated  prices  (including  accrued  interest),  the  assumed  Mortgage  Loan  characteristics,  the prepayment assumption described below and, in the case of the Floating Rate  Classes other than Class FN, the constant LIBOR value described below, no Classes are expected to be issued with OID. Prospective  investors  in  the  Securities  should  be  aware,  however,  that  the  foregoing expectations about OID could change because of differences (1) between anticipated purchase prices and actual purchase prices or (2) between the assumed characteristics of the Trust Assets and  the  characteristics  of  the  Trust  Assets  actually  delivered  to  the  Trust.  The  prepayment assumption that should be used in determining the rates of accrual of OID, if any, on the Regular Securities (as described in "Yield, Maturity and Prepayment Considerations" in this Supplement) is as follows: Group PSA 1 ........................................................................................................................................    250% 2 ........................................................................................................................................    200 3 ........................................................................................................................................    200 4 ........................................................................................................................................    900 5 ........................................................................................................................................    900 6 ........................................................................................................................................    500 7 ........................................................................................................................................    170 8 ........................................................................................................................................    400 9 ........................................................................................................................................    500 10......................................................................................................................................     900 S-39