in a fluctuating interest rate environment, the difference between the interest rates on
the Mortgage Loans and prevailing mortgage interest rates; the extent to which the
Mortgage Loans are assumed or refinanced or the underlying properties are sold or
conveyed; changes in local industry and population as they affect vacancy rates; popula-
tion migration; and the attractiveness of other investment alternatives.
These factors may also include the application of lockout periods or the assessment of
Prepayment Penalties. For a more detailed description of the lockout and Prepayment
Penalty provisions of the Mortgage Loans, see "Characteristics of the Ginnie Mae
Multifamily Certificates and the Related Mortgage Loans" in, in the case of the Group 1
Securities, Exhibit A to this Supplement and, in the case of the Group 2 Securities, the
Updated Exhibits A in Exhibit D to this Supplement.
No representation is made concerning the particular effect that any of these or other factors
may have on the prepayment behavior of the Mortgage Loans. The relative contribution of these
or other factors may vary over time.
Notwithstanding the foregoing, the Trust will not be entitled to receive any principal
prepayments or any applicable Prepayment Penalties with respect to the Trust CLC Mortgage
Loans until the earliest of (i) the liquidation of such Mortgage Loans, (ii) at the related Ginnie
Mae Issuer's option, either (a) the first Ginnie Mae Certificate Payment Date of the Ginnie Mae
Project Loan Certificate following the conversion of the Ginnie Mae Construction Loan
Certificate or (b) the date of conversion of the Ginnie Mae Construction Loan Certificate to a
Ginnie Mae Project Loan Certificate, and (iii) the applicable Maturity Date. However, the
Holders of the Securities will not receive any such amounts until the next Distribution Date and
will not be entitled to receive any interest on such amount.
In addition, following any Mortgage Loan default and the subsequent liquidation of the
underlying Mortgaged Property, the principal balance of the Mortgage Loan will be distributed
through a combination of liquidation proceeds, advances from the related Ginnie Mae Issuer
and, to the extent necessary, proceeds of Ginnie Mae's guaranty of the Ginnie Mae Multifamily
Certificates.
As a result, defaults experienced on the Mortgage Loans will accelerate the distribution
of principal of the Securities.
Under certain circumstances, the Trustee has the option to purchase the Trust Assets,
thereby effecting early retirement of the Securities. See "Description of the Securities
Termination" in this Supplement.
Assumability
Each Mortgage Loan may be assumed, subject to HUD review and approval, upon the sale
of the related Mortgaged Property. See "Yield, Maturity and Prepayment Considerations
Assumability of FHA Loans" in the Multifamily Base Offering Circular.
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