on your security may occur much earlier than
the final distribution date.
Support securities will be more sensitive to
rates of principal payments than other
securities. If principal prepayments result in
principal distributions on any distribution
date equal to or less than the amount needed
to produce scheduled payments on the PAC
class, the support class will not receive any
principal distribution on that date. If prepay-
ments result in principal distributions on any
distribution date greater than the amount
needed to produce scheduled payments on
the PAC class for that distribution date, this
excess will be distributed to the support
class.
The rate of principal payments on the un-
derlying certificates will directly affect the
rate of principal payments on the group 2
securities. The underlying certificates will
be sensitive in varying degrees to
the rate of payments of principal (includ-
ing prepayments) of the related mortgage
loans, and
the priorities for the distribution of princi-
pal among the classes of the related under-
lying series.
As described in the related underlying certifi-
cate disclosure documents, the underlying
certificates included in trust asset group 2 are
not entitled to distributions of principal until
certain classes of the related underlying se-
ries have been retired and, accordingly, dis-
tributions of principal of the related
mortgage loans for extended periods may be
applied to the distribution of principal of
those classes of certificates having priority
over the underlying certificates.
In addition, the principal entitlement of the
underlying certificates included in trust asset
group 2 on any payment date is calculated on
the basis of schedules; no assurance can be
given that the underlying certificates will ad-
here to their schedules. Further, with respect
to trust asset group 2, prepayments on the
related mortgage loans may have occurred at
rates faster or slower than those initially
assumed.
This supplement contains no information as
to whether the underlying certificates have
adhered to the applicable principal balance
schedules, whether any related supporting
classes remain outstanding or whether the
underlying certificates otherwise have per-
formed as originally anticipated. Additional
information as to the underlying certificates
may be obtained by performing an analysis of
current principal factors of the underlying
certificates in light of applicable information
contained in the related underlying certifi-
cate disclosure documents.
The securities may not be a suitable invest-
ment for you. The securities, especially the
group 2 securities and, in particular, the sup-
port, interest only, principal only, inverse
floating rate and residual classes, are not
suitable investments for all investors.
In addition, although the sponsor intends to
make a market for the purchase and sale of
the securities after their initial issuance, it
has no obligation to do so. There is no assur-
ance that a secondary market will develop,
that any secondary market will continue, or
that the price at which you can sell an invest-
ment in any class will enable you to realize a
desired yield on that investment.
You will bear the market risks of your invest-
ment. The market values of the classes are
likely to fluctuate. These fluctuations may be
significant and could result in significant
losses to you.
The secondary markets for mortgage-related
securities have experienced periods of illi-
quidity and can be expected to do so in the
future. Illiquidity can have a severely adverse
effect on the prices of classes that are espe-
cially sensitive to prepayment or interest rate
risk or that have been structured to meet the
investment requirements of limited catego-
ries of investors.
The residual securities may experience sig-
nificant adverse tax timing consequences. Ac-
cordingly, you are urged to consult tax
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