EXHIBIT 99.2

                     [Letterhead of Chapman and Cutler LLP]

                                December 23, 2003

TO THE PARTIES LISTED
ON SCHEDULE A HERETO

         Re:      Sequoia Mortgage Trust 2003-7

Ladies and Gentlemen:

         You have requested our supplemental opinion in connection with certain
federal income tax matters related to the transfer on December 23, 2003 of
Subsequent Mortgage Loans to Sequoia Mortgage Trust 2003-7 (the "Trust Fund")
pursuant to (a) that certain Pooling and Servicing Agreement, dated as of
November 1, 2003 (the "Pooling and Servicing Agreement"), among Sequoia
Residential Funding, Inc. (the "Depositor"), HSBC Bank USA, as Trustee, and
Wells Fargo Bank Minnesota, National Association, as Master Servicer and
Securities Administrator, and (b) that certain Mortgage Loan Purchase and Sale
Agreement, dated as of November 1, 2003 (the "Mortgage Loan Purchase
Agreement"), between RWT Holdings, Inc. and the Depositor. The $830,391,645
Sequoia Mortgage Trust 2003-7 Mortgage Pass-Through Certificates (the
"Certificates") were issued pursuant to the Pooling and Servicing Agreement.
Each capitalized term used but not defined herein has the meaning assigned
thereto in the Pooling and Servicing Agreement.

         We have acted as special tax counsel to the Depositor in connection
with the above transaction. In formulating our opinions, we have reviewed final
copies, dated on or before the date hereof, of (i) the Prospectus for this
transaction, (ii) the Pooling and Servicing Agreement and the forms of
Certificates issued pursuant thereto, (iii) the Mortgage Loan Purchase
Agreement, (iv) the Purchase Agreements and the Servicing Agreements, (v) the
Acknowledgments, dated as of November 25, 2003, assigning rights under the
Purchase Agreements and the Servicing Agreements, and (vi) such resolutions,
certificates, records, and other documents provided by the Depositor as we have
deemed necessary or appropriate as a basis for the opinions set forth below.

         In our examination, we have assumed the legal capacity of all natural
persons, the genuineness of all signatures, the authenticity of all documents
submitted to us as originals or finals, the conformity to original documents of
all documents submitted to us as certified, conformed or other copies, and the
authenticity of the originals of such copies. In rendering our opinions, we have
assumed that the transactions described in or contemplated by the foregoing
documents have been and will be consummated in accordance with the terms of such
operative documents, and that such documents accurately reflect the material
facts of such transactions.

         Our opinion is also based on the Internal Revenue Code of 1986, as
amended, administrative rulings, judicial decisions, Treasury regulations and
other applicable authorities. The statutory provisions, regulations, and
interpretations on which our opinion is based are subject to change, possibly



TO THE PARTIES LISTED
ON SCHEDULE A HERETO
December 23, 2003
Page 2

retroactively. In addition, there can be no complete assurance that the Internal
Revenue Service will not take positions contrary to the conclusions stated in
our opinion.

         Based on the foregoing, we are of the opinion that, assuming (i) the
making of a timely election to treat the Trust Fund as consisting of multiple,
tiered REMICs, each comprised of the assets and interests specified in the
Pooling and Servicing Agreement (and, in particular, excluding from the assets
of each such REMIC the Reserve Fund, the Capitalized Interest Account, the
Pre-Funding Accounts and the Additional Collateral) and (ii) compliance with the
provisions of the Pooling and Servicing Agreement, the Mortgage Loan Purchase
Agreement, the Purchase Agreements, the Servicing Agreements and the
Acknowledgments, for federal income tax purposes:

         1.       each segregated asset pool for which the Pooling and Servicing
                  Agreement directs the Trustee to make a REMIC election will
                  continue to qualify as a REMIC within the meaning of Section
                  860D of the Code;

         2.       the Reserve Fund will continue to be an "outside reserve fund"
                  that is beneficially owned by the Class X-1, Class X-2 and
                  Class X-B Certificate Owners; and

         3.       the rights of the Certificate Owners with respect to the
                  Reserve Fund will continue to represent, for federal income
                  tax purposes, contractual rights that are separate from their
                  regular interests within the meaning of Treasury Regulations
                  Section 1.860G-2(i).

         Other than as expressly stated above, we express no opinion on any
issue relating to the Depositor, the Trust Fund, or to any other securities
issued by them, or under any law other than the federal income tax laws.



TO THE PARTIES LISTED
ON SCHEDULE A HERETO
December 23, 2003
Page 3

         We are furnishing this opinion to you solely in connection with the
transfer of the Subsequent Mortgage Loans and it is not to be relied upon by any
other person or for any other purpose without our express written permission.

                                             Very truly yours,

                                             /s/ Chapman and Cutler LLP



                                   SCHEDULE A

Redwood Trust, Inc.
One Belvedere Place
Suite 300
Mill Valley, CA 94941

Sequoia Residential Funding, Inc.
One Belvedere Place
Suite 330
Mill Valley, CA 94941

Greenwich Capital Markets, Inc.
600 Steamboat Road
Greenwich, CT 06830

Merrill Lynch, Pierce,
Fenner & Smith Incorporated
4 World Financial Center, 10/F
New York, NY 10080

Banc of America Securities LLC
214 North Tryon Street
NC1-027-21-04
Charlotte, NC 28255

Morgan Stanley & Co. Incorporated
1585 Broadway
New York, NY 10036

Wells Fargo Bank Minnesota,
National Association
9062 Old Annapolis Road
Columbia, MD 21045

HSBC Bank USA
452 Fifth Avenue
New York, NY 10018