Servicing

Brookfield Properties Corp., has announced that it will proceed with the spin-out of its U.S. homebuilding subsidiary, Brookfield Homes Corp.Brookfield Properties said it had received a go-ahead from the Securities and Exchange Commission for the spin-out, which will be effective Jan. 6. The shares of the subsidiary will trade on the New York Stock Exchange under the symbol BHS. Brookfield Properties has dual headquarters in New York and Toronto. It can be found on the Web at http://www.brookfieldproperties.com.

The volume of primary new mortgage insurance written rose in November thanks to a surge in bulk insurance, according to data collected by the Mortgage Insurance Cos. of America.Mortgage insurance firms wrote $25.56 billion of traditional MI and $4.45 billion of bulk MI in November, for a total of $30.11 billion. The amount of traditional insurance written was off 0.3% from October's total, but bulk volume surged 133.7%. Applications decreased by 4% to 269,436 in November. New pool risk written totaled $668.1 million, a 184% increase from that of October. The cure/default ratio increased from 80.6% in October to 88.4% in November. MICA can be found on the Web at www.micadc.org.

Fitch Ratings has raised the residential primary servicer rating of CitiMortgage Inc., St. Louis, from RPS1-minus to RPS1 for prime loans.The upgrade was based on CitiMortgage's "experienced management team, solid collateral performance, state-of-the-art risk management tools, comprehensive training programs, and the financial strength of its parent Citigroup, which is rated AA-plus by Fitch," the rating agency said. Fitch rates residential servicers on a scale of 1 to 5, with 1 being the highest rating. The rating agency can be found online at http://www.fitchratings.com.

The stocks of Fannie Mae and Prudential Financial Inc. have made it onto the Brokerage Firm Buy List portfolio of Zacks.com, Chicago.Zacks said the portfolio consists of stocks that currently appear on the core recommended lists of at least three of the top 15 brokerage firms. Regarding Fannie Mae, Zacks noted that it has beaten Wall Street earnings-per-share estimates in three of the past four quarters. "Recently [Fannie Mae] went through a new risk-based capital test designed to test whether the mortgage finance companies have enough capital to weather a lengthy downturn in the U.S. economy," Zacks.com said. "The company passed with flying colors and renewed confidence with analysts." As for Prudential -- whose subsidiaries include Prudential Mortgage Capital Co. and Prudential Real Estate Investors -- Zacks said such investment companies normally see rising traffic in December and January "as investors rush to make retirement contributions and save year-end bonuses." Pru recently committed to achieve $300 million in cost savings in 2003 and 2004, which "sent several major brokerage firms scrambling to add Pru to their core recommendations list," the company said. Zacks can be found online at http://www.zacks.com.

Sales of existing single-family homes fell 3.5% in November -- the sixth-highest monthly rate ever -- while price appreciation nearly hit 10% last month.The National Association of Realtors reported that single-family resales fell from 5.76 million in October to a seasonally adjusted annual rate of 5.56 million in November. "For the last three months [September, October, and November] existing-home sales have averaged 5.59 million units -- an extraordinarily high level of activity," NAR chief economist David Lereah told reporters. Looking ahead, the NAR economist said he does not expect 30-year mortgage rates to move above 6.6% in 2003, but he does expect the housing market to cool somewhat while remaining relatively strong. "There should be some cooling of the housing markets entering 2003," Mr. Lereah said. "Price appreciation should cool as well." The median existing-home price was $161,400 in November, up 9.7% from that of a year earlier. The current record is 10.6%, set in July 1987. With one month to go, the NAR economist estimates that median home price appreciation will come in at 7% for calendar year 2002.

Twelve classes of Oakwood manufactured housing Transactions have been downgraded from CCC to C by Fitch Ratings.The downgrades were as follows: the B-2 classes of series 1996-A, 1996-B, and 1996-C, and the B-2 limited-guarantee classes of series 1997-A, 1997-B, 1997-C, 1997-D, 1998-B, 1998-C, 1999-A, 1999-B, and 1999-C. Fitch said Oakwood Homes did not make guarantee payments to the bonds after its Chapter 11 bankruptcy filing Nov. 15. Moreover, servicing of its manufactured housing portfolio was transferred to Oakwood Servicing Holdings Co., a newly created limited-purpose subsidiary of Oakwood Acceptance Corp. With that transfer, all servicing fees -- some of which had previously been subordinated to the bonds -- will now be paid first, reducing the available cash payable to the deals, Fitch said. If losses are greater than the excess spread, the B-2 classes will incur a principal writedown. The rating agency can be found on the Web at http://www.fitchratings.com.

Washington Mutual, Inc. is seeking release of an escrow account (valued at more than $700 million in stock and cash) it set up six years ago as part of its acquisition of a California thrift formerly know as American Savings Bank.This escrow account was designed to reimburse ASB investors for an estimated $500 million in "goodwill" claims against the U.S. government. If the escrow is released, those investors, including the Federal Deposit Insurance Corp, would lose any chance of receiving restitution from the government for the breach of a goodwill contract made to ASB in the 1980s by the former savings and loans deposit insurance fund. So far, the long-running goodwill litigation has yielded only a partial summary judgment and WAMU contends the six-year escrow agreement expired as of Dec. 20. But the FDIC wants a four-year extension of the escrow agreement to ensure it remains in line to share in any possible award. The two parties have entered into negotiations. Once the escrow account is released, all proceeds from the goodwill case would go to WaMu. The escrow account currently holds 18 million shares of WaMu common stock and $85 million in cash from dividends and interest.

American Business Financial Services Inc., Bala Cynwyd, Pa., has closed a $376.2 million senior/subordinated mortgage loan securitization.Anthony J. Santilli, the company's chairman and chief executive officer, touted the fact that all the triple-A rated bonds in the deal (approximately 87% of the total) were purchased by an unnamed government-sponsored entity. "We have just completed our eighth year of securitizing mortgage loans, and have built a loan portfolio, which we manage and service for others, of more than $3.2 billion," Mr. Santilli said. The lead manager of the latest deal was Credit Suisse First Boston, and the co-manager was Bear, Stearns & Co. Inc. The company can be found on the Web at http://www.abfsonline.com.

Freddie Mac acquired $74.34 billion in mortgages during November, yet another record month for the secondary market giant.Moreover, its purchase commitments rose in November (from October), indicating that December will likely turn out to be another stellar month for the company. With one month left to report, Freddie Mac has purchased a record-breaking $551 billion in home mortgages in 2002. Its issuance of participation certificates totaled $473.8 billion through the first 11 months of the year. In November its portfolio grew to $549.38 billion, a 14% gain from a year earlier. Freddie's chief competitor in the secondary market, Fannie Mae, acquired $129.13 billion in home mortgages in November, a record for that company, too. Both government-sponsored enterprises have benefited from record production volumes in the primary market. It is anticipated that 2003 could be yet another $2 trillion-plus year for residential funders.

John D. Gellhausen has been appointed executive vice president of National City Corp., Cleveland.Mr. Gellhausen was recently named head of the company's National Consumer Finance business, which services, sells, and originates conforming mortgages and originates and services nonconforming mortgages. (The business includes National City Mortgage Co., First Franklin Financial Corp., National City Home Loan Services, and National Home Equity.) Mr. Gellhausen was previously president and chief operating officer of National City Mortgage, and senior vice president and corporate comptroller for National City Corp. The company can be found on the Internet at http://www.nationalcity.com.