Servicing

Seven tranches from Newcastle Mortgage Securities Trust 2007-1 have been downgraded by Moody's Investors Service.The downgrades were as follows: class M-5, from A2 to A3; class M-6, from A3 to Baa2; class M-7-A, from Baa1 to Ba1; class M-7-B, from Baa1 to Ba1; class M-8-A, from Baa2 to Ba3; class M-8-B, from Baa2 to Ba3; and class M-9, from Baa3 to B2. "In its analysis, Moody's has combined its published methodology updates as of July 13th, 2007 to the nondelinquent portion of the transactions," the rating agency said. "Collateral backing these transactions is also experiencing higher-than-anticipated rates of delinquency, foreclosure, and REO relative to credit enhancement levels." The collateral backing these classes consists primarily of first-lien, fixed- and adjustable-rate subprime mortgage loans.

Forty-five classes of mortgage-backed securities from several issuers have been downgraded by Fitch Ratings as a result of changes to its subprime loss forecasting assumptions.Fitch also placed 31 classes on Rating Watch Negative and affirmed the ratings on classes with outstanding balances of about $1.5 billion. Among the securities affected by the latest downgrades were: 13 classes from Option One mortgage pass-through certificates; 11 classes from Wells Fargo Home Equity asset-backed certificates; 10 classes from WaMu Home Equity asset-backed certificates; and nine classes of SG Mortgage Securities asset-backed certificates. The rating actions were attributed to changes in Fitch's subprime loss forecasting assumptions that "better capture the deteriorating performance of pools from 2006 and late 2005 with regard to continued poor loan performance and home price weakness." The rating agency can be found online at http://www.fitchratings.com.

Twenty-seven classes of certificates from four deals issued by Aegis Asset-Backed Securities Trust in 2005 have been downgraded by Moody's Investors Service.The downgrades were attributed to an analysis of the credit enhancement provided by subordination, overcollateralization, and excess spread relative to expected losses. "A high pipeline of seriously delinquent loans has caused the protection available to those tranches to be diminished," Moody's said. "Losses have eroded the overcollateralization, leaving the rated bonds less protected." The deals are backed by subprime mortgage loans.

Moody's Investors Service has downgraded 121 tranches of securities from four issuers that are backed primarily by first-lien, adjustable-rate, negative amortizing, alternative-A mortgage loans.Moody's also placed under review for possible downgrade 38 tranches of mortgage-backed securities from the four issuers. The downgraded securities are: 73 tranches from 13 deals issued by WaMu Mortgage Pass-Through Certificates in 2006 and late 2005; 25 tranches from seven deals issued by Structured Asset Mortgage Investments II Trust in 2006 and late 2005; 16 tranches from five deals issued by Bear Stearns Mortgage Funding Trust in 2006; and seven tranches from two deals issued by MASTR Adjustable Rate Mortgages Trust in 2006. The negative rating actions were based on higher-than-expected rates of delinquency, foreclosure, and real estate owned in the underlying collateral relative to credit enhancement levels, the rating agency said. Moody's can be found online at http://www.moodys.com.

Forestar Real Estate Group Inc., Austin, Texas, has obtained $440 million in senior credit facilities, according to the company.The three-year facilities consist of a $175 million term loan and a $265 million revolving credit facility. The sole arranger and bookrunner of the facilities is KeyBanc Capital Markets. Forestar can be found on the Web at http://www.forestargroup.com.

Congress could pass a mortgage tax relief bill this week that encourages loan modifications and ensures that homeowners are not penalized when a lender reduces the principal amount of their mortgage.The bill, passed by the Senate Dec. 14, eliminates tax penalties for three years on mortgage debt forgiven in a loan mortification or foreclosure. Currently, any reduction in mortgage debt by a lender is treated as income for tax purposes. "Homeowners who are already in trouble on the mortgage certainly can't afford a big hit from the tax man, too," said Sen. Max Baucus, D-Mont., chairman of the Senate Finance Committee. The House passed a permanent exception back in October. But the House is expected to vote on and pass the Senate version so it can be sent to the president for his signature quickly. House Ways and Means Committee spokesman Matthew Beck said it is important to provide this relief to troubled homeowners as soon as possible. "I believe the House will accept the Senate version," he said. The Senate bill also includes a three-year extension of a tax deduction for mortgage insurance premiums. The House bill called for a seven-year extension.

Three classes of notes in Ballantyne Re PLC have been downgraded by Fitch Ratings because certain reserve funds backing the transaction have material exposure to subprime residential asset- and mortgage-backed securities.The downgrades were as follows: class A-1 floating-rate notes, from A-plus to BB; class B-1 subordinated notes, from BB-plus to B; and class B-2 subordinated floating-rate notes, from BB-plus to B. The ratings have been removed from Rating Watch Negative. The downgrades reflect "material mark-to-market declines" in the value of RMBS and ABS in the asset portfolios supporting Ballantyne Re's reserves, resulting in "significant unrealized losses" in the portfolios. Ballantyne Re is a special-purpose company incorporated in Ireland.

Four classes from two issues of NovaStar mortgage pass-through certificates have been downgraded by Fitch Ratings.The downgrades were as follows: NovaStar 2003-1, class M-3, from BBB to BB; and NovaStar 2004-4, class B-2, from A-minus to BBB-plus, class B-3, from BBB to BBB-minus, and class B-4, from BBB-minus to B. Fitch also affirmed the ratings on 11 other classes in the two transactions. The downgrades were attributed to deterioration in the relationship between credit enhancement and expected losses. The collateral consists of first- and second-lien subprime mortgage loans.

Six classes from two securitizations by Option One Mortgage Corp. have been downgraded by Fitch Ratings.The downgrades were as follows: series 2004-1, class M-5, from BBB-plus to BBB-minus (and removed from Rating Watch Negative), class M-6, from BB-plus to BB, and class M-7, from BB-minus to CC/DR3; and series 2004-2, class M-5, from BBB-plus to BBB-minus (and removed from Rating Watch Negative), class M-6, from BB-plus to BB, and class M-7, from B-plus to B. Fitch also affirmed the ratings on nine classes in the two deals. The downgrades were attributed to deterioration in the relationship between credit enhancement and loss expectations. The collateral for the transactions consists of first- and second-lien mortgage loans.

Fifty-four classes of mortgage-backed securities from several issuers have been downgraded by Fitch Ratings as a result of changes to its subprime loss forecasting assumptions.Fitch also placed 35 classes on Rating Watch Negative and affirmed the ratings on classes with outstanding balances of about $3 billion. Among the securities affected by the latest downgrades were: 14 classes from Credit-Based Asset Servicing & Securitization LLC series 2007-CB4; 11 classes from Natixis mortgage pass-through certificates, series 2007-HE2; 11 classes from Credit Suisse First Boston Home Equity Asset Trust series 2007-2; and 10 classes from Carrington mortgage pass-through certificates, series 2007-FRE1. The rating actions were attributed to changes to Fitch's subprime loss forecasting assumptions that "better capture the deteriorating performance of pools from 2006 and late 2005 with regard to continued poor loan performance and home price weakness."