Servicing

Four classes from four net-interest-margin securitizations issued by Lehman Brothers (SASCO) have been downgraded by Moody's Investors Service.The downgrades were as follows: SARM Net Interest Margin Notes, series 2005-5, class A, from A3 to B1; SAIL Net Interest Margin Notes, series 2003-2, class A, from Baa2 to Ba2; SASCO Net Interest Margin Trust 2003-36XS, class A, from A1 to Baa2; and SASCO Net Interest Margin Trust 2003-3XS, class A, from A3 to Baa2. NIM deals typically represent the securitization of excess spread, prepayment penalties, and cap payments generated by the underlying residential mortgage-backed securities. Moody's attributed the downgrades to "low and diminishing levels" of residual cash flows from the underlying transactions. The transaction underlying SARM 2005-5 has experienced high prepayments, reducing the payments to the A-IO2 class that serves as collateral, the rating agency said. "For the other NIM securities, losses incurred by the underlying pools have diverted cash flow away from the residual tranches, which provide collateral to the NIMs," Moody's reported. The rating agency can be found online at http://www.moodys.com.

The PMI Group, San Francisco, has inked a deal to buy back $345 million worth of its common stock through Goldman Sachs & Co.A spokesman for the company said the accelerated buyback commitment will offset a debenture program that will result in the issuance of about $345 million worth of new stock to bondholders. The mortgage insurer said the company is trying to avoid a dilution in its share price. Not only is Goldman serving as broker on the share buybacks, but it has also arranged for $345 million in financing to fund the program. According to the Quarterly Data Report, PMI is the nation's second-largest mortgage insurance company. PMI can be found on the Web at http://www.pmigroup.com.

Three subordinate certificates from three subprime securitizations issued by Saxon Asset Securities Trust in 2001 have been downgraded by Moody's Investors Service.The downgrades were as follows: series 2001-1, class MF-2, from Ba2 to Ba3; series 2001-2, class B-1, from Ba2 to B1; and series 2001-3, class B, from Ba1 to B1. The downgrades were based on weaker-than-expected performance by the mortgage pools and the resulting erosion of credit support, Moody's said. In the 2001-1 deal, the overcollateralization is almost fully depleted and the BF-1 tranche has realized losses, the rating agency reported. In the 2001-2 and 2001-3 deals, pipeline losses could cause further erosion of the overcollateralization and put pressure on the most subordinate tranches, Moody's said. Saxon Mortgage Inc. is the master servicer of the transactions, and Saxon Mortgage Services Inc., a sister company, is the primary servicer.

Interactive Mortgage Advisors, Denver, is offering a $145.7 million portfolio of bulk Fannie Mae servicing rights.The average loan size of the portfolio is $106,967. The average yield is 5.96%. IMA, a servicing brokerage and advisory firm, did not disclose the identity of the seller. The bid deadline is Aug. 31.

H&R Block Inc., Kansas City, Mo., has announced that it expects to record a $102.1 million provision for losses in the current quarter related to its subsidiary Option One Mortgage Corp.Block said the expected loss provision would reflect an increase in the estimated recourse liability recorded by Option One for loan repurchases and premium-recapture reserves. "The increased level of loan repurchases, which have been noted industrywide, are primarily due to a higher level of repurchase requests from loan buyers and an increase in early payment delinquencies," the company said. The provision would represent an after-tax amount of $61.3 million, or $0.19 per share, Block reported. The company can be found online at http://www.hrblock.com.

Five classes of the Long Beach Mortgage Loan Trust series 2002-1 subprime mortgage deal have been downgraded by Fitch Ratings.The downgrades were as follows: group 1, class I-M2, from BBB to BB, and class I-M3, from CCC/DR2 to C/DR4; and group 2, class II-M1, from A-plus to BBB-plus, class II-M2, from BBB to BB, and class II-M3, from CCC/DR2 to C/DR4. In addition, the rating on one class in group 1 was affirmed. The downgrades stem from the fact that the transaction is experiencing monthly losses that exceed the available excess spread, causing "substantial deterioration" of the overcollateralization, the rating agency said. The performance of the deal has also been hurt by a growing concentration of loans secured by manufactured homes, Fitch said. Fitch can be found online at http://www.fitchratings.com.

Eight classes from five Ameriquest Mortgage Securities Inc. securitizations have been downgraded by Moody's Investors Service.The downgrades were as follows: series 2003-1, class M-4, from Baa3 to B1; series 2003-2, class M-3, from Baa2 to Baa3, and class M-4, from Baa3 to Ba3; series 2003-7, class M-5, from Baa3 to Ba1; series 2003-8, class M-5, from Baa2 to Baa3, class MV-6, from Baa3 to Ba3, and class MF-6, from Baa3 to Ba3; and Quest Trust 2003-X4, class M-3, from Baa3 to Ba3. In addition, class M-4 of series 2003-AR2 was placed under review for possible downgrade, and nine classes from four Ameriquest deals were upgraded. The negative rating actions were based on projected losses versus available support from excess spread and overcollateralization, Moody's said. The rating agency can be found online at http://www.moodys.com.

Accredited Home Lenders Holding Co., San Diego, has reported an increase in the size of its asset-backed commercial paper conduit from $1.0 billion to $2.5 billion.The company said the conduit is issued through its subsidiary Carmel Mounting Funding Trust, a special-purpose, bankruptcy-remote entity formed by Accredited Home Lenders Inc., a wholly owned subsidiary of the parent company. The conduit finances subprime mortgage loans originated by Accredited Home Lenders Inc. through the issuance of extendible asset-backed commercial paper and subordinated debt. "Increasing the size of this facility provides us with additional origination funding capacity at more favorable rates than traditional warehouse lines," said James Konrath, Accredited's chairman and chief executive officer. The company can be found online at http://www.accredhome.com.

Class A-6 of Access Financial's series 1996-1 securitization of manufactured housing contracts has been downgraded from AA-minus to A-minus by Fitch Ratings.In addition, the ratings on six classes from two Access manufactured housing transactions were affirmed. Fitch attributed the downgrade to a deterioration in the relationship between credit enhancement and expected losses. Cumulative losses now represent 27.6% of the original balance, and the certificates are undercollateralized by $11.2 million, the rating agency said. Fitch can be found online at http://www.fitchratings.com.

Radius Mortgage Capital LLC, San Diego, has selected GMAC Mortgage Corp., Horsham, Pa., to handle the special servicing of mortgage loans.Radius is a whole-loan mortgage investor that focuses on credit-sensitive and liquidity-impaired residential loans. GMAC Mortgage said it will provide interim and retained subservicing for Radius' complete portfolio of first and closed-end second mortgages. The companies can be found online at http://www.radiusmc.com and http://www.gmacsolutions.com.