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Only a handful of reverse-mortgage securitizations have been done so far, but conditions are "ripe for the market to explode," according to a new report from Standard & Poor's Ratings Services."As this product continues to evolve, investors will become more comfortable with reverse-mortgage securitizations," said credit analyst Waqas Shaikh, a director in S&P's Residential Mortgage group. "This in turn will lead to more securitizations backed by these loans. In addition, the secondary markets will continue to add certain efficiencies to the process, reducing the costs associated with originating reverse mortgages." The report, titled "For Seniors, Equity Begins at Home," says reverse mortgages do pose risks, however. Obtaining such a mortgage means that homeowners begin accumulating debt again after years of paying down their mortgages. Moreover, as interest accrues, the borrower's equity continues to decline, reducing the potential inheritance of the borrower's heirs. "For lenders, the risk is that the principal outstanding, together with accrued interest for the loan, could exceed the value of the home," said Terry Osterweil, a director in the Residential Mortgage group and a co-author of the report. S&P can be found online at http://www.standardandpoors.com.

Class B-1 of Birch Real Estate CDO I Ltd./Birch Real Estate CDO I Corp., a collateralized debt obligation consisting mainly of residential mortgage-backed securities, has been downgraded from BBB to BB by Fitch Ratings.The ratings on five other classes of notes in the transaction were affirmed. Fitch attributed the downgrade to "steadily eroding" par coverage due to a newly defaulted asset and lowered recovery assumptions for distressed assets. Approximately 81% of the transaction is composed of residential MBS, while commercial MBS and asset-backed securities account for approximately 12% and 7%, respectively.

Two certificates from CSFB manufactured housing pass-through certificates series 2002-MH3 have been downgraded by Moody's Investors Service.Class M-2 was downgraded from A2 to Baa2, and class B-1 was downgraded from Baa2 to Ba3. The transaction is backed by manufactured housing loans originated by CIT Group/Sales Financing Inc., and Moody's said performance has been weaker than expected. Moody's can be found online at http://www.moodys.com.

Foreclosures have been rising sharply in South Florida since January, with Broward County topping the list with a 50% increase, according to Default Research Inc., a foreclosure research company based in Mt. Pleasant, Pa.Palm Beach ranked second, with a 37% increase in foreclosures since January, and Miami was third, with 30%, the company said. "Investors are shying away from the Eastern coast and focusing on the Gulf coast, which has seen significant decreases in 2006," said Serdar Bankaci, president and chief executive officer of Default Research. The company touts the timeliness of its foreclosure data, which it says arrive two to three weeks ahead of competitors' data. Default Research can be found online at http://www.defaultresearch.com.

Class M-3 of RAMP mortgage asset-backed pass-through certificates, series 2003-RP1, has been downgraded from BB to CCC and assigned a Distressed Recovery rating of DR3 by Fitch Ratings.In addition, the ratings on three other classes in the deal were affirmed. The downgrade reflects a deterioration in the relationship between the bond's credit enhancement and expected losses, Fitch said. Over the past 12 months, losses have exceeded excess spread, resulting in a reduction of the overcollateralization amount, the rating agency said. The collateral in the transaction consists of fixed- and adjustable-rate residential mortgage loans secured by first and second liens.

Colleen Hernandez has been named president and executive director of the Homeownership Preservation Foundation, Minneapolis, effective July 5.Ms. Hernandez was executive director of the Kansas City Neighborhood Alliance for 18 years, and she was most recently the principal of Hernandez Consulting LLC, which specializes in affordable housing and community development. She served on the board of directors of the Federal Reserve Bank of Kansas City for six years and on the Consumer Advisory Council to the Federal Reserve Board, the Homeownership Preservation Foundation said. The foundation, a nonprofit organization dedicated to reducing foreclosures and preserving homeownership, can be found online at http://www.hpfonline.org.

Arbor Realty Trust Inc., a real estate investment trust based in Uniondale, N.Y., has announced the completion of the sale of $15 million of trust preferred securities in a private placement.The trust said it will use the proceeds to repay short-term debt and provide capital to fund loan originations. The trust preferred securities have an approximately 30-year term and bear interest at a rate of 7.87% for the first five years and a floating-rate of 2.52% above the three-month London interbank offered rate thereafter. Arbor, which specializes in real-estate-related bridge and mezzanine loans, can be found online at http://www.thearbornet.com.

Classes B-2 and B-3 of Bear Stearns ARM Trust series 2001-4 have been placed under review for possible downgrade by Moody's Investors Service.The rating actions were taken because existing credit enhancement levels "may be low given the current level of foreclosures on the underlying pools," Moody's said. The most junior subordinate class, B-6, is completely written down, leaving the class B-3 certificates protected only by a $486,194 balance from classes B-4 and B-5 as of the April 25 reporting date, the rating agency reported. Moody's can be found on the Web at http://www.moodys.com.

Prepayment rates on 30-year fixed-rate mortgages in Fannie Mae and Freddie Mac mortgage-backed securities increased by a constant prepayment rate of 1.2 in May, according to the Bear Stearns Prepayment Commentary.Overall speeds on 30-year Fannie Mae collateral came in at 12.6 CPR for the month, while speeds for comparable Freddie Mac mortgages averaged 11.2 CPR, Bear Stearns senior managing directors V.S. Srinivasan and Dale Westhoff said in the report. "A seasonal increase in housing turnover activity and a two-day increase in the business calendar more than offset the 12-bp increase in mortgage rates," the analysts said. Prepayments on 30-year Ginnie Mae collateral rose from 15.8 CPR to 16.9 CPR. The analysts predicted a "pronounced slowdown" in speeds over the next few months "as the rate of home price appreciation moderates and the full impact of the increase in mortgage rates is factored in." Bear Stearns can be found online at http://www.bearstearns.com.

Freddie Mac's board of directors has set Sept. 8 as the date of the company's annual stockholders' meeting and announced a dividend of $0.47 per share on the corporation's voting common stock for the second quarter, the same as in the first quarter.The board also declared the following preferred stock dividends per share: $0.55 on its 1996 and 1998 variable-rate stock; $0.7675 on its 6.14% stock; $0.72625 on its 1997, 2001, and 2002 5.81% stock; $0.625 on its 5% stock; $0.6375 on its 1998 and 1999 5.1% stock; $0.6625 on its 5.3% stock; $0.72375 on its 5.79% stock; $0.4475 on its 1999 variable-rate stock; $0.49125 on its January 2001 variable-rate stock; $0.63826 on its March 2001 variable-rate stock; $0.48125 on its May 2001 variable-rate stock; $0.75 on its 6% stock; and $0.7125 on its 5.7% stock. The dividends will be payable on June 30 to stockholders of record as of June 12. Freddie Mac can be found online at http://www.freddiemac.com.