Servicing

Class B3 of series 2001-2 of Structured Asset Securities Corp. residential mortgage-backed certificates has been downgraded from B to C by Fitch Ratings.In addition, the ratings on seven classes from two SASCO deals were affirmed. "The downgrade is the result of Fitch's observation of continuing high monthly pool losses and delinquency levels," the rating agency said. July 25 remittance information indicates that 13.53% of the pool was over 90 days delinquent and cumulative losses totaled 0.99% of the original pool balance, according to Fitch. The collateral consists of conventional, fixed-rate, fully amortizing residential mortgage loans extended to prime and alternative-A borrowers.

Six classes from two Structured Asset Securities Corp. residential mortgage-backed certificate transactions have been downgraded by Fitch Ratings.The downgrades were as follows: series 2002-HF2, class M3, from BBB to BBB-minus, and classes B1 and B2, from BBB-minus to BB; and series 2003-BC2, class M4, from BBB-plus to BBB, class B1, from BBB-minus to BB, and class B2, from BB-plus to B. In addition, Fitch has affirmed the ratings on 12 classes in the two deals. The downgrades were attributed to concerns about the adequacy of credit enhancement in light of declining collateral performance. Fitch said remittance information for SASCO 2002-HF2 indicates that as of July 25, excess spread had not been sufficient to cover losses for the previous three months. The mortgage pool consists primarily of first-lien subprime loans. For SASCO 2003-BC2, comparable remittance information indicates that excess spread had not been sufficient to cover losses for the previous five months, the rating agency said. The mortgage pool consists primarily of subprime first- and second-lien loans. Fitch can be found online at http://www.fitchratings.com.

Moody's Investors Service has downgraded Residential Capital Corp's senior and short-term debt ratings from Baa2 to Baa3 and from Prime 2 to Prime 3, respectively."Although the residential real estate finance business of ResCap, and auto finance business of GMAC, are separate from an operating perspective, ResCap continues to be substantially dependent on the support of GMAC in regards to its capital structure, though such support should continue to diminish," the rating agency said. Moody's added that the downgrade "is not a result of any change in Moody's views regarding ResCap's intrinsic creditworthiness, which the rating agency deems to be 'high Baa' on a stand-alone basis." The rating agency said about $5 billion in securities are affected by the downgrade and those securities' ratings have a negative outlook. Moody's can be found online at http://www.moodys.com.

RealtyTrac, an online foreclosure marketplace based in Irvine, Calif., has reported that the number of new properties in some stage of foreclosure increased 4.7% nationwide in July to a new monthly high for the year.The company's Monthly U.S. Foreclosure Market Report indicates that 78,979 new foreclosure properties were added to the rolls in July. "If the trend from the last two months continues, foreclosures may gather enough momentum to significantly impact the real estate market," said James J. Saccacio, RealtyTrac's chief executive officer. The company said Florida reported the highest number of new foreclosures of any state in July, with 12,471, an increase of 27.5%. However, the state's foreclosure rate fell from second-highest to third-highest because of greater percentage increases in other states. New foreclosures in Arkansas shot up 150% in July, giving it the nation's highest foreclosure rate, the company said. RealtyTrac can be found online at http://www.realtytrac.com.

SLM Corp., commonly known as Sallie Mae, has announced an agreement to acquire GRP Financial Services, a specialty finance company that buys and resolves mortgage loans, for an undisclosed amount.Under the agreement, the company would be purchased from GRP's management and Angelo, Gordon & Co. "With the addition of GRP to our existing debt management operations, we will be able to service virtually every type of major consumer debt," said Tim Fitzpatrick, vice chairman and chief executive officer of Sallie Mae, which was created in 1972 as a government-sponsored enterprise specializing in student loans but severed its ties to the federal government last year. Under the agreement, the White Plains, N.Y.-based GRP would become a wholly owned subsidiary of SLM Corp., but would retain its brand and senior management team, Sallie Mae said. The former GSE, based in Reston, Va., can be found on the Web at http://www.salliemae.com.

Eight classes of IndyMac ABS Inc. home equity issues have been downgraded by Fitch Ratings.The downgrades were as follows: series SPMD 2000-A group 1, class BF, from CCC to C; series SPMD 2000-B group 1, class MF-2, from B to CCC; series SPMD 2000-C group 1, class MF-2, from CCC to C; series SPMD 2000-C group 2, class MV-2, from BBB to BB; series SPMD 2001-A group 1, class MF-1, from BBB-minus to BB-minus, and class MF-2, from CCC to C; and series SPMD 2001-B groups 1 and 2, class MF-2, from A to BBB-minus, and class BF, from CCC to C. In addition, the ratings on 30 other classes in six home equity deals were affirmed. Fitch attributed the downgrades to poor collateral performance and the deterioration of asset quality beyond original expectations. Fitch can be found online at http://www.fitchratings.com.

Thrift institutions posted record profits in the second quarter as single-family originations jumped 20% from those of the prior quarter to $169.4 billion, according to the Office of Thrift Supervision.Lower mortgage rates increased loan demand, the OTS said. However, the percentage of adjustable-rate mortgages fell to 42% of loan production from 50% in the first quarter. And refinancings declined to 30% of loan production from 37% in the prior quarter. The OTS said its examiners are closely monitoring newer types of loans, such as interest-only ARMs, as well as home equity lines of credit. But troubled loans at thrifts are at a record low. Meanwhile, thrifts reported record earnings for the third consecutive quarter even though the value of mortgage servicing assets declined by $112.6 million in the second quarter. Earnings totaled $4.03 billion, up 1% from those of the first quarter and up 20% from those of the second quarter of 2004.

Four classes of Origen Financial Inc. manufactured housing contracts, series 2001-A, have been downgraded by Fitch Ratings.The downgrades were as follows: class A-5, from AA to A-plus; classes A-6 and A-7, from A to BBB-minus; and class M-1, from BB to CCC. Fitch also affirmed the rating on one other class in the deal. "Credit enhancement has continued to decline due to an elevated rate of defaulted loans," the rating agency said in explaining the actions. "Cumulative losses of over 18% of the original collateral balance have caused writedowns of the subordinate classes and have increased the credit risk to the senior classes." Origen is a real estate investment trust based in Southfield, Mich.

Five classes from two Merit Securities Corp. manufactured housing contract transactions have been downgraded by Fitch Ratings.The downgrades were as follows: series 12-1, class M-1, from A to BBB-minus, class M-2, from BB-minus to B, and class B-1, from CCC to CC; and series 13, class M-1, from BBB-minus to BB-minus, and class M-2, from B to B-minus. Fitch also affirmed the ratings on three other classes from the two deals. The rating agency said the downgrades reflect the poor performance of the collateral pool. The deals, both issued in 1999, include loans that were called from previous transactions. Fitch can be found online at http://www.fitchratings.com.

Class B of First Union HEL mortgage pass-through certificates, series 1997-3, has been downgraded from BB to B by Fitch Ratings.The downgrade reflects the fact that poor collateral performance has reduced credit enhancement in the form of overcollateralization, the rating agency said. The transaction consists of 15-year fixed-rate mortgages extended to subprime borrowers. "Over the last six months, the monthly average in realized losses (after the application of excess interest) is approximately $75,000," Fitch said. "The high percentage of loans more than 60 days delinquent (approximately 25% of the current pool) suggests continued poor performance." The rating agency can be found on the Web at http://www.fitchratings.com.