Servicing

Fannie Mae, which likely will not report any earnings this year, has created six new positions in its finance division and appointed nine new officers.Two of the new appointees -- R. Scott Blackley (senior vice president of accounting policy) and Nicholas Radesca (vice president of financial reporting) -- replace Fannie Mae executives who have been demoted but are now serving in full-time advisory roles at the company. The new positions are part of a major shake-up in Fannie's finance division. The controller's office is headed by vice president and controller David Hisey, who joined Fannie in January. Mr. Hisey oversees four major reporting functions: financial controls and systems, financial reporting, accounting operations, and valuation and price verification. Fannie director H. Patrick Swygert said the new positions and appointments represent the first phase of a "significant reorganization" at the government-sponsored enterprise.

CitiFinancial has announced that it will eliminate mandatory arbitration provisions on real-estate-secured loans later this year and reduce its maximum prepayment penalty.The new mandatory arbitration policy will begin with loans originated after August 2005, the company said. The elimination of such provisions has been a goal of consumer groups. CitiFinancial said the new maximum prepayment penalty will be limited to 3% of the loan amount in the first year, 2% in the second year, and 1% in the third year. The new policies were highlighted by Citi along with Sen. Paul Sarbanes, D-Md., the Leadership Conference on Civil Rights, Self Help Credit Union, the Center for Responsible Lending, and the AARP. Sen. Sarbanes said the new steps "place CitiFinancial in a leadership position in raising lending standards in the consumer finance mortgage industry." Chris Hansen, associate executive director of the AARP, commended Citi and said eliminating mandatory arbitration provisions "will help restore fairness and balance to the lender/homebuyer relationship, and sets a good precedent for the industry."

Class B-3 of Structured Asset Mortgage Investments Trust, series 2001-4, has been downgraded from Baa2 to Baa3 by Moody's Investors Service.The transactions are backed by first-lien fixed-rate mortgage loans. The downgrade was attributed to weak performance by the underlying loans, with historical and expected cumulative losses exceeding original expectations. Future losses could cause the writedown of the nonrated subordinate certificates in the deal, Moody's said.

Bimini Mortgage Management Inc., a real estate investment trust based in Vero Beach, Fla., has reported a private placement of $50 million of trust preferred securities through the newly formed Bimini Capital Trust I.The 30-year securities will bear an interest rate of 7.61% through March 30, 2010, and 3.30% above the prevailing three-month London interbank offered rate thereafter, the company said. They are redeemable in whole or in part at the option of Bimini on or after March 30, 2010. The mortgage REIT said it intends to use the net proceeds to invest in mortgage-backed securities issued by Fannie Mae, Freddie Mac, and Ginnie Mae. Bimini can be found online at http://www.biminireit.com.

Anworth Mortgage Asset Corp., Santa Monica, Calif., has announced a filing by its wholly owned subsidiary, Belvedere Trust Mortgage Corp., to register $100 million of common stock in connection with a contemplated initial public offering.The registration statement, filed with the Securities and Exchange Commission, has not yet become effective. Anworth is a mortgage real estate investment trust, and Belvedere was formed in 2003 to acquire mortgage loans, especially jumbo adjustable-rate and hybrid first-lien single-family residential mortgage loans of high credit quality, Anworth said.

The Prestwick Mortgage Group, Alexandria, Va., is brokering the sale of servicing rights on a $104 million portfolio of Fannie Mae mortgage loans from the Midwest.The weighted average note rate is 5.578, and the weighted average servicing fee is 0.3579%, the company said. The average loan balance is $90,714, with 32 months of weighted average seasoning. Approximately 75.9% of the loans are on properties in Ohio or Indiana. The seller is a bank-affiliated mortgage company. The bid deadline is May 25.

Class BF of Bear Stearns Asset Backed Securities Inc., series 1999-2, has been placed under review for possible downgrade by Moody's Investors Service.Moody's attributed the watchlist placement to credit enhancement levels that "may be low given the current projected losses on the underlying pools." The transaction has suffered "significant" losses that have gradually eroded the overcollateralization, the rating agency said. The securitization is backed by fixed-rate and adjustable-rate subprime mortgage loans that have multiple originators, including ContiMortgage Corp., Amresco Residential Mortgage Corp., and Provident Funding Associates LP.

Class M4 (the most subordinate class) of Ameriquest Mortgage Securities Inc., series 2002-3, has been placed under review for possible downgrade by Moody's Investors Service.The review was prompted by credit enhancement levels that were deemed low in view of projected losses on the underlying pool, Moody's said. "The transaction has taken losses, and pipeline loss could cause eventual erosion of the overcollateralization," the rating agency said. Moody's also placed under review for possible upgrade 27 certificates from 11 Ameriquest deals originated by backed by first lien adjustable- and fixed-rate subprime mortgage loans. Moody's can be found online at http://www.moodys.com.

Four classes of Diversified Asset Securitization Holdings III LP have been downgraded by Fitch Ratings.The downgrades were as follows: classes A-1L and A-2, from AA-plus to AA; class A-3L, from A-minus to BBB-minus; and class B-1L, from BB-plus to B-minus. Fitch said DASH III is a collateralized debt obligation that was originated and managed by Asset Allocation & Management LLC, but that TCW Asset Management Co. became the substitute asset manager for AAMCO in October 2002. The portfolio backing the CDO consists of residential and commercial mortgage-backed securities, asset-backed securities, real estate investment trusts, and other CDOs. Fitch attributed the downgrades to collateral deterioration and an "underhedged position that increases in severity in various prepayment scenarios." Mezzanine and subordinate tranches from underperforming manufactured housing securitizations have taken principal writedowns, the rating agency said. Fitch can be found online at http://www.fitchratings.com.

Fitch Ratings has downgraded 114 classes of Conseco/Green Tree manufactured housing loan securities.The rating agency also upgraded 14 classes from various Conseco/Green Tree deals and affirmed the ratings on 52 classes. Fitch noted that Conseco Finance Corp. filed for Chapter 11 bankruptcy in 2002, and that its MH platform was sold to CFN Investment Holdings LLC in June 2003 and the servicing platform was renamed Green Tree Servicing LLC. "From mid-2003 until mid-2004, the collateral performance improved notably and has remained generally stable since mid-2004," Fitch said. "However, collateral losses have continued to exceed excess spread, causing bond writedowns and credit enhancement deterioration." Fitch can be found on the Web at http://www.fitchratings.com.