Servicing

Four classes of certificates issued in four transactions by Aames Mortgage Trust in 2001 have been downgraded by Moody's Investors Service.The downgrades were as follows: series 2001-1, class B, from Baa2 to Ba2; series 2001-2, class M-2, from A2 to Baa1, and class B, from Baa2 to B2 (remains under review for downgrade); and series 2001-3, class B, from Baa2 to Ba1. Moody's also confirmed the ratings on three classes of Aames certificates. The transactions are backed mostly by first-lien, fixed-rate subprime mortgage loans originated by Aames Financial Corp. The rating agency attributed the downgrades to significant losses that have eroded overcollateralization. The class B certificates of the 2001-2 transaction will remain on watch for possible downgrade because high loss severities on the properties held for resale could impair their credit quality further, Moody's said.

Fifty-two classes from 20 Green Tree Financial Corp. (later Conseco Finance Corp.) manufactured housing securitizations have been placed on review for possible downgrade by Moody's Investors Service.The rating agency said the review was prompted by the continued weaker-than-expected performance of Green Tree's pools. "Although repossessions and loss severities have decreased, the improvement has been slower than expected," Moody's said. "As a result, losses remain high and credit support continues to erode. The B-2 classes of many of the pools have been completely written down." The transactions are being serviced by Green Tree Investment Holdings II LLC -- a joint venture of Fortress Investment Group LLC and Cerberus Capital Management -- which bought the MH servicing platform of Conseco Finance in 2003. Moody's can be found online at http://www.moodys.com.

Freddie Mac repurchased $1.76 billion of targeted debt securities with expired call options in connection with a cash tender offer that closed Nov. 19, according to the government-sponsored enterprise.The securities were originally issued as European-style callable debt and have since converted to bullet securities. Tenders were made for 20 securities in amounts ranging from $7.53 million (for 2.65% medium-term notes due Aug. 4, 2006) to $341.57 million (for 2.25% medium-term notes due Dec. 4, 2006), Freddie Mac reported. Freddie Mac can be found on the Web at http://www.freddiemac.com.

Freddie Mac has announced the pricing of a $2.5 billion 5% Gold MACS Strip security.The weighted average coupon is 5.53%, the weighted average maturity is 355 months, and the weighted average loan age is four months, the government-sponsored enterprise reported. The settlement date of the issue (CUSIPs: IO 31282YDN6, PO 3128HVC80) is Nov. 19. The transaction is lead managed by J.P. Morgan Chase and UBS Investment Bank. Freddie Mac can be found online at http://www.freddiemac.com.

NovaStar Financial Inc., a real estate investment trust based in Kansas City, Mo., has announced the completion of a $2.5 billion securitization by its subsidiary, NovaStar Mortgage.The transaction, NovaStar Mortgage Funding Trust series 2004-4, offered 15 rated classes of certificates with a face value of $2.47 billion, NovaStar said. The lead managers of the deal are RBS Greenwich Capital and Wachovia Securities. NovaStar Mortgage can be found on the Web at http://www.novastarmortgage.com.

Impac Mortgage Holdings Inc., Newport Beach, Calif., has priced public offerings of 3.75 million shares of its common stock at $23 per share and 4.0 million shares of preferred stock at $25 per share.The common stock offering produced estimated net proceeds of $81.9 million, and the offering of 9.125% series C cumulative redeemable preferred stock produced an estimated $96.9 million, Impac said. The common stock offering was led by UBS Investment Bank, with Bear, Stearns & Co. as joint lead manager. The preferred stock offering was managed by Bear Stearns, with Stifel, Nicolaus & Co. as co-manager. The company has granted the underwriters of the common stock an option to buy up to 562,500 additional shares, and the underwriters of the preferred stock an option to buy up to 300,000 additional shares, to cover any overallotments. Impac, a mortgage real estate investment trust, can be found online at http://www.impaccompanies.com.

Two classes of IndyMac ABS Inc. home equity issues have been downgraded by Fitch Ratings.The downgrades were as follows: class BF of series SPMD 2000-B group 1, from CC to C; and class BF of series SPMD 2001-B, from BB to CCC. In addition, the ratings on 43 classes in eight IndyMac ABS deals were affirmed. The rating agency attributed the downgrades to "poor collateral performance and the deterioration of asset quality beyond original expectations." Fitch said the percentage of manufactured housing collateral in IndyMac SPMD 2000-B group 1 had tripled (to 37.4%) as of October 2004, and that MH loans "have exhibited very high historical loss severities, causing Fitch to have concerns regarding the adequacy of enhancement in this deal." For series SPMD 2001-B, the percentage of MH collateral had grown from 2.3% at closing to 9.5% as of October. Fitch can be found online at http://www.fitchratings.com.

The California commercial loan delinquency ratio was below one-half of 1% in the third quarter for the 24th consecutive quarter, according to the California Mortgage Bankers Association.The Sept. 30 Quarterly Delinquency Survey found that 99.8% of the California commercial real estate loans serviced by 18 mortgage banking firms were either current or delinquent by only one payment. This represents a delinquency ratio of 0.24%, compared with 0.33% three months ago and 0.24% a year ago. Sixteen of the 18 companies reported no loans more than 30 days delinquent. Of the $60.7 billion of loans being serviced by the 18 mortgage bankers, 15 loans totaling $143.1 million were two or more payments past due. The 15 delinquent loans represent 0.15% of the 9,884 commercial real estate loans included in the survey. For survey purposes, a loan is considered delinquent if it is two or more payments past due, although loans in foreclosure are included regardless of the number of payments past due. The CMBA, based in Sacramento, can be found online at http://www.cmba.com.

The Federal Home Loan Bank of Seattle saw its third-quarter earnings plunge by 53% to $16.8 million due to hedging mistakes and a poor performance in two key products.The FHLBank admitted in a statement that it did not "efficiently manage the funding and hedging of its investments." These investments include mortgage-backed securities and its mortgage purchase program. The MPP, which competes against Fannie Mae and Freddie Mac, was hurt by decreasing volumes and the bank's decision to limit purchases from larger member banks while it enhances what it calls its "financial infrastructure." On Monday, the Federal Home Loan Bank of Chicago, which operates the bank system's Mortgage Partnership Finance program, said it will delay reporting third-quarter earnings because of concerns over accounting for derivatives.

Class M-2 of American Residential HELT series 1998-1 has been downgraded from A to A-minus and removed from Rating Watch Negative by Fitch Ratings.Fitch also affirmed the rating on one other class in the deal. The downgrade stemmed from concerns about the adequacy of credit enhancement in the light of declining collateral performance, the rating agency said.