Servicing

Fidelity Information Systems, Jacksonville, Fla., is investing millions of dollars to enhance its home equity line of credit servicing functionality.Fidelity said about half of its Mortgage Servicing Package customers currently have the HELOC functionality installed in their organizations. MSP is used to service some 30 million mortgage loans. As part of the enhancements, Fidelity said it intends to provide MSP users with credit card interfacing for HELOC loans. Fidelity said Dovenmuehle Mortgage, EMC Mortgage, Navy Federal Credit Union, and Aurora Loan Services are among the firms capitalizing on the HELOC benefits.

Freddie Mac acquired $35.19 billion in loans during September, its second-worst purchase month of the year.Meanwhile, Fannie Mae acquired $63.45 billion, its fourth-best purchase month of the year. For the year to date, Freddie Mac has purchased $383.75 billion in loans, and Fannie has bought $560.01 billion. It has been anticipated that Fannie might grow more slowly in coming months as it tries to raise additional capital to please its regulator. However, September's purchases reflect commitments entered into during the summer. Meanwhile, Freddie's retained portfolio fell slightly in September, to $660.71 billion, from $661.35 billion the month before. Fannie's portfolio increased to $904.76 billion from $895.42 in August. The two government-sponsored enterprises can be found online at http://www.freddiemac.com and http://www.fanniemae.com.

Four mezzanine and subordinate certificates of the Madison Avenue Manufactured Housing Contract Trust 2002-A securitization have been downgraded by Moody's Investors Service.The downgrades were as follows: class M-1, from Aa2 to Baa3; class M-2, from A2 to Caa1; class B-1, from Baa2 to C; and class B-2, from Ba2 to C. The senior certificates are not affected because the ratings are based on an insurance policy issued by Ambac Assurance Corp., Moody's said. The rating agency attributed the downgrades to weaker-than-expected performance by the manufactured housing loans that make up the collateral pool and the resulting erosion in credit support. The loans were originated and are being serviced by GreenPoint Credit LLC. The rating agency can be found online at http://www.moodys.com.

Performance-related upgrades exceeded performance-related downgrades by 8-to-1 in the third quarter in the U.S. residential mortgage-backed securities market, according to Standard & Poor's Ratings Services.S&P said in a recent report that there were 228 performance-related upgrades and 28 performance-related downgrades in the U.S. RMBS market during the quarter. "The catalysts for the overwhelmingly positive rating activity continue to include the effect of extraordinarily fast principal prepayments (driven by mortgage loan interest rates that neared a 45-year low), seasoning of the underlying mortgage loans, the shifting interest features of the transactions, market value appreciation, moderate delinquencies, and low losses," S&P said. The rating agency can be found on the Web at http://www.standardandpoors.com.

Class B of First Union Home Equity Loan Series 1997-1 has been downgraded from BB-minus to B by Fitch Ratings.The rating action attributed the downgrade to the poor performance of the underlying collateral in the deal. Monthly losses have generally exceeded monthly excess spread, Fitch said.

Class M-2 of Metropolitan Mortgage series 2000-A has been downgraded from B-minus to CCC by Fitch Ratings.In addition, Fitch affirmed the ratings on two other classes in the deal. The rating agency attributed the downgrade to poor collateral performance and the deterioration of asset quality beyond original expectations.

Class BV of IndyMac ABS Inc. home equity series SPMD 2000-B, group 2, has been downgraded from BB to CCC by Fitch Ratings.In addition, the rating agency affirmed three other classes in the transaction. The downgrade was attributed to poor collateral performance and the deterioration of asset quality beyond original expectations. Fitch said the portfolio performance is suffering, in part, from adverse selection, citing the increase in manufactured housing collateral from 6.7% of the pool at closing to 20.2% as of September. "To date, MH loans have exhibited very high historical loss severities, causing Fitch to have concerns regarding the adequacy of enhancement in this deal, especially with regard to class BV," the rating agency said. Manufactured housing collateral has been responsible for 42.8% of total losses to date in the transaction, Fitch reported. The rating agency can be found online at http://www.fitchratings.com.

Washington Mutual Inc., Seattle, has reported earnings of $674 million ($0.76 per share) for the third quarter, down from $999 million ($1.09 per share) a year earlier, a decline it attributed partly to reduced mortgage refinancings.Net income for WaMu's mortgage banking segment totaled $271 million in the third quarter, up from $117 million a year earlier and from a loss of $63 million in the second quarter, the company said. Originations of home loans totaled $40.49 billion for the quarter, down from $111.95 billion a year earlier. However, WaMu touted the improved performance of its mortgage servicing rights, which rose $601 million from that of the second quarter "due to lower medium-term interest rates and a widening of the spread between mortgage rates and the rates on certain financial instruments the company uses to hedge the MSR risk." Loans held in portfolio rose by $11.62 billion from the second-quarter level due chiefly to "strong growth" in WaMu's home equity loans and lines of credit and short-term adjustable-rate mortgages, the company reported. WaMu can be found online at http://www.wamu.com.

Washington Mutual, Seattle, has hired J.P. Morgan Chase veteran Taj Bindra as its new executive vice president for finance and servicing operations of mortgage banking.Mr. Bindra, 42, was formerly chief financial officer and executive vice president for Chase Home Finance. He will be responsible for managing WaMu's mortgage servicing rights management, capital market activities, and servicing operations. He will be located in Seattle and report to Craig Chapman, president of WaMu's commercial and mortgage banking businesses. In his capacity as chief financial officer for the mortgage banking business, Mr. Bindra will also report to WaMu CFO Tom Casey.

Capital Title Group Inc., a title insurance underwriter based in Scottsdale, Ariz., and Charter One Bank, Cleveland, have announced an agreement whereby a CTG subsidiary will acquire the assets of Real Estate Appraisal Services Inc., a wholly owned subsidiary of the bank.The terms of the deal were not disclosed. CTG's subsidiary CTG Real Estate Information Services will acquire REAS, a provider of appraisal and flood determination services for residential and commercial property in five states. "The vertical integration of REAS's current services with the technological support of Nationwide Appraisal Services, a CTG REIS subsidiary headquartered near Pittsburgh, will produce effective cost-saving synergies," CTG said. The companies can be found online at http://www.capitaltitlegroup.com and http://www.charterone.com.