Servicing

Class M-2 of Origen Financial Inc. manufactured housing contracts, series 2001-A, has been downgraded from B-minus to CCC by Fitch Ratings.In addition, Fitch affirmed the ratings on five other classes in the deal. Southfield, Mich.-based Origen, formerly named Dynex Financial, is a privately held company that provides financing for the purchase of manufactured housing. "Loss severity on Origen's liquidated loans have been better than the industry average due to the company's dealer relationships and ability to provide financing for purchasers of repossessed units," Fitch said. "Despite this advantage, problems in the manufactured housing sector have caused loss severities to be higher than Fitch's initial expectations. This, coupled with higher default rates, has reduced the relationship between expected losses and credit enhancement."

Fitch Ratings has announced that it is maintaining its criteria on home loans governed by New Jersey's predatory-lending laws following the amendment to New Jersey's Homeownership Security Act of 2002.Fitch said it believes the elimination of "covered home loans" and "flipping" should eliminate some of the uncertainties for mortgage lenders and will benefit the New Jersey mortgage market, as more lenders may now begin, or resume, making mortgage loans in New Jersey. However, Fitch added that the amendment does not change or further clarify the assignee liability or safe-harbor issues. Thus, Fitch's policies and procedures in regard to "high-cost home loans" in New Jersey are not affected by passage of the amendment. In order to rate residential mortgage-backed securities transactions, which contain any loans originated in New Jersey after the original act's effective date of Nov. 28, 2003, Fitch will continue its policy of reviewing the results of an independent analysis of loans by an acceptable, unaffiliated third party that states that due diligence was conducted on the New Jersey loans.

Class BF-1 of Saxon Asset Securities Trust series 1999-5 has been downgraded from BBB to BB-plus by Fitch Ratings.In addition, Fitch affirmed the ratings on three classes from the deal. The downgrade was attributed to loss levels that have resulted in a decline in overcollateralization and to high delinquencies in relation to the applicable credit support.

The Community Development Trust, a New York-based real estate investment trust, has reported the completion of its first mortgage loan securitization with Fannie Mae.CDT, which provides capital for affordable housing, said it swapped 32 loans with a balance of $44.5 million for an equal amount of Fannie Mae mortgage-backed securities, which were then sold to JP Morgan Chase. The loans had an average balance of $1.4 million and are secured by properties in eight states, most of them with Low Income Housing Tax Credits, CDT said.

Price inflation of resale homes in the greater Las Vegas area averaged a record 45.3% over the past year, suggesting the existence of a housing price bubble that could deflate at any time, according to Foreclosures.com, a Sacramento, Calif.-based distressed property investment advisory firm.The 45.3% Clark County price rise from July 2003 to July 2004 represents "an all-time record for U.S. housing markets, and is far above a sustainable level," said Alexis McGee, president of Foreclosures.com. She cited figures from the Greater Las Vegas Association of Realtors indicating that new listings of single-family detached homes have risen 78.4% during the same period, reaching a median price of $329,900. "That's a sure sign that speculators are in the Las Vegas market," Ms. McGee said, and that they are "buying new homes from builders, and reselling them at a profit a few weeks later." But some major builders are scaling back prices in new subdivisions, and the Realtors group says the time on market for new houses has risen from 8-10 days to more than 30 days, Ms. McGee said. "When things slow down, the speculators will leave the scene and there will be a shakeout," she said. The firm can be found online at http://www.foreclosures.com.

Class M-1F of ContiMortgage Home Equity Loan Trust series 1997-2 group 1 has been downgraded to AA-minus by Fitch Ratings and removed from Rating Watch Negative.In addition, Fitch affirmed the ratings on three other classes in the deal and on two classes of series 1997-2 group 2. The rating agency attributed the downgrade to high loss levels and a continuing decline in credit enhancement relative to the required credit support.

Class BV of IndyMac ABS Inc. series SPMD 2000-B group 2 has been downgraded from BBB to BB and removed from Rating Watch Negative by Fitch Ratings.In addition, the ratings on three other classes in the same home equity deal were affirmed. Fitch attributed the downgrade to "poor collateral performance and the deterioration of asset quality beyond original expectations." The deal originally contained 6.7% of manufactured housing collateral, but the percentage had increased to 19.1% as of July, the rating agency said. "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," Fitch said. The rating agency can be found online at http://www.fitchratings.com.

Hibernia, a bank headquarted in New Orleans, is selling its $10 billion third party mortgage servicing portfolio to CitiMortgage, Stamford, Conn.Matrix Bancorp Trading Inc., Denver, is the sales advisor for Hibernia. "Fluctuating interest rates over the past two years have impacted the value of mortgage servicing rights and resulted in volatility in the mortgage servicing income stream for Hibernia and many other banks," said Paul Peters, mortgage banking president for Hibernia. "Based on our ongoing analysis of the mortgage servicing asset and our desire to limit earnings volatility in this area, we decided to exit the third-party mortgage servicing business. We will now direct most of our mortgage banking efforts toward retail residential origination and release the servicing rights to others in the industry." Hibernia will retain a $2 billion adjustable-rate mortgage portfolio and a $650 billion portfolio owned by Hibernia that is serviced by others.

LNR Property Corp. subsidiary Lennar Partners Europe Ltd. has acquired commercial real estate loan servicer Hatfield Philips International.Jeffrey P. Krasnoff, president and chief executive officer of LNR Property Corp., said he and Mark Griffith, managing director of LNR's European operations, have worked closely with Hatfield Philips International chairman John Hatfield for "almost a dozen years." He added that, over the past seven years, he has watched closely "as the HPI team built a first rate operation in Europe." Mr. Hatfield said that his company "already had a wonderful working relationship with the LNR team" and that he is "thrilled to formally join forces with LNR in Europe." LNR can be found on the Web at http://www.lnrproperty.com.

C-BASS, New York, has completed a real estate mortgage investment conduit deal backed by approximately $448 million of residential mortgages.The company said the REMIC -- C-BASS Mortgage Loan Asset-Backed Certificates, Series 2004-CB5 -- consists of about $434 million investment grade certificates underwritten by Banc of America Securities and WaMu Capital Corp. The servicer on the deal is Litton Loan Servicing LP, a C-BASS subsidiary. C-BASS specializes in acquiring, servicing and securitizing "credit sensitive" residential mortgages. C-BASS can be found online at http://www.c-bass.com.