Servicing

ABN Amro Mortgage Group, Ann Arbor, Mich., now services more than $200 billion of mortgage loans for 1.6 million customers.Richard Geary, group senior vice president for loan administration, said that reaching the $200 billion threshold demonstrates the company's commitment to customer service. "AAMG's focus on customer retention has helped maintain the company's leadership position in the market," Mr. Greary said. At the beginning of this year, AAMG serviced $186 billion of home loans. In addition to servicing loans purchased from mortgage brokers through InterFirst Wholesale Lending, AAMG services all loans generated through its various consumer-direct lending operations, including Standard Federal Bank, LaSalle Bank, the AAMG National Lending Center, and its website, http://www.mortgage.com.

The ratings on the B-1 classes of three OMI Trust manufactured housing transactions have been lowered by Standard & Poor's Ratings Services.The downgrades were as follows: OMI Trust 1999-C, class B-1, from CCC to CC; OMI Trust 1999-D, class B-1, from CCC to CC; and OMI Trust 2001-C, class B-1, from CCC-minus to CC. S&P said the downgrades "reflect the unlikelihood that investors will receive timely interest and the ultimate repayment of their original principal investment." The rating agency said high losses in the past year have reduced the deals' overcollateralization ratios to zero, causing writedowns on the B-1 classes of OMI Trust 1999-C and OMI Trust 2001-C and threatening a writedown in OMI Trust 1999-D next month. The deals are backed by manufactured housing retail installment contracts originated by Oakwood Homes Corp. Oakwood announced in November 2002 that it was filing for Chapter 11 bankruptcy protection.

The ratings on three classes of Morgan Stanley Capital I Inc.'s commercial mortgage pass-through certificates, series 1998-CF1, have been lowered by Standard & Poor's Ratings Services.The downgrades were as follows: class C, from A to BBB; class D, from BB-plus to B; and class E, from BB to CCC. Classes D and E were removed from CreditWatch with negative implications, and the ratings on five other classes in the deal were affirmed. S&P attributed the downgrades to expected losses on the numerous delinquent and specially serviced mortgages, $14.1 million in accrued interest shortfalls, and expectations that the shortfalls will continue until the resolution of real estate owned health care assets. In addition, the master servicer, GMAC Commercial Mortgage Corp., has $16.1 million in outstanding advances to the trust, the rating agency said. S&P can be found on the Web at http://www.standardandpoors.com.

Homestar Mortgage Services LLC, Paramus, N.J., has announced the formation of a Conduit Lending Division that will purchase and securitize closed alternative-A loans from mortgage bankers.Mary Glass-Schannault has been promoted to executive vice president of the division, Homestar said. Bela Donine has been named senior vice president and chief credit officer of the division, and Laurie Nicoli has been named senior vice president and director of national production in the unit. The Conduit Lending Division, headquartered in Foothill Ranch, Calif., is scheduled to begin operations late this year, Homestar said. The company can be found on the Web at http://www.homestar.com.

Two classes of Metropolitan Asset Funding residential mortgage-backed securities, series 1998-B, have been downgraded by Fitch Ratings.Class B1 was downgraded from BBB to BB-minus and removed from Rating Watch Negative, and class B2 was downgraded from B-minus to CC, the rating agency said. In addition, the ratings on four other classes in the deal were affirmed. Fitch said the downgrades stemmed from higher-than-expected loss levels that have resulted in the depletion of overcollateralization. The rating agency can be found online at http://www.fitchratings.com.

The ratings on six classes of Asset Securitization Corp.'s commercial mortgage pass-through certificates series 1997-D5 have been lowered by Standard & Poor's.The downgrades were as follows: class A-1E, from AA-plus to AA-minus; class A-2, from A-plus to BBB; class A-3, from A-minus to BBB-minus; class A-4, from BBB-plus to B; class A-5, from BBB to D; and class A-6, from BBB-minus to D. The rating on class A-1E was placed on CreditWatch with negative implications, the ratings on classes A-5 and A-6 were removed from CreditWatch negative, and the ratings on the other three classes remain on CreditWatch negative. S&P also placed the ratings on four other classes -- A-1A, A-1B, A-1C, and A-1D -- on CreditWatch negative. The rating actions were attributed to "significant interest shortfalls" that will result chiefly from the master servicer's recovery of nonrecoverable advances related to a particular loan. The rating agency can be found online at http://www.standardandpoors.com.

Prepayment rates for agency mortgage-backed securities fell across the board among coupons below the 6.5% level and held steady or rose modestly among higher coupons in the August reporting period, according to the Bear Stearns Prepayment Commentary.Analysts Dale Westhoff and Bruce Kramer said percentage declines in constant prepayment rates ranged from 25% to 35% for new cohorts of 5.0% and 5.5% coupons for both conventional MBS and Ginnie Maes. While acknowledging a few surprises among super-premiums in the report, the analysts said "all signs point toward a sharp slowdown across all coupons and vintages in the September reporting period." Speeds of Freddie Mac MBS were once again consistently faster than those of comparable Fannie Maes, but the gap had narrowed and should close by the end of the year, the analysts predicted. Bear Stearns can be found online at http://www.bearstearns.com.

The American Stock Exchange has announced the commencement of trading in options on the stocks of Anworth Mortgage Asset Corp. and MFA Mortgage Investments Inc.The options on Anworth stock were slated to open with strike prices of 12.5-15.0-17.5 and position limits of 31,500 contracts, Amex reported. The specialist is Bowery Specialist Group LLC. Anworth invests in mortgage pass-through certificates, collateralized mortgage obligations, mortgage loans, and other mortgage assets. The options on MFA stock were slated to open with strike prices of 7.5-10.0-12.5 and position limits of 31,500 contracts, Amex said. The specialist is Highland Securities Corp. MFA is a mortgage real estate investment trust that invests chiefly in highly rated adjustable-rate mortgage securities. Amex can be found online at http://www.amex.com.

Abington Bancorp, Abington, Mass., has announced a major balance sheet restructuring program that includes the sale of $75 million of mortgage-backed securities.Abington said the restructuring is aimed at reducing unamortized premiums, improving earnings and operating ratios, strengthening capital, and reducing interest rate and price risk. Besides the sale of higher-risk MBS, the company said it will sell $22 million of smaller-denomination securities and liquidate short-term debt and a portion of its longer-term, high-cost Federal Home Loan Bank borrowings. "The elimination of higher-risk earning assets and repayment of some of our higher-cost borrowings is expected to improve our net interest income by over $1.5 million annually," said James P. McDonough, the company's president and chief executive officer. In May, Abington announced a revision of its 2002 financial results and a restatement of its 2001 results to correct certain accounting errors related to prepayments on MBS, among other things. Abington, the holding company for Abington Savings Bank, can be found online at http://www.abingtonsavings.com.

Mortgage lenders added 7,200 full-time employees to their payrolls in July even though mortgage rates began to climb during the month.Data released Friday by the U.S. Bureau of Labor Statistics show that employment in the mortgage banker/broker sector rose from 414,500 in June to 421,700 in July. (There is a one-month lag in mortgage employment data due to recent changes in the BLS employment report.) Next month's employment report is likely to show some slowdown in hiring in August, but lenders are still processing a huge number of loans, and some firms continue to hire loan officers to increase their market share. Over the past 12 months, employment in the mortgage industry has increased by nearly 20%, or 66,900 new hires. Meanwhile, the U.S. jobless recovery continued in August. The BLS reported that nonfarm payrolls declined by 93,000 in August even though the unemployment rate edged down to 6.1% from 6.2% in July. The BLS can be found online at http://stats.bls.gov.