Broadhollow Notes on CreditWatch

Standard & Poor's Ratings Services has placed its BBB ratings on the series 2004-A and 2005-A subordinated notes issued by Broadhollow Funding LLC on CreditWatch with negative implications.Broadhollow is a single-seller warehouse asset-backed commercial paper conduit that issues extendible notes to finance mortgage loans originated by American Home Mortgage Corp. The rating actions followed a bankruptcy filing by American Home Mortgage Investment Corp., which is a "termination event" under the Broadhollow transaction documents, S&P said. Broadhollow is no longer permitted to buy additional mortgage loans, and all collections and sales proceeds will be held to pay off Broadhollow's secured liquidity notes as they mature. S&P said the rating actions reflect its uncertainty about the bankruptcy filing and the extent to which AHM's recent announcements and reduced operating structure will affect its servicing operations. "Further aging of delinquent loans, in combination with the current market environment for pricing those nonperforming loans, has increased the risk of unprecedented market value declines," the rating agency said.