Conti HEL Classes Downgraded

Seven classes from six ContiMortgage Home Equity Loan Trust transactions have been downgraded by Standard & Poor's Ratings Services.The downgrades were as follows: class B, series 1997-5, from B to CC; class B, series 1998-1, from CCC to CC; class B-I, series 1998-3, from BBB-minus to BB-plus; class B-II, series 1998-3, from BBB-minus to BB; class B, series 1999-1, from B to CCC; class B, series 1999-2, from BB to CCC; and class B, series 1999-3, from BBB-minus to BB. In addition, the ratings on 73 other classes from 19 ContiMortgage deals were affirmed. The downgrades reflect a decline in credit support for the subordinate classes due to an erosion of overcollateralization stemming from the fact that net losses have been consistently greater than excess interest, S&P said. The "dramatic" increase in losses for these and "most other" ContiMortgage pools results from the servicer's having charged off loans that were previously in loss mitigation where advances have now been deemed nonrecoverable, the rating agency said. S&P can be found on the Web at http://www.standardandpoors.com.