Four classes of Diversified Asset Securitization Holdings III LP have been downgraded by Fitch Ratings.The downgrades were as follows: classes A-1L and A-2, from AA-plus to AA; class A-3L, from A-minus to BBB-minus; and class B-1L, from BB-plus to B-minus. Fitch said DASH III is a collateralized debt obligation that was originated and managed by Asset Allocation & Management LLC, but that TCW Asset Management Co. became the substitute asset manager for AAMCO in October 2002. The portfolio backing the CDO consists of residential and commercial mortgage-backed securities, asset-backed securities, real estate investment trusts, and other CDOs. Fitch attributed the downgrades to collateral deterioration and an "underhedged position that increases in severity in various prepayment scenarios." Mezzanine and subordinate tranches from underperforming manufactured housing securitizations have taken principal writedowns, the rating agency said. Fitch can be found online at http://www.fitchratings.com.

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