Three classes from two Delta Funding Corp. home equity transactions have been downgraded by Fitch Ratings.The downgrades were as follows: series 2000-1, class B, from CC to C; and series 2000-3, class M-2, from A to A-minus, and class B, from B-minus to C. In addition, Fitch upgraded two classes and affirmed the ratings on seven classes from four Delta issues. "Due to performance triggers that are in breach in all the transactions, principal distributions on the certificates are currently applied in a sequential order," Fitch reported. This generally results in lower credit risk for the more senior tranches, the rating agency said. "There is, however, a higher degree of risk associated with the lower priority of payment to the subordinate classes, represented by the downgrades in series 2000-1 and series 2000-3," Fitch explained. The collateral for the deals consists of both fixed- and adjustable-rate subprime mortgages.

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