Downey Option ARM Classes Downgraded

Four tranches from two payment-option adjustable-rate mortgage transactions backed by loans originated by Downey Savings and Loan Association have been downgraded by Moody's Investors Service. The downgrades were as follows: DSLA Mortgage Loan Trust 2005-AR2, class 2-A2, from Aaa to Aa3, and class 2-A1B, from Aaa to Aa3; and DSLA Mortgage Loan Trust 2005-AR3, class 2-A2, from Aaa to A2, and class 2-A1C, from Aaa to A2. In addition, 10 senior tranches from four transactions were confirmed at Aaa. The downgrades, in general, were based on higher-than-expected rates of delinquency, foreclosure, and real estate owned in the underlying collateral relative to credit enhancement levels, Moody's said. The collateral consists primarily of first-lien, adjustable-rate, negatively amortizing alternative-A mortgage loans. Moody's can be found online at http://www.moodys.com.