Fitch Eyes 42 Conseco HE Classes

The ratings on 42 classes of 33 home equity loan deals by Conseco Finance Corp. (formerly Green Tree Financial Corp.) have been placed on Rating Watch Negative by Fitch Ratings.The actions reflect concerns about certain servicing practices used by Conseco on its HEL portfolio, as well as Conseco's "extremely weak financial profile," Fitch said. While the home equity deals' performance has largely met Fitch's expectations, the servicing practices -- such as loan extensions and deferrals -- "may have portrayed more favorable performance than is actually the case," the rating agency said. The practices have been used to modify about 36% of the company's home equity portfolio, and "may only be a way of delaying losses," Fitch opined. The rating agency can be found online at http://www.fitchratings.com.