Merrill MBS Classes Downgraded

The ratings on four classes of Merrill Lynch Mortgage Investors Inc.'s mortgage pass-through certificates, series 1998-C2, have been lowered by Standard & Poor's Ratings Services and removed from CreditWatch with negative implications.The ratings were lowered as follows: class F, from BB to B; class G, from BB-minus to B-minus; class H, from B to CCC; and class J, from B-minus to D. The rating agency also affirmed the ratings on seven other S&P-rated classes of the deal. S&P attributed the lowered ratings on classes H and J to interest shortfalls resulting largely from appraisal subordinated entitlement reduction amounts, or ASERs. The lowered ratings on classes F and G were due to an erosion of credit support that is expected to occur upon the disposition of some of the specially serviced assets, the rating agency said. S&P can be found online at http://www.standardandpoors.com.