Class M-5 of Homestar Mortgage Acceptance Corp. asset-backed pass-through certificates, series 2004-3, has been downgraded from Baa2 to Ba3 by Moody's Investors Service.The downgrade was based on deteriorating credit enhancement, the rating agency said. "While the collateral is performing better than expected, the overcollateralization has consistently been falling below its target as a result of lower-than-expected excess spread levels," Moody's reported. The deal is backed by Homestar-originated collateral consisting primarily of alternative-A loans, with a small percentage of subprime loans.
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