NovaStar Completes 2nd MBS

NovaStar Financial subsidiary NovaStar Mortgage has completed its second securitization of 2005, the company said.Lead managers RBS Greenwich Capital, Wachovia Securities and Deutsche Bank Securities, underwrote the transaction with co-manager Morgan Stanley. The transaction -- NovaStar Mortgage Funding Trust, series 2005-2 -- includes 17 rated classes of certificates with a face value of about $1.78 billion. NovaStar Mortgage retained the class C certificate in the deal, which has a notional amount of $1.8 billion and entitles the company to excess and prepayment penalty fee cash flow from the underlying loan collateral and serves as overcollateralization. The company said class C is subordinated to all other classes. NovaStar can be found on the Web at http://www.novastarmortgage.com.