ContiMortgage $40M HEL Trust 1999-3 Cls B Rated BBB by Fitch IBCA.NEW YORK--(BUSINESS WIRE)--June 24, 1999-- ContiMortgage Corp.'s (ContiMortgage) $40.0 million home equity loan trust 1999-3 class B certificates are rated `BBB' by Fitch fitch: see polecat. IBCA IBCA International Braille Chess Association IBCA Institute of Burial and Cremation Administration IBCA Integrated Business Communications Alliance IBCA International Barbeque Cookers Association IBCA Department of Interior Board of Contract Appeals . Credit enhancement Credit Enhancement A method whereby a company attempts to improve its debt or credit worthiness. Notes: Credit enhancements take many different forms. An example of a credit enhancement would be conversion rights added on to a debt instrument in order to lower the issuing for the class B certificates is based upon monthly excess interest and future overcollateralization created by the application of excess spread to the senior certificates. The monthly excess interest and future overcollateralization will be available to absorb losses on all the certificates. The starting overcollateralization target will be 2.45% and will not step down until a required step-down date has occurred. Also, the overcollateralization target may step up to 3.10% if a cumulative realized loss Realized Loss A loss recognized when assets are sold for a price lower than the original purchase price. Notes: A portion of the realized loss may be applied against a capital gain or realized profit to reduce taxes. trigger event occurs. In addition, the ratings on the certificates reflects the quality of the home equity loans, the sufficient amounts of credit enhancement, the soundness of the legal and financial structures, and the capabilities of Norwest Bank Minnesota, N.A. as master servicer and ContiMortgage as servicer of the loans. The loans were originated by ContiMortgage, a subsidiary of ContiFinancial Corp. The originator's underwriting Underwriting 1. The process by which investment bankers raise investment capital from investors on behalf of corporations and governments that are issuing securities (both equity and debt). 2. The process of issuing insurance policies. process assesses both the borrower's ability to repay the loan and the adequacy of the property value of the home securing the loan. Different credit risk ratings are assigned to the loans based on, but not limited to, the past mortgage and credit payment histories and debt to income ratios of the borrowers. The class B certificates are collateralized by both a pool of fixed-rate, closed-end home equity mortgage loans (Loan Group I) creating a first or second lien A Second lien financing is a form of financing secured on a second ranking basis by (more or less) the same security, which secures the first ranking financing. The first lien lenders and the second lien lenders agree that, in the event of a security enforcement or bankruptcy, the , and by a pool of adjustable-rate, closed-end home equity mortgage loans (Loan Group II) creating a first lien lien, claim or charge held by one party, on property owned by a second party, as security for payment of some debt, obligation, or duty owed by that second party. . The average balance of the Loan Group I is $71,894; the weighted average coupon Weighted average Coupon The weighted average of the gross interest rates of mortgages underlying a pool as of the pool issue date; the balance of each mortgage is used as the weighting factor. is 10.20%; the weighted average remaining term is 279 months; the weighted average combined loan- to-value ratio is 79.42%; the properties are secured primarily by one-to four-family residences (93.77%), manufactured homes (3.57%), and condominiums (0.78%). In addition, 5.43% are investor-owned properties. Geographically, the loans are located primarily in California (9.59%), Michigan (7.98%) and Illinois (7.97%). The average balance of the Loan Group II is $106,738; the weighted average coupon is 10.04%; the weighted average remaining term is 357 months; the weighted average combined loan-to-value ratio Loan-to-value ratio (LTV) The ratio of money borrowed on a property to the property's fair market value. is 79.25%; the properties are secured primarily by one-to four-family residences (89.54%), manufactured homes (3.76%), and condominiums (1.83%). In addition, 6.24% are investor-owned properties. Geographically, the loans are located primarily in California (28.71%), Utah (7.83%) and Michigan (7.59%). Interest and principal payments on the certificates will be distributed on the 25th day of the month commencing in July of 1999. Payments of principal will not be made to the subordinate certificates until the required step-down date has occurred and certain performance triggers have been met. |
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