Fitch Downgrades 1 Class from FUHEL 1997-3.NEW YORK New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of -- Fitch Ratings Fitch Ratings An international rating agency for financial institutions, insurance companies, and corporate, sovereign, and municipal debt. Fitch Ratings has headquarters in New York and London and is wholly owned by FIMALAC of Paris. has taken rating actions on the following First Union Home Equity Loan (FUHEL) series 1997-3 mortgage pass-through certificates: --Class B downgraded to 'CCC' from 'B', assigned Distressed Recovery rating of 'DR2'. The collateral on the aforementioned transaction consists of mixed fixed-rate and balloon mortgages, which were extended to subprime borrowers. First Union National Bank (FUNB FUNB First Union National Bank ) is the servicer for the transaction, and Wells Fargo acts as the trustee. FUNB currently does not have a servicer rating provided by Fitch. The pool factor (current collateral balance as a percentage of the initial balance) is approximately 6%, and the transaction is 100 months seasoned. The cumulative loss as a percentage of the initial balance is approximately 5.39%, and approximately 23% of the current balance is in the delinquency pipeline (with the majority being in the bankruptcy (BK), foreclosure (FC) and real estate owned Real Estate Owned Property owned by a lender - usually a bank - after an unsuccessful sale at a foreclosure auction. This is common because most of the properties up for sale at these auctions are worth less than the total amount owed to the bank: the minimum bid in most (REO reo Noun NZ a language [Maori] ) buckets). The downgrade, affecting $764,192, reflects the deterioration of 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 (CE) to future expected losses. Although the amount of collateral in the 60+ delinquency buckets (includes BK, FC, and REO) has decreased due to recent liquidations, the amounts in FC and REO still remain relatively high and have been stable. As a result of these liquidations, the amount of overcollateralization (OC) that supports the transaction has been decreasing. Fitch projects that this amount will continue to decrease in the future as a result of excess spread not being able to cover the realized losses. Fitch's last review was in August 2005 when Class B was downgraded to 'B' from 'BB'. For other information regarding delinquencies, collateral attributes and other statistical information please visit the Fitch Ratings web site at www.fitchratings.com. Fitch's Distressed Recovery (DR) ratings, introduced in April 2006 across all sectors of structured finance, are designed to estimate recoveries on a forward-looking basis while taking into account the time vale of money. For more information on Distressed Recovery ratings, see the full report ('Structured Finance Distressed Recovery Ratings'), which is available on the Fitch Ratings web site at www.fitchratings.com. Fitch's rating definitions and the terms of use Terms of Use are rules set up by the owner of an intellectual property or service to govern how they may be legally used. In many cases, terms of service are used as a contractual agreement between a company and users of a service they provide. of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures Policies and Procedures are a set of documents that describe an organization's policies for operation and the procedures necessary to fulfill the policies. They are often initiated because of some external requirement, such as environmental compliance or other governmental are also available from the 'Code of Conduct' section of this site. |
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