Fitch Downgrades 2 & Affirms 4 RMBS Classes from 2 Ameriquest Issues.

NEW YORK -- Fitch Ratings has taken rating actions on the following Ameriquest Mortgage Securities Inc. (AMSI) home equity issues:

AMSI series 2002-C

--Class A affirmed at 'AAA';

--Class M1 affirmed at 'BBB';

--Class M2 downgraded to 'B' from 'BBB-' and is removed from Rating Watch Negative.

AMSI series 2002-3

--Class M-2 affirmed at 'AA-';

--Class M-3 affirmed at 'BBB';

--Class M-4 downgraded to 'B' from 'BBB-' and is removed from Rating Watch Negative.

The affirmations reflect satisfactory credit enhancement (CE) relationships to future loss expectations and affect approximately $193.64 million. In the case of series 2002-C class A, affirmation on this class reflects the Freddie Mac guarantee of timely distribution on interest and ultimate distribution of principle on the offered certificates and affect approximately $79.48 million of outstanding certificates. The downgrades, affecting approximately $28.97 million of the outstanding certificates, are taken as a result of a deteriorating relationship between CE and expected loss.

All of the loans were either originated or acquired by Ameriquest Mortgage Company, which also serves as the servicer (rated 'RSP2+' by Fitch). Ameriquest Mortgage Company is a specialty finance company engaged in the business of originating, purchasing, and selling mortgage loans.

The underlying collateral consists of fully amortizing 15- to 30-year fixed-and adjustable-rate mortgages secured by first liens on one- to four-family residential properties extended to subprime borrowers. As of the May 2006 distribution date, the series 2002-C is 42 months seasoned and series 2002-3 is 44 months seasoned. The pool factors (current principal balance as a percentage of original) are approximately 11% and 10%, respectively.

Due to differences in prepayment behavior, the geographic composition of the pools has changed significantly since issuance. Borrowers located in areas enjoying rapid home appreciation have prepaid at a much faster rate than borrowers located in areas with relatively slow home price appreciation. As a result, a large percentage of the remaining pool is now located in states which have experienced slower-than-average home price appreciation trends. Approximately 40% of the remaining loans in both pools are secured by properties in Indiana, Ohio, Michigan, Illinois, Pennsylvania and Texas. Loans located in these states have generally been more likely to default and have generally experienced high loss severities. This is expected to continue to put upward pressure on loss trends going forward.

Series 2002-C collateral losses have exceeded excess spread (XS) nine times (x) out of the past 12 months causing the overcollateralization (OC) to fall below its target amount. The current OC is at $3,648,590 which falls short of its target by $2,851,410. The cumulative loss as a percentage of the original pool balance is 1.71% and the delinquency rate (including 60+, bankruptcy foreclosure, and REO) as a percentage of the current pool balance is 24.6%.

The OC for series 2002-3 is also currently below its target due to losses that have exceeded XS 10x out of the last 12 months. The current OC amount is 2,782,719, about 3.46% of current principal balance. The cumulative loss as a percentage of the original pool balance is 2.08% and the delinquency rate (including 60+, bankruptcy foreclosure, and REO) as a percentage of the current pool balance is 27.94%.

Both transactions are currently failing their delinquency trigger tests and Fitch expects that the triggers will continue to fail therefore the transactions will distribute principal sequentially among the classes. As a result, the credit risk for the mezzanine and senior classes is mitigated.

Further information regarding current delinquency, loss, and credit enhancement statistics is available on the Fitch Ratings web site at www.fitchratings.com.

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