Fitch Rates FHASI $282.4MM Mtge P-T Ctfs, Ser 2004-AR3.Business EditorsNEW YORK--(BUSINESS WIRE)--May 28, 2004 Fitch rates First Horizon Asset Securities Inc. (FHASI) $282.4 million mortgage pass-through certificates Pass-Through Certificates (PTCs) are instruments that evidence the ownership of two or more Equipment Trust Certificates. In other words, Equipment Trust Certificates may be bundled into a pass-through structure as a means of diversifying the asset pool and/or increasing the size , series 2004-AR3 classes I-A-1, II-A-1, II-A-RL, II-A-RU, III-A-1, and IV-A-1 'AAA'. The 'AAA' rating on the senior certificates reflects the 2.85% subordination provided by the class B certificates (which are not rated by Fitch). Fitch believes the above 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 will be adequate to support mortgagor mortgagor n. the person who has borrowed money and pledged his/her real property as security for the (mortgagee). (See: mortgage, mortgagee) MORTGAGOR, estate's, contracts. He who makes a mortgage. 2. defaults as well as bankruptcy, fraud and special hazard In aircraft crash rescue and fire-fighting activities: fuels, materials, components, or situations that could increase the risks normally associated with military aircraft accidents and could require special procedures, equipment, or extinguishing agents. losses in limited amounts. In addition, the ratings reflect the quality of the mortgage collateral, strength of the legal and financial structures, and the servicing capabilities of First Horizon Home Loan Corporation, currently rated 'RPS2' by 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. . The certificates represent ownership interests in a trust fund that consists of four cross-collateralized pools of mortgages. The senior certificates whose class designation begins with I, II, III, and IV correspond to Pools I, II, III, and IV respectively. Each of the senior certificates generally receives distributions based on principal and interest collected from mortgage loans in its corresponding mortgage pool. If on any distribution date a pool is undercollaterized and borrower payments from the underlying loans are insufficient to pay senior certificate principal and interest, borrower payments from the other pools that would have been distributed to the subordinate certificates will instead be distributed as principal and interest to the undercollaterized group's senior certificates. The subordinate certificates will only receive principal and /or interest distributions after all the senior certificates receive all their required principal and interest distributions. Pool I consists of 3/1 hybrid ARMs. The loans have an initial fixed interest rate period of three years. Thereafter, the interest rate will adjust annually based on the weekly average yield on U.S. Treasury Securities U.S. Treasury securities Interest-bearing obligations if the U.S. government issued by the U.S. Department of the Treasury as a means of borrowing money to meet government expenditures not covered by tax revenues. (one-year CMT CMT Certified Medical Transcriptionist. CMT abbr. Certified Medical Transcriptionist CMT California mastitis test. ) plus a gross margin. Approximately 25.20% of the mortgage loans in Pool II have interest only payments scheduled during the three year fixed rate period, with principal and interest payments commencing after the first rate adjustment date. The aggregate principal balance of this pool is $25,186,804 and consists of conventional, fully amortizing, adjustable-rate mortgage Adjustable-rate mortgage (ARM) A mortgage that features predetermined adjustments of the loan interest rate at regular intervals based on an established index. The interest rate is adjusted at each interval to a rate equivalent to the index value plus a predetermined spread, or loans secured by first liens on single-family residential properties, substantially all of which have original terms to maturity of 30 years. The average principal balance of the loans in this pool is approximately $559,707. The mortgage pool has a weighted average original loan-to-value ratio Loan-to-value ratio (LTV) The ratio of money borrowed on a property to the property's fair market value. (OLTV OLTV Original Loan-to-Value ratio OLTV on Line Television ) of 66.02%. Rate/Term and cash-out refinance Refinance 1. When a business or person revises their payment schedule for repaying debt. 2. Replacing an older loan with a new loan offering better terms. Notes: When a business refinances they typically extend the maturity date. loans account for 48.01% and 14.22% of the pool, respectively. Second homes represent 1.83% of the pool; there are no investor occupancies. The states with the largest concentrations are California (27.36%), Texas (10.77%), Washington (9.06%), Virginia (8.35%), and Colorado (7.17%). All other states represent less than 5% of the pool as of the cut-off cut-off Anesthesiology The point at which elongation of the carbon chain of the 1-alkanol family of anesthetics results in a precipitous drop in the anesthetic potential of these agents–eg, at > 12 carbons in length, there is little anesthetic activity, date. Pool II consists of 5/1 hybrid ARMs. The loans have an initial fixed interest rate period of five years. Thereafter, the interest rate will adjust annually based on the weekly average yield on U.S. Treasury Securities (one-year CMT) plus a gross margin. Approximately 55.51% of the mortgage loans in Pool II have interest only payments scheduled during the five year fixed rate period, with principal and interest payments commencing after the first rate adjustment date. The aggregate principal balance of this pool is $185,355,225 and consists of conventional, fully amortizing, adjustable-rate mortgage loans secured by first liens on single-family residential properties, substantially all of which have original terms to maturity of 30 years. The average principal balance of the loans in this pool is approximately $546,771. The mortgage pool has a weighted average OLTV of 65.97%. Rate/Term and cash-out refinance loans account for 59.48% and 9.38% of the pool, respectively. Second homes represent 2.34% of the pool and investor occupancies represent 0.80% of the pool. The states with the largest concentrations are California (65.26%) and Washington (5.40%). All other states represent less than 5% of the pool as of the cut-off date. Pool III consists of 7/1 hybrid ARMs. The loans have an initial fixed interest rate period of seven years. Thereafter, the interest rate will adjust annually based on the weekly average yield on U.S. Treasury Securities (one-year CMT) plus a gross margin. Approximately 36.79% of the mortgage loans in Pool III have interest only payments scheduled during the seven year fixed rate period, with principal and interest payments commencing after the first rate adjustment date. The aggregate principal balance of this pool is $55,008,356 and consists of conventional, fully amortizing, adjustable-rate mortgage loans secured by first liens on single-family residential properties, substantially all of which have original terms to maturity of 30 years. The average principal balance of the loans in this pool is approximately $495,571. The mortgage pool has a weighted average OLTV of 68.06%. Rate/Term and cash-out refinance loans account for 62.55% and 8.74% of the pool, respectively. Second homes represent 4.90% of the pool; there are no investor occupancies. The states with the largest concentrations are California (38.25%), Virginia (10.95%), Washington (8.62%), and Maryland (6.73%), Massachusetts (5.43%), Texas (5.07%). All other states represent less than 5% of the pool as of the cut-off date. Pool IV consists of 10/1 hybrid ARMs. The loans have an initial fixed interest rate period of ten years. Thereafter, the interest rate will adjust annually based on the weekly average yield on U.S. Treasury Securities (one-year CMT) plus a gross margin. Approximately 41.65% of the mortgage loans in Pool IV have interest only payments scheduled during the ten year fixed rate period, with principal and interest payments commencing after the first rate adjustment date. The aggregate principal balance of this pool is $25,123,543 and consists of conventional, fully amortizing, adjustable-rate mortgage loans secured by first liens on single-family residential properties, substantially all of which have original terms to maturity of 30 years. The average principal balance of the loans in this pool is approximately $570,990. The mortgage pool has a weighted average OLTV of 67.85%. Rate/Term and cash-out refinance loans account for 60.88% and 15.52% of the pool, respectively. There are no second homes or investor occupancies in the pool. The states with the largest concentrations are California (62.64%), Washington (8.46%), Virginia (6.61%), and Maryland (6.07%), Michigan (5.35%). All other states represent less than 5% of the pool as of the cut-off date. None of the mortgage loans are 'high cost' loans as defined under any local, state or federal laws. For additional information on Fitch's rating criteria regarding predatory predatory pertaining to predator. predatory behavior the hunting of birds, mice and small reptiles by cats and the hunting and herding behavior of dogs, often facilitated in a pack. lending legislation, please see the press release issued May 1, 2003 entitled en·ti·tle tr.v. en·ti·tled, en·ti·tling, en·ti·tles 1. To give a name or title to. 2. To furnish with a right or claim to something: 'Fitch Revises Rating Criteria in Wake of Predatory Lending Legislation', available on the Fitch Ratings web site at 'www.fitchratings.com'. All the mortgage loans were originated or acquired in accordance with First Horizon Home Loan Corporation'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. guidelines guidelines, n.pl a set of standards, criteria, or specifications to be used or followed in the performance of certain tasks. . The trust, First Horizon Mortgage Pass-Through Trust 2004-AR3, was created for the sole purpose of issuing the certificates. For federal income tax purposes, an election will be held to treat the trust as two real estate mortgage investment conduits Real Estate Mortgage Investment Conduit (REMIC) A pass-through tax entity that can hold mortgages secured by any type of real property and can issue multiple classes of ownership interests to investors in the form of pass-through certificates, bonds, or other legal forms. (REMICs). The Bank of New York The Bank of New York, abbrieviated to BNY, was a global financial services company that existed until its merger with the Mellon Financial Corporation on July 2, 2007.[1] The bank now continues under the new name of The Bank of New York Mellon Corporation. will act as trustee. |
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