Fitch Ratings Upgrades Remaining Classes Of DLJ 1994-MF11.Business Editors CHICAGO--(BUSINESS WIRE)--Aug. 8, 2002 DLJ DLJ Distributor License for Java DLJ Donaldson, Lufkin & Jenrette Inc. DLJ Drive Like Jehu (band) DLJ Defence Laboratory Jodhpur (India) DLJ Dead Letter Journal Mortgage Acceptance Corp.'s multifamily 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 1994-MF11 $7.3 million class B-1 is upgraded to 'AAA' from 'AA' 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. . In addition, Fitch upgrades $15 million class B-2 to 'AA' from 'BBB' and $8.6 million class B-3 to 'BBB-' from 'BB'. Fitch does not rate the $8.54 million class C. The rating upgrades follow Fitch's review of the transaction after significant mortgage balance reduction during the year 2002. The upgrades are due to an increase in subordination caused by loan prepayments Prepayments Payments made in excess of scheduled mortgage principal repayments. coupled with strong performance of the remaining loans in the transaction. The deal has paid down 80% since issuance, to $39.4 million from $214.1 million and to eight loans from 78. In addition to the high credit support resulting from this pay down, the overall weighted average debt service coverage ratio The debt service coverage ratio (DSCR), or debt service ratio, is the ratio of net operating income to debt payments on a piece of investment real estate. It is a popular benchmark used in the measurement of an income-producing property’s ability to produce (DSCR DSCR See: Debt-service coverage ratio ) using year-end 2001 financial statements has increased to 1.78 times (x) from 1.34x at issuance. All loans received at least a 'good' rating on the most recent site inspections. In addition, each loan has a reserve account that can be used for capital improvements or applied to the debt at maturity. The master servicer, GMAC GMAC General Motors Acceptance Corporation GMAC Graduate Management Admission Council GMAC Give Me A Call GMAC Genetic Manipulation Advisory Committee GMAC Genetic Modification Advisory Committee (Singapore) GMAC Give Me A Chance Commercial Mortgage, has no loans on the watch list and Fitch identified no loans of concern. One loan, collateralized by a property located in Montgomery, AL, had a year-end 2001 DSCR of 1.18x, which is the lowest in the pool. However, the loan is the smallest by loan balance at $2 million and has the highest interest rate of 8.95%. Because no loans have prepayment lockouts or yield maintenance penalties and with a weighted average interest rate of 8.39%, Fitch expects the loans to continue to prepay prior to the maturity dates in 2004. Of concern is the concentration of the remaining pool with only eight loans remaining. Approximately 54% of the properties are located in Michigan and only three borrowers own the properties. These concerns were factored into the upgrades. Fitch will continue to monitor the performance of the remaining loans as surveillance is ongoing. |
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