Fitch Upgrades Countrywide's Master Servicer to 'RMS1-'; Affirms Primary at 'RPS1'.

NEW YORK -- Fitch Ratings affirms Countrywide Home Loans' (CHL) 'RPS1' residential primary servicer ratings for prime, Alt-A, subprime, and HE/HELOC products, and its special servicer rating of 'RSS1'. In addition, Fitch upgrades CHL's master servicer rating to 'RMS1-' from 'RMS2+'. The primary servicer ratings are based on the company's seasoned, experienced management team, strong default management experience, intensive risk management practices, and upgraded technology. The special servicer rating is based on the company's ability to effectively manage and liquidate non-performing residential mortgage loans and real estate owned assets. The master servicer rating upgrade is based on CHL's proven ability to oversee the servicing activities of its primary and special servicers, enhancements to its proprietary master servicing system and expanded servicing capabilities. In addition, the ratings also reflect CHL's solid financial strength (rated 'A' by Fitch).

CHL has eight servicing facilities located in Simi Valley and Lancaster, CA, Plano, Fort Worth, and Richardson, TX, Tempe, AZ, and Mumbai and Hyderabad, India. The company continues to pursue its servicing strategy of utilizing its own integrated residential mortgage related businesses to perform traditional vendor services in an effort to gain operating efficiencies, improve quality control, and improve foreclosure timelines. Over the past year, CHL enhanced its technology platform with the implementation of an internal disaster recovery solution between its main data center in Simi Valley and alternate sites in Plano and Fort Worth. In addition, CHL further developed its proprietary master servicing system to include new product types. The company also implemented NICE call and screen recording software in its customer service department which will be used for monitoring and training purposes.

As of Feb. 28, 2006, CHL's servicing portfolio consisted of over 7.5 million loans totaling over $1.13 trillion, an increase from 6.7 million loans totaling over $925 billion as of April 30, 2005. The primary servicing portfolio included $785 billion prime, $44 billion Alt-A, $121 billion subprime, and $47 billion of HELOC loans. The master servicing portfolio consisted of over 86,000 loans totaling over $11.9 billion and the special servicing portfolio consisted of over 32,000 loans totaling over $2.1 billion. Fitch has reviewed the company's servicing operations and believes that Countrywide has the appropriate staff, default procedures, and controls in place to manage its growth initiatives while maintaining performance. Fitch will continue to closely monitor the company's effective management of its business expansion plans and any impact on its multiple servicing locations.

Fitch rates residential mortgage primary, master, and special servicers on a scale of 1 to 5, with 1 being the highest rating. Within some of these rating levels, Fitch further differentiates ratings by plus (+) and minus (-) as well as the flat rating. For more information on Fitch's residential servicer rating program, please see Fitch's report 'Residential Mortgage Servicer Ratings', dated June 21, 2006, which is available on the Fitch Ratings web site at www.fitchratings.com.

Fitch's rating definitions and the terms of use 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 are also available from the 'Code of Conduct' section of this site.