Fitch Takes Various Rating Actions on American Home's U.S. Residential Servicer Ratings

NEW YORK--(BUSINESS WIRE)--Fitch Ratings takes the following rating actions on the U.S. residential servicer ratings of American Home Mortgage Servicing, Inc. (AHMSI):

--Residential primary servicer rating for prime product upgraded to 'RPS2-' from 'RPS3+';

--Residential primary servicer rating for Alt-A product upgraded to 'RPS2-' from 'RPS3+';

--Residential primary servicer rating for subprime product upgraded to RPS3+ from 'RPS3';

--Residential primary specialty servicer rating for closed-end seconds upgraded to 'RPS2-' from 'RPS3+';

--Residential special servicer rating upgraded to 'RSS2-' from 'RSS3+';

--Residential primary servicer rating for HELOC 'RPS3+' withdrawn.

The rating actions reflect AHMSI's experienced management team, upgraded technology platform, and significant enhancements to both its solid loan administration processes and default management practices. The HELOC rating was withdrawn because AHMSI is not servicing any HELOC product at the current time. AHMSI is owned by WL Ross, LLC. Fitch does not publicly rate the credit or financial strength of AHMSI or its parent WL Ross, LLC. However, Fitch has read AHMSI's financial statements as the financial condition is an important component of Fitch's servicer rating analysis. In addition, the ratings were determined in accordance with Fitch's criteria 'Rating U.S. Residential Mortgage Servicers' and 'Global Rating Criteria for Structured Finance Servicers'.

During the year AHMSI moved its corporate headquarters from Irving, TX to a new facility in Coppell, TX that provides the company with ample growth capacity. Additionally, AHMSI maintains offices in Jacksonville, FL and Irvine, CA as well as a captive offshore site in Pune, India. Approximately 45% of AHMSI's servicing staff is managed offshore. AHMSI remains committed to its offshore strategy and as of the Fitch review was in the process of expanding its bilingual call center capabilities to a vendor site in Guadalajara, Mexico. As of June 30, 2009, AHMSI serviced 517,888 loans with a UPB of over $102.8 billion, representing a 34% increase over Dec. 31, 2008 volumes.

Since Fitch's prior review, AHMSI continued to enhance the servicing operation through increased staffing and the functional alignment of many loan administration and default processes to increase efficiencies across the organization. AHMSI continues to invest in technology and has made several upgrades to support its scalable servicing platform. The company continues to maintain strong default management practices, focusing on enhancing loss mitigation tools and placing an emphasis on automation of loss mitigation processes.

Fitch's review confirmed that AHMSI has the management, staff, technology, and effective workout capabilities to manage its primary and special servicing operations. Fitch will continue to monitor AHMSI's effective use of its offshore servicing capabilities and its ability to maintain servicing performance in a high delinquency environment.

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 'Rating U.S. Residential Mortgage Servicers', dated Nov. 29, 2006 and 'Global Rating Criteria for Structured Finance Servicers' dated Sept. 30, 2009, which are available on the Fitch Ratings web site at 'www.fitchratings.com'.

Additional information is available at 'www.fitchratings.com'.

ALL FITCH CREDIT RATINGS ARE SUBJECT TO CERTAIN LIMITATIONS AND DISCLAIMERS. PLEASE READ THESE LIMITATIONS AND DISCLAIMERS BY FOLLOWING THIS LINK: HTTP://FITCHRATINGS.COM/UNDERSTANDINGCREDITRATINGS. IN ADDITION, RATING DEFINITIONS AND THE TERMS OF USE OF SUCH RATINGS ARE AVAILABLE ON THE AGENCY'S PUBLIC WEBSITE '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.