As of the cut-off date, the collateral for series 2004-R3 had a weighted average original loan-to-value
(OLTV) of 79.
The loan was written for a term of 20 years with a 20-year amortization and a loan-to-value
of 71 percent.
Under current circumstances, however, MONY is considering mezzanine lending with a total loan-to-value
of 80 to 90 percent, comprised of a 70 to 75 percent conventional loan combined with a mezzanine segment commanding a higher rate of return with a more aggressive amortization schedule.
(based on a direct capitalization of stabilized year one income) was 83 percent, exceeding Wall Street's magic number of 80 percent.
NEW YORK -- Fitch Ratings affirms Irwin Home Equity Corporation's (IHE) 'RPS2' residential primary servicer ratings for home equity and high loan-to-value
It also allows the lenders to lend more on a given property without stepping outside their set loan-to-value
As of the cut-off-date, the weighted average original loan-to-value
ratio (OLTV) of the collateral pool was 100.
Strong house price inflation, combined with fierce competition among lenders and accompanying new mortgage products, has led to an increase of high loan-to-value
products and growth in flexible mortgages as well as an extension of mortgage tenors.
increase to a maximum of 75% loan-to-value
for no more than three months if
Where the typical first mortgage provider only provides up to 70% loan-to-value
financing, the mezzanine provider is willing to increase those proceeds to 85% or 90%.
Mortgage insurers also play a critical role by providing additional market capital that bridges the loan-to-value
requirements of government-sponsored enterprises and primary lenders, so home buyers can bridge the gap between their resources and lender requirements.
Institutions' expected dollar losses are determined primarily by the distribution of loan-to-value
ratios within their mortgage portfolios: Higher ratios are associated with higher mortgage default probabilities and loss severity rates.