Fitch Affirms Aames Financial Corp.'s 'RPS3-' Servicer Rating for Subprime Product

Business Wire, Dec 28, 2005

NEW YORK -- Fitch Ratings affirms Aames Financial Corporation's (Aames) 'RPS3-' residential primary servicer rating for subprime product. The rating reflects Aames' seasoned executive and servicing management teams, capable loan administration and default management practices, and competent use of servicing technology.

Based in Los Angeles, CA, Aames specializes in the origination and servicing of subprime and nonconforming residential mortgage loans. The firm sources its production through retail and wholesale channels located throughout the country. As of Sept. 30, 2005, Aames serviced 39,304 mortgage loans totaling $5.6 billion.

In November 2004, Aames completed its conversion to a real estate investment trust (REIT). Also during the year, Aames made several organizational changes, which included hiring John Vella as President and Chief Operating Officer. The servicing organization reports to Mr. Vella and the company did not indicate that additional organizational changes were expected. Aames has made a number of positive processing changes during the review period, including the implementation of automated call recording, expanded customer service hours, and the implementation of a new voice response system. The company also undertook independent benchmarking with outside firms.

Fitch believes that Aames will remain a competent servicer of subprime product. The servicer has seasoned servicing management and adequate servicing technology, as well as flexible reporting provided by a robust data warehouse from which to expand its current servicing portfolio. The combination of experienced management and staff, reliable servicing technology, effective loan administration practices, and acceptable internal controls position the firm to pursue its organic growth strategy for retained servicing.

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. If at any time Fitch determines that Aames no longer meets the requirements of a servicer at its current rating level, Fitch will take immediate and definitive action with regard to their servicer rating. For more information on Fitch's residential servicer rating program, please see Fitch's report 'Residential Mortgage Servicer Ratings' dated Feb. 21, 2003, which is available on Fitch's 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.