A combination of factors including increased delinquencies, higher loss severities, slower prepayments and mounting losses in the underlying collateral prompted Moody’s Investors Service to downgrade six securities from Option One Option One Mortgage Loan Trust 2007-1. Higher expected pool losses in relation to remaining tranche-specific credit protection was the reason Moody’s gave for downgrading three tranches of SACO I Inc. Series 2000-3. A belief that credit enhancement will be insufficient to cover projected losses as a result of increased delinquencies as well as the current state of the U.S. housing market led Standard and Poor’s Ratings Services 707 ratings on 206 subprime transactions from 2002 to 2004. On Aug. 4, the New York-based ratings agency downgraded 4,435 ratings on 744 subprime RMBS.

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