Fitch rates CWALT, Inc.'s (CWALT) mortgage pass-through certificates, Alternative Loan Trust 2006-46 as follows:
--$283.9 million classes A-1 through A-10, X, PO, and A-R senior certificates 'AAA';
--$7.5 million class M 'AA';
--$2.8 million class B-1 'A'
--$2.1 million class B-2 'BBB';
--$1.5 million class B-3 'BB';
--$1 million class B-4 'B'.
The 'AAA' rating on the senior certificates reflects the 5.35% subordination provided by the 2.50% class M, 0.95% class B-1, 0.70% class B-2, 0.50% privately offered class B-3, 0.35% privately offered class B-4 and 0.35% privately offered class B-5 (not rated by Fitch). Classes M, B-1, B-2, B-3 and B-4 are rated 'AA', 'A', 'BBB', 'BB' and 'B' based on their respective subordination only.
Fitch believes the above credit enhancement will be adequate to support mortgagor defaults. In addition, the rating also reflects the quality of the underlying mortgage collateral, strength of the legal and financial structures and the master servicing capabilities of Countrywide Home Loans Servicing LP (Countrywide Servicing; rated 'RMS2+' by Fitch), a direct wholly owned subsidiary of Countrywide Home Loans, Inc. (CHL).
The mortgage pool consists of 40-year conventional, fully amortizing mortgage loans totaling $299,999,588 as of the cut-off date (Dec. 1, 2006), secured by first liens on one- to four-family residential properties. The mortgage pool, as of Dec. 1, 2006, demonstrates an approximate weighted-average original-loan-to-value (OLTV) of 70.68%. The weighted average FICO credit score is approximately 709. Cash-out refinance loans represent 59.11% of the mortgage pool and second homes 1.20%. The average loan balance is $270,514. The two states that represent the largest portion of mortgage loans are California (49.84%) and Florida (8.57%). All other states represent less than 5% of the Dec. 1, 2006 pool balance.
CWALT purchased the mortgage loans from CHL and deposited the loans in the trust, which issued the certificates, representing undivided beneficial ownership in the trust. The Bank of New York will serve as trustee. For federal income tax purposes, an election will be made to treat the trust fund as one or more real estate mortgage investment conduits (REMICs).
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.
