ARC Ratings’ approach to rating RMBS transactions assesses the credit risk within the asset class through a review of the underlying mortgage portfolio, state of the local housing market and the lenders mortgage performance history. There will be a key focus on the review of the originators underwriting policy and the servicers’ ability to manage the portfolio. In addition, ARC Ratings will review the transaction and legal documentation and will conduct a cashflow analysis to determine the transactions’ ability to withstand various rating scenarios. The ratings process is concluded through the presentation of the above to a rating panel, followed by lifetime monitoring of transaction metrics.