SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) June 25, 1999
GE CAPITAL MORTGAGE SERVICES, INC.
(as Seller and Servicer under the Pooling and
Servicing Agreement, dated as of June 1, 1999,
providing for the issuance of REMIC Home Equity Loan
Pass-Through Certificates, Series 1999-HE2)
GE Capital Mortgage Services, Inc.
(Exact name of registrant as specified in its charter)
New Jersey 33-5042 21-0627285
- ------------------------------------------------------------------------------
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
Three Executive Campus
Cherry Hill, New Jersey 08002
(Address of Principal Executive Office) (Zip Code)
Registrant's telephone number, including area code (609) 661-6100
ITEM 2. ACQUISITION OR DISPOSITION OF ASSETS
General.
On June 25, 1999, GE Capital Mortgage Services, Inc., ("GECMSI") offered to
investors certain classes of its REMIC Home Equity Loan Pass-Through
Certificates, Series 1999-HE2 (the "Certificates") evidencing beneficial
ownership interests in a trust fund (the "Trust Fund"). The assets of the Trust
Fund consist primarily of a pool (the "Mortgage Pool") of closed-end,
fixed-rate, home equity loans (the "Mortgage Loans") secured by first or second
liens on one- to four-family residential properties (the "Mortgaged
Properties"). Capitalized terms used herein and not otherwise defined shall have
the meanings assigned to them in the Prospectus dated April 22, 1999 as
supplemented by the Prospectus Supplement dated June 23, 1999.
The original principal balance of each class of the Certificates is as follows:
Class A1 $77,000,000.00
Class A2 $31,000,000.00
Class A3 $53,000,000.00
Class A4 $32,000,000.00
Class A5 $13,847,000.00
Class A6 $23,000,000.00
Class R1 $500.00
Class R2 $500.00
Class M $14,962,000.00
Class B1 $6,801,000.00
Class B2 $5,441,000.00
Class B3 $4,081,000.00
Class B4 $4,081,000.00
Class B5 $6,801,350.23
---------------
Total $272,015,350.23
---------------
(1) The Class S has an original Notional Principal Balance equal to
$272,015,350.23
The initial Junior Percentage and Senior Percentage of the Certificates are
approximately 15.50% and 84.50% respectively. The Bankruptcy Loss Amount, the
Fraud Loss Amount and the Special Hazard Loss Amount, as of the initial issuance
of the Certificates, are approximately $50,000, $5,440,307 and $2,720,154
respectively, representing approximately 0.02%, 2.00% and 1.00%, respectively,
of the aggregate Principal Balances of the Mortgage Loans as of June 1, 1999
(the "Cut-off Date").
The Mortgage Loans accrue interest on a simple interest basis (the "Simple
Interest Mortgage Loans") or a self-amortizing basis (the "Self-Amortizing
Mortgage Loans"). Approximately 99.84% of the Mortgage Loans are Self-Amortizing
Mortgage Loans, and approximately 0.16% of the Mortgage Loans are Simple
Interest Mortgage Loans, in each case by Principal Balance as of the Cut-off
Date.
The Mortgage Rates borne by the Mortgage Loans range from approximately
6.75% to 14.49% per annum, and the weighted average of the Mortgage Rates as of
the Cut-off Date for the Mortgage Loans is approximately 9.67% per annum. The
original principal balances of the Mortgage Loans range from approximately
$7,450.00 to $450,000.00 and, as of the Cut-off Date, the average Principal
Balance of the Mortgage Loans is approximately $74,771 after application of
payments made before the Cut-off Date. The month and year of the earliest
origination date of any Mortgage Loan is April 1992, and the month and year of
the latest scheduled maturity date of any such Mortgage Loan is June 2029. All
of the Mortgage Loans have original terms to maturity of approximately 5 years
to 30 years. The remaining months to stated maturity for the Mortgage Loans as
of the Cut-off Date range from approximately 50 months to 360 months and the
weighted average remaining months to stated maturity of the Mortgage Loans as of
the Cut-off Date is approximately 247 months. Approximately 36.07% of the
Mortgage Loans are Balloon Loans. The weighted average remaining term to stated
maturity of the Balloon Loans is approximately 179 months. The Home Equity
Loan-to-Value Ratios of the Mortgage Loans at origination range from
approximately 4.93% to 90.00%, and the weighted average of the Home Equity
Loan-to-Value Ratios of the Mortgage Loans at origination is approximately
70.69%. The Second-Lien Combined Loan-to-Value Ratio of the second-lien Mortgage
Loans at origination range from approximately 15.09% to 115.71%, and the
weighted average of the Second-Lien Combined Loan-to-Value Ratios of such
Mortgage Loans at origination is approximately 85.49%. No more than
approximately 0.50% (by Principal Balance as of the Cut-off Date) of the
Mortgage Loans will be secured by Mortgaged Properties located in any one postal
zip code area.
No more than approximately 1.00% (by Principal Balance as of the Cut-off
Date) of the Mortgage Loans have been originated under GECMSI's no income
verification programs.
Set forth below is a description of certain additional characteristics of
the Mortgage Pool and the Mortgage Loans included therein (the sum of the
balances may not equal 100% due to rounding) :
Cut-off Date Principal Balances
- ------------------------------------ -------------------------- --------------------------- ---------------------------------
Range of Cut-off Date Number of Cut-off Date Percentage of Cut-off Date
Principal Balances Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ---------------------------------
$ 00.00 - 10,000.00 28 $266,927.77 0.10%
10,000.01 - 20,000.00 282 $4,485,231.82 1.65%
20,000.01 - 30,000.00 375 $9,563,898.36 3.52%
30,000.01 - 40,000.00 360 $12,776,141.05 4.70%
40,000.01 - 50,000.00 376 $17,089,237.96 6.28%
50,000.01 - 60,000.00 390 $21,661,009.45 7.96%
60,000.01 - 75,000.00 464 $31,251,554.86 11.49%
75,000.01 - 100,000.00 547 $47,450,011.45 17.44%
100,000.01 - 150,000.00 523 $63,378,977.18 23.30%
150,000.01 - 200,000.00 154 $26,398,615.32 9.70%
200,000.01 - 250,000.00 73 $16,346,570.23 6.01%
250,000.01 - 300,000.00 30 $8,318,264.47 3.06%
300,000.01 - 350,000.00 17 $5,483,906.57 2.02%
350,000.01 - 400,000.00 15 $5,777,252.29 2.12%
400,000.01 and Above 4 $1,767,751.45 0.65%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
Mortgage Rates
- ------------------------------------ -------------------------- --------------------------- -----------------------------------
Number of Cut-off Date Percentage of Cut-off Date
Range of Mortgage Rates Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- -----------------------------------
0.000 - 7.500% 15 $1,485,612.76 0.55%
7.501 - 8.000 218 $18,421,278.90 6.77%
8.001 - 8.500 342 $27,691,707.96 10.18%
8.501 - 9.000 544 $48,328,773.39 17.77%
9.001 - 9.500 466 $39,032,208.20 14.35%
9.501 - 10.000 640 $51,641,167.05 18.98%
10.001 - 10.500 380 $27,660,654.89 10.17%
10.501 - 11.000 380 $26,355,921.25 9.69%
11.001 - 11.500 235 $13,095,658.14 4.81%
11.501 - 12.000 208 $9,415,220.36 3.46%
12.001 - 12.500 76 $4,109,117.67 1.51%
12.501 - 13.000 70 $2,839,870.37 1.04%
13.001 - 13.500 40 $1,395,653.49 0.51%
13.501 - 14.000 21 $479,013.68 0.18%
14.001 - 14.500 3 $63,492.12 0.02%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
Geographic Distribution of Mortgaged Properties
- ---------------------------- --------------------- ---------------------- -------------------------------------------------------
Number of Cut-off Date Percentage of Cut-off Date Aggregate
State Mortgage Loans Principal Principal Balance
Balance
- ---------------------------- --------------------- ---------------------- -------------------------------------------------------
Alabama 56 $3,490,308.62 1.28%
Arizona 10 $1,261,728.02 0.46%
Arkansas 14 $1,234,822.27 0.45%
California 146 $18,081,066.78 6.65%
Colorado 73 $5,167,164.82 1.90%
Connecticut 57 $5,906,197.06 2.17%
Delaware 23 $1,493,470.44 0.55%
District of Columbia 34 $3,873,238.11 1.42%
Florida 330 $20,874,788.81 7.67%
Georgia 103 $7,319,613.56 2.70%
Idaho 6 $400,594.88 0.15%
Illinois 197 $16,794,443.55 6.17%
Indiana 119 $6,095,311.64 2.24%
Iowa 10 $616,190.87 0.23%
Kansas 5 $342,616.68 0.12%
Kentucky 51 $3,261,471.80 1.20%
Louisiana 29 $1,501,460.66 0.55%
Maine 1 $151,904.06 0.06%
Maryland 176 $14,328,016.46 5.27%
Massachusetts 125 $11,723,036.37 4.31%
Michigan 120 $8,945,982.05 3.29%
Minnesota 9 $489,043.29 0.18%
Mississippi 23 $1,183,285.97 0.44%
Missouri 49 $2,923,619.51 1.07%
Montana 1 $261,559.33 0.10%
Nebraska 43 $2,400,933.40 0.88%
Nevada 8 $449,155.04 0.17%
New Hampshire 19 $1,200,030.81 0.44%
New Jersey 137 $12,440,320.63 4.57%
New Mexico 11 $691,051.21 0.25%
New York 317 $27,516,407.70 10.11%
North Carolina 261 $18,349,958.79 6.75%
Ohio 288 $17,009,303.21 6.25%
Oklahoma 10 $984,733.03 0.36%
Oregon 36 $4,044,169.38 1.49%
Pennsylvania 201 $12,490,193.17 4.59%
Rhode Island 28 $1,501,171.88 0.55%
South Carolina 175 $10,887,275.15 4.00%
South Dakota 5 $363,202.89 0.13%
Tennessee 118 $7,397,982.64 2.72%
Texas 13 $1,252,285.80 0.46%
Utah 15 $1,185,010.31 0.44%
Vermont 12 $812,649.76 0.30%
Virginia 76 $5,228,847.80 1.92%
Washington 56 $5,184,909.26 1.91%
West Virginia 19 $1,411,541.04 0.52%
Wisconsin 20 $1,300,909.56 0.48%
Wyoming 3 $192,372.16 0.07%
----------------------------------------------------------------------------------------------
Total 3638 $749,528,657.123 100.00%
==============================================================================================
Priority of Mortgage Loans
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Number of Cut-off Date Percentage of Cut-off Date
Priority Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
First-priority 2,718 $238,087,358.56 87.53%
Second-priority 920 $33,927,991.67 12.47%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
Year of Origination
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Number of Cut-off Date Percentage of Cut-off Date
Year of Origination Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
1999 3,303 $247,259,059.42 90.90%
1998 324 $23,825,286.98 8.76%
1997 10 $656,603.83 0.24%
1992 1 $274,400.00 0.10%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.01%
======================================================================================
Months Remaining to Stated Maturity as of the Cut-off Date
- -------------------------------------- -------------------------- -------------------------- -----------------------------------
Number of Months Remaining to Number of Cut-off Date Percentage of Cut-off Date
Stated Maturity Mortgage Loans Principal Balance Aggregate Principal Balance
- -------------------------------------- -------------------------- -------------------------- -----------------------------------
36 - 59 9 $232,735.88 0.09%
60 - 83 11 $322,169.60 0.12%
84 - 107 1 $15,626.58 0.01%
108 - 129 160 $5,250,696.03 1.93%
130 - 155 5 $203,082.98 0.07%
156 - 179 1,368 $98,249,406.87 36.12%
180 - 239 985 $67,027,456.42 24.64%
240 & Above 1,099 $100,714,175.87 37.02%
------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
====================================================================================
Types of Mortgaged Properties (1)
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Number of Cut-off Date Percentage of Cut-off Date
Property Type Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Single-family detached 3,105 $234,972,048.17 86.38%
Single-family attached 201 $13,423,886.13 4.93%
2 - 4 family 146 $12,710,336.78 4.67%
Condo 63 $4,108,294.55 1.51%
Manufactured housing 123 $6,800,784.60 2.50%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
Use of Mortgaged Properties (1)(2)
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Number of Cut-off Date Percentage of Cut-off Date
Use Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Primary residence 3,445 $257,857,210.59 94.80%
Non-primary residence(2) 193 $14,158,139.64 5.20%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
(1) Based on information supplied by the Mortgagor in the loan application.
(2) The Company believes that the majority of the non-primary residences are
investment properties.
Second-Lien
Combined Loan-to-Value Ratio (1) (2)
(for Second-Lien Mortgage Loans)
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Range of Combined Number of Mortgage Cut-off Date Percentage of Cut-off Date
Loan-to-Value Ratios Loans in a Second-Lien Principal Balance Aggregate Principal Balance in a
Position Second-Lien Position
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
10.01 - 20.00 9 $273,590.01 0.81%
20.01 - 30.00 5 $254,458.08 0.75%
30.01 - 40.00 10 $322,672.08 0.95%
40.01 - 50.00 16 $741,839.84 2.19%
50.01 - 60.00 24 $1,354,754.16 3.99%
60.01 - 70.00 51 $1,442,348.17 4.25%
70.01 - 75.00 42 $2,276,042.48 6.71%
75.01 - 80.00 113 $5,078,788.29 14.97%
80.01 - 85.00 96 $3,189,870.82 9.40%
85.01 - 90.00 69 $3,044,520.19 8.97%
90.01 and Above 485 $15,949,107.55 47.01%
--------------------------------------------------------------------------------------
Total 920 $33,927,991.67 100.01%
======================================================================================
(1) The "Second-Lien Combined Loan-to-Value Ratio" of a second-lien Mortgage
Loan is the ratio (expressed as a percentage) that the sum of the original
principal balance of such Mortgage Loan and the then current principal
balance of the related first-lien mortgage loan, bears to the appraised
value of the related Mortgaged Property at the time such Mortgage Loan was
originated (or if the proceeds of such Mortgage Loan were used to refinance
an existing mortgage, the appraised value based on a recent appraisal).
(2) The weighted average of the Second-Lien Combined Loan-to-Value Ratio for
second-lien Mortgage Loans is approximately 85.49%.
Home Equity Loan-to-Value Ratio (1) (2)
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Range of Home Equity Number of Mortgage Cut-off Date
Loan-to-Value Ratios Loans Principal Balance Percentage of Cut-off Date
Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
0.00 - 10.00% 72 $2,102,792.11 0.77%
10.01 - 20.00 510 $14,604,491.75 5.37%
20.01 - 30.00 269 $12,014,189.75 4.42%
30.01 - 40.00 137 $7,245,009.09 2.66%
40.01 - 50.00 142 $8,733,202.92 3.21%
50.01 - 60.00 154 $11,025,885.99 4.05%
60.01 - 70.00 275 $22,683,404.74 8.34%
70.01 - 75.00 330 $28,325,073.74 10.41%
75.01 - 80.00 902 $82,545,246.15 30.36%
80.01 - 85.00 395 $34,666,335.72 12.74%
85.01 - 90.00 452 $48,069,718.27 17.67%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
(1) The "Home Equity Loan-to-Value Ratio" of a Mortgage Loan is the ratio
(expressed as a percentage) that the original principal balance of such
Mortgage Loan bears to the appraised value (or, with respect to
approximately 13.36% of the Mortgage Loans, the lesser of (i) the appraised
value or (ii) the selling price) of the related Mortgaged Property at the
time such Mortgage Loan was originated (or if the proceeds of such Mortgage
Loan were used to refinance an existing mortgage, the appraised value based
on a recent appraisal).
(2) The weighted average of the Home Equity Loan-to-Value Ratios for the
Mortgage Loans is approximately 70.69%. The weighted average of the Home
Equity Loan-to-Value Ratios for the first-lien Mortgage Loans and the
second-lien Mortgage Loans is approximately 77.34% and 23.96%,
respectively.
Home Equity Loan Ratio (1) (2)
(for second-lien Mortgage Loans)
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Percentage of Cut-off Date
Number of Aggregate Principal Balance of
Range of Home Mortgage Loans in a Cut-off Date Mortgage Loans in a Second-Lien
Equity Loan Ratios Second-Lien Position Principal Balance Position
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
0 - 10.00% 29 $699,410.74 2.06%
10.01 - 20.00 411 $11,323,920.32 33.40%
20.01 - 30.00 273 $10,467,981.76 30.85%
30.01 - 40.00 107 $5,395,032.14 15.90%
40.01 - 50.00 45 $2,860,884.43 8.43%
50.01 - 60.00 28 $1,595,179.36 4.70%
60.01 - 70.00 8 $271,702.51 0.80%
70.01 - 75.00 1 $70,333.79 0.21%
75.01 - 80.00 $82,474.10 0.24%
2
80.01 - 85.01 2 $135,988.98 0.40%
85.01 - 85.00 3 $319,663.72 0.94%
90.01 - above 11 705,419.82 2.08%
===========================================================================================
Total: 920 $33,927,991.67 100.00%
===========================================================================================
(1) The "Home Equity Loan Ratio" of a second-lien Mortgage Loan is the ratio
(expressed as a percentage) that the original principal balance of such
Mortgage Loan bears to the total of the original principal balance of such
Mortgage Loan plus the outstanding amount of the related first-lien
Mortgage Loan at the time such Mortgage Loan was originated.
(2) The weighted average of the Home Equity Loan Ratios of the second-lien
Mortgage Loans is approximately 29.31%.
Loan Type
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Number of Cut-off Date Percentage of Cut-off Date
Type Mortgage Loans Principal Balance Aggregate Principal Balance
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Fully amortizing 1,003 $98,127,875.23 36.07%
Balloon 2,635 $173,887,475.00 63.93%
--------------------------------------------------------------------------------------
Total 3,638 $272,015,350.23 100.00%
======================================================================================
Months Remaining to Stated Maturity as of the Cut-off Date
(for Balloon Loans)
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
Number of Months Remaining to
Stated Maturity as of Cut-off Date Number of Percentage of Cut-off Date
Balloon Mortgage Cut-off Date Aggregate Principal Balance of
Loans Principal Balance Balloon Loans
- ------------------------------------ -------------------------- --------------------------- ------------------------------------
156 - 179 700 $67,246,889.56 68.53%
180 - 239 303 $30,880,985.67 31.47%
--------------------------------------------------------------------------------------
Total 1003 $98,127,875.23 100.00%
======================================================================================
ITEM 7 FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS AND EXHIBITS
1.1 The Underwriting Agreement for the Series 1999-HE2 Certificates dated
September 24, 1996, as modified and supplemented by the related terms
agreement dated June 23, 1999, between GE Capital Mortgage Services, Inc.,
and Prudential Securities Incorporated and Lehman Brothers Inc.
4.1 The Pooling and Servicing Agreement for the Series 1999-HE2 Certificates
dated as of June 1, 1999 between GE Capital Mortgage Services, Inc., as
seller and servicer, and The First National Bank of Chicago, as trustee.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GE Capital Mortgage Services, Inc.
By: /s/ Syed W. Ali
-----------------------------
Name: Syed W. Ali
Title: Vice President
Dated as of June 25, 1999
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
GE Capital Mortgage Services, Inc.
By: /s/ Syed W. Ali
-----------------------------
Name: Syed W. Ali
Title: Vice President
Dated as of June 25, 1999
EXHIBIT INDEX
The exhibits are being filed herewith:
EXHIBIT NO. DESCRIPTION PAGE
- ----------- ----------- ----
1.1 The Underwriting Agreement dated
September 24, 1996, as modified and
supplemented by the related terms
agreement dated June 23, 1999 between GE
Capital Mortgage Services, Inc., and
Prudential Securities Incorporated and
Lehman Brothers Inc.
4.1 The Pooling and Servicing Agreement for
the Series 1999-HE2 Certificates dated
as of June 1, 1999 between GE Capital
Mortgage Services, Inc., as seller and
servicer, and The First National Bank of
Chicago, as trustee.