Filed Pursuant to Rule 433
Registration No.: 333-118843
[BANC OF AMERICA SECURITIES LOGO]
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The asset-backed securities referred to in these materials, and the asset
pools backing them, are subject to modification or revision (including the
possibility that one or more classes of securities may be split, combined or
eliminated at any time prior to issuance or availability of a final prospectus)
and are offered on a "when, as and if issued" basis. You understand that, when
you are considering the purchase of these securities, a contract of sale will
come into being no sooner than the date on which the relevant class has been
priced and we have confirmed the allocation of securities to be made to you; any
"indications of interest" expressed by you, and any "soft circles" generated by
us, will not create binding contractual obligations for you or us.
Because the asset-backed securities are being offered on a "when, as and
if issued" basis, any such contract will terminate, by its terms, without any
further obligation or liability between us, if the securities themselves, or the
particular class to which the contract relates, are not issued. Because the
asset-backed securities are subject to modification or revision, any such
contract also is conditioned upon the understanding that no material change will
occur with respect to the relevant class of securities prior to the closing
date. If a material change does occur with respect to such class, our contract
will terminate, by its terms, without any further obligation or liability
between us (the "Automatic Termination"). If an Automatic Termination occurs, we
will provide you with revised offering materials reflecting the material change
and give you an opportunity to purchase such class. To indicate your interest in
purchasing the class, you must communicate to us your desire to do so within
such timeframe as may be designated in connection with your receipt of the
revised offering materials.
MBS New Issue Term Sheet
Banc of America Mortgage 2005-12 Trust
Mortgage Pass-Through Certificates, Series 2005-12
$298,847,554 (approximate)
Banc of America Mortgage Securities, Inc.
Depositor
Bank of America, National Association
Seller and Servicer
[BANK OF AMERICA LOGO]
December 21, 2005
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The issuer has filed a registration statement (including a prospectus) with the
SEC for the offering to which this communication relates. Before you invest, you
should read the prospectus in that registration statement and other documents
the issuer has filed with the SEC for more complete information about the issuer
and this offering. You may get these documents for free by visiting EDGAR on the
SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any
dealer participating in the offering will arrange to send you the prospectus if
you request it by calling toll-free 1-800-294-1322 or you e-mail a request to
dg.prospectus_distribution@bofasecurities.com. The securities may not be
suitable for all investors. Banc of America Securities LLC and its affiliates
may acquire, hold or sell positions in these securities, or in related
derivatives, and may have an investment or commercial banking relationship with
the issuer.
The information contained in these materials may be based on assumptions
regarding market conditions and other matters as reflected herein. Banc of
America Securities LLC (the "Underwriter") makes no representation regarding the
reasonableness of such assumptions or the likelihood that any such assumptions
will coincide with actual market conditions or events, and these materials
should not be relied upon for such purposes. The Underwriter and its affiliates,
officers, directors, partners and employees, including persons involved in the
preparation or issuance of these materials, may, from time to time, have long or
short positions in, and buy and sell, the securities mentioned herein or
derivatives thereof (including options). Information in these materials is
current as of the date appearing on the material only. Information in these
materials regarding any securities discussed herein supersedes all prior
information regarding such securities. These materials are not to be construed
as an offer to sell or the solicitation of any offer to buy any security in any
jurisdiction where such an offer or solicitation would be illegal.
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IRS CIRCULAR 230 NOTICE
THIS FREE WRITING PROSPECTUS IS NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT
BE USED, FOR THE PURPOSE OF AVOIDING U.S. FEDERAL, STATE OR LOCAL TAX PENALTIES.
THIS FREE WRITING PROSPECTUS IS WRITTEN AND PROVIDED BY THE UNDERWRITER IN
CONNECTION WITH THE PROMOTION OR MARKETING OF THE TRANSACTIONS OR MATTERS
ADDRESSED HEREIN. INVESTORS SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR
CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.
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[BANC OF AMERICA SECURITIES LOGO] Banc of America Mortgage Securities, Inc.
Mortgage Pass-Through Certificates, 2005-12
$298,847,554 (approximate)
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Last Scheduled Pass-
WAL (Yrs) Prin Pmt (Mths) Through
Class Class Balance (1) (Call/Mat) (2) (Call/Mat) (2) Rate Principal and Interest Type
- ----- ----------------- -------------- --------------- ------------- --------------------------------------------------
A-1 $20,445,000 11.16/14.21(6) 37-140/37-360 5.75% Senior, Sequential Pay, Special Retail, Fixed Rate
A-2 $81,828,000 3.86/ 3.86 1-131/1-131 (3) Senior, Companion, Floating Rate
A-3 $14,232,000 3.86/ 3.86 1-131/1-131 (4) Senior, Companion, Inverse Floating Rate
A-4 $132,775,000 3.95/ 3.95 1-96/1-96 5.75% Senior, Planned Amortization, Fixed Rate
A-5 $4,104,000 8.33/ 8.33 96-104/96-104 5.75% Senior, Planned Amortization, Fixed Rate
A-6 $320,008 11.16/ 14.21 37-140/37-360 None Senior, Sequential Pay, Principal Only
A-7 $27,032,000 9.64/11.04 61-140/61-360 5.75% Super Senior, Lockout, Fixed Rate
A-8 $3,003,000 9.64/ 11.04 61-140/61-360 5.75% Super Senior Support, Lockout, Fixed Rate
A-R $100 Information Not Provided Herein Senior, Sequential Pay, Residual
A-PO $7,149,445 5.22/ 5.62 1-140/1-360 None Senior, Ratio Strip, Principal Only
$3,526,940
A-IO (Notional) 5.26/ 5.66 NA-NA/NA-NA 5.75% Senior, Fixed Rate, Interest Only
B-1 $5,406,000 9.03/10.28 1-140/1-360 5.75% Subordinate, Fixed Rate
B-2 $1,652,000 9.03/ 10.28 1-140/1-360 5.75% Subordinate, Fixed Rate
B-3 $901,000 9.03/ 10.28 1-140/1-360 5.75% Subordinate, Fixed Rate
B-4 $601,000 Information Not Provided Herein Subordinate, Fixed Rate
B-5 $451,000 Information Not Provided Herein Subordinate, Fixed Rate
B-6 $450,575 Information Not Provided Herein Subordinate, Fixed Rate
Expected Expected
Credit Ratings
Class Enhancement(5) (Fitch\Moody's)
- ----- -------------- ---------------
A-1 3.15% AAA/Aaa
A-2 3.15% AAA/Aaa
A-3 3.15% AAA/Aaa
A-4 3.15% AAA/Aaa
A-5 3.15% AAA/Aaa
A-6 3.15% AAA/Aaa
A-7 3.15% AAA/Aaa
A-8 3.15% AAA/Aa1
A-R 3.15% AAA/None
A-PO 3.15% AAA/Aaa
A-IO 3.15% AAA/Aaa
B-1 1.35% AA/None
B-2 0.80% A/None
B-3 0.50% BBB/None
B-4 0.30% BB/None
B-5 0.15% B/None
B-6 0.00% NR
(1) The Certificate sizes are approximate and are subject to a +/- 5%
variance.
(2) The Weighted Average Life, Last Scheduled Principal Payment to Call and to
Maturity for the Certificates are shown to 300% PSA.
(3) During the initial LIBOR Based Interest Accrual Period, interest will
accrue on the Class A-2 Certificates at the rate of 5.19% per annum.
During each LIBOR Based Interest Accrual Period thereafter, interest will
accrue on the Class A-2 Certificates at a per annum rate equal to (i)
0.900% plus (ii) the arithmetic mean of the London interbank offered rate
quotations for one-month U.S. dollar deposits ("LIBOR") determined monthly
by the Trustee, subject to a minimum rate of 0.900% and a maximum rate of
6.750%.
(4) During the initial LIBOR Based Interest Accrual Period, interest will
accrue on the Class A-3 Certificates at the rate of 8.96976393% % per
annum. During each LIBOR Based Interest Accrual Period thereafter interest
will accrue on the Class A-3 Certificates at a per annum rate equal to (i)
33.63545531% minus (ii) the product of 5.74957841 and LIBOR determined
monthly as set forth in this Prospectus Supplement, subject to a minimum
rate of 0.00% and a maximum rate of 33.63545531%.
(5) The credit enhancement sizes are preliminary and subject to change based
upon the final pool as of the Cut-off Date and any additional rating
agency analysis.
(6) The weighted average life of the class of Special Retail Certificates
applies to such class as a whole. Because of the special procedures for
allocating principal distributions to holders within the class of Special
Retail Certificates, the weighted average life of an individual
certificate may vary from the weighted average life of the class as a
whole.
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Preliminary Summary of Terms
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Transaction: Banc of America Mortgage 2005-12 Trust
Mortgage Pass-Through Certificates,
Series 2005-12
Depositor: Banc of America Mortgage Securities,
Inc.
Underwriter: Banc of America Securities LLC
Seller and Servicer: Bank of America, National Association
Trustee: Wells Fargo Bank, National Association
Insurer of the Special Retail
Certificates: Assured Guaranty Corp.
Rating Agencies: Moody's Investors Service, Inc. and
Fitch Ratings
Offered Size: $298,847,554
Expected Closing Date: December 29, 2005
Expected Investor Closing Date: December 30, 2005
Distribution Date: 25th of each month, or the next
succeeding business day
(First Distribution Date: January 25,
2006)
Cut-off Date: December 1, 2005.
Determination Date: For any Distribution Date, the 16th day
of the month in which the Distribution
Date occurs or, if that day is not a
business day, the immediately preceding
business day
Record Date: For any Distribution Date, the close of
business on the last business day of the
month preceding the month of that
Distribution Date.
Senior Certificates: Class A-1, A-2, A-3, A-4, A-5, A-6, A-7,
A-8, A-PO, A-IO and A-R Certificates.
The Class A-R Certificate is not offered
hereunder.
Subordinate Certificates or
Class B Certificates: Class B-1, B-2, B-3, B-4, B-5 and B-6.
The Class B-4, B-5 and B-6 Certificates
are not offered hereunder.
Offered Certificates: Class A-1, A-2, A-3, A-4, A-5, A-6, A-7,
A-8, A-PO, A-IO, B-1, B-2 and B-3
Certificates.
Floating Rate Certificates: Class A-2
Inverse Floating Rate
Certificates: Class A-3
Interest Only Certificates: Class A-IO
Principal Only Certificates: Class A-6 and Class A-PO
Lockout Certificates: Class A-7 and Class A-8
PAC Certificates: Class A-4 and Class A-5
Companion Certificates: Class A-2 and Class A-3
Super Senior Certificates: Class A-7
Super Senior Support Certificates: Class A-8
Special Retail Certificates: Class A-1
Residual Certificate: Class A-R
Day Count: 30/360
Pricing Speed: 300% PSA. "PSA" or the Prepayment
Standard Assumption represents an
assumed rate of principal prepayment
each month relative to the
then-outstanding principal balance of a
pool of mortgage loans for the life of
such mortgage loans. A prepayment
assumption of 100% PSA assumes constant
prepayment rates of 0.2% per annum of
the then-outstanding principal balance
of such mortgage loans in the first
month of the life of the mortgage loans
and an additional 0.2% per annum in each
month thereafter until the thirtieth
month. Beginning in the thirtieth month
and in each month thereafter during the
life of the mortgage loans, 100% PSA
assumes a constant prepayment rate of 6%
per annum each month.
Clearing: DTC, Clearstream and Euroclear.
Original Certificate Minimum Incremental
Denominations: Form Denominations Denominations
A-2, A-3, A-4, A-5, A-7 and A-8 Book Entry $1,000 $1
Special Retail Certificates Book Entry $1,000 $1,000
Principal Only Certificates Book Entry $25,000 $1
Interest Only Certificates Book Entry $1,000,000 $1
Subordinate Certificates Book Entry $25,000 $1
SMMEA Eligibility: The Senior Certificates and the Class
B-1 Certificates are expected to
constitute "mortgage related securities"
for purposes of SMMEA.
ERISA Eligibility: A fiduciary or other person acting on
behalf of any employee benefit plan or
arrangement, including an individual
retirement account, subject to the
Employee Retirement Income Security Act
of 1974, as amended ("ERISA"), the Code
or any federal, state or local law
("Similar Law") which is similar to
ERISA or the Code (collectively, a
"Plan") should carefully review with its
legal advisors whether the purchase or
holding of an Offered Certificate could
give rise to a transaction prohibited or
not otherwise permissible under ERISA,
the Code or Similar Law.
The U.S. Department of Labor has
extended to Banc of America Securities
LLC an administrative exemption (the
"Exemption") from certain of the
prohibited transaction rules of ERISA
and the related excise tax provisions of
Section 4975 of the Code with respect to
the initial purchase, the holding and
the subsequent resale by certain Plans
of certificates in pass-through trusts
that consist of certain receivables,
loans and other obligations that meet
the conditions and requirements of the
Exemption.
The Exemption may cover the acquisition
and holding of the Offered Certificates
by the Plans to which it applies
provided that all conditions of the
Exemption other than those within the
control of the investors are met. In
addition, as of the date hereof, there
is no single mortgagor that is the
obligor on 5% of the initial balance of
the Mortgage Pool.
Prospective Plan investors should
consult with their legal advisors
concerning the impact of ERISA, the Code
and Similar Law, the applicability of
PTE 83-1 and the Exemption, and the
potential consequences in their specific
circumstances, prior to making an
investment in the Offered Certificates.
Moreover, each Plan fiduciary should
determine whether under the governing
plan instruments and the applicable
fiduciary standards of investment
prudence and diversification, an
investment in the Offered Certificates
is appropriate for the Plan, taking into
account the overall investment policy of
the Plan and the composition of the
Plan's investment portfolio.
Tax Structure: For federal income tax purposes, an
election will be made to treat the Trust
as a "real estate mortgage investment
conduit" (a "REMIC"). The Offered
Certificates (other than the Class A-R
Certificate) will constitute "regular
interests" in the REMIC and will be
treated as debt instruments for federal
income tax purposes. The Class A-R
Certificate constitutes the sole class
of "residual interest" in the REMIC.
Optional Termination Date: On any Distribution Date on which the
aggregate Stated Principal Balance of
the Mortgage Loans is less than 10% of
the initial aggregate unpaid principal
balance of the Mortgage Loans as of the
Cut-off Date, the Servicer may, at its
option, subject to certain conditions,
purchase the Mortgage Loans, which would
effect an early retirement of the
Certificates.
Reserve Fund and Policy for
the Class A-1 Certificates:
The Class A-1 Certificates are entitled
to the benefit of a reserve fund as
protection against certain interest
shortfalls arising from the timing of
principal payments on the Mortgage Loans
up to $10,000.
The Class A-1 Certificates also will be
entitled to the benefit of an
irrevocable financial guaranty insurance
policy to be issued by Assured Guaranty
Corp. ("Assured Guaranty").
Under the policy, Assured Guaranty
will unconditionally and irrevocably
guarantee:
o the current payment of
interest allocated to the
Class A-1 Certificates,
other than interest
shortfalls arising from the
timing of principal payments
on the Mortgage Loans and
interest shortfalls
attributable to the
Servicemembers Civil Relief
Act or comparable state
legislation; and
o the payment of any losses of
principal allocated to the
Class A-1 Certificates.
The Pooling Agreement: The Certificates will be issued pursuant
to a Pooling and Servicing Agreement
(the "Pooling Agreement") to be dated
the Closing Date, among the Depositor,
the Servicer and the Trustee.
The Mortgage Pool: The "Mortgage Pool" will consist of
fixed rate, conventional,
fully-amortizing mortgage loans (the
"Mortgage Loans,") secured by first
liens on one- to four-family properties.
All of the Mortgage Loans were
originated or acquired by Bank of
America, National Association, which is
an affiliate of the Depositor and Banc
of America Securities LLC.
Compensating Interest: Pursuant to the Pooling Agreement, the
aggregate Servicing Fee payable to the
Servicer for any month will be reduced
(but not below zero) by an amount equal
to the lesser of (i) the Prepayment
Interest Shortfall for such Distribution
Date and (ii) one-twelfth of 0.25% of
the aggregate Stated Principal Balance
of the Mortgage Loans as of the due date
in the month preceding the month of such
Distribution Date (such amount, the
"Compensating Interest"). The
"Prepayment Interest Shortfall" is equal
to the difference between (x) 30 days'
interest at the mortgage interest rate
(less the Servicing Fee Rate) on the
amount of each prepayment on the
Mortgage Loans minus (y) the amount of
interest actually paid by the related
mortgagors on the amount of such
prepayments during the preceding month.
Advances: Subject to the certain limitations, the
Servicer will be required pursuant to
the Pooling Agreement to advance (any
such advance, an "Advance") prior to
each remittance date an amount equal to
the aggregate of payments of principal
and interest (net of the Servicing Fee)
which were due on the related due date
on the Mortgage Loans and which were
delinquent on the related Determination
Date. Advances made by the Servicer will
be made from its own funds or funds
available for future distribution. The
obligation to make an Advance with
respect to any Mortgage Loan will
continue until the ultimate disposition
of the REO Property or Mortgaged
Property relating to such Mortgage Loan.
An "REO Property" is a Mortgaged
Property that has been acquired by the
Trust through foreclosure or grant of a
deed in lieu of foreclosure.
Class Balance: The class balance of a class of
Certificates at any time will equal its
initial class balance less (i) all
distributions of principal made to such
class, and (ii) losses allocated to such
class.
Notional Amount: The Notional Amount of the Class A-IO
Certificates will be equal to the
product of (i) the aggregate of the
Stated Principal Balances of the
Mortgage Loans with Net Mortgage
Interest Rate as of the Cut-off Date
greater than or equal to 5.750% as of
the due date in the month preceding the
month of such Distribution Date and (ii)
a fraction, (a) the numerator of which
is equal to the weighted average of the
Net Mortgage Interest Rates of the these
Mortgage Loans (based on the Stated
Principal Balances of these Mortgage
Loans as of the due date in the month
preceding the month of such Distribution
Date) minus 5.750% and (b) the
denominator of which is equal to 5.750%
Net Mortgage Interest Rate: The "Net Mortgage Interest Rate" of a
Mortgage Loan is the excess of its
mortgage interest rate over the sum of
the servicing fee rate (which is 0.25%)
and the Trustee fee rate (which is
0.0065%)
Reserve Fund: A reserve fund will be established on
the Closing Date for the benefit of the
Class A-1 Certificates (the "Reserve
Fund") by an initial deposit into an
account maintained by the Trustee in the
amount of approximately $10,000. No
additional amounts will be deposited
into the Reserve Fund after the initial
deposit. The Reserve Fund will be
beneficially owned by the Underwriter
and will not be an asset of the REMIC.
A withdrawal will be made on each
Distribution Date from the amount on
deposit in the Reserve Fund, to the
extent available, to cover any
Non-Supported Interest Shortfalls
allocated to the Class A-1 Certificates.
A withdrawal from the Reserve Fund may
only be made, to the extent funds are
available therein, to cover any
Non-Supported Interest Shortfall
allocated to the Class A-1 Certificates
and may not be made to cover any
Non-Supported Interest Shortfall
allocated to any other class. Once the
Reserve Fund has been reduced to zero,
the Policy will not cover any
Non-Supported Interest Shortfalls
allocated to Class A-1 Certificates. A
"Non-Supported Interest Shortfall" is
the amount by which the aggregate of
Prepayment Interest Shortfalls for the
Mortgage Loans during the calendar month
preceding the month of such Distribution
Date exceeds the applicable Compensating
Interest for such period.
The balance of any amount remaining in
the Reserve Fund on the Distribution
Date on which the class balance of a
Class A-1 Certificates is reduced to
zero will be distributed to the
Underwriter.
Neither the Reserve Fund nor the Policy
will cover any Net Interest Shortfalls
arising as a result of a Relief Act
Reduction allocated to the Class A-1
Certificates.
With respect to any Distribution Date,
the "Net Interest Shortfall" is equal to
the sum of (i) the shortfall in interest
received with respect to any Mortgage
Loan as a result of a Relief Act
Reduction and (ii) any Non-Supported
Interest Shortfalls.
A "Relief Act Reduction" is a reduction
in the amount of monthly interest
payment on a Mortgage Loan pursuant to
the Servicemembers Civil Relief Act or
similar state legislation.
Distributions in Reduction of
the Special Retail Certificates: As to distributions of principal among
holders of the Class A-1 Certificates
(the "Special Retail Certificates"),
Deceased Holders (as defined below) will
be entitled to first priority (up to a
limit of approximately $100,000, as
described below) and beneficial owners
other than Deceased Holders ("Living
Holders") will be entitled to second
priority (up to a limit of approximately
$10,000, as described below). Beneficial
owners of the class of the Special
Retail Certificates will have the right
to request that distributions of
principal be made with respect to their
Special Retail Certificates on each
Distribution Date on which distributions
of principal are made with respect to
that class. All such requested
distributions are subject to the
priorities described below and to the
limitations (i) that they be made only
in lots equal to $1,000 of initial class
balance and (ii) that aggregate
distributions on the class of Special
Retail Certificates on a Distribution
Date will not exceed the portion of the
Senior Principal Distribution Amount
allocated to the Class A-1 Certificates
on that Distribution Date (plus any
amounts available from the Rounding
Account, as described below). To the
extent that amounts available for
distributions of principal on the class
of Special Retail Certificates on any
Distribution Date exceed the aggregate
requests by Deceased Holders and Living
Holders of that class for principal
distributions applicable to that
Distribution Date, those excess amounts
will be distributed to the beneficial
owners of that class by random lot, as
described below.
On each Distribution Date, on which
amounts are available for distribution
of principal on the class of Special
Retail Certificates, the aggregate
amount allocable to those distributions
will be rounded upward, as necessary, to
equal an integral multiple of $1,000,
except as provided below, in accordance
with the priorities and limitations set
forth in this discussion. Rounding will
be accomplished on the first
Distribution Date on which distributions
of principal on the class of Special
Retail Certificates are made, by
withdrawing, from a non-interest bearing
account to be established on the Closing
Date for the Special Retail
Certificates, with a $999.99 deposit by
the Underwriter (the "Rounding
Account"), the amount of funds, if any,
needed to round the amounts otherwise
available for distributions to the
Special Retail Certificates upward to
the next higher integral multiple of
$1,000. On each succeeding Distribution
Date on which distributions of principal
on the class of Special Retail
Certificates are to be made, the amounts
allocable to the class will be applied
first to repay any funds withdrawn from
the Rounding Account on the prior
Distribution Date, and then the
remainder of such allocable amount, if
any, will be similarly rounded upward
through another withdrawal from the
Rounding Account and distributed as
principal on that class. This process
will continue on succeeding Distribution
Dates with respect to the class of
Special Retail Certificates until its
class balance has been reduced to zero.
Thus, the aggregate distribution made in
reduction of the class balance of the
class of Special Retail Certificates on
each Distribution Date may be slightly
more or less than would be the case in
the absence of such rounding procedures,
but such difference will be no more than
$999.99 on that Distribution Date. Under
no circumstances will the sum of all
distributions of principal on the class
of Special Retail Certificates through
any Distribution Date be less than the
sum that would have resulted in the
absence of such rounding procedures.
A beneficial owner of a Special Retail
Certificate who has submitted a request
for a principal distribution may not
receive a distribution at any particular
time after its request, since there can
be no assurance that funds will be
available for making principal
distributions on the class of Special
Retail Certificates on any particular
Distribution Date. Even if funds are
available, those distributions with
respect to the Special Retail
Certificates owned by any particular
beneficial owner may not be made. Also,
due to the procedure for mandatory
distributions described below, there can
be no assurance that on any Distribution
Date on which the funds available for
distribution of principal on the class
of Special Retail Certificates exceed
the aggregate amount of distributions
requested by beneficial owners of the
class, any particular beneficial owner
will not receive a principal
distribution from such excess funds even
if such beneficial owner has not
submitted a request for distribution.
Thus, the timing of distributions of
principal with respect to any particular
Special Retail Certificate is highly
uncertain, and such distributions may be
made earlier or later than the date that
may be desired by a beneficial owner.
Priority of Requested Distributions
Subject to the limitations described
herein, including the order of the
receipt of the request for distributions
as described below under "-- Procedure
for Requesting Distributions,"
beneficial owners of the Special Retail
Certificates have the right to request
that distributions of principal on their
Special Retail Certificates be made. On
each Distribution Date on which
distributions of principal on the class
of Special Retail Certificates are made,
priority of payment on that class will
be given to beneficial owners for whom
principal payment requests are in
effect. For the class of Special Retail
Certificates, DTC will honor requests in
the following order of priority:
First, DTC will honor requests
submitted on behalf of Deceased Holders
in the order of their receipt by DTC,
until those requests have been honored
in an amount up to $100,000 for each
requesting Deceased Holder; and
Second, DTC will honor requests
submitted on behalf of Living Holders in
the order of their receipt by DTC, until
those requests have been honored in an
amount up to $10,000 for each requesting
Living Holder.
Thereafter, DTC will honor requests
submitted on behalf of each Deceased
Holder as provided in step First up to a
second $100,000 and requests submitted
on behalf of each Living Holder as
provided in step Second up to a second
$10,000. This sequence of priorities
will be repeated until all principal
payment requests for the class of
Special Retail Certificates have been
honored to the extent of amounts
available in reduction of that class. In
no event will distributions to the class
of Special Retail Certificates exceed
the amount of principal available for
distribution to such class of Special
Retail Certificates on such Distribution
Date. In no event will the beneficial
owner of a Special Retail Certificate
receive a distribution of principal in
an amount greater than the principal
balance of its Special Retail
Certificate.
If the amount of principal available for
payment on the class of Special Retail
Certificates on a given Distribution
Date is insufficient to honor all
requests with respect to such class,
such requests will be honored on
succeeding Distribution Dates as
principal becomes available. A Special
Retail Certificate principal payment
request submitted on behalf of a Living
Holder who later dies will become
entitled to the priority of a newly
submitted request on behalf of a
Deceased Holder. That priority will be
effective for each subsequent
Distribution Date if DTC has received a
certified copy of the death certificate
and any additional appropriate evidence
of death and any requested tax waivers
by the last business day of the
preceding calendar month.
Procedure for Requesting Distributions
A beneficial owner may request that
distributions of principal on such
beneficial owner's Special Retail
Certificates be made on a Distribution
Date by delivering a written request
therefor to the participant in the DTC
system ("Participants") or to an
organization that holds through a
Participant (an "Indirect Participant")
that maintains such beneficial owner's
account in the Special Retail
Certificates so that the request for
such distribution is received on or
before the Record Date for such
Distribution Date. In the case of a
request on behalf of a Deceased Holder,
a certified copy of the death
certificate and any additional
appropriate evidence of death and any
tax waivers are required to be forwarded
to the Participant under separate cover.
Furthermore, such requests of Deceased
Holders that are incomplete may not be
honored by the Participant and, if not
honored, will lose their priority and
must be rerequested. The Participant
will in turn make the request of DTC
(or, in the case of an Indirect
Participant, such Indirect Participant
must notify the related Participant of
such request, and the Participant will
make the request of DTC) on DTC's
participant terminal system. Upon
receipt of such request, DTC will date
and time stamp such request and forward
such request to the Trustee. DTC may
establish such procedures as it deems
fair and equitable to establish the
order of receipt of requests for such
distributions received by it on the same
day. None of the Depositor, the
Servicer, Assured Guaranty or the
Trustee will be liable for any delay by
DTC, any Participant or any Indirect
Participant in the delivery of requests
for distributions. Requests for
distributions of principal received by
DTC after the Record Date for such
Distribution Date and requests for
distributions of principal received in a
timely manner but not accepted with
respect to a given Distribution Date,
will be treated as requests for
distributions of principal on the next
succeeding Distribution Date and each
succeeding Distribution Date thereafter
until each request is accepted or is
withdrawn as described below. Each
request for distributions of principal
on a Special Retail Certificate
submitted by a beneficial owner of a
Special Retail Certificate will be held
by DTC until such request has been
accepted or has been withdrawn in
writing, in the manner set forth below.
The principal amount covered by such
request will continue to bear interest
at the related pass-through rate through
the last calendar date of the month
preceding the month of the Distribution
Date.
With respect to Special Retail
Certificates for which beneficial owners
have requested distributions on a
particular Distribution Date on which
distributions of principal on the class
of Special Retail Certificates are being
made, DTC will notify the Participants
prior to such Distribution Date whether,
and the extent to which, such requests
for distributions on the Special Retail
Certificates have been accepted.
Participants and Indirect Participants
holding Special Retail Certificates are
required to forward such notices to the
beneficial owners of such Certificates.
Requested distributions on Special
Retail Certificates entitled to such
distributions will be due and payable on
the applicable Distribution Date and
will cease to bear interest after the
last calendar date of the month
preceding the month of such Distribution
Date.
Any beneficial owner of a Special Retail
Certificate that has requested a
distribution may withdraw such request
by so notifying in writing the
Participant or Indirect Participant that
maintains such beneficial owner's
account. The Participant will make the
request of DTC on DTC's participant
terminal system. In the event that such
account is maintained by an Indirect
Participant, such Indirect Participant
must notify the related Participant,
which in turn must make the request of
DTC on DTC's participant terminal
system. If such notice of withdrawal of
a request for distribution has not been
received by the DTC on or before the
Record Date for the Distribution Date,
the previously made request for
distribution will be irrevocable with
respect to the making of distributions
of principal on the class of Special
Retail Certificates on the applicable
Distribution Date.
Mandatory Distributions of Principal on
the Special Retail Certificates
If the amount available for principal
distributions on the class of Special
Retail Certificates on a Distribution
Date exceeds the aggregate amount of
distribution requests for that class
which have been received by DTC on or
before the applicable Record Date,
additional Special Retail Certificates
in lots equal to $1,000 will be selected
to receive principal distributions in
accordance with the then-applicable
established random lot procedures of
DTC, and the procedures of the
Participants and Indirect Participants,
which may or may not be by random lot.
Investors in the Special Retail
Certificates should ask Participants or
Indirect Participants which allocation
procedures they use. Participants and
Indirect Participants holding Special
Retail Certificates selected for
mandatory distributions of principal are
required to provide notice of such
mandatory distributions to the affected
beneficial owners.
Deceased Holders
A "Deceased Holder" is a beneficial
owner of a Special Retail Certificate
who was living at the time such interest
was acquired and whose executor or other
authorized representative causes to be
furnished to the Participant a certified
copy of the death certificate and any
additional evidence of death
satisfactory to the Participant and any
tax waivers requested by the
Participant. Special Retail Certificates
beneficially owned by tenants by the
entirety, joint tenants or tenants in
common will be considered to be
beneficially owned by a single owner.
The death of a tenant by the entirety,
joint tenant or tenant in common will be
deemed to be the death of the beneficial
owner, and the Special Retail
Certificates so owned will be eligible
for priority with respect to
distributions of principal, subject to
the limitations described herein.
Special Retail Certificates beneficially
owned by a trust will be considered to
be beneficially owned by each
beneficiary of the trust to the extent
of such beneficiary's interest therein,
but in no event will a trust's
beneficiaries collectively be deemed to
be beneficial owners of a number of
Special Retail Certificates greater than
the number of Special Retail
Certificates of which the trust is the
owner. The death of the beneficiary of a
trust will be deemed to be the death of
a beneficial owner of the Special Retail
Certificates beneficially owned by the
trust to the extent of that
beneficiary's interest in the trust. The
death of an individual who was a tenant
by the entirety, joint tenant or tenant
in common in a tenancy that is the
beneficiary of a trust will be deemed to
be the death of the beneficiary of the
trust. The death of a person who, during
his or her lifetime, was entitled to
substantially all of the beneficial
ownership interest in a Special Retail
Certificate will be deemed to be the
death of the beneficial owner of the
Special Retail Certificate regardless of
the registration of the ownership, if
the beneficial ownership interest can be
established to the satisfaction of the
Participant. Beneficial interests will
be deemed to exist in typical cases of
street name or nominee ownership,
ownership by a trustee, ownership under
the Uniform Gift to Minors Act and
community property or other joint
ownership arrangements between a husband
and wife. Beneficial interests shall
include the power to sell, transfer, or
otherwise dispose of a Special Retail
Certificate and the right to receive the
proceeds therefrom, as well as interest
payments and distributions in reduction
of principal balance with respect
thereto. As used in this Prospectus
Supplement, a request for a distribution
of principal of a Special Retail
Certificate by a Deceased Holder shall
mean a request by the personal
representative, surviving tenant by the
entirety, surviving joint tenant or
surviving tenant in common of such
Deceased Holder.
Pro Rata Distributions
On each Distribution Date, if Assured
Guaranty fails to pay an Insured Amount
in respect of principal, distributions
of principal on the class of Special
Retail Certificates will be made pro
rata among the holders of such class of
Special Retail Certificates and will not
be rounded up to an integral multiple of
$1,000 or made in integral multiples of
$1,000 nor will distributions be made
pursuant to requested distributions or
mandatory random lot distributions. If
pro rata distributions cannot be made
through the facilities of DTC, the
Special Retail Certificates will be
withdrawn from the facilities of DTC and
Definitive Certificates will be issued
to the beneficial owners of those
Certificates.
The Financial Guaranty
Insurance Policy: The following summary of terms of the
financial guaranty insurance policy to
be issued by Assured Guaranty Corp.
("Assured Guaranty") does not purport to
be complete and is qualified in its
entirety by reference to the Policy
referred to below.
Assured Guaranty has made a commitment,
subject to the satisfaction of certain
conditions, to issue a financial
guaranty insurance policy (the "Policy")
relating to the Banc of America Mortgage
Securities, Inc. Mortgage Pass-Through
Certificates, Series 2005-12, Class A-1
Certificates (the "Insured
Certificates"), effective as of the date
of issuance of the Insured Certificates.
Under the terms of the Policy, Assured
Guaranty will unconditionally and
irrevocably guarantee to pay each and
every Insured Amount (as defined below)
that shall become due for payment but
shall be unpaid by reason of Nonpayment
(as defined below). The Policy is
non-cancelable for any reason.
Principal payable by Assured Guaranty
under the Policy in respect of the
Insured Certificates will in no event
exceed the class balance of the Insured
Certificates as of the date of issuance,
which is expected to be $20,445,000.
Assured Guaranty will pay each Insured
Amount that constitutes a Deficiency
Amount to the Trustee, as beneficiary of
the Policy on behalf of the holders of
the Insured Certificates, on the later
of (i) the Distribution Date on which
such Deficiency Amount becomes due for
payment or (ii) the third business day
following the day on which Assured
Guaranty receives notice of claim
therefor in accordance with the terms of
the Policy. Assured Guaranty will pay
each Insured Amount that constitutes a
Preference Amount when due to be paid by
or on behalf of the holders of the
Insured Certificates pursuant to an
applicable court order, but in any event
no earlier than the fourth business day
following receipt by Assured Guaranty of
the documentation required by Assured
Guaranty in accordance with the terms of
the Policy.
The terms below are summary
descriptions. Reference should be made
to the Policy for the actual definition
of each term defined below.
"Deficiency Amount" means, with respect
to the Insured Certificates and any
Distribution Date, the amount (if any)
equal to (1) the sum of (a) any
shortfall in amounts available in the
certificate account to pay interest for
the related Interest Accrual Period on
the class balance of the Insured
Certificates at the then applicable
pass-through rate for such Distribution
Date and (b) the amount of the principal
portion of any Realized Losses allocated
to the Insured Certificates on such
Distribution Date and (2) on the
Distribution Date in January 2036 or,
with the consent of Assured Guaranty,
upon the earlier of the termination of
the Trust pursuant to the terms of the
Pooling Agreement, the class balance of
the Insured Certificates after giving
effect to any distributions on such
Distribution Date and, in the case of
each of clauses (1) and (2), net of any
Prepayment Interest Shortfalls or Relief
Act Reductions allocated to the Insured
Certificates, or any shortfall
attributable to the liability of the
Trust, the REMIC, the Trustee for
withholding or other taxes, including
interest and penalties in respect of
such liabilities allocated to the
Insured Certificates on such
Distribution Date; provided, however,
that "Deficiency Amount" shall not
include any additional amounts owing by
the Trust as a result of the failure by
the Trustee to pay such amount when due
and payable, including, without
limitation, any such additional amounts
as may be attributable to penalties or
default interest rates, amounts in
respect of indemnification, or any other
additional amounts payable by reason of
such a default.
"Insured Amount" means, with respect to
any Distribution Date, the sum of any
Deficiency Amount for such Distribution
Date and any Preference Amount.
"Insured Payment" means, with respect to
any Distribution Date, the aggregate
amount paid by Assured Guaranty to the
Trustee in respect of (i) the Deficiency
Amount for such Distribution Date and
(ii) Preference Amounts for any given
Business Day.
"Nonpayment" means, with respect to any
Distribution Date, an Insured Amount is
due for payment but the funds, if any,
remitted to the Trustee pursuant to the
Pooling Agreement are insufficient for
payment in full of such Insured Amount.
"Preference Amount" means any payment of
principal or interest previously
distributed by or on behalf of the Trust
to a holder of Insured Certificates,
which would have been covered under the
Policy as a Deficiency Amount if there
had been a shortfall in funds available
to make such a payment on the required
Distribution Date for such payment,
which has been deemed a preferential
transfer and has been recovered from
such holder pursuant to the United
States Bankruptcy Code in accordance
with a final nonappealable order of a
court or other body exercising
jurisdiction in an insolvency proceeding
by or against the Trust.
Assured Guaranty shall be subrogated to
the rights of the holders of the Insured
Certificates to receive distributions in
respect of the Insured Certificates to
the extent of any payment by Assured
Guaranty under the Policy.
The Policy is not covered by the
property/casualty insurance fund
specified in Article 76 of the New York
Insurance Law.
Capitalized terms used in the Policy and
not otherwise defined in the Policy
shall have the meanings set forth in the
Pooling Agreement as of the date of
execution of the Policy, without giving
effect to any subsequent amendment to or
modification of the Pooling Agreement
unless such amendment or modification
has been approved in writing by Assured
Guaranty.
The Certificate Insurer: Assured Guaranty is a Maryland-domiciled
insurance company regulated by the
Maryland Insurance Administration and
licensed to conduct financial guaranty
insurance business in forty-seven
states, the District of Columbia and
Puerto Rico. Assured Guaranty commenced
operations in 1988. Assured Guaranty is
a wholly owned, indirect subsidiary of
Assured Guaranty Ltd. ("AGL"), a
Bermuda-based holding company whose
shares are publicly held and are listed
on the New York Stock Exchange under the
symbol "AGO." AGL, through its operating
subsidiaries, provides credit
enhancement products to the public
finance, structured finance and mortgage
markets. Neither AGL nor any of its
shareholders is obligated to pay any
debts of Assured Guaranty or any claims
under any insurance policy issued by
Assured Guaranty.
Assured Guaranty is subject to insurance
laws and regulations in Maryland and in
New York (and in other jurisdictions in
which it is licensed) that, among other
things, (i) limit Assured Guaranty's
business to financial guaranty insurance
and related lines, (ii) prescribe
minimum solvency requirements, including
capital and surplus requirements, (iii)
limit classes and concentrations of
investments, (iv) regulate the amount of
both the aggregate and individual risks
that may be insured, (v) limit the
payment of dividends by Assured
Guaranty, (vi) require the maintenance
of contingency reserves and (vii) govern
changes in control and transactions
among affiliates. Certain state laws to
which Assured Guaranty is subject also
require the approval of policy rates and
forms.
Assured Guaranty's financial strength is
rated "AAA" by Standard & Poor's, a
division of The McGraw-Hill Companies,
Inc., "Aa1" by Moody's Investors
Service, Inc. and "AAA" by Fitch Inc.
Each rating of Assured Guaranty should
be evaluated independently. An
explanation of the significance of the
above ratings may be obtained from the
applicable rating agency. The above
ratings are not recommendations to buy,
sell or hold any security, and such
ratings are subject to revision or
withdrawal at any time by the rating
agencies. Any downward revision or
withdrawal of any of the above ratings
may have an adverse effect on the market
price of any security guaranteed by
Assured Guaranty. Assured Guaranty does
not guaranty the market price of the
securities it guarantees, nor does it
guaranty that the ratings on such
securities will not be revised or
withdrawn.
Capitalization of Assured Guaranty Corp.
The following table sets forth the
capitalization of Assured Guaranty as of
December 31, 2003 and December 2004 and
as of September 30, 2005 (unaudited), on
the basis of accounting principles
generally accepted in the United States
of America ("GAAP"):
Capitalization of Assured Guaranty Corp.
December 31, 2003 December 31, 2004 September 30, 2005
(in millions) (in millions) (in millions)
----------------- ----------------- ------------------
Unearned Premiums $389 $369 $197
Other Liabilities 236 280 167
Shareholder's Equity:
Common Stock 15 15 15
Additional Paid-in Capital 351 386 363
Unrealized Gain on Bonds, Net of Tax 45 43 32
Retained Earnings 465 563 617
Total Shareholder's Equity $876 $1,007 $1,027
----------------- ----------------- ------------------
Total Liabilities and Shareholder's Equity $1,501 $1,656 $1,391
The following documents are hereby
incorporated by reference into this Free
Writing Prospectus and shall be deemed
to be a part hereof:
o The consolidated balance sheets of
Assured Guaranty as of December
31, 2004 and December 31, 2003 and
the related consolidated
statements of operations and
comprehensive income, of
shareholder's equity and of cash
flows for each of the three years
in the period ended December 31,
2004, prepared in accordance with
GAAP, included as Exhibit 99.1 to
the Annual Report on Form 10-K of
AGL for the fiscal year ended
December 31, 2004 (which was filed
with the Securities and Exchange
Commission (the "SEC") on March
22, 2005);
o The unaudited consolidated balance
sheet and statement of
shareholder's equity of Assured
Guaranty as of and for the period
ended March 31, 2005,
respectively, and the related
consolidated statements of
operations and comprehensive
income and cash flows for the
three months ended March 31, 2005
and March 31, 2004, prepared in
accordance with GAAP, included as
Exhibit 99.1 to the Quarterly
Report on Form 10-Q for the
quarterly period ended March 31,
2005 (which was filed by AGL with
the SEC on May 12, 2005);
o The unaudited consolidated balance
sheet and statement of
shareholder's equity of Assured
Guaranty as of and for the period
ended June 30, 2005, respectively,
the related consolidated
statements of operations and
comprehensive income for the three
and six months ended June 30, 2005
and June 30, 2004, and the
statements of cash flows for the
six months ended June 30, 2005 and
June 30, 2004, prepared in
accordance with GAAP, included as
Exhibit 99.1 to the Quarterly
Report on Form 10-Q for the
quarterly period ended June 30,
2005 (which was filed by AGL with
the SEC on August 15, 2005);
o The unaudited consolidated balance
sheet and statement of
shareholder's equity of Assured
Guaranty as of and for the period
ended September 30, 2005,
respectively, the related
consolidated statements of
operations and comprehensive
income for the three and nine
months ended September 30, 2005
and September 30, 2004, and the
statements of cash flows for the
nine months ended September 30,
2005 and September 30, 2004,
prepared in accordance with GAAP,
included as Exhibit 99.1 to the
Quarterly Report on Form 10-Q for
the quarterly period ended
September 30, 2005 (which was
filed by AGL with the SEC on
November 7, 2005); and
o The Current Reports on Form 8-K
filed by AGL with the SEC on April
12, 2005, April 20, 2005, May 10,
2005, May 18, 2005, June 24, 2005,
August 5, 2005, December 12, 2005
and December 21, 2005 as they
relate to Assured Guaranty.
Any statement contained in a document
incorporated herein by reference or
contained in this Free Writing
Prospectus under the heading "The
Certificate Insurer" shall be modified
or superseded for the purposes of this
Free Writing Prospectus to the extent
that a statement contained herein or in
any subsequently filed document which is
incorporated by reference herein also
modifies or supersedes such statement.
Any statement so modified or superseded
shall not be deemed, except as so
modified or superseded, to constitute a
part of this Free Writing Prospectus.
All consolidated financial statements of
Assured Guaranty included in documents
filed by AGL with the SEC pursuant to
Section 13(a), 13(c), 14 or 15(d) of the
Securities Exchange Act of 1934, as
amended, subsequent to the date of this
Free Writing Prospectus and prior to the
termination of the offering of the
Insured Certificates shall be deemed to
be incorporated by reference into this
Free Writing Prospectus and to be a part
hereof from the respective dates of
filing such consolidated financial
statements.
The Maryland Insurance Administration
recognizes only statutory accounting
practices for determining and reporting
the financial condition and results of
operations of an insurance company, for
determining its solvency under the
Maryland Insurance Code, and for
determining whether its financial
condition warrants the payment of a
dividend to its stockholders. No
consideration is given by the Maryland
Insurance Administration to financial
statements prepared in accordance with
GAAP in making such determinations.
Copies of the consolidated financial
statements of Assured Guaranty
incorporated by reference herein and of
the statutory financial statements filed
by Assured Guaranty with the Maryland
Insurance Administration are available
upon request by contacting Assured
Guaranty at 1325 Avenue of the Americas,
New York, New York 10019 or by calling
Assured Guaranty at (212) 974-0100.
Assured Guaranty makes no representation
regarding the Certificates or the
advisability of investing in the Insured
Certificates. In addition, Assured
Guaranty makes no representation
regarding, nor does it accept any
responsibility for the accuracy or
completeness of this Free Writing
Prospectus or any information or
disclosure contained herein, or omitted
herefrom, other than with respect to the
accuracy of the information regarding
the Policy and Assured Guaranty supplied
by Assured Guaranty and presented under
the headings "The Financial Guaranty
Insurance Policy" and "The Certificate
Insurer" in this Free Writing
Prospectus.
Stated Principal Balance: The Stated Principal Balance means, as
to any Mortgage Loan and due date, the
unpaid principal balance of such
Mortgage Loan as of such due date, as
specified in the amortization schedule
at the time relating thereto (before any
adjustment to such amortization schedule
by reason of any moratorium or similar
waiver or grace period), after giving
effect to any previous partial principal
prepayments and Liquidation Proceeds
(net of unreimbursed expenses and
unreimbursed Advances) allocable to
principal received and to the payment of
principal due on such due date and
irrespective of any delinquency in
payment by the related mortgagor and
after giving effect to any deficient
valuation by a court in connection with
a bankruptcy .
Pool Principal Balance (Non-PO
Portion): The Pool Principal Balance (Non-PO
Portion) for any Distribution Date
equals the sum of the product, for each
Mortgage Loan, of the Non-PO Percentage
of such Mortgage Loan multiplied by its
Stated Principal Balance on the due date
in the month preceding the month of such
Distribution Date.
Pool Principal Balance: The Pool Principal Balance with respect
to any Distribution Date equals the
aggregate Stated Principal Balances of
the Mortgage Loans outstanding on the
due date in the month preceding the
month of such Distribution Date.
Non-PO Principal Amount: The "Non-PO Principal Amount" for any
Distribution Date will equal the sum of
the applicable Non-PO Percentage of:
(a) all monthly payments of
principal due on each
Mortgage Loan on the related
due date;
(b) the principal portion of the
purchase price (net of
unreimbursed Advances and
other amounts as to which
the Servicer is entitled to
be reimbursed pursuant to
the Pooling Agreement) of
each Mortgage Loan that was
repurchased by the Depositor
pursuant to the Pooling
Agreement during the
calendar month preceding the
month of that Distribution
Date;
(c) amounts received with
respect to such Distribution
Date as a substitution
adjustment amount (net of
unreimbursed Advances and
other amounts as to which
the Servicer is entitled to
be reimbursed pursuant to
the Pooling Agreement)
received during the calendar
month preceding the month of
that Distribution Date;
(d) any Liquidation Proceeds
(net of unreimbursed
expenses and unreimbursed
Advances, if any) allocable
to recoveries of principal
of the Mortgage Loans that
have not yet been liquidated
received during the calendar
month preceding the month of
that Distribution Date;
(e) with respect to each
Mortgage Loan that was
liquidated during the
calendar month preceding the
month of that Distribution
Date, the amount of the
Liquidation Proceeds (other
than any profits retained by
the Servicer in connection
with the foreclosure and net
of unreimbursed expenses and
unreimbursed Advances, if
any) allocable to principal
received with respect to
that Mortgage Loan; and
(f) all partial and full
principal prepayments on the
Mortgage Loans by mortgagors
received during the calendar
month preceding the month of
that Distribution Date.
Senior Principal Distribution Amount: The Senior Principal Distribution Amount
for any Distribution Date will equal the
sum of (i) the Senior Percentage of the
applicable Non-PO Percentage of all
amounts described in clauses (a) through
(d) of the definition of "Non-PO
Principal Amount" for such Distribution
Date and (ii) the Senior Prepayment
Percentage of the applicable Non-PO
Percentage of all amounts described in
clauses (e) and (f) of the definition of
"Non-PO Principal Amount" for such
Distribution Date subject to certain
reductions due to losses.
Subordinate Principal
Distribution Amount: The Subordinate Principal Distribution
Amount for any Distribution Date will
equal the sum of (i) the Subordinate
Percentage for the applicable Non-PO
Percentage of all amounts described in
clauses (a) through (d) of the
definition of "Non-PO Principal Amount"
for such Distribution Date and (ii) the
Subordinate Prepayment Percentage of the
applicable Non-PO Percentage all amounts
described in clauses (e) and (f) of the
definition of "Non-PO Principal Amount"
for such Distribution Date.
Senior Percentage: The Senior Percentage on any
Distribution Date will equal (i) the
aggregate class balance of the Senior
Certificates (but not the Class A-PO
Certificates) immediately prior to such
date, divided by (ii) the Pool Principal
Balance (Non-PO Portion) for such date.
Subordinate Percentage: The Subordinate Percentage for any
Distribution Date will equal 100% minus
the Senior Percentage for such date.
Non-PO Percentage: The "Non-PO Percentage" with respect to
any Mortgage Loan with a Net Mortgage
Interest Rate as of the Cut-off Date
less than 5.750% (each such Mortgage
Loan, a "Discount Mortgage Loan") will
be equal to the Net Mortgage Interest
Rate as of the Cut-off Date divided by
5.750%. The Non-PO Percentage with
respect to any Mortgage Loan with a Net
Mortgage Interest Rate as of the Cut-off
Date equal to or greater than 5.750 will
be 100%. The "PO Percentage" for any
Discount Mortgage Loan will be equal to
100% minus the Non-PO Percentage for
such Mortgage Loan.
Premium Distribution Amount: On each Distribution Date, from and to
the extent of the Pool Distribution
Amount, Assured Guaranty will be
entitled to receive a premium (the
"Premium Distribution Amount") with
respect to the Class A-1 Certificates.
The Premium Distribution Amount will be
equal to the sum of (i) the product of
one-twelfth of 0.09% and the class
balance of the Class A-1 Certificates
and (ii) the sum of the amounts, if any,
by which the amount described in clause
(i) above on each prior Distribution
Date exceeded the amount actually
distributed in respect of the premium
from the Pool Distribution Amount on
such prior Distribution Dates and not
subsequently distributed. No further
amounts will be payable to Assured
Guaranty once the Class A-1 Certificates
are no longer outstanding.
Priority Amount: For any Distribution Date will equal the
lesser of (i) the sum of the class
balances of the Class A-7 and Class A-8
Certificates and (ii) the product of (a)
the Shift Percentage, (b) the Priority
Percentage and (c) the Non-PO Principal
Amount.
Priority Percentage: For any Distribution Date will equal (i)
the sum of the class balances of the
Class A-7 and Class A-8 Certificates
divided by (ii) the Pool Principal
Balance (Non-PO Portion) immediately
prior to such date.
Shift Percentage: For the following Distribution Dates,
will be as follows:
Distribution Date Shift Percentage
January 2006 through December 2010 0%
January 2011 through December 2011 30%
January 2012 through December 2012 40%
January 2013 through December 2013 60%
January 2014 through December 2014 80%
January 2015 and thereafter 100%
Principal Distributions: The Senior Principal Distribution Amount
will generally be allocated sequentially
as follows:
(i) To the Class A-R
Certificate, until its class
balance has been reduced to
zero;
(ii) Concurrently, to the Class
A-7 and Class A-8
Certificates, pro rata, up
to the Priority Amount for
such Distribution Date,
until their class balances
have been reduced to zero;
(iii) On or before December 2008,
pay sequentially as follows:
1. to the Class A-4 and
Class A-5
Certificates, in that
order, up to the PAC
Principal Amount for
such Distribution
Date;
2. Concurrently to the
Class A-2 and Class
A-3 Certificates, pro
rata, until their
class balances have
been reduced to zero;
3. Sequentially to the
Class A-4 and Class
A-5 Certificates, in
that order, until
their class balances
have been reduced to
zero;
4. Concurrently to the
Class A-1 and Class
A-6 Certificates, pro
rata, until their
class balances have
been reduced to zero;
(iv) After December 2008, pay
sequentially as follows:
1. $20,765.01
concurrently to the
Class A-1 and Class
A-6 Certificates, pro
rata, until their
class balances have
been reduced to zero;
2. Sequentially to the
Class A-4 and Class
A-5 Certificates, in
that order, up to the
PAC Principal Amount
for such Distribution
Date;
3. Concurrently to the
Class A-2 and Class
A-3 Certificates, pro
rata, until their
class balances have
been reduced to zero;
4. Sequentially to the
Class A-4 and Class
A-5 Certificates, in
that order, until
their class balances
have been reduced to
zero;
5. Concurrently to the
Class A-1 and Class
A-6 Certificates, pro
rata, until their
class balances have
been reduced to zero;
(v) Concurrently, to the Class
A-7 and Class A-8
Certificates, pro rata,
until their class balances
have been reduced to zero.
Subordinate Prepayment Percentage: The Subordinate Prepayment Percentage
for any Distribution Date will equal
100% minus the Senior Prepayment
Percentage for such date.
Senior Prepayment Percentage: For the following Distribution Dates,
will be as follows:
Distribution Date Senior Prepayment Percentage
January 2006 through December 2010 100%;
January 2011 through the applicable Senior Percentage plus, 70% of the
December 2011 applicable Subordinate Percentage;
January 2012 through the applicable Senior Percentage plus, 60% of the
December 2012 applicable Subordinate Percentage;
January 2013 through the applicable Senior Percentage plus, 40% of the
December 2013 applicable Subordinate Percentage;
January 2014 through the applicable Senior Percentage plus, 20% of the
December 2014 applicable Subordinate Percentage;
January 2015 and thereafter the applicable Senior Percentage;
provided, however, if on any
Distribution Date the Senior Percentage
exceeds the initial Senior Percentage,
then the Senior Prepayment Percentage
for such Distribution Date will equal
100%.
No decrease in the Senior Prepayment
Percentage will occur if the following
occurs as of any Distribution Date as to
which any such decrease applied : (i)
the outstanding principal balance of all
Mortgage Loans (including, for this
purpose, any Mortgage Loans in
foreclosure, any REO Property and any
Mortgage Loan for which the mortgagor
has filed for bankruptcy after the
Closing Date) delinquent 60 days or more
(averaged over the preceding six-month
period), as a percentage of the
aggregate class balance of the Class B
Certificates, is equal to or greater
than 50%, or (ii) cumulative Realized
Losses with respect to the Mortgage
Loans exceed the percentage of the
aggregate balance of the Class B
Certificates as of the Closing Date (the
"Original Subordinate Principal
Balance") indicated below:
% of Original Subordinate
Distribution Date Occurring Principal Balance
---------------------------------- -------------------------
January 2011 through December 2011 30%
January 2012 through December 2012 35%
January 2013 through December 2013 40%
January 2014 through December 2014 45%
January 2015 and thereafter 50%
Allocation of Losses: On each Distribution Date, the
applicable PO Percentage of any Realized
Loss on a Discount Mortgage Loan will be
allocated to the Class A-PO
Certificates. Such allocation will be
effected on each Distribution Date by
reducing the class balance of the Class
A-PO Certificates, if and to the extent
that such class balance (after taking
into account the amount of all
distributions to be made on such
Distribution Date) exceeds the related
Adjusted Pool Amount (PO Portion) for
such Distribution Date. The amount of
any such Realized Loss allocated to the
Class A-PO Certificates will be treated
as a "Class PO Deferred Amount." To the
extent funds are available on such
Distribution Date or on any future
Distribution Date from amounts that
would otherwise be allocable to the
Subordinate Principal Distribution
Amount, the Class PO Deferred Amounts
for the Class A-PO Certificates will be
paid on the Class A-PO Certificates
prior to distributions of principal on
the Class B Certificates. Payments of
the Class PO Deferred Amounts will be
made from the principal payable to the
Subordinate Certificates beginning with
the principal payable to the class of
Subordinate Certificates with the
highest numerical class designation. Any
distribution in respect of unpaid Class
PO Deferred Amounts for the Class A-PO
Certificates will not further reduce the
class balance of such Class A-PO
Certificates The Class PO Deferred
Amounts will not bear interest. The
class balance of the class of Class B
Certificates then outstanding with the
highest numerical class designation will
be reduced by the amount of any payments
in respect of Class PO Deferred Amounts
for the Class A-PO Certificates. Any
excess of these Class PO Deferred
Amounts over the class balance of that
class will be allocated to the next most
subordinate class of Class B
Certificates to reduce its class balance
and so on, as necessary. On each
Distribution Date, the applicable Non-PO
Percentage of any Realized Loss will be
allocated first to the Class B
Certificates in the reverse order of
their numerical class designations
(beginning with the class of Class B
Certificates then outstanding with the
highest numerical class designation), in
each case until the class balance of
such class of Certificates has been
reduced to zero, and then to the Senior
Certificates (but not the Class A-PO
Certificates) pro rata based on their
respective class balances. Such
allocation will be effected on each such
Distribution Date by reducing the class
balance of the class of Class B
Certificates then outstanding with the
highest numerical class designation if
and to the extent that the aggregate of
the class balances of all classes of
Senior Certificates (but not the Class
A-PO Certificates) and the Class B
Certificates (after taking into account
the amount of all distributions to be
made on such Distribution Date) exceeds
the Adjusted Pool Amount (Non-PO
Portion) for such Distribution Date.
In general, a "Realized Loss" means, (a)
with respect to a Mortgage Loan that has
been liquidated, the amount by which the
remaining unpaid principal balance of
the Mortgage Loan exceeds the amount of
proceeds from the liquidation applied to
the principal balance of the related
Mortgage Loan and (b) a losses due to
the bankruptcy of the mortgagor.
After the date on which the aggregate
class balance of the Subordinate
Certificates has been reduced to zero,
on each Distribution Date, the aggregate
of the class balances of all classes of
Senior Certificates (but not the Class
A-PO Certificates) then outstanding will
be reduced if and to the extent that
such aggregate balance (after taking
into account the amount of all
distributions to be made on such
Distribution Date) exceeds the Adjusted
Pool Amount (Non-PO Portion) for such
Distribution Date. The amount of any
such reduction will be allocated among
the Senior Certificates (but not the
Class A-PO Certificates) pro rata based
on their respective class balances.
After the senior credit support
depletion date, the class balance of the
Class A-8 Certificates will be reduced
not only by the principal portion of
Realized Losses allocated to such class,
but also by the portion allocated to the
Class A-7 Certificates.
Adjusted Pool Amount: The Adjusted Pool Amount will equal the
aggregate unpaid principal balance of
the Mortgage Loans as of the Cut-off
Date minus the sum of (i) all amounts in
respect of principal received in respect
of the Mortgage Loans (including amounts
received as Advances, principal
prepayments and Liquidation Proceeds
(net of unreimbursed expenses and
unreimbursed advances) in respect of
principal) and distributed on the
Certificates on such Distribution Date
and all prior Distribution Dates and
(ii) the principal portion of all
Realized Losses (other than debt service
reductions) incurred on the Mortgage
Loans from the Cut-off Date through the
end of the month preceding such
Distribution Date.
Adjusted Pool Amount (PO Portion) The Adjusted Pool Amount (PO Portion)
will equal the sum as to each Mortgage
Loan outstanding as of the Cut-off :
Date of the product of (A) the PO
Percentage for such Mortgage Loan and
(B) the principal balance of such
Mortgage Loan as of the Cut-off Date
less the sum of (i) all amounts in
respect of principal received in respect
of such Mortgage Loan (including amounts
received as Advances, principal
prepayments and Liquidation Proceeds
(net of unreimbursed expenses and
unreimbursed advances) in respect of
principal) and distributed on the
Certificates on such Distribution Date
and all prior Distribution Dates and
(ii) the principal portion of any
Realized Loss (other than a debt service
reduction) incurred on such Mortgage
Loan from the Cut-off Date through the
end of the month preceding the month in
which such Distribution Date occurs.
Adjusted Pool Amount (Non-PO Portion): The Adjusted Pool Amount (Non-PO
Portion) will equal the difference
between the Adjusted Pool Amount and the
Adjusted Pool Amount (PO Portion).
Interest Accrual: Interest will accrue on the Certificates
(other than the Class A-2 and Class A-3
Certificates) during each one-month
period ending on the last day of the
month preceding the month in which each
Distribution Date occurs (each, a
"Regular Interest Accrual Period"). The
initial Regular Interest Accrual Period
will be deemed to have commenced on
December 1, 2005. Interest will accrue
on the Class A-2 and Class A-3
Certificates from the previous
Distribution Date, or in the case of the
first Distribution Date, from the
Closing Date, through and including the
day prior to the current Distribution
Date (each, a "LIBOR Based Interest
Accrual Period" and together with the
Regular Interest Accrual Period, an
"Interest Accrual Period").
Planned Amortization
Certificates and Companions: The balances of the Class A-4 and Class
A-5 Certificates (the "PAC Group") will
be reduced to the applicable balances
indicated in a predetermined
amortization schedule, attached as
AppendixA, for each Distribution Date if
prepayments on the Mortgage Loans occur
at a constant rate between 125% and 350%
PSA. It is highly unlikely, however,
that the underlying Mortgage Loans will
prepay at a constant rate until maturity
or that all the underlying Mortgage
Loans will prepay at the same rate or
that they will have the characteristics
assumed. Therefore, there can be no
assurance that the balances of the PAC
Group after the payment of principal on
any Distribution Date will be equal to
the balances for such Distribution Date
specified in the amortization table
attached as Appendix A.
The weighted average lives of the PAC
Group will vary under different
prepayment scenarios. If principal
prepayments on the underlying mortgage
loans occur at a constant rate that is
slower than the lower PAC band, the
amount available to make principal
payments to the PAC Group may be
insufficient to reduce the PAC Group's
balances to their planned balances for
such Distribution Date. The weighted
average lives of the PAC Certificates
may therefore be extended. If such
principal prepayments on the underlying
Mortgage Loans occur at a constant rate
that is faster than the upper PAC band,
the weighted average lives of the PAC
Certificates may be shortened.
Because all amounts available for
principal payments on any Distribution
Date will be distributed to holders on
such Distribution Date, the ability to
distribute any PAC Principal Amount on
any Distribution Date will not be
enhanced by the averaging of high and
low principal prepayment rates on the
underlying Mortgage Loans over several
Distribution Dates, as might be the case
if any principal payments were held for
future applications and not distributed
monthly.
The extent to which the planned balances
and targeted balances are achieved and
the sensitivity of any PAC Group to
principal prepayments on the underlying
Mortgage Loans will depend in part on
the period of time during which the
class or classes which support the PAC
Group remain outstanding. Any Companion
Certificates will support the PAC Group.
On each Distribution Date, after any PAC
Group has received its PAC Principal
Amount for such Distribution Date, no
further principal payments will be made
to the PAC Group until the class
balances of the class or classes
supporting any PAC Group have been
reduced to zero. This support is
intended to decrease the likelihood that
the balance of the PAC Group will be
reduced below its respective planned
balance or targeted balance on a given
Distribution Date. Once the applicable
class or classes that provide support to
the PAC Group are no longer outstanding,
any PAC Certificates of any PAC Groups
will become more sensitive to the rate
of prepayments on the underlying
Mortgage Loans, as such classes will
receive principal payments that
otherwise would have been distributable
to the class or classes which supported
them.
- --------------------------------------------------------------------------------
Preliminary Credit Support
- --------------------------------------------------------------------------------
The Subordinate Certificates provide credit support for the Senior Certificates.
Additional credit enhancement is provided by the allocation of the applicable
Non-PO Percentages of all principal prepayments on the Mortgage Loans to the
Certificates , subject to certain exceptions, for the first five years and the
disproportionately greater allocation of prepayments to the Senior Certificates
over the following four years. The disproportionate allocation of prepayments
will accelerate the amortization of the Senior Certificates relative to the
amortization of the Subordinate Certificates. As a result, the credit support
percentage for the Senior Certificates should be maintained and may be increased
during the first nine years.
Subordination of Certificates
| ^
| Senior |
| Credit Support [3.15%] |
| |
| Class B-1 |
| Credit Support [1.35%] |
| |
Priority of | Class B-2 | Order of
Payment | Credit Support [0.80%] | Loss
| | Allocation
| Class B-3 |
| Credit Support [0.50%] |
| |
| Class B-4 |
| Credit Support [0.30%] |
| |
| Class B-5 |
| Credit Support [0.15%] |
| |
| Class B-6 |
v Credit Support [0.00%] |
- --------------------------------------------------------------------------------
Preliminary Priority of Distributions
- --------------------------------------------------------------------------------
Distributions will be made on each Distribution Date from the Pool Distribution
Amount in the following order of priority:
Preliminary Priority of Distributions
- --------------------------------------------------------------------------------
First, to Assured Guaranty to pay its premium;
- --------------------------------------------------------------------------------
|
v
- --------------------------------------------------------------------------------
Second, to the Senior Certificates entitled to payments of interest to pay
interest;
- --------------------------------------------------------------------------------
|
v
- --------------------------------------------------------------------------------
Third, to the Senior Certificates to pay principal;
- --------------------------------------------------------------------------------
|
v
- --------------------------------------------------------------------------------
Fourth, to the Class A-PO Certificates to pay any applicable PO Deferred
Amounts, but only from amounts that would otherwise be distributable on
such Distribution Date as principal of the Subordinate Certificates.
- --------------------------------------------------------------------------------
|
v
- --------------------------------------------------------------------------------
Fifth, sequentially, to each class of Subordinate Certificates to pay Interest
and Principal in the order of numerical class designations, beginning with
Class B-1 Certificates, until each class balance is zero; and
- --------------------------------------------------------------------------------
|
v
- --------------------------------------------------------------------------------
Sixth, to Assured Guaranty, any remaining Pool Distribution Amount, up
to the aggregate amount of previously unreimbursed Insured Payments;
and
- --------------------------------------------------------------------------------
|
v
- --------------------------------------------------------------------------------
Seventh, to the residual certificate, any remaining amounts.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Preliminary Summary of Terms
- --------------------------------------------------------------------------------
Pool Distribution Amount: The "Pool Distribution Amount" with
respect to any Distribution Date will be
determined by reference to amounts
received and expenses incurred in
connection with the Mortgage Loans and
will be equal to the sum of:
(i) all scheduled installments of
interest (net of the related Servicing
Fee) and principal due on the Mortgage
Loans on the due date in the month in
which such Distribution Date occurs and
received prior to the related
Determination Date, together with any
Advances in respect thereof and any
Compensating Interest allocable to the
Mortgage Loans;
(ii) all proceeds of any primary
mortgage guaranty insurance policies and
any other insurance policies with
respect to the Mortgage Loans, to the
extent such proceeds are not applied to
the restoration of the related mortgaged
property or released to the mortgagor in
accordance with the Servicer's normal
servicing procedures and all other cash
amounts received and retained in
connection with the liquidation of
defaulted Mortgage Loans, by foreclosure
or otherwise (collectively, "Liquidation
Proceeds"), during the calendar month
preceding the month of such Distribution
Date (in each case, net of unreimbursed
expenses incurred in connection with a
liquidation or foreclosure and
unreimbursed Advances, if any);
(iii) all partial or full
prepayments received on the Mortgage
Loans during the calendar month
preceding the month of such Distribution
Date; and
(iv) amounts received with respect
to such Distribution Date as a
substitution adjustment amount or
purchase price in respect of any deleted
Mortgage Loan or amounts received in
connection with the optional termination
of the Trust as of such Distribution
Date, reduced by amounts in
reimbursement for Advances previously
made and other amounts as to which the
Servicer is entitled to be reimbursed
pursuant to the Pooling Agreement.
Description of Servicer: All of the Mortgage Loans will be
serviced by Bank of America, National
Association (in its capacity as
servicer, the "Servicer") in accordance
with the terms of the Pooling Agreement.
The Servicer may perform any of its
obligations under the Pooling Agreement
through one or more subservicers.
Despite the existence of subservicing
arrangements, the Servicer will be
liable for its servicing duties and
obligations under the Pooling Agreement
as if the Servicer alone were servicing
the Mortgage Loans.
Bank of America, National Association is
an indirect wholly-owned subsidiary of
Bank of America Corporation. Bank of
America, National Association is engaged
in a general commercial banking
business, offering a wide range of
commercial, corporate, international,
financial and retail banking services to
corporations, governments and
individuals. Bank of America, National
Association originates and services
residential mortgage loans and performs
subservicing functions for affiliates.
Bank of America, National Association's
headquarters and its executive offices
are located at 101 South Tryon Street,
Charlotte, North Carolina 28255, and the
telephone number is (704) 386-5478. Bank
of America, National Association is
subject to regulation, supervision and
examination by the Office of the
Comptroller of the Currency and has been
approved as a mortgagee and
seller/servicer by the Department of
Housing and Urban Development, the
Veterans Administration, the Government
National Mortgage Association, Fannie
Mae and Freddie Mac.
Underwriting Guidelines of
America, National Association: Bank of America, National Association
may, as part of its overall evaluation
of a prospective borrower's
creditworthiness, use Credit Scores or a
combination of Credit Scores and
Mortgage Scores. "Credit Scores"
arestatistical credit scores designed to
assess a borrower's creditworthiness and
likelihood to default on a consumer
obligation over a two-year period based
on a borrower's credit history. Credit
Scores were not developed to predict the
likelihood of default on mortgage loans
and, accordingly, may not be indicative
of the ability of a mortgagor to repay
its Mortgage Loan. A "Mortgage Score"
takes into account not only a borrower's
credit history but also uses statistics
to predict how the majority of loans
with common characteristics in a broad
group of the population will perform in
the future. The Mortgage Score used by
Bank of America, National Association
will either have been developed by Bank
of America, National Association or by a
third party and approved by Bank of
America, National Association. Some
mortgage loans originated by Bank of
America, National Association may have
no Credit Score or Mortgage Score or
have a Credit Score that Bank of
America, National Association believes,
as a result of other factors, is not
predictive of a borrower's capacity and
willingness to pay. In those cases, Bank
of America, National Association will
obtain an alternative credit history
that has at least three credit
references, one of which is housing
related. A prospective borrower with (1)
a higher Credit Score or (2) a higher
Credit Score and Mortgage Score, which,
in either event, indicates a more
favorable credit history, is eligible
for one of Bank of America, National
Association's accelerated processing
programs (the "Accelerated Processing
Programs"). Loans in the Accelerated
Processing Programs (which include,
among others, the All-Ready Home and
Rate Reduction Refinance programs
described below) are subject to less
stringent documentation requirements.
Once the credit report and any
applicable employment and deposit
documentation are received, a
determination is made as to whether the
prospective mortgagor has sufficient
monthly income available (i) to meet the
mortgagor's monthly obligations on the
proposed mortgage loan and other
expenses related to the mortgaged
property (such as property taxes and
hazard insurance) and (ii) to meet other
financial obligations and monthly living
expenses.
To determine the adequacy of the
mortgaged property as collateral,
generally an independent appraisal is
made of each mortgaged property
considered for financing. In certain
instances the appraisal may be conducted
by an employee of Bank of America,
National Association or an affiliate.
The evaluation is based on the
appraiser's estimate of value, giving
appropriate weight to both the market
value of comparable housing, as well as
the cost of replacing the mortgaged
property. If the loan is a refinance of
a loan currently serviced by Bank of
America, National Association, or
carries a conforming loan amount, the
collateral valuation of the property may
be established by an automated valuation
or the tax assessed value.
Mortgage loans will generally be covered
by an appropriate standard form American
Land Title Association title insurance
policy, or a substantially similar
policy or form of insurance acceptable
to FNMA or FHLMC, or if the related
mortgaged property is located in a
jurisdiction where such policies are
generally not available, an opinion of
counsel of the type customarily rendered
in such jurisdiction in lieu of title
insurance will be obtained instead.
Notwithstanding the foregoing, certain
mortgage loans that are not purchase
money mortgage loans or that have
principal balances less than certain
specified amounts may not be covered by
title insurance policies, although title
searches are performed in connection
with the origination of such mortgage
loans. The Depositor will represent and
warrant to the Trustee that the
Mortgaged Property related to each
Mortgage Loan (including each Mortgage
Loan for which a title search is
performed in lieu of obtaining a title
insurance policy) is free and clear of
all encumbrances and liens having
priority over the first lien of the
related Mortgage, subject to certain
limited exceptions. However, in the
event that a lien senior to the lien of
the Mortgage related to a Mortgage Loan
for which a title search is performed in
lieu of obtaining a title insurance
policy is found to exist, the sole
recourse of the Trustee will be against
the Depositor for breach of its
representation and warranty. The Trustee
will not have recourse against any title
insurance company or other party.
Certain states where the mortgaged
properties securing the mortgage loans
are located are "anti-deficiency"
states, where, in general, lenders
providing credit on one-to-four family
properties must look solely to the
property for repayment in the event of
foreclosure. Bank of America, National
Association's underwriting guidelines in
all states (including anti-deficiency
states) require that the value of the
mortgaged property being financed
currently supports and is anticipated to
support in the future the outstanding
loan balance and provides sufficient
value to mitigate the effects of adverse
shifts in real estate values, although
there can be no assurance that such
value will support the outstanding loan
balance in the future.
Bank of America, National Association
may provide secondary financing to a
borrower contemporaneously with the
origination of the first mortgage loan
but only if the first mortgage loan does
not have a Loan-to-Value Ratio exceeding
80% and a combined loan-to-value ratio
exceeding 95%. The underwriting
guidelines applied to the first mortgage
loan are based on the combined higher
loan-to-value ratio with the exception
of the requirement of primary mortgage
insurance and loan amount limit.
Secondary financing by a lender other
than Bank of America, National
Association is not prohibited but the
terms of such financing are subject to
review by Bank of America, National
Association and may not be as stringent
as the Bank of America, National
Association's underwriting guidelines
for secondary financing.
Bank of America, National Association
may originate new mortgage loans under
its "All-Ready Home" mortgage refinance
program. Under this program, a borrower
whose mortgage loan is serviced by Bank
of America, National Association may be
eligible for a reduced documentation
refinancing if the borrower's mortgage
loan has had no delinquent payments in
the previous twelve months and the only
change is to the mortgage interest rate
or term of the mortgage loan. In
addition, under its "Rate Reduction
Refinance" program, Bank of America,
National Association may offer to
refinance a mortgage loan to reduce the
mortgage interest rate and/or change the
amortization schedule for a borrower who
has indicated an interest in refinancing
or who has requested payoff information,
through the extension of a replacement
mortgage loan or the modification of the
existing mortgage loan, provided the
borrower has had no delinquent mortgage
loan payments in the previous twelve
months. In such cases, Bank of America,
National Association will not apply any
significant borrower credit or property
underwriting standards. Mortgage Loans
may have been the subject of a
refinancing described above. To the
extent a borrower becomes eligible for
such a refinancing after his or her
Mortgage Loan has been included in a
particular Trust, such Mortgage Loan
could be refinanced resulting in a
prepayment of such Mortgage Loan.
Foreclosure and Delinquency
Experience of Bank of
America, National
Association: The following table summarizes the
delinquency and foreclosure experience
on the portfolio of one- to four-family
first mortgage loans originated or
acquired by Bank of America, National
Association or certain of its affiliates
and serviced or subserviced by Bank of
America, National Association or
serviced by Bank of America, National
Association for others, other than (i)
mortgage loans acquired through certain
mergers with previously unaffiliated
entities, (ii) mortgage loans with
respect to which the servicing rights
were acquired by Bank of America,
National Association in bulk and (iii)
certain mortgage loans originated at
bank branches of Bank of America,
National Association.
The portfolio of mortgage loans serviced
by Bank of America, National Association
includes both fixed and adjustable
interest rate mortgage loans, including
"buydown" mortgage loans, loans with
balances conforming to Freddie Mac's and
Fannie Mae's limits as well as jumbo
loans, loans with stated maturities of
10 to 40 years and other types of
mortgage loans having a variety of
payment characteristics, and includes
mortgage loans secured by mortgaged
properties in geographic locations that
may not be representative of the
geographic distribution or concentration
of the mortgaged properties securing the
Mortgage Loans. There can be no
assurance that the delinquency,
foreclosure and loss experience set
forth below will be similar to the
results that may be experienced with
respect to the Mortgage Loans.
Bank of America, National Association
Delinquency and Foreclosure Experience on Mortgage Loans
At September 30, 2005 At December 31, 2004 At December 31, 2003
-------------------------- -------------------------- -------------------------
Number/ Outstanding Number/ Outstanding Number/ Outstanding
% of Principal % of Principal % of Principal
Mortgage Amount Mortgage Amount Mortgage Amount
Loans (In Millions) Loans (In Millions) Loans (In Millions)
- --------------------------------------- --------- ------------- --------- ------------- --------- -------------
Total Portfolio 1,356,316 $214,901.0 1,300,762 $194,743.4 1,229,050 $174,777.5
Delinquencies*
One Installment delinquent 16,345 $1,927.5 16,251 $1,802.3 20,406 $2,219.3
Percent Delinquent 1.2% 0.9% 1.2% 0.9% 1.7% 1.3%
Two Installments delinquent 4,186 $445.2 4,224 $428.3 5,399 $549.9
Percent Delinquent 0.3% 0.2% 0.3% 0.2% 0.4% 0.3%
Three or more installments delinquent 4,488 $449.0 4,935 $484.0 6,294 $615.8
Percent Delinquent 0.3% 0.2% 0.4% 0.2% 0.5% 0.4%
In Foreclosure 3,333 $297.2 4,296 $399.2 5,449 $548.2
Percent in Foreclosure 0.2% 0.1% 0.3% 0.2% 0.4% 0.3%
Delinquent and in Foreclosure 28,352 $3,118.8 29,706 $3,113.8 37,548 $3,933.2
Percent Delinquent and in Foreclosure** 2.1% 1.5% 2.3% 1.6% 3.1% 2.3%
- ----------
* A mortgage loan is deemed to have "one installment delinquent" if any
scheduled payment of principal or interest is delinquent past the end of
the month in which such payment was due, "two installments delinquent" if
such delinquency persists past the end of the month following the month in
which such payment was due, and so forth.
** The sums of the Percent Delinquent and Percent in Foreclosure set forth in
this table may not equal the Percent Delinquent and in Foreclosure due to
rounding.
- --------------------------------------------------------------------------------
Risk Factors
- --------------------------------------------------------------------------------
Subordination of Super Senior
Support and Subordinate Certificates
Increases Risk of Loss: Subordinate certificateholders are more
likely to suffer losses as a result of
losses or delinquencies on the Mortgage
Loans than are Class A
certificateholders.
o The rights of each class of
Subordinate Certificates to
receive distributions of interest
and principal are subordinated to
the rights of the Senior
Certificates and each class of
Subordinate Certificates with a
lower numerical designation. For
example, the Class B-2
Certificates will not receive
principal or interest on a
distribution date until the Class
A Certificates and Class B-1
Certificates have received the
amounts to which they are entitled
on that Distribution Date.
o Losses that are realized on the
Mortgage Loans will be allocated
first to the Class B-6
Certificates then to the Class B-5
Certificates and so on, in reverse
numerical order of the class
designation, until the outstanding
class balances of such classes
have been reduced to zero.
Super Senior Support certificateholders
should consider the risk that after the
Subordinate Certificates are no longer
outstanding, the principal portion of
losses realized on the Mortgage Loans
that are allocated to the Super Senior
Certificates will be borne by the Super
Senior Support Certificates, rather than
the Super Senior Certificates.
The Rate of Principal Payments on
the Mortgage Loans Will Affect the
Yield on the Offered Certificates: Because principal payments on the
Mortgage Loans will be distributed
currently on the Senior Certificates and
the Subordinate Certificates, the rate
of distributions of principal and the
yield to maturity on your Certificates
will be directly related to (i) the rate
and timing of payments of principal on
the applicable Mortgage Loans and (ii)
the amount and timing of defaults by
borrowers that result in losses on the
applicable Mortgage Loans. Borrowers are
permitted to prepay their Mortgage
Loans, in whole or in part, at any time.
The principal payments on the Mortgage
Loans may be in the form of scheduled
principal payments or principal
prepayments (for this purpose, the term
"principal prepayment" includes
prepayments and any other recovery of
principal in advance of the scheduled
due date, including repurchases and
liquidations due to default, casualty,
condemnation and the like). Any of these
prepayments will result in distributions
to you of amounts that would otherwise
be distributed over the remaining term
of the Mortgage Loans.
The rate of principal payments on the
Mortgage Loans will be affected by the
following:
o the amortization schedules of the
Mortgage Loans;
o the rate of partial prepayments
and full prepayments by borrowers
due to refinancing, job transfer,
changes in property values or
other factors;
o liquidations of the properties
that secure defaulted Mortgage
Loans;
o repurchases of Mortgage Loans by
the Depositor as a result of
defective documentation or
breaches of representations or
warranties;
o the exercise of due-on-sale
clauses by the Servicer in
connection with transfers of
mortgaged properties;
o the optional repurchase of all the
Mortgage Loans by the Depositor to
effect a termination of the Trust
when the aggregate Stated
Principal Balance of the Mortgage
Loans is less than 10% of the
aggregate unpaid principal balance
of the mortgage loans as of the
cut-off date; and
o general and targeted solicitations
for refinancing by mortgage
originators (including Bank of
America, National Association).
The rate of principal payments on the
Mortgage Loans will depend greatly on
the level of mortgage interest rates:
o If prevailing interest rates for
similar mortgage loans fall below
the interest rates on the Mortgage
Loans in the Trust, the rate of
prepayment is likely to increase.
o Conversely, if prevailing interest
rates for similar mortgage loans
rise above the interest rates on
the Mortgage Loans in the Trust,
the rate of prepayment is likely
to decrease.
If you are purchasing Offered
Certificates at a discount, and
specifically if you are purchasing the
Class A-6 or Class A-PO Certificates,
you should consider the risk that if
principal payments on the applicable
Mortgage Loans or in the case of the
Class A-PO Certificates, the Discount
Mortgage Loans, occur at a rate slower
than you expected, your yield will be
lower than you expected. If you are
purchasing Offered Certificates at a
premium, or are purchasing a Class A-IO
Certificate (which has no class
balance), you should consider the risk
that if principal payments on the
applicable mortgage loans or, in the
case of the Class A-IO Certificates, the
Mortgage Loans with a Net Mortgage
Interest Rate as of the Cut-off Date
greater than or equal to 5.750%, occur
at a rate faster than you expected, your
yield may be lower than you expected. If
you are purchasing Class A-IO
Certificates, you should consider the
risk that a rapid rate of principal
prepayments on the Mortgage Loans with a
Net Mortgage Interest Rate as of the
Cut-off Date greater than or equal to
5.750%, could result in your failure to
recover your initial investment. If you
are purchasing the Class A-3
Certificates, which are Inverse Floating
Rate Certificates, you should consider
the risk that a high rate of LIBOR may
result in a lower yield than you
expected or a negative yield. In
particular, you should consider the risk
that high constant rates of LIBOR or
high constant prepayment rates on the
Mortgage Loans may result in the failure
to recover your initial investment. You
must make your own decisions as to the
appropriate prepayment assumptions to be
used when purchasing Offered
Certificates. The Senior Prepayment
Percentage of all principal prepayments
(excluding for this purpose, partial
liquidations due to default, casualty,
condemnation and the like) initially
will be distributed to the classes of
Senior Certificates that are entitled to
receive principal prepayment
distributions at that time. This may
result in all (or a disproportionately
high percentage) of those principal
prepayments being distributed to the
Senior Certificates and none (or a
disproportionately low percentage) of
those principal prepayments being
distributed to holders of the
Subordinate Certificates during the
periods of time described in the
definition of "Senior Prepayment
Percentage."
The timing of changes in the rate of
prepayments may significantly affect the
actual yield to you, even if the average
rate of principal prepayments is
consistent with your expectations. In
general, the earlier the payment of
principal of the Mortgage Loans, the
greater the effect on your yield to
maturity. As a result, the effect on
your yield of principal prepayments
occurring at a rate higher (or lower)
than the rate you anticipate during the
period immediately following the
issuance of the certificates will not be
offset by a subsequent like reduction
(or increase) in the rate of principal
prepayments.
Delinquencies and Losses on the
Mortgage Loans Will Adversely Affect
Your Yield: Delinquencies on the mortgage loans
which are not advanced by or on behalf
of the Servicer (because the Servicer
has determined that these amounts, if
advanced, would be nonrecoverable), will
adversely affect the yield on the Senior
Certificates and the Subordinate
Certificates. The Servicer will
determine that a proposed advance is
nonrecoverable when, in the good faith
exercise of its servicing judgment, it
believes the proposed advance would not
be ultimately recoverable from the
related mortgagor, related liquidation
proceeds, or other recoveries in respect
of the Mortgage Loan. Because of the
priority of distributions, shortfalls
resulting from delinquencies that are
not covered by advances will be borne
first by the Subordinate Certificates
(in reverse numerical order), and then
by the Senior Certificates.
Net interest shortfalls will adversely
affect the yields on the Offered
Certificates. In addition, losses
generally will be borne by the
Subordinate Certificates. As a result,
the yields on the Offered Certificates
will depend on the rate and timing of
realized losses on the Mortgage Loans.
Credits Scores May Not Accurately
Predict the Likelihood of Default: Bank of America, National Association
generally uses Credit Scores as part of
its underwriting process. The attached
collateral annex shows credit scores for
the mortgagors obtained at the time of
origination of their mortgage loans. A
credit score purports only to be a
measurement of the relative degree of
risk a borrower represents to a lender,
i.e., that a borrower with a higher
score is statistically expected to be
less likely to default in payment than a
borrower with a lower score. In
addition, it should be noted that credit
scores were developed to indicate a
level of default probability over a
two-year period, which does not
correspond to the life of most mortgage
loans. Furthermore, credit scores were
not developed specifically for use in
connection with mortgage loans, but for
consumer loans in general. Therefore,
credit scores do not address particular
mortgage loan characteristics that
influence the probability of repayment
by the borrower. Neither the depositor
nor Bank of America, National
Association makes any representations
any mortgage loan or that a particular
credit score should be relied upon as a
basis for an expectation that a borrower
will repay its mortgage loan according
to its terms.
Geographic Concentration May Increase
Risk of Loss Due to Adverse Economic
Conditions or Natural Disasters: At various times, certain geographic
regions will experience weaker economic
conditions and housing markets and,
consequently, will experience higher
rates of delinquency and loss on
mortgage loans generally. In addition,
certain states have experienced natural
disasters, including earthquakes, fires,
floods and hurricanes, which may
adversely affect property values.
Although mortgaged properties located in
certain identified flood zones will be
required to be covered, to the maximum
extent available, by flood insurance, no
mortgaged properties will otherwise be
required to be insured against
earthquake damage or any other loss not
covered by standard hazard insurance
policies. Any concentration of mortgaged
properties in a state or region may
present unique risk considerations. See
the tables entitled "Geographic
Distribution of Mortgaged Properties" in
the attached collateral annex for a
listing of the locations and
concentrations of the mortgaged
properties.
Any deterioration in housing prices in a
state or region due to adverse economic
conditions, natural disaster or other
factors, and any deterioration of
economic conditions in a state or region
that adversely affects the ability of
borrowers to make payments on the
mortgage loans, may result in losses on
the Mortgage Loans. Any losses may
adversely affect the yield to maturity
of the Offered Certificates.
Residential Real Estate Values May
Fluctuate and Adversely Affect
Your Investment: There can be no assurance that values of
the mortgaged properties have remained
or will remain at their levels on the
dates of origination of the related
Mortgage Loans. The value of any
mortgaged property generally will change
over time from its value on the
appraisal or sales date. If residential
real estate values generally or in a
particular geographic area decline, the
loan-to-value ratios shown in the table
in the accompanying collateral annex
might not be a reliable indicator of the
rates of delinquencies, foreclosures and
losses that could occur on the Mortgage
Loans. If the residential real estate
market should experience an overall
decline in property values large enough
to cause the outstanding balances of the
Mortgage Loans and any secondary
financing on the related mortgaged
properties to equal or exceed the value
of the mortgaged properties,
delinquencies, foreclosures and losses
could be higher than those now generally
experienced in the mortgage lending
industry or in Bank of America, National
Association's prior securitizations
involving the Depositor.
In addition, adverse economic conditions
and other factors (which may or may not
affect real property values) may affect
the mortgagors' timely payment of
scheduled payments of principal and
interest on the Mortgage Loans and,
accordingly, the actual rates of
delinquencies, foreclosures and losses
with respect to any Mortgage Pool. These
other factors could include excessive
building resulting in an oversupply of
housing in a particular area or a
decrease in employment reducing the
demand for housing in an area. To the
extent that credit enhancements do not
cover such losses, your yield may be
adversely impacted.
United States Military Operations May
Increase Risk of Relief Act Shortfalls: As a result of military operations in
Afghanistan and Iraq, the United States
has placed a substantial number of armed
forces reservists and members of the
National Guard on active duty status. It
is possible that the number of
reservists and members of the National
Guard placed on active duty status may
remain at high levels for an extended
time. To the extent that a member of the
military, or a member of the armed
forces reserves or National Guard who is
called to active duty, is a mortgagor of
a mortgage loan in the trust, the
interest rate limitation of the
Servicemembers Civil Relief Act, and any
comparable state law, will apply. This
may result in interest shortfalls on the
Mortgage Loans in the trust, which will
be borne by all classes of interest
bearing Certificates. The Policy will
not cover any such shortfalls allocated
to the Class A-1 Certificates. Neither
Bank of America, National Association
nor the depositor has not taken any
action to determine whether any of the
Mortgage Loans would be affected by
these interest rate limitations.
Distributions of Principal to the
Special Retail Certificates are
Subject to Special Procedures: Although there can be no assurance as to
the rate at which principal
distributions will be made on any class
of Offered Certificates, the Special
Retail Certificates, in particular, may
be inappropriate investments for you if
you require a distribution of a
particular amount of principal on a
specific date or an otherwise
predictable stream of distributions. If
you own Special Retail Certificates,
funds available for distributions of
principal may not be sufficient to
permit the distributions you request
within any specific period of time after
your request. During periods in which
prevailing interest rates are generally
higher than the pass-through rate for
the class of Special Retail
Certificates, greater numbers of
beneficial owners may request
distributions of principal in respect of
the Special Retail Certificates to take
advantage of higher interest rates.
During such periods there may, however,
be a concurrent reduction in the rate of
prepayments of the Mortgage Loans, thus
limiting the funds available for such
distributions.
In addition, because of the random lot
procedure for distributing principal,
you may receive a principal distribution
on your Special Retail Certificates on a
Distribution Date (even if you have not
requested such a distribution) if the
amount available for distribution in
respect of principal on such
Distribution Date on the class of
Special Retail Certificates exceeds the
aggregate amount requested for
distribution of principal by all holders
of the class of Special Retail
Certificates. It is more likely that
amounts will be distributed by random
lot during the periods of the relatively
low interest rates and, correspondingly,
higher prepayment rates. Under such
circumstances you may have difficulty
reinvesting these principal
distributions at rates as high as the
pass-through rate of your Certificates
or your expected yield.
There is a Risk that Interest Payments
on the Mortgage Loans May Be
Insufficient to Pay Interest on Your
Certificates: When a Mortgage Loan is prepaid in full,
the mortgagor is charged interest only
up to the date on which payment is made,
rather than for an entire month. When a
mortgagor makes a partial principal
prepayment on a Mortgage Loan, the
mortgagor is not charged interest on the
prepayment for the month in which the
principal prepayment was received. This
may result in a shortfall in interest
collections available for payment on the
next Distribution Date. The Servicer is
required to cover a portion of the
shortfall in interest collections that
are attributable to prepayments in full
and partial prepayments on the Mortgage
Loans, but in each case only up to the
amount of Compensating Interest for such
Distribution Date. To the extent these
shortfalls are not covered by the amount
of Compensating Interest, they will be
allocated pro rata to the related
classes of interest-bearing
Certificates. The Policy will not cover
any such shortfalls allocated to the
Class A-1 Certificates.
Certificates May Not Be Appropriate
for Individual Investors: If you are an individual investor who
does not have sufficient resources or
expertise to evaluate the particular
characteristics of the applicable class
of Offered Certificates, the Offered
Certificates may not be an appropriate
investment for you. This may be the case
because, among other things:
o if you purchase your
Certificates at a price
other than par, your yield
to maturity will be
sensitive to the uncertain
rate and timing of principal
prepayments on the
applicable Mortgage Loans;
o the rate of principal
distributions on, and the
weighted average lives of,
the Offered Certificates
will be sensitive to the
uncertain rate and timing of
principal prepayments on the
applicable Mortgage Loans
and the priority of
principal distributions
among the classes of
Certificates, and as such,
the Offered Certificates
and, in particular, the
Special Retail Certificates,
may be inappropriate
investments for you if you
require a distribution of a
particular amount of
principal on a specific date
or an otherwise predictable
stream of distributions;
o you may not be able to
reinvest amounts distributed
in respect of principal on
your Certificates (which
distributions, in general,
are expected to be greater
during periods of relatively
low interest rates) at a
rate at least as high as the
applicable pass-through rate
or your expected yield;
o a secondary market for the
Offered Certificates may not
develop or provide you with
liquidity of investment; and
o you must pay tax on any
interest or original issue
discount in the year it
accrues, even if the cash is
paid to you in a different
year.
Limited Source of Payments --
No Recourse to Depositor,
Seller, Servicer or Trustee: Proceeds of the Mortgage Loans will be
the sole source of payments on the
Certificates, other than the Class A-1
Certificates, as to which certain
payments may be made from the Reserve
Fund or under the Policy. The
Certificates do not represent an
interest in or obligation of the
Depositor, the Servicer, the Seller, the
Trustee or any of their affiliates.
There are, however, limited obligations
of the Depositor with respect to certain
breaches of representations and
warranties, and limited obligations of
the Servicer with respect to its
servicing obligations.
Neither the Certificates nor the
Mortgage Loans will be guaranteed by or
insured by any governmental agency or
instrumentality, the Depositor, the
Seller, the Servicer, the Trustee or any
of their affiliates. Consequently, if
payments on the Mortgage Loans are
insufficient or otherwise unavailable to
make all payments required on the
Certificates, there will be no recourse
to the Depositor, the Seller, the
Servicer, the Trustee or any of their
affiliates.
Limited Liquidity: The Underwriter intends to make a market
for purchase and sale of the Offered
Certificates after their initial
issuance, but the Underwriter has no
obligation to do so. There is no
assurance that such a secondary market
will develop or, if it does develop,
that it will provide you with liquidity
of investment or that it will continue
for the life of the Offered
Certificates. As a result, you may not
be able to sell your Certificates or you
may not be able to sell your
Certificates at a high enough price to
produce your desired return on
investment.
The secondary market for mortgage-backed
securities has experienced periods of
illiquidity and can be expected to do so
in the future. Illiquidity means that
there may not be any purchasers for your
class of Certificates. Although any
class of Certificates may experience
illiquidity, it is more likely that
classes of Certificates that are more
sensitive to prepayment, credit or
interest rate risk (such as the Interest
Only, Super Senior Support, Principal
Only, Inverse Floating Rate or
Subordinated Certificates) will
experience illiquidity.
- --------------------------------------------------------------------------------
[BANC OF AMERICA SECURITIES LOGO] Banc of America Mortgage Securities, Inc.
Mortgage Pass-Through Certificates, 2005-12
$298,847,554 (approximate)
- --------------------------------------------------------------------------------
Appendix A
Principal Balance Schedule
PAC Group
- ------------------ --------------------------
Initial Balance.... $136,879,000.00
January 25, 2006... $136,463,886.13
February 25, 2006.. $135,986,250.18
March 25, 2006..... $135,446,339.68
April 25, 2006..... $134,844,342.30
May 25, 2006....... $134,180,485.83
June 25, 2006...... $133,455,038.15
July 25, 2006...... $132,668,307.10
August 25, 2006.... $131,820,640.28
September 25, 2006. $130,912,424.96
October 25, 2006... $129,944,087.72
November 25, 2006.. $128,916,094.26
December 25, 2006.. $127,828,949.06
January 25, 2007... $126,683,194.95
February 25, 2007.. $125,479,412.80
March 25, 2007..... $124,218,220.99
April 25, 2007..... $122,900,274.94
May 25, 2007....... $121,526,266.60
June 25, 2007...... $120,096,923.86
July 25, 2007...... $118,613,009.93
August 25, 2007.... $117,075,322.69
September 25, 2007. $115,484,694.01
October 25, 2007... $113,841,989.00
November 25, 2007.. $112,148,105.27
December 25, 2007.. $110,403,972.11
January 25, 2008... $108,610,549.68
February 25, 2008.. $106,768,828.09
March 25, 2008..... $104,879,826.54
April 25, 2008..... $102,944,592.37
May 25, 2008....... $100,965,064.60
June 25, 2008...... $98,998,798.32
July 25, 2008...... $97,045,883.11
August 25, 2008.... $95,106,232.36
September 25, 2008. $93,179,760.04
October 25, 2008... $91,266,380.66
November 25, 2008.. $89,366,009.33
December 25, 2008.. $87,478,561.66
January 25, 2009... $85,624,718.87
February 25, 2009.. $83,783,632.67
March 25, 2009..... $81,955,220.35
April 25, 2009..... $80,139,399.73
May 25, 2009....... $78,336,089.15
June 25, 2009...... $76,545,207.52
July 25, 2009...... $74,766,674.25
August 25, 2009.... $73,000,409.28
September 25, 2009. $71,246,333.09
October 25, 2009... $69,504,366.66
November 25, 2009.. $67,774,431.49
December 25, 2009.. $66,056,449.61
January 25, 2010... $64,350,343.54
February 25, 2010.. $62,656,036.32
March 25, 2010..... $60,973,451.48
April 25, 2010..... $59,302,513.05
May 25, 2010....... $57,643,145.58
June 25, 2010...... $55,995,274.08
July 25, 2010...... $54,358,824.07
August 25, 2010.... $52,733,721.57
September 25, 2010. $51,119,893.04
October 25, 2010... $49,517,265.47
November 25, 2010.. $47,925,766.30
December 25, 201... $46,345,323.44
January 25, 2011... $44,864,602.28
February 25, 2011.. $43,394,625.19
March 25, 2011..... $41,935,321.83
April 25, 201...... $40,486,622.29
May 25, 2011....... $39,048,457.13
June 25, 2011...... $37,620,757.37
July 25, 2011...... $36,203,454.47
August 25, 2011.... $34,796,480.36
September 25, 2011. $33,399,767.40
October 25, 2011... $32,013,248.42
November 25, 2011.. $30,636,856.66
December 25, 2011.. $29,270,525.83
January 25, 2012... $27,943,204.79
February 25, 201... $26,625,668.32
March 25, 2012..... $25,317,851.80
April 25, 2012..... $24,019,691.02
May 25, 2012....... $22,731,122.22
June 25, 2012...... $21,452,082.03
July 25, 2012...... $20,182,507.52
August 25, 2012.... $18,937,853.05
September 25, 2012. $17,722,944.77
October 25, 2012... $16,537,150.93
November 25, 2012.. $15,379,852.65
December 25, 2012.. $14,250,443.67
January 25, 2013... $13,282,645.42
February 25, 2013.. $12,338,725.60
March 25, 2013..... $11,418,157.58
April 25, 2013..... $10,520,425.78
May 25, 2013....... $9,645,025.47
June 25, 2013...... $8,791,462.52
July 25, 2013...... $7,959,253.20
August 25, 2013.... $7,147,923.96
September 25, 2013. $6,357,011.24
October 25, 2013... $5,586,061.24
November 25, 2013.. $4,834,629.75
December 25, 2013.. $4,102,281.92
January 25, 2014... $3,504,166.96
February 25, 2014.. $2,920,871.48
March 25, 2014..... $2,352,061.26
April 25, 2014..... $1,797,409.34
May 25, 2014....... $1,256,595.83
June 25, 2014...... $729,307.79
July 25, 2014...... $215,239.05
August 25, 2014.... $0.00
- --------------------------------------------------------------------------------
The issuer has filed a registration statement (including a prospectus) with the
SEC for the offering to which this communication relates. Before you invest, you
should read the prospectus in that registration statement and other documents
the issuer has filed with the SEC for more complete information about the issuer
and this offering. You may get these documents for free by visiting EDGAR on the
SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any
dealer participating in the offering will arrange to send you the prospectus if
you request it by calling toll-free 1-800-294-1322 or you e-mail a request to
dg.prospectus_distribution@bofasecurities.com. The securities may not be
suitable for all investors. Banc of America Securities LLC and its affiliates
may acquire, hold or sell positions in these securities, or in related
derivatives, and may have an investment or commercial banking relationship with
the issuer.
The information contained in these materials may be based on assumptions
regarding market conditions and other matters as reflected herein. Banc of
America Securities LLC (the "Underwriter") makes no representation regarding the
reasonableness of such assumptions or the likelihood that any such assumptions
will coincide with actual market conditions or events, and these materials
should not be relied upon for such purposes. The Underwriter and its affiliates,
officers, directors, partners and employees, including persons involved in the
preparation or issuance of these materials, may, from time to time, have long or
short positions in, and buy and sell, the securities mentioned herein or
derivatives thereof (including options). Information in these materials is
current as of the date appearing on the material only. Information in these
materials regarding any securities discussed herein supersedes all prior
information regarding such securities. These materials are not to be construed
as an offer to sell or the solicitation of any offer to buy any security in any
jurisdiction where such an offer or solicitation would be illegal.
- --------------------------------------------------------------------------------
[BANC OF AMERICA SECURITIES LOGO]
- --------------------------------------------------------------------------------
The asset-backed securities referred to in these materials, and the asset
pools backing them, are subject to modification or revision (including the
possibility that one or more classes of securities may be split, combined or
eliminated at any time prior to issuance or availability of a final prospectus)
and are offered on a "when, as and if issued" basis. You understand that, when
you are considering the purchase of these securities, a contract of sale will
come into being no sooner than the date on which the relevant class has been
priced and we have confirmed the allocation of securities to be made to you; any
"indications of interest" expressed by you, and any "soft circles" generated by
us, will not create binding contractual obligations for you or us.
Because the asset-backed securities are being offered on a "when, as and
if issued" basis, any such contract will terminate, by its terms, without any
further obligation or liability between us, if the securities themselves, or the
particular class to which the contract relates, are not issued. Because the
asset-backed securities are subject to modification or revision, any such
contract also is conditioned upon the understanding that no material change will
occur with respect to the relevant class of securities prior to the closing
date. If a material change does occur with respect to such class, our contract
will terminate, by its terms, without any further obligation or liability
between us (the "Automatic Termination"). If an Automatic Termination occurs, we
will provide you with revised offering materials reflecting the material change
and give you an opportunity to purchase such class. To indicate your interest in
purchasing the class, you must communicate to us your desire to do so within
such timeframe as may be designated in connection with your receipt of the
revised offering materials.
MBS New Issue Term Sheet - Collateral Appendix
Banc of America Mortgage 2005-12 Trust
Mortgage Pass-Through Certificates, Series 2005-12
$298,847,554 (approximate)
Banc of America Mortgage Securities, Inc.
(Depositor)
Bank of America, National Association
Seller and Servicer
[BANK OF AMERICA LOGO]
December 20, 2005
- --------------------------------------------------------------------------------
The issuer has filed a registration statement (including a prospectus) with the
SEC for the offering to which this communication relates. Before you invest, you
should read the prospectus in that registration statement and other documents
the issuer has filed with the SEC for more complete information about the issuer
and this offering. You may get these documents for free by visiting EDGAR on the
SEC Web site at www.sec.gov. Alternatively, the issuer, any underwriter or any
dealer participating in the offering will arrange to send you the prospectus if
you request it by calling toll-free 1-800-294-1322 or you e-mail a request to
dg.prospectus_distribution@bofasecurities.com. The securities may not be
suitable for all investors. Banc of America Securities LLC and its affiliates
may acquire, hold or sell positions in these securities, or in related
derivatives, and may have an investment or commercial banking relationship with
the issuer.
The information contained in these materials may be based on assumptions
regarding market conditions and other matters as reflected herein. Banc of
America Securities LLC (the "Underwriter") makes no representation regarding the
reasonableness of such assumptions or the likelihood that any such assumptions
will coincide with actual market conditions or events, and these materials
should not be relied upon for such purposes. The Underwriter and its affiliates,
officers, directors, partners and employees, including persons involved in the
preparation or issuance of these materials, may, from time to time, have long or
short positions in, and buy and sell, the securities mentioned herein or
derivatives thereof (including options). Information in these materials is
current as of the date appearing on the material only. Information in these
materials regarding any securities discussed herein supersedes all prior
information regarding such securities. These materials are not to be construed
as an offer to sell or the solicitation of any offer to buy any security in any
jurisdiction where such an offer or solicitation would be illegal.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
[BANC OF AMERICA SECURITIES LOGO] Banc of America Mortgage Securities, Inc.
Mortgage Pass-Through Certificates, 2005-12
$298,847,554 (approximate)
- --------------------------------------------------------------------------------
IRS CIRCULAR 230 NOTICE
THIS FREE WRITING PROSPECTUS IS NOT INTENDED OR WRITTEN TO BE USED, AND CANNOT
BE USED, FOR THE PURPOSE OF AVOIDING U.S. FEDERAL, STATE OR LOCAL TAX PENALTIES.
THIS FREE WRITING PROSPECTUS IS WRITTEN AND PROVIDED BY THE UNDERWRITERS IN
CONNECTION WITH THE PROMOTION OR MARKETING OF THE TRANSACTIONS OR MATTERS
ADDRESSED HEREIN. INVESTORS SHOULD SEEK ADVICE BASED ON THEIR PARTICULAR
CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR.
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Collateral Summary
- --------------------------------------------------------------------------------
Description of The Mortgage Loans
The Mortgage Loans consist of fixed rate, conventional, fully amortizing
mortgage loans secured by first liens on one- to three-family residential
properties. The majority of the Mortgage Loans will have original terms to
stated maturity of approximately 30 years and principal balances at origination
in excess of the conforming loan balance limits established by FHLMC. Borrowers
are permitted to prepay their Mortgage Loans, in whole or in part, at any time
without penalty. Accordingly, the actual date on which any Mortgage Loan is paid
in full may be earlier than the stated maturity date due to unscheduled payments
of principal.
- --------------------------------------------------------------------------------
The tables set forth below contain approximate statistical information as of the
Cut-off Date regarding all Mortgage Loans. The balances and percentages may not
be exact due to rounding.
Collateral Summary Range (if applicable)
- ------------------------------------------------------- ------------------ ----------------------
Total Outstanding Loan Balance $300,350,131
Total Number of Loans 529
Average Loan Principal Balance $567,770 $298,156 to $1,948,012
WA Gross Coupon 5.937% 5.125% to 7.125%
WA FICO 746 621 to 819
WA Original Term 357 months 240 to 360 months
WA Remaining Term 356 months 239 to 360 months
WA OLTV 69.40% 23.81% to 90.00%
Geographic Concentration of Mortgaged Properties (Top 5 CA 47.47%
States) based on the Aggregate Stated Principal Balance FL 8.05%
TX 4.90%
MA 3.71%
VA 3.63%
Mortgage Loan Data
All Discount Premium
Mortgage Loans Mortgage Loans Mortgage Loans
- ------------------------------------------------------ ---------------------- ---------------------- ----------------------
Number of Mortgage Loans 529 388 141
Aggregate Stated Principal Balance (1) $300,350,131 $221,795,965 $78,554,166
Range of Original Terms to Stated Maturity (1) 240 to 360 months 240 to 360 months 240 to 360 months
Range of Stated Principal Balances (1) $298,156 to $1,948,012 $298,156 to $1,948,012 $403,514 to $1,067,785
Average Stated Principal Balance (1) $567,770 $571,639 $557,122
Latest Stated Maturity Date 12/01/2035 12/01/2035 12/01/2035
Range of Current Mortgage Interest Rates (1) 5.125% to 7.125% 5.125% to 6.000% 6.125% to 7.125%
Weighted Average Current Mortgage Interest Rate (1) 5.94% 5.82% 6.27%
Range of Remaining Terms to Stated Maturity (1) 239 to 360 months 239 to 360 months 239 to 360 months
Weighted Average Remaining Term to Stated Maturity (1) 356 months 357 months 354 months
Range of Original Loan-to-Value Ratios (1) 23.81% to 90.00% 23.81% to 90.00% 32.63% to 80.00%
Weighted Average Original Loan-to-Value Ratio (1) 69.40% 69.40% 69.41%
(1) Approximate.
Occupancy of Mortgaged Properties of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Mortgage Balance as of Pool Principal
Occupancy Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
Primary Residence 483 $273,113,768.82 90.93%
Second Home 46 27,236,361.70 9.07
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) Based solely on representations of the mortgagor at the time of
origination of the related Mortgage Loan.
Property Types of the Mortgage Loans
Aggregate % of
Number Of Stated Principal Cut-off Date
Mortgage Balance as of Pool Principal
Property Type Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
Single Family Residence 364 $203,903,094.12 67.89%
PUD-Detached 97 56,249,697.41 18.73
Condominium 48 27,818,200.13 9.26
2-Family 6 4,375,922.26 1.46
PUD-Attached 7 3,679,193.67 1.22
3-Family 3 2,094,927.16 0.70
Townhouse 3 1,742,081.08 0.58
Cooperative 1 487,014.69 0.16
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
Mortgage Loan Purpose of the Mortgage Loans
Aggregate % of
Number Of Stated Principal Cut-off Date
Mortgage Balance as of Pool Principal
Purpose Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
Purchase 286 $165,810,510.89 55.21%
Refinance-Rate/Term 126 73,434,913.79 24.45
Refinance-Cashout 117 61,104,705.84 20.34
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
Geographical Distribution of the Mortgage Properties
of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Mortgage Balance as of Pool Principal
Geographic Area Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
Alabama 1 $671,246.99 0.22%
Arizona 9 5,177,177.61 1.72
Arkansas 1 422,601.32 0.14
California 252 142,586,159.76 47.47
Colorado 8 5,063,191.59 1.69
Connecticut 4 2,059,191.66 0.69
District of Columbia 5 2,525,392.79 0.84
Florida 45 24,169,838.43 8.05
Georgia 6 3,107,379.72 1.03
Hawaii 1 824,138.65 0.27
Idaho 2 1,263,402.69 0.42
Illinois 15 8,889,072.41 2.96
Indiana 3 1,344,546.70 0.45
Kansas 2 1,496,674.23 0.50
Kentucky 1 494,483.19 0.16
Maine 3 1,631,997.96 0.54
Maryland 18 9,470,561.91 3.15
Massachusetts 19 11,145,637.95 3.71
Michigan 3 1,608,140.21 0.54
Minnesota 6 2,880,970.59 0.96
Missouri 2 1,021,054.62 0.34
Nevada 11 5,265,174.90 1.75
New Hampshire 2 2,723,257.66 0.91
New Jersey 9 5,589,026.93 1.86
New Mexico 2 975,720.91 0.32
New York 12 7,538,596.05 2.51
North Carolina 3 1,863,667.66 0.62
Ohio 2 1,030,994.49 0.34
Oklahoma 1 464,714.29 0.15
Oregon 1 782,342.74 0.26
Pennsylvania 8 4,844,617.32 1.61
Rhode Island 3 1,655,827.28 0.55
South Carolina 8 4,833,128.74 1.61
Tennessee 1 431,515.92 0.14
Texas 24 14,728,360.27 4.90
Utah 1 799,239.31 0.27
Vermont 3 1,797,074.61 0.60
Virginia 20 10,909,570.08 3.63
Washington 11 5,768,911.01 1.92
Wisconsin 1 495,529.37 0.16
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) As of the Cut-off Date, no more than approximately 0.88% of the Mortgage
Loans are expected to be secured by mortgaged properties in any one
five-digit postal zip code.
Current Mortgage Loan Principal Balances of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Current Mortgage Loan Mortgage Balance as of Pool Principal
Principal Balances ($) Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
250,000.01 - 300,000.00 1 $298,156.13 0.10%
400,000.01 - 450,000.00 104 45,002,448.34 14.98
450,000.01 - 500,000.00 136 64,835,057.31 21.59
500,000.01 - 550,000.00 78 40,974,789.51 13.64
550,000.01 - 600,000.00 54 31,124,798.02 10.36
600,000.01 - 650,000.00 49 30,703,414.22 10.22
650,000.01 - 700,000.00 34 23,033,503.35 7.67
700,000.01 - 750,000.00 13 9,359,873.86 3.12
750,000.01 - 800,000.00 14 10,871,972.42 3.62
800,000.01 - 850,000.00 11 9,125,177.10 3.04
850,000.01 - 900,000.00 12 10,514,470.19 3.50
900,000.01 - 950,000.00 5 4,571,358.58 1.52
950,000.01 - 1,000,000.00 11 10,889,486.15 3.63
1,000,000.01 - 1,500,000.00 6 7,097,613.45 2.36
1,500,000.01 - 2,000,000.00 1 1,948,011.89 0.65
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) As of the Cut-off Date, the average outstanding principal balance of the
Mortgage Loans is expected to be approximately $567,770.
Original Loan-To-Value Ratios of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Original Loan-To-Value Ratios Mortgage Balance as of Pool Principal
(%) Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
20.01 - 25.00 1 $630,870.00 0.21%
25.01 - 30.00 1 449,530.17 0.15
30.01 - 35.00 3 1,315,275.73 0.44
35.01 - 40.00 17 9,311,078.36 3.10
40.01 - 45.00 9 5,718,907.30 1.90
45.01 - 50.00 25 13,890,247.34 4.62
50.01 - 55.00 28 14,983,992.95 4.99
55.01 - 60.00 37 19,853,583.95 6.61
60.01 - 65.00 43 25,778,914.93 8.58
65.01 - 70.00 69 41,873,064.25 13.94
70.01 - 75.00 48 26,904,253.50 8.96
75.01 - 80.00 243 137,339,689.34 45.73
85.01 - 90.00 5 2,300,722.70 0.77
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) As of the Cut-off Date, the weighted average Loan-to-Value Ratio at
origination of the Mortgage Loans is expected to be approximately 69.40%.
Current Mortgage Interest Rates of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Current Mortgage Mortgage Balance as of Pool Principal
Interest Rates (%) Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
5.001 - 5.250 6 $3,118,940.24 1.04%
5.251 - 5.500 25 13,187,505.39 4.39
5.501 - 5.750 125 71,717,336.13 23.88
5.751 - 6.000 232 133,772,182.86 44.54
6.001 - 6.250 104 57,954,088.82 19.30
6.251 - 6.500 29 16,012,828.48 5.33
6.501 - 6.750 6 3,492,146.90 1.16
6.751 - 7.000 1 539,546.33 0.18
7.001 - 7.250 1 555,555.37 0.18
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) As of the Cut-off Date, the weighted average Current Mortgage Interest
Rate of the Mortgage Loans is expected to be approximately 5.937% per
annum.
Remaining Terms of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Mortgage Balance as of Pool Principal
Remaining Term (Months) Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
221 - 240 11 $6,133,046.68 2.04%
281 - 300 1 576,095.96 0.19
341 - 360 517 293,640,987.88 97.77
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) As of the Cut-off Date, the weighted average remaining term to stated
maturity of the Mortgage Loans is expected to be approximately 356 months.
Credit Scoring of Mortgagors of the Mortgage Loans (1)
Aggregate % of
Number Of Stated Principal Cut-off Date
Mortgage Balance as of Pool Principal
Credit Scores Loans Cut-off Date Balance
- ----------------------------- --------- ----------------- --------------
801 - 850 29 $17,939,571.66 5.97%
751 - 800 256 147,873,786.94 49.23
701 - 750 153 86,818,402.71 28.91
651 - 700 72 37,717,111.20 12.56
601 - 650 19 10,001,258.01 3.33
- ----------------------------- --------- ----------------- --------------
Total: 529 $300,350,130.52 100.00%
(1) The scores shown are Bureau Credit Scores from Experian (FICO), Equifax
(Beacon) and TransUnion (Empirica).