Examples of Overcollateralized Amount in a sentence
The distribution calculation method the Trustee points to exists only in so-called shifting interest or “SI Trusts.” None of those trusts are OC Trusts, and none of their Governing Agreements use the Overcollateralized Amount concept.
For that reason alone, this issue — and the order of operations in the Settlement Agreement that addresses it — has no bearing on the argument advanced here, which turns on the definition of Overcollateralized Amount.
And those terms provide for a distribution that prevents any “illusory” or “temporary” overcollateralization.Specifically, for all the Freddie Mac trusts, the PSAs determine whether there is overcollateralization that gives rise to Excess Cashflow to be distributed pro rata by losses among senior classes by comparing the Overcollateralized Amount to the Overcollateralization Target.
The PSAs provide that the Trustee shall calculate Overcollateralized Amount by “giving effect to” the distribution “to be made.” CWABS 2006-3 PSA § 1.01, Def.
Thus, after one works through the contractual terms, the PSA distributes repayments of principal through the waterfall distribution, but it removes from the distribution pool the excess of the Overcollateralized Amount over the target threshold, or Overcollateralization Target Amount.