Item 1. Business.
Not Applicable.
Item 2.
Item 2. Properties.
Not Applicable.
Item 3.
Item 3. Legal Proceedings.
The registrant knows of no material pending legal proceedings involving the trust created under the Pooling and Servicing Agreement (the Trust), the Trustee, the Master Servicer, the Securities Administrator or the registrant with respect to the Trust other than routine litigation incidental to the duties of the respective parties.
Item 4.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
PART II
Item 5.
Item 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities.
There is currently no established public trading market for the certificates issued by the Trust.
As of December 31, 2004 the total number of holders with respect to each class of certificates is set forth below:
A-1 25 A-2 5 A-3 2 M-1 4 M-2 1 M-3 2 M-4 2 M-5 2 M-6 2 M-7 1 M-8 1
Item 6.
Item 6. Selected Financial Data.
Not Applicable.
Item 7.
Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operation.
Not Applicable.
Item 7A.
Item 7A. Quantitative and Qualitative Disclosures About Market Risk.
Not Applicable.
Item 8.
Item 8. Financial Statements and Supplementary Data.
Not Applicable.
Item 9.
Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure.
None.
Item 9A.
Item 9A. Controls and Procedures.
Not Applicable.
Item 9B.
Item 9B. Other Information.
Not Applicable.
PART III
Item 10.
Item 10. Directors and Executive Officers of the Registrant.
Not Applicable.
Item 11.
Item 11. Executive Compensation.
Not Applicable.
Item 12.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
Not Applicable.
Item 13.
Item 13. Certain Relationships and Related Transactions.
Not Applicable.
Item 14.
Item 14. Principal Accounting Fees and Services.
Not Applicable.
PART IV
Item 15.
Item 15. Exhibits, Financial Statement Schedules.
(a) The following is a list of documents filed as part of this report:
(4.1) Pooling and Servicing Agreement (filed as an exhibit to Form 8-K on November 12, 2004).
(31.1) Rule 13a-14(a)/15d-14(a) Certification.
(99.1) Annual Independent Public Accountant's Servicing Report concerning servicing activities for the year ended December 31, 2004.
(99.2) Annual Statement of Compliance under the Pooling and Servicing Agreement for the year ended December 31, 2004.
(b) The exhibits required to be filed by Registrant pursuant to Item 601 of Regulation S-K are listed above and in the Exhibit Index that immediately follows the signature page hereof.
(c) Not Applicable.
SIGNATURE
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
CHEC LOAN TRUST 2004-2 ASSET-BACKED CERTIFICATES, SERIES 2004-2
By: Asset Backed Funding Corporation, as Depositor
By: /s/ Daniel B. Goodwin ----------------------- Name: Daniel B. Goodwin Title: President Date: March 28, 2005
SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT.
(a)(i) No annual report is provided to the Certificateholders other than with respect to aggregate principal and interest distributions.
(a)(ii) No proxy statement, form of proxy or other proxy soliciting material has been sent to any Certificateholder with respect to any annual or other meeting of Certificateholders.
EXHIBIT INDEX
Exhibit Description
4.1 Pooling and Servicing Agreement (filed as an exhibit to Form 8-K on November 12, 2004).
33.1 Rule 13a-14(a)/15d-14(a) Certification
99.1 Annual Independent Public Accountant's Servicing Report concerning servicing activities for the year ended December 31, 2004.
99.2 Annual Statement as to Compliance under the Pooling and Servicing Agreement for the year ended December 31, 2004.
EXHIBIT 31.1 Rule 13a-14(a)/15d-14(a) Certification ------------------------
CHEC LOAN TRUST 2004-2, ASSET-BACKED CERTIFICATES, SERIES 2004-2
I, Daniel B. Goodwin, the President of Asset Backed Funding Corporation, certify that:
1. I have reviewed this annual report on Form 10-K, and all monthly current reports on Form 8-K containing distribution or servicing reports filed in respect of periods included in the year covered by this annual report of the CHEC Loan Trust 2004-2 formed pursuant to the Pooling and Servicing Agreement, dated as of October 1, 2004 (the "Agreement"), among Asset Backed Funding Corporation, as depositor, Centex Home Equity Company, LLC, as servicer (the "Servicer") and JPMorgan Chase Bank, N.A., as trustee (the "Trustee");
2. Based on my knowledge, the information in these reports, taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading as of the last day of the period covered by this annual report;
3. Based on my knowledge, the distribution or servicing information required to be provided to the Trustee by the Servicer under the Agreement for inclusion in these reports is included in these reports;
4. Based on my knowledge and upon the annual compliance statement included in the report and required to be delivered to the Trustee in accordance with the terms of the Agreement, and except as disclosed in the reports, the Servicer has fulfilled its obligations under the Agreement; and
5. The reports disclose all significant deficiencies relating to the Servicer's compliance with the minimum servicing standards, based upon the report provided by an independent public accountant after conducting a review in compliance with the Uniform Single Attestation Program for Mortgage Bankers or similar procedure as set forth in the Agreement that is included in these reports.
In giving the certifications above, I have reasonably relied on information provided to me by the following unaffiliated parties: Centex Home Equity Company, LLC and JPMorgan Chase Bank, N.A.
By: /s/ Daniel B. Goodwin ----------------------- Name: Daniel B. Goodwin Title: President Date: March 28, 2005
EXHIBIT 99.1 Annual Independent Public Accountant's Servicing Report with Management Assertion -----------------------
Ernst & Young LLP Dallas, Texas
Report on Management's Assertion on Compliance With Minimum Servicing Standards Set Forth in the Uniform Single Attestation Program for Mortgage Bankers
Report of Independent Accountants
The Members of Centex Home Equity Company, LLC and Subsidiaries and CTX Mortgage Funding, LLC
We have examined management's assertion, included in the accompanying report titled Report of Management, that Centex Home Equity Company, LLC and Subsidiaries and CTX Mortgage Funding, LLC (collectively, the Companies) complied with the minimum servicing standands set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers (USAP) during the nine month period ended December 31, 2004. Management is responsible for the Companies' compliance with those requirements. Our responsibility is to express an opinion on management's assertions about the Companies' compliance based on our examination.
Our examination was made in accordance with attestation standards established by the American Institute of Certified Pubic Accountants and, accordingly, included examining, on a test basis, evidence about the Companies' compliance with those requirements and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination on the Companies' compliance with specified requirements.
In our opinion, management's assertion that the Companies complied with the aforementioned requirements during the nine month period ended December 31, 2004 is fairly stated, in all material respects.
This report is intended solely for the information and use of the audit committee, management and the Companies' private investors and is not intended to be and should not be used by anyone other than these specified parties.
Ernst & Young LLP
March 16, 2005
Centex Home Equity Corporation
Management's Assertion on Compliance With Minimum Servicing Standards Set Forth in the Uniform Single Attestation Program for Mortgage Bankers
Report of Management
We, as members of management of Centex Home Equity Company, LLC and Subsidiaries and CTX Mortgage Funding, LLC (the Companies), are responsible for complying with the minimum servicing standards as set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers (USAP). We are also responsible for establishing and maintaining effective internal control over compliance with these standards. We have performed an evaluation of the Companies' compliance with the minimum servicing standards as set forth in the USAP as of December 31, 2004 and for the nine-month period then ended. Based on this evaluation, we assert that during the nine-month period ended December 31, 2004, the Companies complied, in all material respects, with the minimum servicing standards set forth in the USAP.
As of and for this same period, the Companies had in effect a fidelity bond in the amount of $25 million and $6 million, respectively.
/s/ Jay Bray - ------------------------ Jay Bray Executive Vice President - Chief Financial Officer
/s/ Jerry Berrens - ------------------------ Jerry Berrens Vice President - Controller
March 16, 2005
EXHIBIT 99.2 Servicer's Annual Statement as to Compliance -----------------------
ANNUAL STATEMENT AS TO COMPLIANCE
As of and for the fiscal year ended March 31, 2005, pursuant to Section 3.19 of the Pooling and Servicing Agreement among Asset Backed Funding Corporation ("Depositor"), Centex Home Equity Company, LLC ("Servicer") and JP Morgan Chase Bank ("Trustee"), dated as of October 1, 2004, the undersigned, on behalf of Centex Home Equity Company, has performed a review of the activities of Centex Home Equity Company, LLC as Servicer during such preceding year.
To the best of my knowledge, based on such review, the Servicer has fulfilled all obligations under the Pooling and Servicing Agreement for the fiscal year above referenced.
/s/ Greg Oniu - ----------------------- Greg Oniu Senior Vice President Centex Home Equity Company, LLC