10-K 1 ac040110k.txt 10-K UNITED STATES OF AMERICA SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2004 Commission file number of issuing entity: 333-109964-02 Accredited Mortgage Loan Trust 2004-1 (Exact name of issuing entity as specified in its charter) Commission file number of registrant: 333-109964 Accredited Home Lenders, Inc. (Exact name of Registrant as specified in its Charter) Delaware 33-0426859 (State or other jurisdiction (I.R.S. Employer incorporation or organization) Identification Number) 15090 Avenue of Science San Diego, California 92128 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (858) 676-2100 Securities registered pursuant to Section 12(b) of the Act: none Securities registered pursuant to Section 12(g) of the Act: none. Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of the Registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of the Form 10-K or any amendment to this Form 10-K. [x] Indicate by check mark whether the registrant is an accelerated filer (as defined in Rule 12b-2 of the Act). Yes No X State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the of the last business day of the registrant's most recently completed second fiscal quarter NOT APPLICABLE. Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of December 31,2004. NOT APPLICABLE DOCUMENTS INCORPORATED BY REFERENCE None PART I ITEM 1. Business. Not Applicable ITEM 2. Properties. Not Applicable ITEM 3. Legal Proceedings. None. ITEM 4. Submission of Matters to a Vote of Security Holders. No matters were submitted to a vote of Note Holders during the fiscal year covered by this report. PART II ITEM 5. Market for Registrant's Common Equity and Related Stockholder Matters and Issuer Purchases of Equity Securities. The Trust does not issue stock. There is currently no established public trading market for Registrant's Notes. Registrant believes the Notes are traded primarily in intra-dealer markets and non-centralized inter-dealer markets. As of December 31,2004 the number of registered holders of all class of Notes was 2. ITEM 6. Selected Financial Data. Not Applicable ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. Not Applicable ITEM 7A. Quantitative and Qualitative Disclosures About Market Risk. Not Applicable ITEM 8. Financial Statements and Supplementary Data. Not Applicable ITEM 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None. ITEM 9A Controls and Procedures Not Applicable ITEM 9B. Other Information None. PART III ITEM 10. Directors and Executive Officers of Registrant. Not Applicable. ITEM 11. Executive Compensation. Not Applicable. ITEM 12. Security Ownership of Certain Beneficial Owners and Management. Security ownership of certain beneficial owners. Under the Indenture governing the Trust, the holders of the Notes generally do not have the right to vote and are prohibited from taking part in management of the Trust. For purposes of this Item and Item 13 only, however, the Noteholders are treated as "voting security" holders. As of December 31, 2004, the following are the only persons known to the Registrant to be the beneficial owners of more than 5% of any class of voting securities: CEDEFAST CEDE & CO FAST P.O. BOX 20 BOWLING GREEN STATION NEW YORK, NEW YORK, 10274 SERIES 2004-1 CLASS A-1 $250,121,000 100.0% CEDEFAST CEDE & CO FAST P.O. BOX 20 BOWLING GREEN STATION NEW YORK, NEW YORK, 10274 SERIES 2004-1 CLASS A-2 $254,879,000 100.0% ITEM 13. Certain Relationships and Related Transactions. None ITEM 14. Principal Accountant Fees and Services NOT APPLICABLE PART IV ITEM 15. Exhibits, Financial Statement Schedules. (a) List the following documents filed as a part of the report: (1) All financial statement: Exhibit 31 Section 302 Certification Exhibit 99.1 Servicer's Annual Statement of Compliance for Year End December 31, 2004 Exhibit 99.2 Servicer's Annual Independent Accountant's Report for Year End December 31,2004 Monthly Remittance Statement to the Certificate holders dated as of March 25, 2004, and filed with the Securities and Exchange Commission on Form 8-K on April 2, 2004. Monthly Remittance Statement to the Certificate holders dated as of April 26, 2004, and filed with the Securities and Exchange Commission on Form 8-K on April 28, 2004. Monthly Remittance Statement to the Certificate holders dated as of May 25, 2004, and filed with the Securities and Exchange Commission on Form 8-K on June 02, 2004. Monthly Remittance Statement to the Certificate holders dated as of June 25, 2004, and filed with the Securities and Exchange Commission on Form 8-K on July 01, 2004. Monthly Remittance Statement to the Certificate holders dated as of July 27, 2004, and filed with the Securities and Exchange Commission on Form 8-K on August 3, 2004. Monthly Remittance Statement to the Certificate holders dated as of August 25, 2004, and filed with the Securities and Exchange Commission on Form 8-K on August 26, 2004. Monthly Remittance Statement to the Certificate holders dated as of September 27, 2004, and filed with the Securities and Exchange Commission on Form 8-K on September 28, 2004. Monthly Remittance Statement to the Certificate holders dated as of October 25, 2004, and filed with the Securities and Exchange Commission on Form 8-K on October 28, 2004. Monthly Remittance Statement to the Certificate holders dated as of November 26, 2004, and filed with the Securities and Exchange Commission on Form 8-K on November 29, 2004. Monthly Remittance Statement to the Certificate holders dated as of December 27, 2004, and filed with the Securities and Exchange Commission on Form 8-K on January 03, 2005. (2) Those financial statements schedules required to be filed by Item 8 of this form, and by paragraph (c) below. (3) Those exhibits required by Item 601 of Regulation S-K (229.601 of this chapter) and by paragraph (c) below. Identify in the lost each management contract or compensatory plan or arrangement required to be filed as an exhibit to this form pursuant to Item 14 (c) of this report. (b) Registrants shall file, as exhibits to this form, the exhibits required by Item 601 of Regulation S-K (229.601 of this chapter). (c) Registrants shall file, as financial statements schedules to this form, the financial statements required by Regulation S-X (17 CFR 210) which are exclude from the annual report to shareholders by Rule 14a-3(b) including (1) separate financial statements of subsidiaries not consolidated and fifty percent or less owned persons; (2) separate financial statements of affiliates whose securities are pledged as collateral; and (3) schedules. 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. By: Accredited Home Lenders, Inc., as Master Servicer of Accredited Mortgage Loan Trust 2004-1 By: /s/: James A. Konrath James A. Konrath Chief Executive Officer Date: April 12, 2005 EXHIBIT INDEX Exhibit Document 31 Section 302 Certification 99.1 Servicer's Annual Statement of Compliance for Year End December 31, 2004 99.2 Servicer's Annual Independent Accountant's Report for Year End December 31, 2004 Exhibit 31 ACCREDITED HOME LENDERS, INC. OFFICERS CERTIFICATE I, James A. Konrath, certify that: 1. I have reviewed this annual report on Form 10-K, and all 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 Accredited Mortgage Loan Trust 2004-1; 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 pooling and servicing, or similar, agreement is included in these reports; 4. I am responsible for reviewing the activities by the servicer under the pooling and servicing, or similar, agreement and based upon my knowledge and the annual compliance review required under that agreement, and except as disclosed in the reports, the servicer has fulfilled its obligations under that 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 pooling and servicing, or similar, 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: Deutsche Bank National Trust Company, as Trustee. Date: April 12, 2005 Accredited Home Lenders Inc., as Master Servicer of Accredited Mortgage Loan Trust 2004-1 /s/: James A. Konrath Name: James A. Konrath Title: Chairman of the Board Exhibit 99.1 ACCREDITED MORTGAE LOAN TRUST 2004-1 OFFICER'S CERTIFICATE (Section 5.09 of the Sale and Servicing Agreement) Pursuant to Section 5.09 of the Sale and Servicing Agreement dated as of February 1, 2004 (the "Agreement"), by and among ACCREDITED HOME CAPITAL, INC., as Seller (the "Seller"), ACCREDITED HOME LENDERS, INC., as Sponsor (in such capacity, the "Sponsor") and as Master Servicer (in such capacity, the "Master Servicer"), ACCREDITED MORTGAGE LOAN TRUST 2004-1, as Issuer (the "Trust"), COUNTRYWIDE HOME LOANS SERVICING LP, as Backup Servicer (the "Backup Servicer") and DEUTSCHE BANK NATIONAL TRUST COMPANY, as Indenture Trustee (the "Indenture Trustee") ( the "Agreement"), James A. Konrath, Chairman of the Board of the Master Servicer, and Jeffrey W. Crawford, Assistant Secretary of the Master Servicer, hereby state as follows (initially capitalized terms used herein and not otherwise defined have the same meanings as under the Agreement): 1. They are the duly elected, qualified and acting Chairman of the Board and Assistant Secretary, respectively, of the Master Servicer. 2. A review of the activities of the Master Servicer during the preceding calendar year and of its performance under the Agreement has been made under their supervision. 3. To the best of their knowledge, based on such review, the Master Servicer has fulfilled all its obligations under the Agreement throughout such year. EXECUTED as of the 15th day of March, 2005 /s/: James A. Konrath James A. Konrath Chairman of the Board /s/: Jeffrey W. Crawford Jeffrey W. Crawford Assistant Secretary Exhibit 99.2 Deloitte Deloitte & Touche LLP Suite 1900 701 "B" Street San Diego, CA 92101-8198 USA Tel: +1 619 232 6500 Fax: +1 619 237 1755 www.deloitte.com REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM Board of Directors Accredited Home Lenders, Inc. We have examined management's assertion that Accredited Home Lenders, Inc. (the "Company") has complied as of and for the year ended December 31, 2004, with its established minimum servicing standards described in the accompanying Management's Assertion on Minimum Servicing Standards dated March 30, 2005 related to residential mortgage loans originated or acquired subsequent to November 1, 2000. Management is responsible for the Company's compliance with those minimum servicing standards. Our responsibility is to express an opinion on management's assertion about the Company's compliance based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants, as adopted by the Public Company Accounting Oversight Board (United States) and, accordingly, included examining, on a test basis, evidence about the Company's compliance with its minimum servicing standards 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 does not provide a legal determination on the Company's compliance with its minimum servicing standards. In our opinion, management's assertion that the Company complied with the aforementioned minimum servicing standards as of and for the year ended December 31, 2004, is fairly stated, in all material respects based on the criteria set forth in Appendix I. /s/: Deloitte & Touche LLP March 30, 2005 Member of Deloitte Touche Tohmatsu Accredited company logo here March 15, 2005 Management's Assertion As of and for the year ended December 31, 2004, Accredited Home Lenders, Inc. (the "Company"), has complied, in all material respects, with the Company's established minimum servicing standards for residential mortgage loans originated or acquired subsequent to November 1, 2000, as set forth in Appendix I (the "Standards"). The Standards are based on the Mortgage Banker's Association of America's Uniform Single Attestation Program for Mortgage Bankers. As of and for this same period, the Company had in effect a fidelity bond in the amount of $5 million (except the period from November 1, 2004, through December 31, 2004, for which the amount of the fidelity bond was $10 million) and an errors and omissions policy in the amount of $4.3 million. /s/: James A. Konrath James A. Konrath Chief Executive Officer /s/: Jeffrey Crawford Jeffrey Crawford Director of Operations /s/: John Buchanan John Buchanan Chief Financial Officer /s/: Michael Bojorquez Michael Bojorquez Controller National Headquarters 15090 Avenue of Science San Diego, CA 92128 T 800.690.6000 F 858.676.2170 www.accredhome.com APPENDIX I MIMIMUM SERVICING STANDARDS AS SET FORTH IN THE MORTGAGE BANKERS ASSOCIATION OF AMERICA'S UNIFORM SINGLE ATTESTATION PROGRAM FOR MORTGAGE BANKERS I. CUSTODIAL BANK ACCOUNTS 1. Reconciliations shall be prepared on a monthly basis for all custodial bank accounts and related bank clearing accounts. These reconciliations shall: Be mathematically accurate; Be prepared within forty-five (45) calendar days after the cutoff date; Be review and approved by someone other than the person who prepared the reconciliation; and Document explanations for reconciling items. These reconciling items shall be resolved within ninety (90) calendar days of their original identification. 2. Funds of the servicing entity shall be advanced in cases where there is an overdraft in an investor's or a mortgagor's account. 3. Each custodial account shall be maintained at a federally insured depository institution in trust for the applicable investor. 4. Escrow funds held in trust for a mortgagor shall be returned to the mortgagor within thirty (30) calendar days of payoff of the mortgage loan. II. MORTGAGE PAYMENTS 1. Mortgage payments shall be deposited into the custodial bank accounts and related bank clearing accounts within two business days of receipt. 2. Mortgage payments made in accordance with the mortgagor's loan documents shall be posted to the applicable mortgagor records within two business days of receipt. 3. Mortgage payments shall be allocated to principal, interest, insurance, taxes or other escrow items in accordance with the mortgagor's loan documents. 4. Mortgage payments identified as loan payoffs shall be allocated in accordance with the mortgagor's loan documents. III. DISBURSEMENTS 1. Disbursements made via wire transfer on behalf of a mortgagor or investor shall be made only by authorized personnel. 2. Disbursements made on behalf of a mortgagor or investor shall be posted within two business days to the mortgagor's or investor's records maintained by the servicing entity. 3. Tax and insurance payments shall be made on or before the penalty or insurance policy expiration dates, as indicated on tax bills and insurance premium notices, respectively, provided that such support has been received by the servicing entity at least thirty (30) calendar days prior to these dates. 4. Any late payment penalties paid in conjunction with the payment of any tax bill or insurance premium notice shall be paid from the servicing entity's funds and not charged to the mortgagor, unless the late payment was due to the mortgagor's error or omission. 5. Amounts remitted to investors per the servicer's investor reports shall agree with canceled checks, or other form of payment, or custodial bank statements. 6. Unused checks shall be safeguarded so as to prevent unauthorized access. IV. INVESTOR ACCOUNTING AND REPORTING 1. The servicing entity's investor reports shall agree with, or reconcile to, investors' records on a monthly basis as to the total unpaid principal balance and number of loans serviced by the servicing entity. V. MORTGAGOR LOAN ACCOUNTING 1. The servicing entity's mortgage loan records shall agree with, or reconcile to, the records of mortgagors with respect to the unpaid principal balance on a monthly basis. 2. Adjustments on ARM loans shall be computed based on the related mortgage note and any ARM rider. 3. Escrow accounts shall be analyzed, in accordance with the mortgagor's loan documents, on at least an annual basis. 4. Interest on escrow accounts shall be paid, or credited, to mortgagors in accordance with the applicable state laws. VI. DELINQUENCIES 1. Records documenting collection efforts shall be maintained during the period a loan is in default and shall be updated at least monthly. Such records shall describe the entity's activities in monitoring delinquent loans including, for example, phone calls, letters and mortgage payment rescheduling plans in cases where the delinquency is deemed temporary (e.g., illness or unemployment). VII. INSURANCE POLICIES 1. A fidelity bond and errors and omissions policy shall be in effect on the servicing entity throughout the reporting period in the amount of coverage represented to investors in management's assertion.