A once-bullish home equity analyst downgraded three companies in the sector Monday, citing ever-increasing prepayment rates, continued stiff competition, and in one case management turnover.

Delta Financial Corp., Woodbury, N.Y., First Alliance Corp., Irvine, Calif., and Southern Pacific Funding Corp., Lake Oswego, Ore., were downgraded from "buy" to "hold" by Jennifer S. Scutti, a Prudential Securities analyst.

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