DBRS Morningstar Assigns Provisional Ratings to Verus Securitization Trust 2021-5.
ENPNewswire-September 14, 2021--DBRS Morningstar Assigns Provisional Ratings to Verus Securitization Trust 2021-5
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Release date- 13092021 - DBRS, Inc. (DBRS Morningstar) assigned provisional ratings to the following Mortgaged-Backed Notes, Series 2021-5 (the Notes) to be issued by Verus Securitization Trust 2021-5 (the Trust).
$472.6 million Class A-1 at AAA (sf)
$38.3 million Class A-2 at AA (sf)
$68.5 million Class A-3 at A (sf)
$38.3 million Class M-1 at BBB (sf)
$25.1 million Class B-1 at BB (sf)
$18.7 million Class B-2 at B (sf)
Other than the specified classes above, DBRS Morningstar does not rate any other classes in this transaction.
The AAA (sf) rating on the Class A-1 Notes reflects 30.35% of credit enhancement provided by subordinate notes. The AA (sf), A (sf), BBB (sf), BB (sf), and B (sf) ratings reflect 24.70%, 14.60%, 8.95%, 5.25%, and 2.50% of credit enhancement, respectively.
This securitization is a portfolio of primarily fixed- and adjustable-rate, expanded prime and nonprime, first-lien residential mortgages funded by the issuance of the Notes. The Notes are backed by 1,141 mortgage loans with a total principal balance of $678,634,824 as of the Cut-Off Date (September 1, 2021).
The top originator for the mortgage pool is Calculated Risk Analytics, LLC doing business as Excelerate Capital (11.7%). The remaining originators each comprise less than 10.0% of the mortgage loans. The Servicers of the loans are Shellpoint Mortgage Servicing (85.5%); Specialized Loan Servicing (4.9%); Fay Servicing, LLC (6.3%); and Lima One Capital, LLC (0.7%).
Although the mortgage loans were originated to satisfy the Consumer Financial Protection Bureau's Ability-to-Repay (ATR) rules, they were made to borrowers who generally do not qualify for agency, government, or private-label non-agency prime jumbo products for various reasons. In accordance with the Qualified Mortgage (QM)/ATR rules, 49.1% of the loans are designated as non-QM, 0.1% are designated as QM Safe Harbor, and 0.1% are designated as QM Rebuttable Presumption. Approximately 50.7% of the loans are made to investors for business purposes and, hence, are not subject to the QM/ATR rules.
The Sponsor, directly or indirectly through a majority-owned affiliate, will retain an eligible vertical interest, representing at least 5% of the Notes to satisfy the credit risk-retention requirements under Section 15G of the Securities Exchange...
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