RMBS

Second homes account for 10.1% of the underlying collateral pool, the highest ratio seen in pools all year.

The capital structure includes first cash flow and last cash flow notes among the senior classes, and expected coupons include 5.64% on the A1A, A1B, A1FCF, A1LCF and A1 notes.

NRMLT 2026-NQM7 combines pro rata and sequential payment priorities, with the class A receiving principal on a pro-rata basis before principal is paid to the mezzanine or class B notes sequentially.

The deal also includes a 120-day stop advance provision, which prevents it from forwarding any interest and principal on loans that are past 120 days delinquent.

Lenders are finding better economics by placing agency loans into private-label securities, depending on the particular situation.

On an end-to-end basis, the joint initiative delivers collateral without relying heavily on manual transfers as loans are settled, then transferred between institutions.

Despite the quality of the pool's underlying loans, the pool has a large proportion of investment properties, 76.7%, which are susceptible to higher default probabilities.

An array of unnamed originators accounted for the large majority of originators in the pool, 89.3%, the rating agencies said, while Hometown Equity Mortgage originated 10.7% of the pool.

PRET 2026-RPL2 uses a sequential repayment structure, although the notes will not advance any principal and interest from delinquent loans.