RMBS

Most of the loans, 57.34%, are for cashout purposes and the entire loan pool are first-liens, and are of modest leverage, with an original cumulative loan-to-value (LTV) ratio of 69.74%.

The A1A and A1B tranches, rated 'AAA' from S&P and Kroll Bond Rating Agency, are expected to pay coupons of 5.31%.

The loans were underwritten primarily to full documentation standards, including one to two years of W-2 verification, or two years of personal and business tax returns for self-employed borrowers.

Regardless of whether a trigger is in place, A-1FCF will always receive principal first until that balance is reduced to zero, and then to A-1LCF until it is fully paid off.

RATE 2026-J1 has a seasoned probability of default of 6.4% and 1.3% on the 'AAA' and 'B' rating stress levels, respectively.

LendSure originated more than one third of the loans in the pool, while American Heritage Lending and The Loan Store represent 14.8% and 11.1% of the pool.

The collateral pool consists of 1,318 mortgages, aggregated by Invictus Capital Partners from originators that include NewRez, and each accounts for less than 10% of the mortgage loans.

First liens and junior liens account for 197 and 1,755 of the pool, respectively, DBRS said. They have unpaid balances of $30.5 million and $217 million, with FICO scores of 747 and 740 on a WA basis.

The Loan Store originated the largest portion of mortgages in the pool, 10.3%, according to Fitch, while an array of other lenders accounted for the rest.