Donna M. Mitchell

The 1,055 loans in the pool are primarily non-qualified mortgages and loans that are exempt from ability-to-repay rules, which represent 36.4% and 43.87% of the pool, respectively.

The transaction has a nine-month revolving period. All of the leases are closed end, where the issuer bears the residual value risk, and more of them can be added during that period.

Total initial credit enhancement includes over-collateralization representing 8.95% of the initial pool balance, which is expected to build to a targeted level of 13.95%.

Aside from a $2 million penalty for violating the servicing laws, but the order included told Fay Servicing to pay consumers $3 million in redress and make a $2 million capital investment updating its servicing technology and compliance management systems.

Among the credit challenges, is the lack of amortization on the loans, and the loans are heavily concentrated among states and MSAs.

Fora Financial Asset Securitization, 2024-1, is the first for Fora Financial since 2021, and its third securitization overall. Tier 2 saw the greatest shift in credit distributions among the six credit tiers since the last deal.

FCI Funding 2024-1 has an additional tax liens account that can purchase up to $23 million of qualified assets on or prior to the second anniversary of the deal's closing date, while the subsequent tax lien account will be funded to $5 million for use during the reinvestment period.

The transaction's notes have increased excess spread, as well as some structural optimization by the issuer, S&P said, which helps account for lower total initial hard credit enhancement levels for all classes of notes.

The pool contains 494,987 accounts, where the top borrower accounts for 0.32%, and the top five account for 1.19%, and its granularity counts as a positive credit attribute.

Retail properties account for the largest portion, at 23.5%, according to KBRA. Lodging follows, with 22.1% of the pool.