Donna M. Mitchell

The notes will be issued through series 2025-3 and 2025-4, and aside from slightly different maturity dates, they have similar initial overcollateralization and reserves.

The deal is composed of 11,547 seasoned performing and reperforming loans that are first and second lien. Loan servicing includes a 180-day chargeoff feature.

ACHM 2025-HE1 will repay notes using a pro-rata, sequential pay structure that must satisfy an overcollateralization test, and cumulative loss and delinquency triggers.

Borrowers' high incomes and the abundance of monthly free cash flow speed up repayments and mitigate the transaction's exposure to economic downturns.

Sabey 2025-2 will feature a $24.8 million liquidity reserve among other credit enhancement mechanisms, including cash trap and early amortization triggers.

Almost all the collateral was extended to borrowers attending four-year schools, and the same percentage was made to borrowers attending not-for-profit schools.

The non-prime pool benefits from a non-declining reserve fund of 1.0% of the initial pool balance, and subordination of 32.9% for the pool.

Figg will advise financial institutions, issuers, arrangers and underwriters on asset-backed securities (ABS) deals, collateralized loan obligations among other transactions.

A reserve account starts off at 0.0%, but its funding level varies in line with three-month average excess spreads, if it falls below certain thresholds.

Second-lien loans make up virtually the entire pool, which carries some risk of poor recovery rates. Yet 78% of the pool is also considered safe-harbor mortgages.

Borrowers are considered prime in this pool, but Fitch Ratings notes that delinquency rates have been increasing since 2022.

Total hard credit enhancement will represent 4.5% of the note balance, and initial reserves amounting to 2.0% of the pool.

Almost the entire pool of mortgages will fund primary residences and were underwritten using full documentation.

Loans on used cars, extended to borrowers with prime credit characteristics, make up the reference pool of assets.

Aside from that, three collateral performance trigger events—delinquency, default and extension rate—that can force an early amortization are structured into the deal.

The pool is diversified, with its top obligor accounting for 3.2% of the pool balance, and the top 10 obligors account for 14.1%.

Coupons range from 4.4% on the noted rates P1/A1+ from Moody's and S&P, to 5.66% on the notes rated Ba1/BB+.

FHF sources almost all its loans—most recently 96% in 2024—from franchise dealers.

The deal is structured as a public securitization, under Rule 144A, and is supported by lending indirectly through more than 1,100 partnerships across the country.

The pass-through certificates are supported by a full pool of amortizing loans, which have no interest-only periods.