Caliber Home Loans is preparing a second subprime residential mortgage securitization, just months after completing their first U.S. subprime asset-backed deal of the post-crisis era.

COLT 2016-2 Mortgage Loan Trust is a planned $221.3 million securitization of 510 first-lien subprime loans, according to publicly filed documents detailing a third-party due diligence review of the collateral loans.

Unlike the first deal, consisting entirely of loans originated by Caliber, this transaction features loans also issued by Sterling Bank & Trust, and sold to Texas-based private equity firm Lone Star Funds.

The diligence filing details a line-by-line examination by AMC Diligence to find any exceptions to underlying loan data, such as the total debt ratio of borrowers or the appraised values assigned to the properties.

The Colt 2016-2 transaction follows Caliber’s first nonprime asset-backed deal (COLT 2016-1) in June, which was backed by363 loans with a principal balance of $161.7 million.

Caliber lends to borrowers who do not meet standards for agency, government or private-label nonagency prime jumbo products. But the loans are originated by Caliber to meet ability-to-repay rules enforced by the Consumer Financial Protection Bureau.

Nearly 61% of the loans are adjusted-rate mortgages; 87.8% are owner-occupied homes.


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