Capital Home Loans, an affiliate of Cerberus Capital Management, is refinancing a pool of U.K. residential mortgages that primarily finance rental properties.

The £393 million ($442.3 million) Towd Point Mortgage Funding 2018 Auburn 12 Plc is backed by 2,913 properties, all of which were previously securitized in the sponsor’s 2015-vintage Auburn Securities 9 portfolio. The former deal will be called after the planned Aug. 20 closing of Auburn 12.

Some of the properties are being refinanced for a third time, as a portion of the Securities 9 transaction included mortgages from the former Auburn 6 and 7 ABS pools from 2008.

Town Point Auburn 12 is the 12th securitizations of well-seasoned mortgages originated during the pre-crisis era, and the first for Capital Home since February 2017.

five tranches of notes will be issued in the transacti. A £326.6 million tranche of Class A notes benefits from 16.9% credit enhancement. Four credit rating agencies have provided preliminary AAA ratings: KBRA, Moody’s Investors Service, DBRS and S&P Global Ratings.

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The senior notes will have an initial interest rate of Libor plus 80 basis points (down from Libor plus 100 basis points for Auburn 9), according to presale reports.

The capital stack also includes £25.9 million in double-A-rated Class B notes with 10.3% CE; £11 million in single-A Class C notes (rated single A) with 7.5% CE); as well as Class D notes totaling £9.4 million, with split ratings of A by S&P and triple-B from the remaining agencies. Also being marketed are double-B Class E notes sized at £9.4 million. The Class D and E notes each benefit from 5% CE.

A residual Class F tranche totals $10.2 million in notes, and is unrated.

The buy-to-let loans were originated by Capital Home Loans between 1994 and 2008 (the average seasoning is 11.7 years), when the company was one of the largest specialty lenders of buy-to-let properties in the U.K. The firm, which has been through three owners, now only services legacy loans held by owner Cerberus Capital Management. FirstKey Mortgage, another affiliate of Cerberus, is a co-sponsor of Auburn 12.

In additional to legacy Capital Home Loans originations, Cerberus also holds nearly £5 billion in U.K. home loans acquired from CHL and the Irish bank Permanent TSB Group Holdings PLC, a successor to the Irish Permanent Building Society. The previous Towd Point Auburn 11 securitization provided proceeds to fund a portion of the £2.25 billion acquisition of the Permanent TSB loans.

The current acquisition only includes loans originated by CHL.

Despite the loan’s age and pre-crisis lineage, over 90% of the properties have never been in arrears — perhaps a product of the fact that over 93% of them are interest-only loans with an average of 2.06%. The principal for these interest-only loans is due only at maturity, with 28% coming due within five years, according to presale reports.

The weighted average indexed current loan-to-value ratio is 57.54% (compared with an original WA LTV of 80.3% for the collateral).

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