A pool of 6,979 timeshare loans is securing the collateral pool for Elara HGV Timeshare Issuer 2021-A, which will issue about $180.3 million in asset-backed securities.
The loans are related to just one timeshare site in Las Vegas, Nevada, called the Tower 52 Vacation Suites. LV Tower 52, LLC originated the loans under an agreement with Hilton Resorts Corporation (HRC), according to Fitch Ratings.
Bank of America Securities is lead underwriter on the transaction. Grand Vacations Services will service the notes, with Wells Fargo Bank acting as the backup servicer, Fitch said.
The underlying loans in Elara HGV 2021-A have a weighted average (WA) seasoning of 21 months, compared with 13 months in 2019-A. The WA seasoning was also impacted by the inclusion of called collateral from the 2014-A transaction. Excluding prefunded loans, the called collateral represents 5.5% of the initial pool. From a credit perspective, the more seasoned timeshare loans generally experience lower CDGs relative to the unseasoned loans.
Underlying borrowers were highly qualified. The 2021-A has a weighted average (WA) FICO score of 741, which aligns with the 2019-A, 2014-A and 2016-A deals.
The concentration of loans with original balances of $100,000 or larger, was 11.8%, up from 6.7%. The share of upgraded loans, however, was 68%, up from 58% in the 2019-A deal, Fitch said.
California represents the largest state concentration in the portfolio, with 20.8%; Texas follows with 8.4%; and then Florida, with 7.2%.
The notes, which will mature in August 2035, are slated to receive ‘AAA’ on the class A; ‘A’ on the class B, with ‘BBB’ and ‘BB’ ratings on the subordinate notes, according to Fitch.
