In its fourth rated residential transition loan (RTL) securitization, Fidelis Investors Mortgage Fund I, is preparing to raise $191.5 million, backed by revenues from loans that it purchased from other originators.
Easy Street Capital accounted for 29.6% of the pool, while Unitas Funding represents 18.2% of the pool, according to analysts at Kroll Bond Rating Agency. Fidelis Investors is servicing the underlying debt, composed of short-term bridge construction or renovation loans extended primarily to investors turning over residential or multifamily properties.
The transaction will issue six tranches of class A, mezzanine and class B and P notes, according to KBRA and Morningstar DBRS, which also assessed the notes, which all have a final maturity of July 2041.
Asset Securitization Report's deal database notes that coupons rated (P) BBB (low) (sf)/BBB- from DBRS and KBRA, respectively, are expected to pay a coupon of 5.92%.
The class A notes are exchangeable and will not have a note rate, KBRA specifies, but they will receive payments otherwise for payments due to exchangeable notes, DBRS and KBRA.
Otherwise, coupons range from 5.90% on the A (low)/A- tranches to 7.90% on notes rated (P) B (low) (sf) from DBRS.
The deal is expected to close on July 16, 2026, according to the rating agencies, and the notes repay investors sequentially.
During the reinvestment period, notes will be interest-only, generally. After the reinvestment period, the deal will apply principal to pay down the notes. Should the issuer fail to redeem the notes by January 2029, then classes A1 and A2, which are fixed rate, will step up by 1.00% the next month, the rating agencies said.
Some 381 mortgages, sometimes called fix-and-flip loans, with a total principal balance of about $137 million, make up the collateral pool. The deal also includes a $62.9 million funding account, and about $1 million in the interest reserve account.
DBRS notes that the revolving portfolio has first-lien, fixed-rate, interest-only balloon RTLs with original terms to maturity of five to 24 months, with extension options.
The collateral also has a minimum, non-zero, weighted average (WA) FICO score of 725, a loan-to-cost ratio of 850%, and a repaired loan-to-value ratio of 70.0%, DBRS said.
