A pool of first- and junior-lien revolving home equity lines of credit will secure $306.7 million in securitized notes being offered through FIGRE Trust 2025-HE1, a deal that is slated to close this week.
Figure Lending is sponsoring the deal, which will issue notes through seven tranches of notes, classes A through G, according to ratings analysts from Morningstar | DBRS. Credit enhancement levels range from 26.45% on the class A notes to 2.65% on the class F notes.
Unlike previous FIGRE deals where overcollateralization provided credit support to the notes, FIGRE Trust 2025-HE1 has a class G composed of principal-only notes that provide the credit support, DBRS said. The deal does have a reserve account that represents 0.35% of the aggregate UPB as of the Dec. 31, 2024 cutoff date, the rating agency said.
While Figure Lending will service all the HELOCs, Shellpoint Mortgage Servicing is the subservicer and Northpointe Bank is on the deal as back-up servicer. Figure also originated most of the HELOCs and is the seller to the pool, DBRS said.
Notes will make monthly payments to investors, on the 25th day, with a stated final maturity date of January 2055, the rating agency said.
The revolving home equity lines have an average balance of $77,609, with terms of five to 30 years, with two- to five-year draw periods, the rating agency said. On a weighted average basis, they have a coupon of 10.2%, and a WA rating agency calculated FICO score of 747. DBRS noted that rather than leaning on the classic FICO scoring model, Figure Lending uses the FICO 9, which accounts for rent payments, while leaning less on medical debt and ignores paid collections.
It does not rely on title insurance, either, but an electronic lien search algorithm, to identify existing property liens.
FIGRE 2025-HE1 has an original cumulative loan-to-value ratio of 64.8%, and a maximum original cumulative loan-to-value ratio of 85%, and a maximum debt-to-income ratio of 50%, DBRS said.
DBRS assigns AAA, AA, A, BBB, BB and B to classes A, B, C, D, E and F, respectively.
