Five Oak Acquisition Corp is marketing the first residential mortgage securitization from its newly set up Oaks trust, accoding to rating agency pre-sale reports. 

Five Oaks acquired 74% of the loans from Barclays Bank, which aggregated them from various originators. Barclays applied their underwriting criteria, which is consistent with origination of high quality loans.

The issuer began to acquire and securitize loans in 2014 but had previously issued loans partnered with JP Morgan and Credit Suisse.

The Oaks 2015-1 collateral characteristics are generally similar to other post-crisis RMBS prime transactions with a weighted average FICO score of 766, WA loan-to-value ratio of 69.9% and WA debt-to-income ratio of 32.2%. Borrowers in the loan pool have considerable home equity and substantial liquid reserves.

The largest originators in the pool by balance include Home Street Bank 19.29%; Stonegate Mortgage Corporation 10.71%; Provident Funding Associates 8.37%; Pacific Union Financial 7.60%; Wintrust Mortgage 7.52%; RPM Mortgage 6.01%; and Radius Bank 5.70%.

In total Oaks 2015-1 will offer 11 tranches of senior rated securities and five tranches of junior rated securities.  Moody’s Investors Service assigned preliminary ratings to the entire capital structure and Fitch Ratings assigned ratings to three senior tranches and all five of the junior notes on offer.

Most of $267 million pool is comprised of 30-year, fixed rate mortgages with a total balance of approximately $267.2 million as of the cutoff date and 79% of the loans are, subject to the ability-to-repay (ATR)/qualified mortgage (QM) Rule. All the loans subject to this rule were classified as safe harbor QM.

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