Achieve Home Loans' latest securitization offers $170 million in home equity line of credit (HELOC) notes to investors, secured by a slightly smaller pool of loans to investors and slightly higher loan balance.
First- and second-lien loans comprise the ACHM Trust 2024-HE1 pool, according to Kroll Bond Rating Agency's ratings analysts. The deal's capital structure will repay investors on a combined pro-rata and sequential basis, and even this structure must satisfy an overcollateralization test and two performance triggers— one for cumulative losses and another for delinquency.
If the overcollateralization amount remains above the target, and both triggers are satisfied, classes A, B, and C notes receive available funds up to the principal distribution amount, KBRA said. If the OC amount falls to the overcollateralization floor or below it, or if both triggers fail, then the notes will be paid down sequentially, according to the rating agency. Interest payments, meanwhile, are paid to the class A, B and C notes sequentially.
Notes A, B and C benefit from credit enhancement amounting to 33.3%, 16.2% and 7.0%, respectively, KBRA said. The capital structure will repay notes through a structure of the A, B, C and D tranches, plus an XS tranche. KBRA assigns AAA to the A tranche; A- to the B tranche; and BBB- to the C tranche. The rating agency did not rate the D tranche, however.
Jeffries is the initial purchaser, KBRA said, noting that the deal has 3,066 loans in the pool, compared with 3,234 in the ACHM 2023-HE2.
On average, the loans have a balance of $55,466, slightly up from $53,680 on the ACHM 2023-HE2 deal, according to the rating agency. Otherwise, a lot of the characteristics on the ACHM 2024-HE1 stayed true to the previous deal.
