Nelnet is readying its sixth securitization of 2014, according to a pre-sale from Fitch Ratings.
The $573.3-million deal is split into a $565 million A tranche rated a preliminary AAAsf’ and a $8.3 million B piece rated A+sf.’
The maturities have not yet been determined.
The collateral consists of 100% Federal Family Education Loan Program (FFELP) loans, including around 65% rehabilitated loans. Rehab loans are those that have defaulted and been restructured under the terms of the Higher Education Act of 1965. The government guarantee carried by FFELP loans is what underpins the strong ratings.
In addition, the A notes have a credit enhancement of 3.18% and the B notes of 1.76%.
At the cut-off date for collateral inclusion, the total loan balance was $570.7 million. The weighted average borrower interest rate was 5.56% and the average level of debt per borrower was $21,603.
The master servicer on the deal is National Education Loan Network and subservicers are Nelnet, Great Lakes Educational Loan Services, Xerox Education Services and Pennsylvania Higher Education Assistance Agency.