Onslow Bay is prepared to raise another $789.6 million in residential mortgage-backed securities (RMBS) through hits platform for prime and non-prime underlying assets, the OBX 2026-NQM4.
The underlying collateral pool is comprised of 1,476 first-lien mortgage loans, financing primarily of second homes and investor properties, that were underwritten through alternative income documentation, according to according to S&P Global Ratings and Kroll Bond Rating Agency.
Two of the transaction's senior classes of notes are first, and last cash flow senior classes, the A-1FCF and A-1LCF, S&P said. Regardless of whether a payment sequence has been triggered, principal will always be paid to the A-1FCF first and then to the A-1LCF until their balances are zero, the rating agency said.
Overall, the deal will issue notes through about 15 tranches of notes, mostly senior class As, plus a mezzanine class and four class B notes, according to the rating agency. The notes will repay investors through a structure that combines pro rata or the senior notes and sequential for the subordinated classes.
Barclays and BNP Paribas are managers on the deal, which is slated to close on March 26, according to Asset Securitization Report's deal database.
OBX 2026-NQM4's A1A notes benefit from credit enhancement of 30.55%, while the A1B, A1, A1F, A1IO,A1FCF, A1FCX and A1LCF benefit from enhancement levels of 20.55%, the rating agency said.
Otherwise, the A2, A3, M1, B1A, B1B and B2 tranches will have 16.55%, 6.85%, 3.80%, 2.90% and 1.05% respectively.
The A1A and A1B tranches, rated 'AAA' from S&P and Kroll Bond Rating Agency, are expected to pay coupons of 5.31%, according to the database. Other AAA notes, specifically the A-1FCF and A-1LCF tranches, are expected to offer coupons of 5.21% and 5.41%, respectively.
Otherwise, the A2, A3 and M1 notes, with AA/AA+, A/A, and BBB+ and BBB ratings offer ratings of 5.51%, 5.66% and 5.96% respectively.
The notes get credit support from excess spread and a senior-subordinate repayment sequence.
On average, the loans have a balance of $534,959, with weighted average (WA) FICO scores. Also, the mortgages finance single-family properties, including townhouses and planned-unit developments.
Borrowers, more heavily concentrated in California, have median income of $214,534 and WA liquid reserves of $526,470, KBRA said.
