Redwood Trust is back in the market with its fourth RMBS deal of 2012 called Sequoia Mortgage Trust 2012-4.
The latest deal is sized at $313 million. Fitch Ratings,Kroll Bond Ratings and Moody's Investors Service will rate approximately $290 million worth of Class A, mortgage passthrough certificates at the triple-A level.
The first deal the mortgage REIT issued this year was worth $405 million happened in January while the second worth $327.9 million came to market in March and the third deal worth $293.6 million happened in June . It is also the company's seventh RMBS post-crisis deal.
The mortgage pool backing SEMT 2012-4 is comprises all first-lien mortgage loans with an aggregate principal balance of $313,222,403 as of the cut-off date. All of the loans in the pool are fixed-rate (predominantly 30-year) mortgage loans for which income and assets were fully documented.
Moody's wrote in its presale report released today that this pool is similar to recent Redwood securitized pools, in that it consists of high-quality prime mortgages. The pool consists of a high weighted average FICO of 771 and a low weighted average LTV of 66.4%.
However, the mortgages in the latest Redwood deal exhibit more risk layering and higher leverage than the pools Redwood securitized between 2010 and early 2012.
Kroll said in its presale that the collateral pool consists of high-quality mortgage loans. Most notably, the 66.4% first-lien loan-to-value and the 67.6% combined first- and junior-lien LTV (CLTV), provide a substantial margin of safety against potential home price decline.