Santander Drive Auto Receivables Trust, series 2025-2, is preparing to raise $1.5 billion in asset-backed securities (ABS) secured by revenues from payments on non-prime loans buying new and used automobiles.
Moody's Ratings notes that the deal could be upsized to $2.0 billion. Like many previous deals, several important characteristics are the same, regardless of the securitized amount. SDART 2025-2 will issue notes through seven tranches of notes, three of which are class A notes.
Classes A1, A2 and A3 benefit from total initial hard credit enhancement representing 37.6% of the pool balance, Moody's said.
Santander US Capital Markets and RBC Capital Markets are lead underwriters on the deal, Moody's and Fitch Ratings said.
Asset Securitization Report's deal database says BMO Capital Markets, Citigroup Global Markets, Mizuho Securities and Santander Investment Securities are also on the deal as managers.
The ASR database also notes that coupons range from 4.71% on the notes rated Aaa/AAA, from Moody's and Fitch, respectively, to 5.47% on the notes rated Baa3/BBB. All notes are benchmarked to the one-month I-curve.
The pool, which Fitch says is made up of 66,343 loans, benefits from a non-declining reserve fund of 1.0% of the initial pool balance, and subordination of 32.9% for the pool, Moody's said. Also, the notes have initial over-collateralization of 3.75% of the pool balance, which can build to a target of 5.25% of the outstanding balance, plus 2.0% of the initial pool balance.
Loans on the SDART's platform have a weighted average (WA) loan-funded score of 533, regardless of the securitized amount. In another measure, the loans have a FICO score of 604. The loans have an average remaining loan balance of $24,194, and a loan-to-value-ratio of 110%.
Most of the pool, 72%, is composed of used cars, and they have a WA remaining term of 67 months.
Fitch assigns F1+ to the A1 notes; AAA to the A2 and A3 notes; AA to the class B notes; A to the class C notes; BBB to the class D notes; and BB to the class E notes.
Moody's assigned P1 to the A1 notes; Aaa to the A2 through B notes; Aa3 to the class C notes and Baa3 to the class D notes.
