Silverleaf Finance is making its annual trip to the securitization market with a $150.8 million deal backed by timeshare loans.
Standard & Poor’s has assigned a preliminary A’ rating to the $118 million senior class of notes to be issued by Silverleaf Finance XVIII LLC (Series 2014-A), which benefits from subordination and overcollateralization of 27.63%. S&P also assigned a provisional BBB’ rating to $32.8 million of notes that benefit from credit enhancement of 7.5%.
Based in Dallas, Silverleaf develops, markets, and operates timeshare resorts that cater to individuals looking to vacation within two hours of their residences. The company sells its vacation intervals primarily through on-site sales staff at the resorts.
The loans included in the securitized portfolio must not have been chosen using adverse selection procedures, according to S&P: the loans' maximum remaining term must be less than or equal to 120 months (10 years); the loans cannot be delinquent for 30 days or more; and at origination, the obligor has a minimum FICO score of 600.
The deal is partially prefunded: Silverleaf expects to add subsequent timeshare loans in a principal amount up to approximately $35 million. The collateral, which will be acquired during the prefunding period, has been identified and will be purchased from an existing warehouse facility and from an existing securitization, Silverleaf Finance VII LLC series 2010-A.
Silverleaf was last in the securitization market 12 months ago with a $132 million deal.