Payments from a static pool of primarily unsecured consumer loans made to near-prime borrowers will provide collateral for $688.5 million in asset-backed securities (ABS) to be sold to investors through the SoFi Consumer Loan Program.
All the notes have a legal final maturity date of March 25, 2036, Fitch and S&P said.
The deal saw notable changes from SCLP 2021-1, especially an increase in overcollateralization, S&P said. Initial O/C increased to 8.2%, from 7.0%, and target O/C increased to 14.7% to 10.5%.
Overall, the notes benefit from credit enhancement levels of 31.67%, 23.32%, 14.89% and 8.66% to classes A, B, C and D, respectively.
Fitch notes that SoFi's the managed pool experienced a period of increased default rates, from 2022 through 2023, before they improved marginally and stabilized in 2024, the rating agency said. The rating agency noted that performance for the 2025 looks similar to 2024, with some vulnerability among lower-grade and longer-term loans.
SCLP 2026-2 gets credit support from an overcollateralization target, where the deal will amortize until the notes sequentially until the overcollateralization target is met. Once that threshold is met, any remaining funds will be released, Fitch said.
S&P also notes that SCLP 2026-2 includes net loss conditions that will trigger turbo principal payments, S&P said. The trigger will prioritize payments to the first nine items of the payment waterfall, then apply all available funds remaining to principal payments. This payment sequence will stay in effect regardless of overcollateralization levels, or if the current pool balance is less than 100% of the initial pool balance, the rating agency said.
Borrowers in the pool have a credit score of 747 and an annual income of $158,403, both on a weighted average (WA).
Fitch assigns ratings of AAA, AA, A and BBB to classes A, B, C and D, respectively, while S&P assigns AAA, AA, A and BBB to the A, B, C and D tranches, respectively.
