A timeshare securitization linked primarily to a resort outside Orlando’s Walt Disney World is coming down the pike.
Orange Lake Timeshare Trust (OLTT) 2015-A totals $140.7 million and is split into a $92.4 million A tranche and a $48.3 million B tranche. Fitch rates the A piece ‘A’ and the B piece ‘BBB.’ Both have a final maturity of 2027.
The properties in OLTT are concentrated in Orlando. Some 70% of the loans are secured by timeshare units that make up Orange Lake Resort, bordering the western side of Walt Disney World. The borrowers, though, are scattered throughout the country, with the highest percentage —9.87%— living in Florida. Another 7.07% hail from New York.
Orange Lake Country Club (OLCC) and its unit Wilson Resorts Finance are the originators of the underlying loans. Bank of American Merrill Lynch is leading the deal.
The borrowers behind the 10,660 loans in the pool have a weighted average (WA) FICO score of 717 — at the lower end of prime depending on whom you ask. This is well below the 733 in OLCC’s last deal, 2014-A. On the other hand, the newer transaction also has a smaller share of upgraded loans at 47.6%, from 53% in 2014-A. And credit enhancement — a cushion against losses — is higher than in previous deals, at 43.25% for A tranche and 12.25% on the B one.
Overall, Fitch expects this deal to have higher rate of defaults than the previous one. Its forecast is for cumulative gross defaults to reach 19.7%.