Velocity Commercial Capital's latest securitized pool of home loans, slated to close around August 14, is divided almost evenly between traditional small-balance commercial (SBC) loans and residential investor loans.
The deal will raise about $175 million in securitized bonds, backed by a pool of residential investors loans (42.1%) and traditional small-balance commercial (SBC) mortgages, say analysts at Morningstar DBRS. Analysts say he deal is expected to close around Aug. 14, 2026, and notes have a final distribution date of August 2056.
Velocity Commercial Capital originated the majority of the 524 underlying mortgage loans, analysts said, while New Day Commercial Capital, originated a 16.2% share of the pool, DBRS analysts said. Onity Mortgage will service all the loans in the transaction, and be the backup servicer for the 27 New Day loans in the pool. Also, New Day will act as subservicer for its respective loans in the pool.
The small-balance commercial mortgages in the pool consists of 195 individual loans on commercial and multifamily properties, with an average balance of $519,692 on the cut-off date. None of the loans are cross collateralized or cross-defaulted with each other, the rating agency said.
Among their loan characteristics, they have a WA fixed interest rate of 10.7%, which is 10 basis points higher than a previous VCC transaction, the 2026-P1 series. Most of the loans have original terms of 30 years and will fully amortize over 30-year terms. Six loans, though, represent 5.4% of the SBC pool and have an initial interest-only period of 120 months.
Among this group, the loans have an average amount of $519,692, with moderate leverage, specifically with appraised loan-to-value of 61.7% and an LTV of 64.5% from Morningstar DBRS.
Ratings on the notes range from (P) AAA (sf) on the senior A-S notes to (P) B (low) (sf) M6 interest only tranche, DBRS said.
