VMC Asset Pooler is sponsoring a $733.8 million residential mortgage-backed securities deal, backed by a pool of 1,433 moderately leveraged non-prime mortgages.
The supporting collateral pool of mortgages were originated by various lenders, none of which accounted for more than 10% of the pool, according to Kroll Bond Rating Agency, according to Kroll Bond Rating Agency. On a weighted average (WA) basis, the underlying mortgages have a loan-to-value (LTV) ratio of 69.0%.
On a combined basis, the loans have a loan-to-value (LTV) ratio of 70.5%, KBRA said.
The deal will issue the debt through about 16 classes of A, M and B notes, the rating agency said. The most senior tranche, A1A will benefit from a credit enhancement level equaling 36.00% of the note balance.
The other A1 tranches, including the A-1B and A-1LCF tranches, will benefit from credit enhancement levels of 26.00%, the rating agency said.
The deal, Verus Securitization Trust, series 2026-4, will repay noteholders through a combination of pro rata payments on the A1 through A3 notes, then sequentially on the mezzanine and subordinate notes, according to KBRA.
Wells Fargo Securities, ATLAS SP Securities and Barclays Capital lead a group of banks that are initial purchasers on the deal, which includes Goldman Sachs.
On average, the pool of mortgages, which is primarily first lien, have a balance of $512,126. They have a weighted average (WA) coupon of 7.17%, and just 9.5% of the loans have an interest-only period.
KBRA noted that debt service coverage ratio underwriting accounted for the largest portion of the loans in the pool, 35.0%, followed by bank statement documentation, 26.6%, and P&L, 13.6%, according to KBRA.
A little more than half of the borrowers in the pool, 52.5%, are self-employed, with a non-zero, weighted average annual income of $1.1 million, with liquid reserves of $355,865.
KBRA assigns AAA to the A-1A through A-1IO; AA- to the A2 notes; A- to the A3 class; and BBB, BB and B+ to tranches M1, B1 and B2, respectively.
