A pool of prime and expanded-prime, second-lien mortgages with a significant representation of loans originated through bank statement documentation will back $285.5 million in residential mortgage-backed securities (RMBS) from Vista Point Securitization Trust.
The 2026-CES2 series of fixed-rate notes has credit enhancement levels of 34.55%, 27.15% and 20.55% on classes A1, A2 and A3 notes, respectively, according to Morningstar DBRS and S&P Global Ratings, whose analysts assessed the deal.
The mezzanine tranche and the B1, B2 and B3 subordinate tranches benefit from credit enhancement levels equaling 13.55%, 7.60%, 3.10% and 0.00% of their respective pool balances, respectively.
Series 2026-CES2 is slated to close on April 29, with J.P.Morgan Securities as the lead underwriter, according to S&P. DBRS adds that ATLAS SP Securities and BMO Capital Markets are on the deal as initial note purchasers.
The notes have a final scheduled payment date of May 2056, DBRS said.
Bank statement underwriting, often applied in situations where the borrower is self-employed, accounted for the plurality of documentation types in the pool, at 44.9%, DBRS said. Full documentation accounted for 23.5% of the pool, while profit & loss underwriting represents 19.9% of the pool and debt service coverage ratio (DSCR).
Borrowers in the pool have, on a weighted average (WA) basis a FICO score of 741, and an original cumulative loan-to-value (CLTV) ratio of 67.2%, DBRS said.
Among other favorable traits, the loan pool are fully amortizing, fixed-rate loans, and a vast majority have no balloon features, DBRS said. Also, about 4.6% of the pool has 10-year, 15-year or 20-year loan terms relative to traditional loans, DBRS said.
As of the March 31 cutoff date, 98.8% of the underlying loans were current under the MBA delinquency method, and the pool had a 0.8% delinquency rate, according to the rating agencies.
S&P assigns AAA, AA- and A- to classes A1, A2 and A3, respectively. The M1, B1 and B2 notes received ratings of BBB-, BB- and B-, respectively.
DBRS ratings range from (P) AAA (sf) on the A1 notes to (P) B (low) (sf) on the class B2 notes, the rating agency said.
