Vista Point Securitization Trust is raising $269.6 million in securitization bonds secured by a portfolio of cash-out refinance mortgages on borrowers' primary residences.
The loan types are fixed, prime, expanded-prime and closed-end, second-lien (CES) residential, according to Morningstar | DBRS.
The Vista Point Securitization Trust, series 2025-CES1 deal will issue the securitization bonds through seven tranches of class A, M and B notes, according to DBRS. Notes have a final scheduled payment date of April 2055.
With a cutoff date of February 28, the pool was made up of 1,293 loans originated by a list of companies including Vista Point Mortgage, New American Funding and Home Mortgage Alliance. DBRS also noted that Carrington Mortgage Services is the servicer. Cash-out refinances account for virtually all the financings, 98.6%, and most of the properties involved, 85.6%, are primary residences, on single-family homes (91.5%), DBRS said.
Vista Point's notes receive credit enhancement by subordination, DBRS said, and will repay the notes through a senior-subordinated structure. Specifically, the A1, A2 and A3 notes benefit from credit enhancement levels of 27.3%, 22.0% and 16.9%, respectively. The M1, B1 and B2 classes have enhancement levels of 11.6%, 7.0% and 4.0%, respectively.
DBRS calculated that borrowers in the pool had a weighted average (WA) FICO score of 728. It also noted that the pool had an issuer-provided original combined loan-to-value ratio of 66.3%. Also, the originators applied bank statement, full documentation and profit and loss documentation in their underwriting,
Vista Point has a few strong credit considerations, DBRS said, including their fixed-rate type and being fully amortizing, which represents a reduced risk of future payment shock relative to loans with adjustable-rate mortgage or interest-only features. Also, virtually the entire pool, 99.2%, is current—which is easy, because on a WA basis the pool only has one month of seasoning.
On average, the borrowers had a loan balance of $208,543, a debt-to-income (DTI) ratio of 37.3%, and annual income of $599,269, the rating agency said.
