Organization Root Tag

Follow-through has been weak, but there's hope lower mortgage rates could improve conditions, according to new housing reports from Redfin and MBS Highway.

The company is coming off of a recent period of performance improvements, with gains in net income, cash and cash equivalents.

Loan activity overall came in higher for the second week in a row, with interest rates flattened following an extended volatile period, the Mortgage Bankers Association said.

DEXT is very diversified by equipment type. Enterprise technology, medical technology and surgical equipment account for the top three concentrations, representing 22%, 16% and 10% of the portfolio.

The bonds are supported by overcollateralization, and new collateral was added to further diversify the pool of assets.

Slightly more than half of the borrowers in the collateral pool, 54.74%, have a FICO score that is higher than 740, and just 3.06% of the borrowers have a score below 661.

Since the end of the Small Business Administration's 2022 fiscal year, the average loan size in its flagship program has dropped more than six figures. The addition of three new nondepository lenders could further drive down this figure.

Long-dated Treasury yields had reached the lowest levels in more than a month just a day earlier, attributed to investors and traders positioning for the end of the Fed's historically aggressive tightening cycle.

BAAT's four class A tranches have initial hard credit enhancement representing 3.75% of the pool balance, made up of subordination, 2.50%; a reserve account, 0.25%, and 1.00% in initial (and target) overcollateralization.

The class A1A notes have credit enhancement levels of 30.00% on the A1A notes; 26.40% on the A1B and A1 notes; 18.65% and 12.75% on the A2 and A3 notes, which accounts for the credit enhancements on the senior notes.

The potentially upsized deal could see a cumulative net loss (CNL) proxy of 1.20%, and all of the notes have the same initial hard credit enhancement level of 3.25%.

Consumers under the age of 50 held $9.5 trillion in debt last quarter compared with $9.3 trillion in the second quarter. The increase was the most since the final quarter of 2022.

Total initial hard credit enhancements to vary, however, with levels of 8.85% and 6.85% on the class A and B notes, respectively.

On average, the borrowers have a non-zero FICO score of 723, the same as VZMT 2023-6, Fitch said. Accounts with upgrade eligibility account for 56.12% of the pool, slightly lower than the previous deal.

Total sales of new asset-backed securities are projected to reach $280 billion next year, edging out the $277 billion forecast for this year, strategist Powell Eddins wrote in an Oct. 31 note.

The transaction structure benefits from several forms of credit enhancement to the deal, including advance rates of 55.0%, 66.5% and 76.5% on the classes A, B and C notes, and a rapid amortization trigger event.

Full-term, interest-only loans account for 98.4% of the pool, while just two loans, or 1.6% are financed with an amortizing balloon. Analysts expect a cap rate of 9.19% capitalization rate to the underlying properties.

The Wall Street bank recently shifted its bond recommendation to neutral from underweight — for the first time since June 2020 — though has so far stopped short of an overweight call.

The A1 and A2 notes, the two senior notes in the payment priority, have the same level of total hard credit enhancement, 17.6%.

Short-end issuance is being closely watched after the Treasury Borrowing Advisory Committee on Wednesday recommended the department skew future issuance toward shorter maturities where liquidity and investor demand is stronger.