RMBS

The transaction uses a shifting interest repayment structure, and its lockout that is subject to performance triggers.

New private-label bonds collateralized by loans made outside the qualified mortgage definition hit highs for the month, quarter and year, CreditFlow data shows.

On a weighted average (WA) basis, the collateral mortgages have a slightly higher leverage level than previous transactions, although moderate, with an original loan-to-value (LTV) ratio of 71.9%.

A large majority of the pool assets, 86.2%, are second-lien home equity investment contracts that have a weighted average (WA) multiple share rate of 2.00x.

The Structured Finance Association is adding its weight to recent support for a Securities and Exchange Commission action that could modernize Reg AB II.

SEMT 2025-12's collateral profile is slightly weaker compared with the prior transaction, with a slightly lower weighted average FICO score.

Second-lien mortgages make up the collateral pool. Those assets normally have a high expected loss severity, but the borrowers appear to be of prime credit quality.

Most of the pool of 1,011 residential mortgages, 69.7%, are considered non-prime mortgages, primarily due to the documentation and styles of underwriting.

The pool appears to be well diversified by loan originator. Vista Point Mortgage and FundLoans Capital together originated the largest portion of the portfolio, representing 29.3%.

The A1 tranche contains the bulk of the outstanding notes, $251.4 million, and is divided into the 1A and 1B sub-tranches, with enhancement of 37.0% on the A1A piece and 27.0% on the A1B.