RMBS

The REIT has previously issued unrated bonds backed by loans that were once delinquent but are now making timely payments. It has also completed five offerings of bonds backed by prime jumbo loans between 2008 and 2012.

The deal is the real estate investment trust's seventh of 2017; the collateral was contributed by 135 originators, including Quicken Loans and First Republic Bank.

Nearly half of the properties are in New York (30.3%), New Jersey (10.4%) or Florida (8.7%), states that require a court to sign off on a foreclosure, a lengthy process that could affect the timing of payments.

Regulatory relief remains uncertain, but there's plenty to celebrate as some more esoteric asset classes, such as franchise fees and aircraft leases, move into the mainstream, while others, such as nonprime RMBS, are starting to revive.

Vandy Fartaj, the firm’s chief capital markets officer, says a novel deal structure allows the real estate investment trust to issue additional term notes its portfolio of mortgage servicing rights grows.

Investor demand for mortgage bonds is strong; the only limiting factors are consumer awareness of the product and loan officers' willingness to offer them.

Like the sponsor's previous two offerings, completed in March and October, a large percentage of the collateral was sourced through a bulk acquisition from Bank of America. The total number of originators is 17.

The transaction, from Together Financial Services, is backed by nearly 4,500 first- and second-lien non-conforming loans, including those for "buy-to-let" and self-employed borrowers.

Hurricane Irma could potentially affect more private-label mortgage securities collateral than any other recent storm.

The $426.2 million COLT 2017-2 is backed entirely by loans originated by Caliber, an affiliate of private equity firm Lone Star Funds. There are no loans originated by Sterling Bank & Trust, which accounted for 22% of the collateral for the prior deal.