Student loan ABS

SoFi’s $577.5 million offering is the sponsor’s 23rd rated term student loan ABS transaction, while Massachusetts’ $164 million offering is only its second deal.

Nearly a third of borrowers, 29.5%, backing the $500 million transaction are making timely payments, up from 27.4% for the prior deal and higher than the lender’s previous two deals.

Seth Frotman, whose student lending unit had been gutted in May, said the bureau's current leadership "has abandoned its duty to fairly and robustly enforce the law.”

Cheap funding and marketing muscle could give it an advantage over existing lenders, but this corner of the market may not be big enough to move the needle for the bank.

Borrowers who were once delinquent but are now making timely payments account for a quarter of the collateral, more than the student loan servicer's past two deals.

The amount of loans cherry picked by the likes of SoFi and CommonBond fell by 3%, to $221 million; just as well, since Sallie Mae's grad school loans are off to a slow start.

Evan as the broader securitization market takes a breather, unusual deals from off-the-run asset classes continue provide diversification – and the opportunity to pick up yield.

Just 66% of the collateral Navient Private Education Refi Loan Trust 2018-C consists of loans to borrowers with graduate, medical, law or other advanced degrees, down from 72% in a similar transaction in February.

Private student loans made before the financial crisis were once considered a toxic asset. A recent $414 million securitization by FirstKey, an affiliate of Cerberus Capital Management, shows how much things have changed.

That's a departure from the state student loan authority's previous offering, completed in 2017, which was backed by a mix of private and federally guaranteed student loans, and was rated one notch lower by S&P Global Ratings.