Springleaf Financial, the subprime lender controlled by Fortress Investment Group, is back in the market with a mortgage-backed securitization, according to a presale report from Standard & Poor’s.
The transaction, Springleaf Mortgage Loan Trust 2013-2, is the company’s second RMBS deal this year and is backed by about $875.5 million in loans.
Merrill Lynch, Pierce, Fenner & Smith and Credit Suisse Securities are the underwriters on the deal, which is expected to close July 9.
It features a $511.8 million senior class of notes rated AAA by S&P; four tranches of mezzanine notes totaling $245.1 million rated AA, A+, A- and BBB, respectively; a $62 million subordinate class of notes rated BB; and a $56.7 million class of notes rated B. The remaining 13 subordinate and interest only classes were not rated. The overcollateralization C class and the residual class were also not rated.
The collateral backing the notes consists of seasoned first-lien, fixed- and adjustable-rate residential mortgage loans secured by one-to-four family residences, condominiums, manufactured housing, land, planned unit developments, mixed-use properties and packages of multiple real properties to subprime borrowers, according to the presale report.
The top three originators of the pool are American General (53%), Wilmington Finance (27%) and Equity One Co. (5.5%).
S&P said the collateral in the latest deal is mostly similar to Springleaf’s two prior subprime mortgage securitizations: the pools' typical borrower has an updated FICO score that is subprime, and the properties and outstanding loan amounts are typically low.
Unlike the
However, the transaction benefits from a diverse geographical collateral pool, excess spread that builds overcollateralization by paying down the senior-most class of notes outstanding on any payment date, an interest reserve fund to cover interest shortfalls, and strong master servicer in Wells Fargo.
