Fitch, Kroll and Moody’s Investors Service have issued presale reports on the latest transaction from the only consistent issuer of private-label mortgage-backed securities deals since the downturn.
The Sequoia Mortgage Trust 2012-4 jumbo prime deal is backed by first lien mortgages and has a total principal balance of about $313.2 million, according to Kroll.
Kroll and Moody’s said they are only rating the three senior and three interest-only classes, while Fitch expects to also rate four subordinate classes. There also is a fifth subordinate class that is unrated.
Fitch said it specifically expects to assign investment grade ratings of AAsf, Asf and Bsf to the class B-1 ($9.7 million), B-2 ($5.48 million) and B3 ($2.82 million) subordinate certificates, respectively.
Kroll highlighted the deal’s relatively low loan-to-value and combined first and junior lien LTV ratios, noting that these (66.4% and 67.6%, respectively) provide protection against potential home price declines. The company’s presale report also notes that this reverses a trend toward higher LTVs seen in previous deals.
Moody’s noted that while the LTVs are historically low in this deal, there is a higher concentration in the 75-80% LTVs than in other recent Sequoia deals.
LTVs have proved to be key factors in how jumbo has performed, said Rebecca Walzak, president of industry consultancy Looking Glass Group LLC.
