Five Oaks Acquisition Corp. is marketing the first residential mortgage securitization from its newly set up Oaks Mortgage Trust, according to two ratings agency presale reports.
The company acquired 74% of the loans from Barclays Bank, which aggregated them from various originators. Barclays applied underwriting criteria consistent with origination of high-quality loans.
The company previously partnered with JPMorgan and Credit Suisse on securitizations.
Oaks Mortgage Trust Series 2015-1's collateral characteristics are generally similar to other post-crisis RMBS prime transactions with a weighted average Fair Isaac & Co. credit score of 766, a weighted average loan-to-value ratio of almost 70% and a weighted average debt-to-income ratio of over 32%. Borrowers in the loan pool have considerable home equity and substantial liquid reserves.
Originators in the pool based on approximate percentage of total pool balance include Home Street Bank, 19%; Stonegate Mortgage Corp., 11%; Provident Funding Associates, 8%; Pacific Union Financial, 8%; Wintrust Mortgage, 8%; RPM Mortgage, 6%; and Radius Bank, 6%.
In total, Oaks 2015-1 will offer 11 tranches of senior-rated securities and five tranches of junior rated securities. Moody's Investors Service assigned preliminary ratings to the entire capital structure and Fitch assigned ratings to three senior tranches and all five of the junior notes on offer.
Most of the $267 million pool is comprised of 30-year, fixed-rate mortgages with a total balance of approximately $267 million as of the cutoff date. Almost 80% of the loans are subject to the ability-to-repay rule. All the loans meet the criteria for the qualified mortgage safe harbor, which offers lenders making these loans a higher degree of protection from ATR liability.