Santander Bank is sponsoring the problem of its third non-qualified mortgage (non-QM)/investor mortgage securitization this 12 months. The financial institution is a mortgage mortgage aggregator that predominantly focuses on non-agency mortgage aggregation and securitization.
The Santander Mortgage Asset Receivable Trust 2025-NQM3 will difficulty notes totalling $283.64 million. The sponsor and vendor is Santander Bank, the depositor is Santander Mortgage Asset Dispositor, and the trustee is Citibank.
The loans’ foremost originators are HomeXpress Mortgage Corp. and OCMBC (LoanStream). The major servicer is Selene Finance, the particular servicer is Fay Servicing, and the grasp servicer is NewRez.
The notes are backed by first-lien, fixed- and adjustable-rate, totally amortizing residential mortgage loans, some with interest-only intervals, based on S&P Global Ratings. The loans have a mean seasoning of 4 months.
The 665 properties within the pool are geographically properly diversified and encompass single-family residential, townhouses, planned-unit developments, condominiums, and two- to four-family residential. The loans are non-qualified mortgage/ability-to-repay-compliant (ATR-compliant) and ATR-exempt loans. Investor loans account for 46.42% of the pool. These loans have been issued utilizing Debt Service Coverage Ratios (DSCR).
S&P says that it considers the collateral within the pool to be non-prime. It notes that, though the collateral pool is weaker than that of a first-rate pool, its credit score high quality is mostly in step with expectations for a non-prime residential mortgage pool.
The pool’s weighted common unique loan-to-value ratio is 72.49%, which S&P says is best than archetypal house fairness ratios. The loans’ weighted-average FICO rating of 731 can also be higher than archetypal scores.
S&P’s scores for the senior notes are AAA for courses A-1, A-1A, and A-1B; AA for A-2; and A for A-3.
Mezzanine M-1 notes are rated BBB, and subordinate notes are rated BB for B-1, B for B-2. The remaining notes are unrated.
Credit enhancement for the rated notes is supplied by subordination of notes which are decrease within the cost precedence, based on S&P. In the curiosity cost waterfall, curiosity and curiosity shortfall quantities are allotted sequentially to the category A-1A, A-1B, A-2, A-3, M-1, B-1, and B-2 notes.
There can also be extra unfold, which can be utilized to pay collected curiosity and principal shortfalls. The credit score enhancement varies between 30.2% for sophistication A-1 notes and 1.8% for sophistication B-2.
