3 Jumbo RMBS Issuances

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Three residential mortgage-backed securities transactions are being securitized by three different issuers. Al three deals are backed by jumbo loans.

Redwood Residential Acquisition Corp. is the issuer behind Sequoia Mortgage Trust 2013-10. The pool includes 529 jumbo first liens for $401 million.

Wilmington Trust, N.A., is the trustee. In addition to Moody’s Investors Service, the deal was rated by Fitch Ratings and Kroll Bond Rating Agency.

Loan terms are mostly 30 years, though two loans have 20-year terms. The weighted-average credit score is 775, and the borrowers on the loans have significant liquid cash reserves. Loan-to-value ratios are between 70 percent and 80 percent, the weighted-average LTV is 67 percent, and the weighted-average combined LTV is 68 percent. There is a higher concentration of purchase financing loans in the transaction.

Among the 70 originators were PrimeLending, which accounted for 8.5 percent of loans originated in the deal, and WJ Bradley Mortgage Capital, when generated 7.6 percent of the loans. The rest of the originators each generated less than 5 percent. Loans secured by California properties account for 41 percent of the deal, and 95.2 percent of the loans are owner-occupied.

Moody’s noted that of all Sequoia deals issued from 2010 through 2012, only two loans have been at least 60 days delinquency and both were cured. Fitch said that third-party loan-level due diligence was conducted on 99.8 percent of the pool.

J.P. Morgan Mortgage Trust 2013-3 was rated by Fitch and Kroll. The 389 fixed-rate, 30-year, first mortgages in the transaction have an aggregate principal balance of $345 million. The weighted-average LTV is 64 percent, the weighted-average CLTV is 66 percent and the weighted-average credit score is 763.

Fitch noted that the underlying collateral is high quality, and a large share of the loans were reviewed by third-party underwriters. J.P. Morgan Chase Bank, N.A., originated 45 percent of the loans, and First Republic Bank was responsible for 38 percent. Nearly half the loans are secured by California properties, though New York is the location of 17 percent.

However, Fitch said that the representations and warranties framework is weak.

U.S. Bank Trust, N.A., is the trustee on the deal, which is J.P. Morgan Mortgage Acquisition Corp.’s third prime transaction this year.

Fitch said on Tuesday that it expects to rate Bay Mortgage Trust 2013-1. The deal from Two Harbors Investment Corp. is comprised of 30-year, fixed-rate loans. The weighted average CLTV is 69.9 percent, the weighted-average FICO is 770 and borrowers have “substantial liquid reserves.”

Around 46 percent of the properties in the Bay Mortgage transaction are located in California. Clayton Holdings LLC conducted due diligence on 100 percent of the pool.

Fitch said the representation framework is robust.


Mortgage Daily Staff


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