Quicken Loans Has Biggest Share of Next 2 RMBS

Mortgage & Real Estate









Quicken Loans originated the largest share of mortgages backing the latest two prime, jumbo RMBS deals being marketed by Credit Suisse and WinWater Home Mortgage.

CSMC 2015-2 is backed by a pool of 603 prime mortgage loans with a balance of $405 million, according to a DBRS presale report.

Credit Suisse-owned DLJ Mortgage Capital acquired the loans from several mortgage originators. Among originators contributing more than 5% of the pool are Quicken loans, which originated 39% of the loans, New Penn which did 7.3% and Pinnacle Capital Mortgage Corp originated 5.2%.

On average borrowers in the pool have a FICO score of 763, which indicates strong borrower credit. The average loan size is $672,088. Most of the loans in the pool are subject to the qualified mortgage and ability-to-replay rules issued by the Consumer Financial Protection Bureau.

Approximately 7.8% of the loans finance second homes. These loans represent slightly higher default risk relative to owner-occupied loans.

However, as compared with owner-occupied borrowers, the liquid reserves of $383,318 for the second-home borrowers are higher, primary borrower annual incomes of $366,079 are higher and the debt-to-income ratios of 30.6% are lower. There are no investment properties in this pool.

Loans in the pool have an average of four months of seasoning and a maximum eight months.

The mortgage loans (except for First Republic-originated loans) benefit from representations and warranties backstopped by DLJ. The backstop is, however, subject to certain sunset provisions.

WinWater Home Mortgage has also stuck to its plain-vanilla formula on its second deal of 2015, according to a Kroll Bond Rating Agency’s presale report. The issuer was last in the market in early February with WinWater Mortgage Loan Trust 2015-1.

Its current deal, called WinWater 2015-2, securitizes a $372 million pool of 30-year, fully amortizing, fixed-rate mortgages. On average borrowers in the pool have a weighted average FICO score of 766.

Quicken Loans represents the largest share of the pool at 12.2%, Ditech contributed the second largest share at 11.3% and Prospect Mortgage the third largest at 7.1%

Most of the loans (514 of 516) are subject to ability-to-pay rules and two do not qualify for a legal safe harbor. These loans are at greater risk of litigation-related losses.

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