KBRA Assigns Preliminary Ratings to Santander Mortgage Asset Receivable Trust 2025-NQM1 (SAN 2025-NQM1)
12 Mar 2025 | New York
KBRA assigns preliminary ratings to seven classes of mortgage-backed notes from Santander Mortgage Asset Receivable Trust 2025-NQM1 (SAN 2025-NQM1), a $283.8 million non-prime RMBS transaction. The underlying collateral, comprised of 714 residential mortgages, is characterized by a significant concentration of loans underwritten using alternative income documentation. Approximately 59.1% of the loans were exempt from the ATR/QM rule due to being originated for business purposes or by a CDFI. The remaining portions of the pool were categorized as QM: Safe Harbor (APOR) (7.4%), non-qualified mortgages (Non-QM) under the Ability-to-Repay/Qualified Mortgage (ATR/QM) rule (31.7%) or categorized as QM: Rebuttable Presumption (APOR) (1.8%).
The largest originators in the pool include HomeXpress Mortgage Corp. (HomeXpress; 24.9%), Champions Funding LLC (Champions; 12.6%), and Deephaven Mortgage LLC (Deephaven; 10.5%), with no other originator composing of more than 10% of the transaction. Additionally, 21.6% of the pool includes loans purchased from SG Capital Partners, LLC that were previously aggregated from 32 different originators.
KBRA’s rating approach incorporated loan-level analysis of the mortgage pool through its Residential Asset Loss Model (REALM), an examination of the results from third-party loan file due diligence, cash flow modeling analysis of the transaction’s payment structure, reviews of key transaction parties and an assessment of the transaction’s legal structure and documentation. This analysis is further described in our U.S. RMBS Rating Methodology.
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