NEW YORK--(BUSINESS WIRE)--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to 43 classes of mortgage pass-through certificates from Flagstar Mortgage Trust 2018-6RR (FSMT 2018-6RR), the eighth prime RMBS transaction issued by Flagstar Bank, FSB.
The FSMT 2018-6RR pool comprises 910 first-lien, prime residential mortgage loans with an aggregate principal balance of $326,147,792 as of the October 1, 2018 cut-off date. The collateral consists entirely of fully-amortizing, fixed rate mortgages (FRMs), most of which possess a 30-year (97.7%) maturity term. 77.9% of the underlying loans are collateralized by investment properties underwritten to agency guidelines, while 22.1% of the loans are non-agency underwritten loans primarily collateralized by owner-occupied properties. The pool is characterized by significant borrower equity in each mortgaged property, as evidenced by the WA original LTV of 66.8% and WA original CLTV of 66.9%. The weighted average original credit score is 761, which is well within the prime mortgage range.
Similar to previous FSMT transactions, FSMT 2018-6RR employed due diligence sampling on a portion of the underlying collateral, with full-scope due diligence (credit, compliance, valuation and data verification) on 30.0% of the pool, by loan count.
KBRA’s rating approach incorporated loan-level analysis of the mortgage pool through its Residential Mortgage Default and Loss Model, 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.
For complete details on the analysis, please see our pre-sale report, Flagstar Mortgage Trust 2018-6RR, which was published on October 15, 2018 on www.kbra.com.
Representations & Warranties Disclosure
All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report entitled, Flagstar Mortgage Trust 2018-6 Representations and Warranties Disclosure.
Representations & Warranties Disclosure
All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report available here.
Related Publications: (available at www.kbra.com)
- Flagstar Mortgage Trust 2018-6RR Pre-Sale Report
- Flagstar Mortgage Trust 2018-6RR Tear Sheet
- U.S. RMBS Rating Methodology
- Residential Mortgage Default and Loss Model
- U.S. RMBS Rating Methodology for Assessing Non-QM Risk
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About KBRA and KBRA Europe
KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus, is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.
