KBRA Assigns Preliminary Ratings to Mill City Solar Loan 2019-2 Ltd. and Mill City Solar Loan 2019-2 LLC

NEW YORK--()--Kroll Bond Rating Agency (KBRA) assigns preliminary ratings to three classes of notes issued by Mill City Solar 2019-2 Ltd. and Mill City Solar 2019-2 LLC (“MCSLT 2019-2-GS”). This is a $217.9 million term ABS securitization collateralized by a pool of approximately $255.6 million residential solar loans.

The Notes are backed by a pool of mostly prime quality residential consumer solar loans originated to finance either a Solar Energy System or a Solar Energy System with an Energy Storage System. Credit enhancement on the Notes consists of i) overcollateralization ii) yield supplement overcollateralization iii) subordination (in the case of Class A and Class B notes) and iv) amounts on deposit in a reserve account.

Paramount Equity Mortgage, LLC d/b/a Loanpal (“Loanpal” or the “Company”) was incorporated in California in 2003 to provide residential mortgage loans. In December 2017, Loanpal launched its current solar loan origination platform where it originates loans to mostly prime credit quality homeowners for the purpose of purchasing home improvements, including solar panel systems and batteries. Headquartered in Roseville, CA, as of June 30, 2019, Loanpal has originated and funded over $27.5 billion in loan volume since inception, including approximately $1.36 billion in solar loans since December 2017.

KBRA applied its Global General Rating Methodology for Asset-Backed Securities and Global Structured Finance Counterparty Methodology as part of its analysis of the transaction’s underlying collateral pool and the proposed capital structure. KBRA also conducted an operational assessment of Loanpal in November 2018, as well as a review of the transaction’s legal structure and transaction documents. KBRA will review the operative agreements and legal opinions for the transaction prior to closing.

To access ratings, reports and disclosures, click here.

Class

Preliminary Rating

Principal Balance

A

A (sf)

$188,158,000

B

BBB (sf)

$12,139,000

C

BB (sf)

$17,602,000

Related Publications: (available at www.kbra.com)

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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. KBRA is also 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.

Contacts

Analytical Contacts:
Eric Neglia, Managing Director
(646) 731-2456
eneglia@kbra.com

William Carson, Senior Director
(646) 731-2405
wcarson@kbra.com

Michael Polvere, Senior Analyst
(646) 731-3339
mpolvere@kbra.com

Contacts

Analytical Contacts:
Eric Neglia, Managing Director
(646) 731-2456
eneglia@kbra.com

William Carson, Senior Director
(646) 731-2405
wcarson@kbra.com

Michael Polvere, Senior Analyst
(646) 731-3339
mpolvere@kbra.com