KBRA Assigns Preliminary Ratings to Alterna Funding III, LLC

NEW YORK--(BUSINESS WIRE)--KBRA assigns preliminary ratings to two classes of notes issued by Alterna Funding III, LLC (Alterna 2024-1), an $184.849 million property tax lien ABS transaction. Proceeds from the Notes will be used to acquire a portfolio of 15,643 property tax liens from municipalities from eight states and Washington D.C., including Florida (33.1%), New Jersey (20.5%), and New York (14.8%) with a redemptive value of approximately $119.6 million (the Initial Tax Liens) and a weighted average original lien rate of 12.2%. The Initial Tax Liens have been purchased by Alterna Tax Certificate Fund II, LP (the Seller), an affiliate of the Company, and will be contributed by the Seller to the Issuer at closing. The Seller is the sponsor of the transaction and will retain 100% of the transaction equity at closing.

Alterna Tax Asset Group, LLC (ATAG, the Company or the Manager) or its affiliates, founded in 2007, is a specialty finance company that services real estate tax liens purchased from government entities or third parties. The Company is comprised of nine individuals with headquarters in Plantation, Florida. As of April 15, 2024, ATAG has acquired over $1.35 billion in tax liens since inception, of which approximately $131 million are outstanding.

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Methodologies

• ABS: Property Tax Lien ABS Rating Methodology
• Structured Finance: Global Structured Finance Counterparty Methodology
• ESG Global Rating Methodology

Disclosures

Further information on key credit considerations, sensitivity analyses that consider what factors can affect these credit ratings and how they could lead to an upgrade or a downgrade, and ESG factors (where they are a key driver behind the change to the credit rating or rating outlook) can be found in the full rating report referenced above.

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA) is a full-service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. 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.

Doc ID: 1004218