A&D Mortgage's Bold Move in RMBS: A Game Changer for Non-QM Lending
March 2, 2025, 10:06 am
In the world of finance, the tides can shift quickly. A&D Mortgage, a Florida-based non-QM lender, has just made waves with a monumental announcement. They are set to offer $458.9 million in residential mortgage-backed securities (RMBS). This isn't just another transaction; it's a declaration of intent. A&D is positioning itself as a leader in the non-QM lending space, catering to borrowers with diverse income streams.
The RMBS deal, a collaboration with Imperial Fund Asset Management and Clearwater Analytics, is scheduled to close on March 13. Eleven investors are on board, including heavyweights like Nomura Securities International and Barclays Capital. This backing signals confidence in A&D's strategy and the broader non-QM market.
The transaction is backed by a pool of 1,290 loans. A significant 45% of these loans are tied to investment properties. This is a strategic move, as investment properties often present higher returns. The mix includes bank-statement and debt-service-coverage ratio (DSCR) mortgages, appealing to a wide range of borrowers.
A&D's pool boasts a weighted average credit score of 745. This indicates a strong borrower profile, which is crucial for the success of any RMBS. The weighted average combined loan-to-value ratio stands at 68.9%. This low ratio suggests that borrowers have substantial equity in their properties, reducing risk for investors.
This announcement follows A&D's recent acquisition of the wholesale and nondelegated correspondent businesses of Mr. Cooper Group. This deal, expected to close by the end of March, adds significant muscle to A&D's operations. The acquired entities funded over $10 billion in originations in 2024. This acquisition is not just a number; it’s a strategic play to expand A&D’s footprint in the mortgage market.
A&D's CEO has emphasized a careful approach to growth. The partnership with Mr. Cooper is a calculated step toward becoming an industry leader. The company is not just chasing numbers; it’s building a robust foundation for future success.
In September 2024, A&D partnered with Atlas Merchant Capital, creating a joint venture that expanded its $7 billion securitization platform. This partnership is a testament to A&D's ambition. The joint venture closed its first RMBS deal in August, involving $370 million in mortgages. This was A&D's 21st deal, but the first under its partnership with Atlas.
The market for non-QM loans is evolving. Borrowers are seeking alternatives to traditional financing. A&D is stepping into this gap, offering tailored solutions. The company’s commitment to innovation is evident. They are not just following trends; they are setting them.
The broader economic landscape is complex. Interest rates are fluctuating, and inflation remains a concern. Yet, A&D is navigating these waters with confidence. Their focus on diverse income streams positions them well in a changing market.
Investors are taking note. The RMBS market is competitive, but A&D's strategic moves are making it a player to watch. The backing from major financial institutions adds credibility. It’s a sign that the market believes in A&D’s vision.
The timing of this RMBS transaction is crucial. As the economy faces uncertainties, A&D is providing a beacon of hope for borrowers. They are offering solutions when many are hesitant. This proactive approach could set them apart in a crowded field.
The success of this RMBS will depend on execution. A&D must ensure that the loans in the pool perform well. The weighted average credit score is promising, but the real test lies ahead. Investors will be watching closely.
The acquisition of Mr. Cooper’s businesses is another layer of strategy. It not only boosts A&D’s originations but also enhances its operational capabilities. This move could lead to increased efficiencies and better service for borrowers.
In the world of finance, partnerships are key. A&D’s collaboration with Imperial Fund and Clearwater Analytics is a strategic alliance. It combines expertise and resources, creating a stronger offering for investors.
The RMBS market is evolving, and A&D is at the forefront. Their commitment to non-QM lending is a bold statement. It reflects a deep understanding of market needs and borrower challenges.
As the transaction approaches its closing date, anticipation builds. Will A&D’s gamble pay off? The stakes are high, but so are the potential rewards. This RMBS could redefine A&D’s trajectory and solidify its position in the market.
In conclusion, A&D Mortgage is making strategic moves that could reshape the non-QM lending landscape. Their recent RMBS announcement is more than just a financial transaction; it’s a signal of ambition and innovation. As they navigate the complexities of the market, all eyes will be on A&D. The future is uncertain, but their path is clear. They are ready to lead.
The RMBS deal, a collaboration with Imperial Fund Asset Management and Clearwater Analytics, is scheduled to close on March 13. Eleven investors are on board, including heavyweights like Nomura Securities International and Barclays Capital. This backing signals confidence in A&D's strategy and the broader non-QM market.
The transaction is backed by a pool of 1,290 loans. A significant 45% of these loans are tied to investment properties. This is a strategic move, as investment properties often present higher returns. The mix includes bank-statement and debt-service-coverage ratio (DSCR) mortgages, appealing to a wide range of borrowers.
A&D's pool boasts a weighted average credit score of 745. This indicates a strong borrower profile, which is crucial for the success of any RMBS. The weighted average combined loan-to-value ratio stands at 68.9%. This low ratio suggests that borrowers have substantial equity in their properties, reducing risk for investors.
This announcement follows A&D's recent acquisition of the wholesale and nondelegated correspondent businesses of Mr. Cooper Group. This deal, expected to close by the end of March, adds significant muscle to A&D's operations. The acquired entities funded over $10 billion in originations in 2024. This acquisition is not just a number; it’s a strategic play to expand A&D’s footprint in the mortgage market.
A&D's CEO has emphasized a careful approach to growth. The partnership with Mr. Cooper is a calculated step toward becoming an industry leader. The company is not just chasing numbers; it’s building a robust foundation for future success.
In September 2024, A&D partnered with Atlas Merchant Capital, creating a joint venture that expanded its $7 billion securitization platform. This partnership is a testament to A&D's ambition. The joint venture closed its first RMBS deal in August, involving $370 million in mortgages. This was A&D's 21st deal, but the first under its partnership with Atlas.
The market for non-QM loans is evolving. Borrowers are seeking alternatives to traditional financing. A&D is stepping into this gap, offering tailored solutions. The company’s commitment to innovation is evident. They are not just following trends; they are setting them.
The broader economic landscape is complex. Interest rates are fluctuating, and inflation remains a concern. Yet, A&D is navigating these waters with confidence. Their focus on diverse income streams positions them well in a changing market.
Investors are taking note. The RMBS market is competitive, but A&D's strategic moves are making it a player to watch. The backing from major financial institutions adds credibility. It’s a sign that the market believes in A&D’s vision.
The timing of this RMBS transaction is crucial. As the economy faces uncertainties, A&D is providing a beacon of hope for borrowers. They are offering solutions when many are hesitant. This proactive approach could set them apart in a crowded field.
The success of this RMBS will depend on execution. A&D must ensure that the loans in the pool perform well. The weighted average credit score is promising, but the real test lies ahead. Investors will be watching closely.
The acquisition of Mr. Cooper’s businesses is another layer of strategy. It not only boosts A&D’s originations but also enhances its operational capabilities. This move could lead to increased efficiencies and better service for borrowers.
In the world of finance, partnerships are key. A&D’s collaboration with Imperial Fund and Clearwater Analytics is a strategic alliance. It combines expertise and resources, creating a stronger offering for investors.
The RMBS market is evolving, and A&D is at the forefront. Their commitment to non-QM lending is a bold statement. It reflects a deep understanding of market needs and borrower challenges.
As the transaction approaches its closing date, anticipation builds. Will A&D’s gamble pay off? The stakes are high, but so are the potential rewards. This RMBS could redefine A&D’s trajectory and solidify its position in the market.
In conclusion, A&D Mortgage is making strategic moves that could reshape the non-QM lending landscape. Their recent RMBS announcement is more than just a financial transaction; it’s a signal of ambition and innovation. As they navigate the complexities of the market, all eyes will be on A&D. The future is uncertain, but their path is clear. They are ready to lead.