A&D Mortgage Prices Non-QM Securitization

A&D Mortgage has priced its latest securitization, a $303.9 million transaction backed by 872 newly originated non-prime residential mortgages.

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Atlas Merchant Capital and Imperial Fund Asset Management collaborated on the deal.

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The securitization leverages a diverse portfolio of loans, with nearly 88% originated through alternative income documentation methods such as bank statements, profit and loss statements, and debt service coverage ratios (DSCRs).

The pool reflects the evolving needs of self-employed individuals, investors, and borrowers with unique financial circumstances, A&D Mortgage says in a release.

All of the loans were originated by A&D Mortgage or its qualified correspondents. The average borrower credit score for the loan pool was 743. The weighted average loan-to-value (LTV): was 67.4%.

Non-QM loans comprised 35.3% of the pool, while property loans comprised 45.3%.

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A&D Mortgage will be the primary servicer on the loans while Nationstar Mortgage (d/b/a Mr. Cooper) will serve as master servicer.

The transaction is supported by robust credit enhancements, including excess spread and subordination, as well as a hybrid pro-rata/sequential payment structure designed to protect senior certificate holders.

“Securitization remains a cornerstone for expanding access to capital, especially within the Non-QM mortgage sector,” says Bob Diamond, founding partner and CEO of Atlas Merchant Capital, in the release. “The ADMT 2024-NQM6 transaction underscores our shared commitment with A&D Mortgage to delivering innovative, high-quality asset-backed securities. This deal represents a sound investment, fortified by strong credit enhancements and dynamic collateral, making it resilient against market fluctuations.”

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