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Fitch Rates Non-QM Offering By PRPM 2022-NQM1 Trust

David Krechevsky
Oct 13, 2022
Fitch Ratings

The loans were originated by Sprout Mortgage, Newfi Lending, and others.

Fitch Ratings has assigned final ratings to residential mortgage-backed certificates to be issued by PRPM 2022-NQM1 Trust, Mortgage Pass-Through Certificates, Series 2022-NQM1 (PRPM 2022-NQM1 Trust). 

The certificates are supported by 668 loans with a balance of $319.43 million as of the cut-off date. This will be the first PRPM transaction rated by Fitch, though it is PRPM’s sixth transaction in 2022.

Sprout Mortgage LLC originated 43.2% of the loans, Nexera Holding LLC doing business as Newfi Lending originated 27.2% of the loans, while the remaining 29.6% of the loans were originated by other third-party originators.

The certificates are secured by a pool of fixed- and adjustable-rate mortgage loans (some of which have an initial interest-only period) that are primarily fully amortizing, with original terms to maturity of primarily 30 to 40 years and are secured by first liens primarily on one- to four-family residential properties, units in planned unit developments, condominiums, mixed-use properties, townhouses and 5-20 unit multi-family properties. 

The loans include 30.6% that are classified as non-qualified mortgages (Non-QM) as defined by the Ability to Repay (ATR) rule (the rule); the remaining 69.4% are exempt from the rule as they are investment properties.

Fitch assigned the final ratings as follows:

  • A-1: AAA (sf)
  • A-2: AA (sf)
  • A-3: A (sf)
  • M-1: BBB (sf)
  • B-1: BB (sf)
  • B-2: B (sf)
  • B-3, XS, A-IO-S, R, R: Not rated.

Servis One Inc., d/b/a BSI Financial Services, will service 61.6% of the loans in the pool, while NewRez LLC d/b/a Shellpoint Mortgage Servicing will service 31.1%. The remaining 7.3% will be serviced by Fay Servicing LLC.

The full report is available at www.fitchratings.com.

Published
Oct 13, 2022
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