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KBRA Assigns Preliminary Ratings to RCKT 2022-4

May 23, 2022
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RCKT Mortgage Trust offering comprises 330 residential mortgages with an aggregate principal balance of $337.9 million.

KBRA has assigned preliminary ratings to 48 classes of mortgage-backed notes from RCKT Mortgage Trust 2022-4 (RCKT 2022-4). 

RCKT 2022-4 comprises 330 residential mortgages with an aggregate principal balance of $337.9 million as of the May 1, 2022, cut-off date. The underlying collateral consists entirely of 30-year fixed-rate mortgages (FRMs), all of which are subject to the Ability-to-Repay/Qualified Mortgage (ATR/QM) rules.

The originator, Rocket Mortgage LLC, is a non-bank mortgage originator founded in 1985. RCKT 2022-4 represents the 12th stand-alone issuance from the RCKT shelf, and Rocket collateral has comprised a substantial portion of RMBS 2.0 jumbo collateral in various other transactions.

RCKT 2022-4 consists of high-quality mortgage loans to prime credit borrowers with a weighted average (WA) original credit score of 757 and a WA debt-to-income (DTI) ratio of 34.3%. There is notable borrower equity in the properties collateralizing these mortgages, which is reflected in the WA original loan-to-value (LTV) ratio of 76%. The level of equity provides a substantial margin of safety against potential home price declines, while the pool’s FICO scores, DTI ratios, and income generally display strong borrower credit quality, KBRA said.

KBRA assigned the preliminary ratings as follows:

  • A-4, A-10, A-12, A-16, A-22, A-X-1, A-X-3, A-X-6, A-X-7, A-X-9, A-X-12: AAA
  • B-1, B-X-1: AA+
  • B-2, B-X-2: A+
  • B-3: BBB+
  • B-4: BB+
  • B-5: B+
  • B-6, R, LT-R: Not rated.

KBRA said its rating approach incorporated loan-level analysis of the mortgage pool through its RMBS Credit Model, an examination of the results from third-party loan file due diligence, cash flow modeling analysis of the transaction’s payment structure, reviews of key transaction parties and an assessment of the transaction’s legal structure and documentation. 

The full report is available at www.kbra.com (registration required).

About the author
David Krechevsky was an editor at NMP.
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