Velocity Financial Announces Closing of $265 Million Securitization; Sixteenth Securitization Since 2011
Velocity Financial, Inc. (NYSE: VEL) has successfully closed its first securitization transaction of 2021, totaling $265 million in Mortgage-Backed Certificates, series 2021-1. The certificates, backed by recently originated loans, feature a weighted average fixed rate of 1.735%. They have received ratings from KBRA and DBRS Morningstar, with the largest class (A) rated AAA. Executive Vice President Jeff Taylor expressed confidence in the strong market demand, which helped reduce funding costs and improve growth prospects. The certificates are not registered under the Securities Act of 1933.
- Successful closure of a $265 million securitization transaction.
- Certificates rated AAA by KBRA and DBRS Morningstar.
- Weighted average fixed rate reduced to 1.735%, leading to lower funding costs.
- None.
Velocity Financial, Inc. (NYSE: VEL), ("Velocity" or the "Company"), a leading provider of small balance investor loans, today announced that it has closed its first securitization transaction of 2021, in aggregate
The Certificates were rated by KBRA (Kroll Bond Rating Agency) and DBRS Morningstar; the ratings are as follows:
Ratings | ||||
Class | Balance | KBRA Rating (sf) | DBRS Morningstar (sf) | |
A |
|
AAA | AAA | |
M1 |
|
AA | AA | |
M2 |
|
A | A | |
M3 |
|
BBB | BBB | |
M4 |
|
BB | BB | |
M5 |
|
B | B | |
M6 |
|
Not Rated | Not Rated | |
M7 |
|
Not Rated | Not Rated | |
Initial Balance |
|
|||
"I am pleased with the strong market reception of our first securitization in 2021, which reflects Velocity's extensive track record of performance," said Executive Vice President of Capital Markets, Jeff Taylor. "The outstanding history of Velocity's existing securitizations has resulted in our ability to reduce funding costs and access the capital needed to grow the business successfully. Broad investor demand tightened spreads for the entire capital stack and lowered our weighted average coupon by over
The Certificates are not registered under the Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States absent registration or an applicable exemption from the registration requirements. The Certificates may only be offered and sold in the United States in accordance with Rule 144A under the Securities Act. This press release does not constitute an offer to sell or the solicitation of any offer to buy, nor shall there be any sale of the Certificates in any jurisdiction in which such offer, solicitation or sale would be unlawful under the laws of such jurisdiction.
About Velocity Financial, Inc.
Based in Westlake Village, California, Velocity is a vertically integrated real estate finance company that originates and manages investor loans secured by 1-4 unit residential rental and small commercial properties. Velocity originates loans nationwide across an extensive network of independent mortgage brokers it has built and refined over 16 years. For additional information, please visit the Company’s investor relations website at www.velfinance.com.
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