KBRA Assigns Preliminary Ratings to Morgan Stanley Residential Mortgage Loan Trust 2026-NEW2 (MSRM 2026-NEW2)
KBRA assigns preliminary ratings to ten classes of mortgage-backed certificates from Morgan Stanley Residential Mortgage Loan Trust 2026-NEW2 (MSRM 2026-NEW2). MSRM 2026-NEW2 is an RMBS transaction sponsored by Morgan Stanley Mortgage Capital Holdings LLC as seller/sponsor and includes a meaningful concentration of collateral that KBRA considers to be “non-prime.” The $418.1 million RMBS transaction is collateralized by a pool of 670 fixed-rate residential mortgages. All loans are either classified as non-qualified mortgages (Non-QM) (63.1%) or exempt (36.9%) from the Ability-to-Repay/Qualified Mortgage (ATR/QM) rule due to being originated for non-consumer loan purposes. Nexera Holding LLC d/b/a NewFi Lending is the sole originator and the majority of the pool is serviced by Rocket Mortgage, LLC d/b/a Rushmore Servicing (98.8%).
KBRA’s rating approach incorporated loan-level analysis of the mortgage pool through its Residential Asset Loss Model (REALM), 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. This analysis is further described in our U.S. RMBS Rating Methodology.
