Castlelake Prices $261.3 Million Residential Transition Loan Securitization

The securitization is backed by an initial pool of 327 loans with an aggregate unpaid principal balance of $223 million, spanning 23 states. These assets feature a weighted-average FICO score of 742 and prioritize first-lien, interest-only balloon loans with maturities ranging from 12 to 24 months. Over a two-year revolving period, the collateral pool will adhere to strict eligibility and concentration limits to maintain credit quality.

Armin Rothauser, partner and head of capital markets, noted that the issuance marks a significant expansion of the firm’s capital markets program and its broader residential transition loan strategy. The deal includes four rated note classes, with Morningstar DBRS assigning ratings ranging from A (low) down to B (low). Castlelake will retain a 5% horizontal residual interest in the securities to align its incentives with third-party investors.

Resfin Partners, a specialty lender majority-owned by Castlelake, will act as the servicer and loan administrator. Since 2014, the firm has issued approximately $9.8 billion in asset-backed securities. Deutsche Bank Securities and Goldman Sachs served as joint lead bookrunners for this transaction, while Mayer Brown provided legal counsel.