Tag Archives: Moody’s: Single-family rental equity securitization poses more risk

The “equity” structure favored by bankers for deals in which real-estate investors create securities backed by the rental payments of single-family homes poses significant risks to investors, Moody’s Investors Service noted in its research report. Such a structure would expose investors to risks that are not typically present in residential mortgage-backed securitizations and commercial mortgage-backed securitizations. More risk also means more potential legal challenges. Moody’s analysts Yehudah Forster and Kruti Muni noted a mortgage structure, by way of comparision, is a stronger deterrent to legal challenges. “Even after a substantive […]