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Monday, May 23, 2022

Velocity Financial Closes $265 Million Securitization

Westlake Village-based small business mortgage provider Velocity Financial Inc. announced Monday that it has closed its first securitization of 2021.An aggregated $265 million of mortgage certificates are backed by a portfolio of loans originated through Velocity's operating platform.The certificates, priced with a weighted average fixed rate of 1.74 percent, were rated by Kroll Bond Rating Agency and DBRS Morningstar.Securitization is a process in which an issuer creates an investment instrument by pooling together financial assets – in this case mortgages on commercial properties and apartment buildings – into a group.“I am pleased with the strong market reception of our first securitization in 2021, which reflects Velocity’s extensive track record,” said Velocity’s Executive Vice President of Capital Markets Jeff Taylor in a statement.

"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. … As with our other securitizations, we will continue our practice of retaining at least 5 percent of our deals, which creates a strong alignment of interests with investors."Shares of Velocity (VEL) closed Monday up 23 cents, or 2 percent, to $11.23 per share on the New York Stock Exchange on a day when the Dow fell a fraction of a percent.

Michael Aushenker
Michael Aushenker
A graduate of Cornell University, Michael covers commercial real estate for the San Fernando Valley Business Journal. Prior to the Business Journal, Michael covered the community and entertainment beats as a staff writer for various newspapers, including the Jewish Journal of Greater Los Angeles, The Palisadian-Post, The Argonaut and Acorn Newspapers. He has also freelanced for the Santa Barbara Independent, VC Reporter, Malibu Times and Los Feliz Ledger.

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