LiveMore launches first securitisation with retirement interest-only mortgages

LiveMore has issued its first owner-occupied residential mortgage backed transaction and the first UK public transaction with retirement interest-only mortgages.

The transaction is a static cash securitisation of prime and near prime owner occupied residential mortgage loans extended to borrowers located in England, Wales or Scotland.

The portfolio of assets consists of 1,226 mortgages with a current balance of £208m.

In 2018, the FCA re-categorised RIO mortgages as standard mortgages, diverging from its previous approach of regulating them under equity release standards.

Tina Kumchev, vice president and senior analyst at Moody’s Ratings, commented: “Exmoor Funding 2024-1 is the first UK RMBS to include retirement interest-only mortgages, ones without specified maturity, but repayable upon the borrower’s death or movement to long-term care.

"The £208 million mortgage portfolio has 1,226 borrowers with an average age of 68 years and WA LTV ratio of 49%. The transaction’s main credit risk stems from complex affordability assessment and exposure to potentially vulnerable borrowers and longer foreclosure timing. This product combines features of both interest-only loan and equity release, and is originated by late life specialist lender LiveMore Capital, a new entrant to the UK securitisation market.”