NEW YORK--(BUSINESS WIRE)--Aug 20, 2018--Kroll Bond Rating Agency (KBRA) announces the preliminary ratings to two note classes of Cazenovia Creek Funding II, LLC & Caz Creek TX, LLC, Series 2018-1, a property tax lien ABS transaction.

This transaction represents the second term securitization for Cazenovia Creek Investment Management, LLC (“Caz Creek”, “the Company”, or the “Manager”). The initial collateral pool is comprised of property tax lien assets from municipalities within the states of Alabama, Arizona, Connecticut, Florida, Illinois, New Jersey, Nevada, Ohio, South Carolina, Tennessee, and Texas.

The initial collateral in the transaction includes approximately $199.6 million of property tax liens as of the June 21, 2018 initial cut-off date. The weighted average age of the initial collateral pool is approximately 6.4 months. The property types related to the initial portfolio consist of residential (69.6% by redemptive value), commercial (25.0%), vacant land (4.7%) and agricultural (0.7%). Approximately 66.5% of the initial portfolio by redemptive value is comprised of tax lien assets within Florida, while 10.3% and 10.2% are located within Texas and Tennessee, respectively.

The transaction features an additional tax lien account totaling $20.0 million at closing, which may be used to purchase tax liens (up to 35% of the initial note balance) on new properties that meet certain eligibility criteria on or prior to the payment date in June 2019. The transaction also includes a subsequent tax lien account totaling $2.0 million at closing to purchase subsequent tax liens on properties subject to either tax liens in the initial pool or to tax liens purchased from the additional tax lien account.

Credit enhancement is comprised of overcollateralization, a cash reserve account, a working capital account, amounts in the additional and subsequent tax lien accounts, excess spread and in the case of the Class A notes, subordination of the Class B notes. The credit enhancement levels for the notes are sufficient to cover KBRA’s corresponding stressed cash flow assumptions for the notes. The transaction is structured to de-lever during periods when no subsequent liens or additional tax liens are purchased, or when collections exceed the amount of subsequent and additional tax lien purchases.

KBRA used the Property Tax Lien ABS Rating Methodology to analyze the transaction’s underlying collateral pool, the proposed capital structure and Caz Creek’s historical performance data. KBRA will review the transaction’s operative agreements and legal opinions prior to closing.

The preliminary ratings are based on information known to KBRA at the time of this publication. Information received subsequent to this release could result in the assignment of final ratings that differ from the preliminary ratings.

Preliminary Ratings Assigned: Cazenovia Creek Funding II, LLC & Caz Creek TX, LLC, Series 2018-1 Notes

Representations & Warranties Disclosure

All Nationally Recognized Statistical Rating Organizations are required, pursuant to SEC Rule 17g-7, to provide a description of a transaction’s representations, warranties and enforcement mechanisms that are available to investors when issuing credit ratings. KBRA’s disclosure for this transaction can be found in the report available .

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About KBRA and KBRA Europe

KBRA is a full service credit rating agency registered with the U.S. Securities and Exchange Commission as an NRSRO. In addition, KBRA is designated as a designated rating organization by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus, is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider, and is a certified Credit Rating Agency (CRA) by the European Securities and Markets Authority (ESMA). Kroll Bond Rating Agency Europe Limited is registered with ESMA as a CRA.

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Cecil Smart, 646-731-2381

Jr. Managing Director


Usman Khan, 646-731-2488

Associate Director


James Chiavaro, 646-731-2383




SOURCE: Kroll Bond Rating Agency

Copyright Business Wire 2018.

PUB: 08/20/2018 04:08 PM/DISC: 08/20/2018 04:08 PM