Moody's asks for comments on rental bonds

After giving a AAA rating to a portion of the first bonds backed by home rental payments to come to market late last year, Moody's is requesting comments on its proposed methodology. Moody's decision on the first deal was based on the liquidation value of the homes under a "heavily-stressed scenario."

Competitor S&P, as well as Fitch say the paper doesn't yet meet the criteria for them to assign top ratings. In Moody's request for comment, it says when grading the deals it's focused on two sources of cash flow: Rental income and proceeds from the sale of the underlying properties.

American Homes 4 Rent (AMH +0.3%) is prepping a rental bond of its own, and others in the sector like Silver Bay Realty (SBY +1.4%), American Residential Properties (ARPI -1.9%), and Starwood Waypoint (SWAY +1.2%) no doubt have their own plans. Last year's pioneer Blackstone (BX +0.1%) is surely eyeing up a 2nd offering as well.

From other sites
Comments (0)
Be the first to comment
DJIA (DIA) S&P 500 (SPY)
ETF Screener: Search and filter by asset class, strategy, theme, performance, yield, and much more
ETF Performance: View ETF performance across key asset classes and investing themes
ETF Investing Guide: Learn how to build and manage a well-diversified, low cost ETF portfolio
ETF Selector: An explanation of how to select and use ETFs