SAGE Residential Raises $463.8 Million in Mortgage Deal

The firm securitized a pool of 3,346 second-lien mortgages to raise capital for the securitization trust.

Updated on Oct. 28, 2026 in Residential

Isometric editorial illustration of a stacked collection of block-like house icons, representing the securitization of residential mortgage debt. — SAGE Residential raised $463.8 million in a securitization of over 3,000 second-lien mortgage loans scheduled to close in early November. AI Illustration. Upload story photo >

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SAGE Residential has successfully secured $463.8 million through a new securitization of closed-end second-lien mortgages. The deal, organized as the SAIF Securitization Trust series 2026-CES2, is scheduled to close in early November.

Why it matters

This securitization provides a mechanism to aggregate and distribute risk across a large pool of mortgage assets. By bundling thousands of loans, the firm creates tradable notes that allow investors to participate in the performance of the underlying mortgage debt.

The securitization pool consists of 3,346 mortgages with an average loan balance of $77,272 and a weighted average FICO score of 729. These loans carry a weighted average coupon of 8.98%, with 30.6% of the pool categorized as non-QM loans.

The players

SAGE Residential

This firm is a financial entity specializing in mortgage securitization and asset management.

Carrington Mortgage Services

This mortgage lender and servicer originated 55.8% of the loans contained within this securitization pool.

Onity Mortgage

This financial institution originated 40.7% of the total mortgages included in the 2026-CES2 series.

The details

The transaction involves issuing five class A notes, a mezzanine class, and three class B notes, with the A1 class backed by three AAA-rated tranches. Carrington Mortgage Services and Onity Mortgage served as the primary originators for the assets, accounting for 96.5% of the total loan volume.

September 30, 2026: Collateral principal balance cutoff date.
November 6, 2026: Expected closing date for the securitization deal.
October 2056: Final scheduled payment date for the mortgage notes.

Culture Shift

The mix of Qualified Mortgage and non-QM loans reflects the broader shift in how secondary markets categorize risk under the Ability-to-Repay and Qualified Mortgage Rule. This strategy balances strict regulatory compliance with the demand for higher-yield non-traditional products.

This financial movement signals stability for the lenders involved, potentially keeping mortgage products accessible for homeowners. Borrowers within the pool should not notice changes to their payment schedules or loan terms as a result of this securitization.

The takeaway

Securitization deals allow companies to convert pools of individual loans into capital to fund future lending operations. Investors often look to the weighted average FICO score and loan-to-value ratios as primary indicators of the potential risk inherent in these mortgage-backed products.