Morningstar DBRS Confirms Residential Mortgage Originator Ranking on Acra Lending, Changes Trend to Positive

DBRS, Inc. (Morningstar DBRS) confirmed the MOR RO2 residential mortgage originator ranking for Acra Lending (Acra or the Company). Morningstar DBRS also changed the trend on the ranking to Positive from Stable.

Acra is a specialty finance company focused on non-Qualified Mortgage (non-QM) lending. Acra is a registered doing business as (dba) name of Citadel Servicing Corporation (CSC), which has been originating loans since 2013. CSC was acquired by funds managed by HPS Investment Partners in February 2020 and rebranded its origination arm as Acra Lending in 2021 to differentiate that business from the servicing arm.

Acra is fully licensed by the Nationwide Multistate Licensing System and authorized in 43 states and the District of Columbia to originate and service mortgage loans. Acra offers non-QM, fix-and-flip, short-term, bridge, multifamily, business purpose, and jumbo prime products through loan programs that include the following: Full Doc, Limited Doc, Bank Statement, ATR-In-Full, Investor Cash Flow, Foreign National, Interest Only, ITIN, Jumbo Non-QM, and Small Balance Multifamily. Acra has a fully developed platform and has originated more than $12.3 billion in loans since 2013.

Acra is headquartered in Irvine, California, and is led by an experienced executive and senior management team averaging approximately 21 years of non-prime mortgage origination and underwriting experience. All areas of the Company have well-defined reporting lines with clearly delineated responsibilities. Acra employs approximately 363 employees dedicated to originations, including approximately 38 underwriters averaging 14 years of industry experience.

Acra remains focused on optimizing its origination processes. To this end, the Company continues to closely monitor and align staffing levels in line with origination volumes, operational efficiencies, and profitability. In January 2024, Acra rolled out a new loan origination ecosystem to further automate and enhance origination processes while increasing efficiency, customer experience, compliance, and data security.

Acra continues to maintain targeted origination channels with comprehensive approval and monitoring practices for third-party originators and detailed underwriting processes that are well defined with significant focus on borrowers’ equity and ability to repay.

The MOR RO2 residential mortgage originator ranking reflects Acra’s experienced and stable management team, solid underwriting processes, strong risk and compliance culture, and highly integrated technology infrastructure. The change in trend to Positive from Stable reflects Acra’s ability to effectively manage its operations and its demonstrated ability to achieve year-over-year growth in originations in a challenging economic environment. As well, Acra continues to invest in technology to further streamline and enhance operational efficiencies.

All rankings are subject to surveillance, which could result in rankings being raised, lowered, placed under review, confirmed, or discontinued by Morningstar DBRS.

Morningstar DBRS North American reverse mortgage originator rankings are not credit ratings. Instead, they are designed to evaluate the quality of the parties that originate reverse mortgage loans. Although the originator’s financial condition contributes to the applicable ranking, its relative importance is such that an originator’s ranking should never be considered as a proxy of its creditworthiness.

Notes:
All figures are in U.S. dollars unless otherwise noted.

The principal methodology is U.S. Residential Mortgage Originator Rankings (June 26, 2023), https://dbrs.morningstar.com/research/416455.

For more information on this ranking or on this industry, visit dbrs.morningstar.com or contact us at info-DBRS@morningstar.com.

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