Morningstar DBRS Assigns Provisional Credit Ratings to Bayview PACE 2025-1, LLC

DBRS, Inc. (Morningstar DBRS) assigned provisional credit ratings to the following notes to be issued by Bayview PACE 2025-1, LLC (the Issuer):

-- $131,467,000 Class A Notes at (P) AAA (sf)
-- $4,066,000 Class B Notes at (P) AA (sf)

CREDIT RATING RATIONALE/DESCRIPTION
-- Transaction capital structure, proposed credit rating, and form and sufficiency of available credit enhancement.
-- Credit enhancement in the form of a subordinated note (for the Class A), liquidity reserve, and excess spread.
-- Credit enhancement levels sufficient to support the Morningstar DBRS-expected delinquency and loss severity assumptions under various stress scenarios.
-- The ability of the Transaction to withstand stressed cash flow assumptions and repay investors according to the terms under which they have invested.
-- The capabilities of Bayview with regard to originations and underwriting.
-- Morningstar DBRS performed an operational review of Bayview and considers the Company to be an acceptable originator of PACE assessments.
-- The legal structure and presence of legal opinions that will address the true sale of the assets to the Issuer, the nonconsolidation of the Depositor, that the Issuer will have a valid security interest in the PACE Asset Portfolio, and the consistency with Morningstar DBRS' Legal Criteria for U.S. Structured Finance.
-- Review of legal considerations specific to PACE.
-- Servicing is mostly performed by local county tax collection offices.
-- The transaction assumptions consider Morningstar DBRS' baseline macroeconomic scenarios for rated sovereign economies, available in its commentary "Baseline Macroeconomic Scenarios for Rated Sovereigns March 2025 Update," published on March 26, 2025. These baseline macroeconomic scenarios replace Morningstar DBRS' moderate and adverse pandemic scenarios, which were first published in April 2020.

Morningstar DBRS' credit rating on Class A and Class B Notes addresses the credit risk associated with the identified financial obligations in accordance with the relevant transaction documents. The associated financial obligations for each of the rated notes are the related Note Interest and the related Outstanding Principal Balance.

Morningstar DBRS' credit rating does not address nonpayment risk associated with contractual payment obligations contemplated in the applicable transaction document(s) that are not financial obligations. For example, the associated contractual payment obligations that are not a financial obligation are the interest on unpaid interest distribution amount for the Notes.

Morningstar DBRS' long-term credit ratings provide opinions on risk of default. Morningstar DBRS considers risk of default to be the risk that an issuer will fail to satisfy the financial obligations in accordance with the terms under which a long-term obligation has been issued.

ENVIRONMENTAL, SOCIAL, AND GOVERNANCE CONSIDERATIONS
There were no Environmental, Social, or Governance factors that had a significant or relevant effect on the credit analysis.

A description of how Morningstar DBRS considers ESG factors within the Morningstar DBRS analytical framework can be found in the Morningstar DBRS Criteria: Approach to Environmental, Social, and Governance Factors in Credit Ratings (August 13, 2024), https://dbrs.morningstar.com/research/437781.

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

The principal methodology applicable to the credit ratings is Rating U.S. Property Assessed Clean Energy (PACE) Securitizations (August 06, 2024) https://dbrs.morningstar.com/research/437561.

Other methodologies referenced in this transaction are listed at the end of this press release.

The credit rating was initiated at the request of the rated entity.

The rated entity or its related entities did participate in the credit rating process for this credit rating action.

Morningstar DBRS had access to the accounts, management and other relevant internal documents of the rated entity or its related entities in connection with this credit rating action.

This is a solicited credit rating.

A provisional credit rating is not a final credit rating with respect to the above-mentioned securities and may change or be different than the final credit rating assigned or may be discontinued. The assignment of the final credit ratings on the above-mentioned securities are subject to receipt by Morningstar DBRS of all data and/or information and final documentation that Morningstar DBRS deems necessary to finalize the credit ratings.

Please see the related appendix for additional information regarding the sensitivity of assumptions used in the credit rating process.

DBRS, Inc.
140 Broadway, 43rd Floor
New York, NY 10005 USA
Tel. +1 212 806-3277

The credit rating methodologies used in the analysis of this transaction can be found at: https://dbrs.morningstar.com/about/methodologies.

-- Operational Risk Assessment for U.S. ABS Originators and Servicers (March 26, 2025),
https://dbrs.morningstar.com/research/450709
-- Legal Criteria for U.S. Structured Finance (December 3, 2024),
https://dbrs.morningstar.com/research/444064
-- Rating U.S. Structured Finance Transactions (March 10, 2025),
https://dbrs.morningstar.com/research/449616

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