Press Release|ABS
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KBRA Downgrades and Withdraws Ratings on HOA Funding, LLC, Series 2021-1

12 Jan 2026   |   New York

Contacts

KBRA downgrades the ratings on the Series 2021-1 Class A-2 Notes and Class B Notes (together, the Series 2021-1 Notes) issued by HOA Funding, LLC, a whole business securitization (WBS), to D (sf) from C (sf) and subsequently withdraws the ratings.

The downgrades and subsequent withdrawals are due to a distressed exchange that occurred. A notice was posted by Citibank, N.A. (the Trustee) dated December 9, 2025, stating that the Notes have been cancelled by an October 30, 2025 order of the United States Bankruptcy Court for the Northern District of Texas in exchange (Subsequent Mandatory Exchange) for the issuance of a new series of notes (Royalty Backed Notes) governed by a separate October 31, 2025 indenture, which was not rated by KBRA. The notice does not provide details or summary terms of the Royalty Backed Notes. However, because the Series 2021-1 Notes had missed interest payments beginning in May 2025 following a March 31, 2025 chapter 11 bankruptcy filing of the Manager, KBRA considers the Subsequent Mandatory Exchange to be a distressed debt exchange.

To access ratings and relevant documents, click here.

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Methodologies

Disclosures

A description of all substantially material sources that were used to prepare the credit rating and information on the methodology(ies) (inclusive of any material models and sensitivity analyses of the relevant key rating assumptions, as applicable) used in determining the credit rating is available in the Information Disclosure Form(s) located here.

Information on the meaning of each rating category can be located here.

Further disclosures relating to this rating action are available in the Information Disclosure Form(s) referenced above. Additional information regarding KBRA policies, methodologies, rating scales and disclosures are available at www.kbra.com.

About KBRA

Kroll Bond Rating Agency, LLC (KBRA), one of the major credit rating agencies (CRA), is a full-service CRA registered with the U.S. Securities and Exchange Commission as an NRSRO. Kroll Bond Rating Agency Europe Limited is registered as a CRA with the European Securities and Markets Authority. Kroll Bond Rating Agency UK Limited is registered as a CRA with the UK Financial Conduct Authority. In addition, KBRA is designated as a Designated Rating Organization (DRO) by the Ontario Securities Commission for issuers of asset-backed securities to file a short form prospectus or shelf prospectus. KBRA is also recognized as a Qualified Rating Agency by Taiwan’s Financial Supervisory Commission and is recognized by the National Association of Insurance Commissioners as a Credit Rating Provider (CRP) in the U.S.

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