Moody’s cuts Home Point unsecured rating

Moody's Investors Service said it downgraded Home Point Capital Inc.'s senior unsecured debt rating to B3 from B2. The agency also placed on review for downgrade Home Point's B1 corporate family rating and its B3 senior unsecured debt rating.

Home Point's outlook is under review. Moody's said these actions followed the release of Home Point's second quarter 2021 financial reporting.

“Moody's said the downgrade of Home Point's senior unsecured debt rating reflects an increase in the company's reliance on secured debt and accordingly a worsening of the long-term unsecured debt's subordination in Home Point's capital structure. Moody's said the review for downgrade on Home Point's CFR and senior unsecured debt rating was prompted by a stark and idiosyncratic worsening of Home Point's capitalization and profitability,” the agency said in a press release.

Moody's said it will consider the credit risk associated with Home Point's decline in capitalization and profitability, including assessing the likelihood that the company will be able to reverse these declines and return to profitable growth and increased capitalization. Moody's also will weigh developments in the Home Point's financial policy and business strategy.

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