OREANDA-NEWS. Fitch Ratings has issued a presale report on FREMF 2015-K47 Multifamily Mortgage Pass-Through Certificates and Freddie Mac Structured Pass-Through Certificates series K-047.

Fitch expects to rate the transaction and assign Rating Outlooks as follows:

FREMF 2015-K47 Multifamily Mortgage Pass-Through Certificates
--\\$149,241,000 class A-1 'AAAsf'; Outlook Stable;
--\\$1,038,134,000 class A-2 'AAAsf'; Outlook Stable;
--\\$1,187,375,000* class X1 'AAAsf'; Outlook Stable;
--\\$1,187,375,000* class X2-A 'AAAsf'; Outlook Stable;
--\\$115,841,000 class B 'BBB+sf'; Outlook Stable;
--\\$36,201,000 class C 'BBB-sf'; Outlook Stable.

Freddie Mac Structured Pass-Through Certificates series K-047
--\\$149,241,000 class A-1 'AAAsf'; Outlook Stable;
--\\$1,038,134,000 class A-2 'AAAsf'; Outlook Stable;
--\\$1,187,375,000* class X1 'AAAsf'; Outlook Stable.

*Notional amount and interest only.

The expected ratings are based on information provided by the issuer as of July 15, 2015. Fitch does not expect to rate the following classes of FREMF 2015-K47: the \\$260,643,720 interest-only class X3, the \\$260,643,720 interest only class X2-B, or the \\$108,601,720 class D. Fitch does not expect to rate the \\$260,643,720 class X3 of the Structured Pass-Through Certificates, Series K-047.

The certificates represent the beneficial interests in a pool of 90 commercial mortgages secured by 91 properties. The Freddie Mac Structured Pass-Through Certificates series K-047 (Freddie Mac SPC K-047) represents a pass-through interest in the corresponding class of securities issued by FREMF 2015-K47. Each Freddie Mac SPC K-047 security has the same designation as its underlying FREMF 2015-K47 class. All loans were originated specifically for Freddie Mac by approved Seller Servicers. The certificates follow a sequential-pay structure.

Fitch reviewed a comprehensive sample of the transaction's collateral, including site inspections on 63.3% of the properties by balance and cash flow analysis of 75.3% of the pool.

The transaction has a Fitch stressed debt service coverage ratio (DSCR) of 1.13x, a Fitch stressed loan-to value (LTV) of 114.9%, and a Fitch debt yield of 7.67%. Fitch's aggregate net cash flow represents a variance of 7.60% to issuer cash flows.

KEY RATING DRIVERS

Leverage In Line with Recent Freddie Mac Transactions: The pool's Fitch DSCR and LTV are 1.13x and 114.9%, respectively. The 2015 YTD average DSCR and LTV for Fitch-rated, 10-year, K-series Freddie Mac deals are 1.08x and 115.2%, respectively.

Diverse Pool by Loan Concentration: The top 10 loans comprise 30.8% of the pool, which is lower than the 2015 YTD average of 37.8% for Fitch-rated, 10-year, K-series Freddie Mac deals. The largest loan in the pool, The Pearson Court Square, represents 4.83% of the pool, while the second largest loan, Orion at Roswell Village, represents 4.31% of the pool.

Above Average Property Quality: Fitch considered collateral quality to be above average relative to other 10-year, K-series Freddie Mac deals, with four properties (14% of the Fitch sampled properties) receiving a grade of 'A' or 'A-', an additional 20% receiving a 'B+' grade and none of the properties receiving a grade below 'B-'.

Below-Average Pool Amortization: Within the pool, 15 loans representing 16.2% of the pool are full-term interest only, and 59 loans representing 72.6% of the pool have partial-term interest-only components. Based on the loans' scheduled maturity balance, the pool is expected to amortize 10.4% during the life of the transaction. This is one of the lowest amortization levels of recent Freddie Mac securitizations, which had an average of 12.1% for 2014 for Fitch-rated, 10-year, K-series Freddie Mac deals.

Low Mortgage Coupons: The pool's weighted average coupon is 3.81%, well below historical averages and in line with recent 2015 Fitch-rated, 10-year, K-series Freddie Mac deals. Fitch accounted for increased refinance risk in a higher interest rate environment by reviewing an interest rate sensitivity that assumes an interest rate floor of 4.5% for multifamily properties, in conjunction with Fitch's stressed refinance rates, which were 8.6% on a weighted average basis.

RATING SENSITIVITIES

Fitch performed two model-based break-even analyses to determine the level of cash flow and value deterioration the pool could withstand prior to \\$1 of loss being experienced by the 'BBB-sf' and 'AAAsf' rated classes. Fitch found that the FREMF 2015-K47 pool could withstand a 47.3% decline in value (based on appraised values at issuance) and an approximately 19.6% decrease to the most recent actual cash flow prior to experiencing \\$1 of loss to any 'AAAsf' rated class. Additionally, Fitch found that the pool could withstand a 40.6% decline in value and an approximately 9.3% decrease in the most recent actual cash flow prior to experiencing \\$1 of loss to the 'BBB-sf' rated class.

DUE DILIGENCE USAGE

Fitch was provided with third-party due diligence information from KPMG LLP. The third-party due diligence information was provided on Form ABS Due Diligence-15E and focused on a comparison and re-computation of certain characteristics with respect to each of the 90 mortgage loans. Fitch considered this information in its analysis and the findings did not have an impact on our analysis. A copy of the ABS Due Diligence Form-15E received by Fitch in connection with this transaction may be obtained through the link contained on the bottom of the related rating action commentary (RAC).