Navient Refinance Loan Trust 2026-B secures provisional Morningstar DBRS ratings for $555.9 million note sale

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Navient 2026-B receives ratings

Highlights

Navient Refinance Loan Trust 2026-B receives provisional Morningstar DBRS ratings for $555.9 million notes, with Class A at (P) AAA (sf), Class B at (P) AA (sf), and Class C at (P) A (sf).
Morningstar DBRS cites transaction structure, credit enhancement via overcollateralization, subordination, reserve accounts, and sequential-pay features supporting the ratings under stressed scenarios.
Credit analysis incorporates updated baseline macroeconomic scenarios as of March 27, 2026, and secures legal structure ensuring true sale and first-priority asset claims.

Provisional ratings and transaction structure

As reported by Morningstar DBRS, the trust's proposed issuance includes $521,817,000 of Fixed Rate Class A Notes rated (P) AAA (sf), $4,616,000 of Fixed Rate Class B Notes rated (P) AA (sf), and $29,422,000 of Fixed Rate Class C Notes rated (P) A (sf). The ratings are provisional and apply to notes to be issued by Navient Refinance Loan Trust 2026-B.

Morningstar DBRS says its review is based on the structure of the transaction and the sufficiency of available credit enhancement. It says overcollateralization, subordination for the Class A and Class B Notes, cash held in reserve accounts, and excess spread support enhancement levels consistent with the proposed ratings.

The agency also says transaction cash flows are sufficient to repay investors under stress scenarios aligned with the (P) AAA (sf), (P) AA (sf), and (P) A (sf) ratings. It cites the deal's sequential-pay structure and features that require the most senior outstanding class of notes to enter full turbo principal amortization under certain conditions.

Collateral quality and structured finance implications

Morningstar DBRS says the analysis also considers the quality and credit characteristics of the underlying student loans and borrowers, along with the ability of the servicer and subservicer to collect on the collateral pool and carry out other required duties.

The agency adds that its assumptions incorporate baseline macroeconomic scenarios for rated sovereign economies from its March 27, 2026 update. Those baseline scenarios replace the moderate and adverse coronavirus pandemic scenarios first published in April 2020.

For investors in U.S. structured finance, the ratings address the credit risk tied to the financial obligations defined in the transaction documents, including interest distribution amounts and principal. Morningstar DBRS also says the legal framework is expected to support a true sale of the student loans, nonconsolidation of the trust, and a valid first-priority security interest in the assets, while no environmental, social, or governance factors have a significant or relevant effect on the credit analysis.

Our earlier coverage of Morningstar DBRS’s provisional ratings for BODI Commercial Mortgage Trust 2026-DC1 outlined a financing backed by a fully leased hyperscale data center in Gainesville, Virginia, supporting Blue Owl Digital Infrastructure’s acquisition. We noted how the deal’s structure and the tenant and sponsor profiles underpinned the (P) AAA (sf) and (P) AA (sf) assessments, alongside a favorable sector backdrop for data center demand.

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