T-REX allows for functionality to support the nuances of the Commercial PACE (C-PACE) market. This update provides increased flexibility and functionality for users interested in modeling C-PACE asset cash flows.
How the C-PACE Functionality is Used:
The new C-PACE functionality is used in structuring C-PACE asset cash flows and ABS transactions. Anyone interested in modeling C-PACE assets -whether those cash flows are used in an ABS transaction, or as standalone assets - users can take advantage of this updated functionality.
Detailed Functionality Description: Enhanced Cash Flow Amortization Functionality
In modeling rep-lines, where multiple assets are combined into one aggregate set of inputs for modeling purposes, financial modelers typically structure prepayments to always re-amortize the asset’s scheduled annuity payment. However, with single-asset cash flow modeling, such as with C-PACE assessments, modelers often do not allow prepayment amounts to impact the scheduled annuity payment. Instead, the prepayment will simply alter the distribution in the annuity between interest (which will decrease) and principal (which will increase).
T-REX supports both of these payment methods, for rep-line or asset-level analysis, through the Prepayment parameter in the Scenarios tab. To structure the loan cash flows so that the loans will re-amortize in the event of a Prepayment Scenario, select CPR %. To structure the loan cash flows so that the loans do not re-amortize in the event of a prepayment scenario, select Asset Level Prepayment %”(to provide your Prepayment expressed as a Rate), or Asset Level Prepayment $ (to provide your Prepayment expressed as a Dollar Amount).