Fannie Mae began marketing its fifteenth sale of reperforming loans this week, continuing the GSE’s effort to reduce the size of its retained mortgage portfolio.
The sales consist of roughly 12,775 loans that have an unpaid principal balance of approximately $1.8 billion. Bids are due on March 10.
Reperforming loans are loans that were previously delinquent but have reperformed for a period of time. Some of the loans may be up to 90 days delinquent.
Fannie Mae announced the results of its fourteenth reperforming loan sale transaction late last year. The deal included the sale of approximately 20,800 loans totaling $3.1 billion in unpaid principal balance (UPB), divided into six pools.
The winning bidders of the six pools for the transaction were DLJ Mortgage Capital, Inc. (Credit Suisse) for Pools 1, 2 and 3, J.P. Morgan Mortgage Acquisition Corp. (Chase) for Pools 4 and 6, and NRZ Mortgage Holdings, LLC (Fortress) for Pool 5. The transaction is expected to close on December 19, 2019.
Freddie Mac, meanwhile, recently announced it sold via auction 2,243 non-performing residential first lien loans (NPLs) from its mortgage-related investments portfolio. The loans, with a balance of approximately $369 million, are currently serviced by Specialized Loan Servicing LLC. The transaction was expected to settle in January 2020. The sale is part of Freddie Mac’s Standard Pool Offerings.
Fannie Mae announced this week that it recorded a net income of $14.2 billion in 2019, including $4.4 billion during Q4 2019.
The GSE’s net worth rose to $14.6 billion by the end of the year. Based on the current agreement with the U.S. Department of the Treasury and the Federal Housing Finance Agency (FHFA), the company can retain quarterly earnings until its net worth reaches $25 billion.
Fannie Mae provided more than $650 billion in liquidity to the mortgage market in 2019, helping finance more than three million purchases, refinances, and rental units.
They were the largest issuer of single-family mortgage-related securities in the secondary market during 2019, with an estimated market share of single-family issuances of 37%.