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Fannie Mae Announces $822M Non-Performing Loan Auction

Fannie maeFannie Mae has announced their latest sale of non-performing loans (NPL) as well as the results of the GSE’s eleventh reperforming loan (RPL) sale. Fannie’s NPL sale, announced shortly after the results of Freddie’s NPL sale were released, includes six larger pools of approximately 4,660 loans totaling $822.3 million in unpaid principal balance (UPB) and the Community Impact Pool of approximately 80 loans totaling $17.7 million in UPB. All pools are available for purchase by qualified bidders. This sale of non-performing loans is being marketed in collaboration with Bank of America Merrill Lynch and First Financial Network, Inc. as advisors.

Fannie’s RPL sale included the sale of four pools of approximately 21,200 loans totaling $3.27 billion in UPB. The winning bidder of the four pools for the transaction, which is expected to close on June 21, 2019, was DLJ Mortgage Capital, Inc. (Credit Suisse).

Fannie Mae announced their RPL results and NPL sale a day after Freddie Mac announced the completion of its auction of 1,789 non-performing residential first lien loans (NPLs) from its mortgage-related investments portfolio on Tuesday. The loans totaled around $307 million, and are currently serviced by NewRez LLC, doing business as Shellpoint Mortgage Servicing. The transaction is expected to settle in July 2019.

The winning bidders across the three pools include InSolve Global Credit Fund IV, L.P. for the first pool, and Elkhorn Depositor LLC for the second and third pool.

Freddie Mac and Fannie Mae’s NPL sales are part of the FHFA’s three strategic goals as conservator of the Enterprises, including maintaining foreclosure prevention activities and credit availability, reducing taxpayer risk, and building a new single-family securitization infrastructure.

As part of the Federal Housing Finance Agency’s (FHFA) effort to build a single security platform, Common Securitization Solutions, LLC along with Fannie and Freddie are to implement the Single Security Initiative on the Common Securitization Platform for both Fannie Mae and Freddie Mac in the Q2  2019. As part of this implementation Freddie Mac recently announced that its Investor Reporting Change Initiative (IRCI) will revise Single-Family investor reporting requirements, beginning in May 2019, including moving the investor reporting cycle from mid-month to end-of-month and updating remittance cycles. The FHFA's 2018 Scorecard Progress Report details these major GSE activities.

About Author: Seth Welborn

Seth Welborn is a Staff Reporter for DS News and MReport. A graduate of Harding University, he has covered numerous topics across the real estate and default servicing industries. Additionally, he has written B2B marketing copy for Dallas-based companies such as AT&T. An East Texas Native, he also works part-time as a photographer.
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