As part of the continued effort to excise all deeply delinquent, non-performing single-family residential loans from its mortgage portfolio, Freddie Mac has announced its first-ever Extended Timeline Pool Offering (EXPO) auction.
EXPOs differ from Freddie Mac's Standard Pool Offerings in that the loans include smaller pool sizes and a longer marketing period. Bids are due from qualified buyers for the first EXPO auction on June 2 and the loans offered have an aggregate unpaid principal balance of $35 million. The loans being offered in the auction are all located in Miami-Dade County, Florida, one of the hardest hit areas by the foreclosure crisis.
Along with the announcement of the first EXPO auction, Freddie Mac announced the launch of a new Web page designed to share information on future non-performing loan sales for prospective investors.
Freddie Mac is targeting smaller investors with its EXPO auctions, which are intended to give these investors extra time to secure funding to participate in the NPL sales. Freddie Mac is encouraging private investors, minority- and women-owned businesses, non-profits, and neighborhood advocacy funds to bid in the auction.
The advisors for the transaction are Wells Fargo Securities and the Williams Capital Group. Potential bidders must be approved by Freddie Mac to gain access to the secure data room that contains information about the NPLs in order to bid in the auction. The winning bidder must meet Freddie Mac's reserve levels and will be determined on the basis of economics.
Freddie Mac has already conducted three Standard Pool Offering NPL sales in the last eight months totaling approximately $1.97 billion in UPB. The last such sale by Freddie Mac, completed on March 25, was its largest bulk NPL sale ever – it included nearly 5,400 loans totaling $985 million in UPB. Freddie Mac's fellow GSE, Fannie Mae, announced the marketing of its first-ever bulk NPL sale on April 8, consisting of about 3,200 NPLs totaling $786 million in aggregate UPB.