Fannie Mae Announces Winning Bids for its Second Sale of Non-Performing Loans

Keosha Burns

202-752-7840

WASHINGTON, DC – Fannie Mae (FNMA/OTC) today announced the winning bidder of its second non-performing loan sale (NPL).  The transaction is expected to close September 25, 2015, and included approximately 3,900 loans totaling $765 million in unpaid principal balance (UPB) for the two larger pools. The winning bidder of Pools #1 and #2 was Lone Star (LSF9 Mortgage Holdings, LLC).

In collaboration with Credit Suisse Securities (USA) LLC, Wells Fargo Securities, LLC and the Williams Capital Group L.P., Fannie Mae began marketing these loans to potential bidders on July 16. The loans were awarded in two separate pools:

• Pool #1:  831 loans with an aggregate UPB of $175,489,876; average loan size $211,179; average note rate 5.00%; average delinquency 37 months; average BPO LTV of 137%
• Pool #2:  3,034 loans with an aggregate UPB of $589,499,256; average loan size $194,298; average note rate 5.27%; average delinquency 37 months; average BPO LTV of 68%

The cover bid price for Pool #1 is 51.04% of UPB (69.67% BPO) and for Pool #2 is 86.28% of UPB (58.20% BPO). The average loan size and average note rate on the aggregate of the two pools were $197,927 and 5.20%, respectively. The average delinquency of the loans was approximately 37 months with an average BPO LTV of 76%.

"The goal of non-performing loans sales is to be able to offer borrowers additional options to avoid foreclosure, while also reducing the number of seriously delinquent loans in Fannie Mae’s portfolio," said Joy Cianci, Fannie Mae’s Senior Vice President for Credit Portfolio Management. "Our goal is to market these loans to a diverse range of buyers, including non-profit organizations, smaller investors and minority- and women-owned businesses."

This NPL sale included a smaller Community Impact Pool, a geographically-focused, high occupancy pool being marketed to encourage participation by non-profits and minority- and women-owned businesses (MWOBs). In order to be as inclusive as possible, bidders on the Community Impact Pool have been given additional time to participate.  Bids are due on the Community Impact Pool of approximately 75 loans, totaling $11 million in UPB by August 25, 2015.

For more information on the FHFA Non-performing Loan Sale guidelines or if you are an interested buyer, you can register for ongoing announcements, training and other information at: https://www.fanniemae.com/portal/funding-the-market/npl/index.html.