Announces sale of 7,000 deeply delinquent loans
August 11, 2016 Ben Lane - Housing Wire
Fannie Mae announced earlier this week that it plans to sell more than $1 billion in non-performing loans as it continues its effort to rid its portfolio of deeply delinquent loans.
The sale will be conducted with five different pools of non-performing loans. One of the pools is a Community Impact Pool, which are smaller pools of loans that are marketed to encourage participation by smaller investors, non-profit organizations, and minority- and women-owned businesses.
The smaller pool of loans is also geographically focused and high occupancy, Fannie Mae said. According to Fannie Mae, the smaller pool consists of 120 loans, focused in the Miami, Florida area, totaling $20.7 million in unpaid principal balance.
The four of larger pools total approximately 6,900 loans and carry a total unpaid principal balance of $1.08 billion.
“We continue to strive to help struggling homeowners and neighborhoods recover,” said Joy Cianci, Fannie Mae’s senior vice president, single-family credit portfolio management. “Today’s announcement of our non-performing loan sale furthers this commitment by expanding the opportunities available for borrowers to avoid foreclosure.”
According to Fannie Mae, this sale of non-performing loans is being marketed in collaboration with Wells Fargo Securities and The Williams Capital Group as advisors.
The loans in this sale subject to the new rules for non-performing loan sales announced by the Federal Housing Finance Agency in April.
Among those rules are that buyers of purchase non-performing loans from Fannie Mae orFreddie Mac must now evaluate certain underwater borrowers for modifications that include principal and/or arrearage forgiveness.
Buyers are also forbidden from “walking away” from vacant homes, and the new rules establish more specific proprietary loan modification standards for NPL buyers.
According to the FHFA, these new rules are designed to minimize foreclosures, help mitigate the potential for neighborhood blight and decay, and help improve loan modification success rates.￼￼￼￼￼￼￼￼￼￼