Fannie Mae Announces Sale of Reperforming Loans
Rhea-AI Summary
Fannie Mae (OTCQB: FNMA) has announced the sale of 3,119 reperforming loans with an unpaid principal balance of approximately $611.2 million. This sale is part of the company's ongoing strategy to reduce its retained mortgage portfolio. The sale is being marketed in collaboration with Citigroup Global Markets, Inc., with bids due on September 5, 2024.
Reperforming loans are those that were previously delinquent but have since resumed payments. The sale terms require buyers to offer loss mitigation options to borrowers who may default again within five years of the sale. Purchasers must also honor existing loss mitigation efforts and provide a range of options to delinquent borrowers before initiating foreclosure.
Positive
- Reduction of retained mortgage portfolio, potentially improving financial position
- Sale of $611.2 million in unpaid principal balance, generating potential revenue
- Collaboration with Citigroup Global Markets, Inc. for marketing the sale
Negative
- Potential loss of future interest income from the sold loans
- Possible reduction in total assets on the balance sheet
News Market Reaction 1 Alert
On the day this news was published, FNMA declined 1.79%, reflecting a mild negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
The sale consists of approximately 3,119 loans, having an unpaid principal balance of approximately
This sale of reperforming loans is being marketed in collaboration with Citigroup Global Markets, Inc. Bids are due on September 5, 2024.
Reperforming loans are loans that have been or are currently delinquent but have reperformed for a period of time. The terms of Fannie Mae's reperforming loan sale require the buyer to offer loss mitigation options to any borrower who may re-default within five years following the closing of the reperforming loan sale. All purchasers are required to honor any approved or in-process loss mitigation efforts at the time of sale, including forbearance arrangements and loan modifications. In addition, purchasers must offer delinquent borrowers a waterfall of loss mitigation options, including loan modifications, which may include principal forgiveness, prior to initiating foreclosure on any loan.
Interested bidders can register for ongoing announcements, training, and other information here. Fannie Mae will also post information about specific pools available for purchase on that page.
About Fannie Mae
Fannie Mae advances equitable and sustainable access to homeownership and quality, affordable rental housing for millions of people across America. We enable the 30-year fixed-rate mortgage and drive responsible innovation to make homebuying and renting easier, fairer, and more accessible. To learn more, visit: fanniemae.com | Twitter | Facebook | LinkedIn | Instagram | YouTube | Blog
Fannie Mae Newsroom
https://www.fanniemae.com/news
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SOURCE Fannie Mae
FAQ
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