Fannie Mae’s results for a recent reperforming loan sale of approximately 5,460 loans totaling $663.3 million in unpaid principal balance (UPB) was awarded to JP Morgan Mortgage Acquisition Corp. (Chase). The transaction is expected to close on August 26, 2022. The pool was marketed with Citigroup Global Markets Inc. as advisor.
The loan pool awarded in this most recent transaction includes an average loan size of $121,476, weighted average note rate of 4.49%, and weighted average broker’s price opinion loan-to-value ratio of 48%. The approximate weighted average bid, as a percentage of UPB, was in the low 90s for this pool.
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.