The results of Fannie Mae’s 25th reperforming loan sale transaction included the sale of approximately 7,500 loans totaling $1.47 billion in unpaid principal balance (UPB), divided into three pools. The winning bidders of the three pools for the transaction were Pacific Investment Management Co. LLC (PIMCO) for Pools 1 and 2, and MCLP Asset Company Inc. (Goldman Sachs) for Pool 3, each awarded individually. The transaction is expected to close on June 17, 2022. The pools were marketed with Citigroup Global Markets Inc. as advisor.
Pool 1 includes 1,925 loans with an aggregate UPB of $595,670,413; average loan size of $309,439; weighted average note rate of 3.64%; and weighted average broker’s price opinion (BPO) loan-to-value ratio of 63%.
For Pool 2, there were 3,706 loans with an aggregate UPB of $507,534,359; average loan size of $136,949; weighted average note rate of 4.26%; and weighted BPO loan-to-value ratio of 50%.
Pool 3 has 1,928 loans with an aggregate UPB of $365,402,568; average loan size of $189,524; weighted average note rate of 3.99%; and weighted BPO loan-to-value ratio of 59%.
The cover bids, which are the second highest bids per pool, were 89.10% of UPB (50.04% of BPO) for Pool 1, 93.07% of UPB (37.24% of BPO) for Pool 2, and 88.59% of UPB (44.73% of BPO) for Pool 3.
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.