Fannie Mae Announces Winner of its Latest Non-Performing Loan Sale

Alicia Jones

202-752-5716

WASHINGTON, DC – Fannie Mae (FNMA/OTC) today announced the winning bidders for its twelfth non-performing loan sale. The sale includes approximately 5,700 loans totaling $1.002 billion in unpaid principal balance (UPB), divided among three pools. The winning bidders for the transaction are Bungalow Series III Trust (Balbec Capital LP) for pool 1 and Elkhorn Depositor LLC (Roosevelt Management Company LLC) for pools 2 and 3. The transaction is expected to close on April 24, 2018.

In collaboration with Bank of America Merrill Lynch and First Financial Network, Inc., Fannie Mae began marketing these loans to potential bidders on February 13, 2018.

The loan pools awarded in this most recent transaction include:

• Group 1 Pool: 1,061 loans with an aggregate unpaid principal balance of $178,269,824; average loan size $168,021; weighted average note rate 4.48%; weighted average delinquency 19 months; and weighted average broker's price opinion (BPO) loan-to-value ratio of 91%.

• Group 2 Pool: 2,793 loans with an aggregate unpaid principal balance of $441,703,102; average loan size $158,146; weighted average note rate 5.04%; weighted average delinquency 34 months; and weighted average BPO loan-to-value ratio of 65%.

• Group 3 Pool: 1,822 loans with an aggregate unpaid principal balance of $382,833,067; average loan size $210,117; weighted average note rate 4.38%; weighted average delinquency 35 months; weighted average BPO loan-to-value ratio of 130%.

The cover bid, which is the second highest bid, for pool 1 was 75.13% of UPB (56.80% of BPO) and for pools 2 and 3 combined was 77.69% of UPB (58.05% of BPO).

Bids are due on Fannie Mae's eleventh and twelfth Community Impact Pools on March 20, 2018.

On April 14, 2016, the Federal Housing Finance Agency announced additional enhancements to its requirements for sales of non-performing loans by Fannie Mae and Freddie Mac that build on the requirements originally announced in March 2015. The additional requirements, which apply to this Fannie Mae non-performing loan sale, encourage sustainable modifications that have the potential to provide more borrowers the opportunity for home retention by requiring evaluation of underwater borrowers for modifications that may include principal and/or arrearage forgiveness; forbidding "walking away" from vacant homes; and establishing more specific proprietary loan modification standards.

Potential buyers can register for ongoing announcements or training, and find more information on Fannie Mae's sales of non-performing loans and on the Federal Housing Finance Agency's guidelines for these sales, at https://www.fanniemae.com/portal/funding-the-market/npl/index.html.