Lending The Ticker

First Freddie Mac NPL sale of 2016 hits market

Selling $1.6 billion in non-performing loans


Freddie Mac announced a $1.6 billion non-performing loan transaction, marking the first one for the year. 

The transaction is an auction of seasoned non-performing residential whole loans held in Freddie Mac's mortgage investment portfolio.

Currently, Nationstar Mortgage services the NPLs.

The NPLs are being marketed via seven pools: five geographically diversified Standard Pool Offerings and two geographically concentrated Extended Timeline Pool Offerings, which targets participation by smaller investors, including non-profits and minority and women-owned businesses.

All eligible bidders, including private investors, MWOBs, non-profits and neighborhood advocacy funds are encouraged to bid.

The winning bidder will be determined on the basis of economics, subject to meeting Freddie Mac's internal reserve levels.

To participate, all potential bidders are required to be approved by Freddie Mac to access the secure data room containing information about the NPLs and to bid on the NPL pool.

Wells Fargo Securities, Credit Suisse Securities and The Williams Capital Group are advisors to Freddie Mac on the transaction.

Bids are due from qualified bidders on Feb. 23, 2016, for the SPO offerings and March 8, 2016, for the EXPO offerings. The sales are expected to settle in the second quarter of 2016.

Freddie Mac closed out last year by announcing it sold its first pool of non-performing loans to a non-profit buyer, Community Loan Fund of New Jersey, Inc.

The non-performing loan sale was initially announced in November, as part of a larger offering of $1.2 billion in “deeply delinquent” loans that were currently being serviced by Wells Fargo.


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