Fannie Mae to sell $1.6B reperforming loan pool

The offering is the agency’s 26th sale of reperforming loans since the inaugural deal in 2016

Fannie Mae has unveiled its third reperforming loan sale of the year, an offering of nearly 10,000 loans valued at $1.57 billion.

The offering, dubbed FNMA 2022-RPL3, represents the agency’s 26th sale of reperforming loans since the inaugural offering in October 2016, which involved a pool of 3,600 reperforming loans valued at about $806 million. A reperforming loan is a mortgage that has been or is currently delinquent but has been reperforming for a period of time.

Fannie Mae will attempt to sell reperforming loans to investors, nonprofits and public-sector organizations, according to a program description on the agency’s website.

“Fannie Mae’s sales of non-performing loans … are intended to reduce the number of seriously-delinquent loans that Fannie Mae owns, to help stabilize neighborhoods and to help meet the portfolio reduction targets required under [Fannie Mae’s] senior preferred stock purchase agreement with the United States Treasury,” the program description states. 

The Federal Housing Finance Agency oversees Fannie Mae and its sister government-sponsored enterprise (GSE) Freddie Mac, which have been in conservatorship since 2008 in the wake of the global financial crisis of that era. The two GSEs, or agencies, buy loans from lenders, pool them and issue mortgage-backed securities that are sold to investors and guaranteed for a fee by Fannie and Freddie.

Bids for the FNA 2022-RPL3 reperforming loan offering are due by July 7. Buyers are required to offer loss mitigation options to borrowers who re-default within five years of the closing of the sale of the reperforming-loan portfolio. “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,” Fannie Mae’s announcement of the deal states.

Freddie Mac updates risk mitigation requirements for the industry due to elevated cybersecurity threats

According to a Q4 analysis by MISMO-certified wire and prevention fintech FundingShield, 42% of loans reviewed by the fintech firm had at least one risk finding, and of those loans, an average of 2.1 risk findings existed per transaction.

Presented by: FundingShield

The two early reperforming loans sales this year included an offering in February of 8,050 loans valued at $1.3 billion (FMNA 2022-RPL1) and a second deal (FMNA 2022-RPL2) in April of 7,600 reperforming loans valued at $1.49 billion.

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