PennyMac Mortgage Investment Trust recently agreed to acquire a nonperforming whole loan pool totaling $452 million in unpaid principal balance.
The deal is expected to close by the end of the month. The sellers were not revealed.
About 53% of the UPB is related to loans backed by houses in foreclosure, while the rest is at least 90 days delinquent. Most of the loans are in Florida, California, Illinois, New York and New Jersey.
The flow of distressed whole loan deals at PennyMac is strengthening. The agreement follows a second quarter in which PennyMac bought $402 million in UPB of both nonperforming ($224 million) and reperforming loans ($178 million). See the chart below, provided by PennyMac.
PennyMac said it is actively seeking more whole loan purchases. “We anticipate the pipeline of potential whole loan acquisitions to remain strong into 2Q13 and possibly longer,” the company said.
The acquisition of nonperforming loans is increasingly becoming a key aspect of many firms’ investment strategy as lenders and other note holders begin the process of clearing their books.
Carrington Mortgage Holdings will close the year having bought $800 million in nonperforming loans, surpassing company expectations. The loans, which have an unpaid principal balance of roughly $1.6 billion, were purchased earlier in the year.
“There’s been a lack of available pools to purchase in recent years," Carrington Executive Vice President Rick Sharga said. "For some reason, it looks like the market is ready to become active again."