Debtmarket and First Associates partner to offer new liquidity options

Debtmarket and First Associates partner to offer new liquidity options

September 10, 2009

DebtMarket, an automated marketplace that connects buyers and sellers of loan portfolios, and First Associates Inc., one of the nation’s premier consumer loan servicing firms, have announced a partnership that will provide schools, banks, credit unions and other financial institutions a new way to sell the loans they originate and offer faster transfer of loan servicing once a portfolio sale is completed.
Many experts regard a transparent secondary marketplace--where financial institutions can turn to establish pricing and transact sales of hundreds of billions of troubled consumer loans--as a critical step toward an economic recovery. Once these portfolios are sold, loan servicers are responsible for coordinating loan payment from the consumer to the new institutional owner of the loan. Integrating access to this new, technology-based secondary market for loans with servicing will facilitate a faster, more efficient and cost-effective portfolio transaction for clients of both companies.
The recently launched DebtMarket technology platform enables sellers of consumer loan portfolios to list loans representing any asset class, size of portfolio, credit quality and loan performance; establish and negotiate pricing using an auction-style marketplace; perform due diligence; and close and fund the sale. The partnership with First Associates will enable portfolio sellers and buyers to further streamline the transaction process by speeding the transfer of loan servicing, thus helping eliminate payment disruptions among consumers, who often are confused about where to send payment when a loan is sold.
The partnership provides consumer lenders already served by First Associates with free access to DebtMarket’s standardized, efficient technology-enabled portfolio sales marketplace that enables them to establish market pricing for assets and provides an end-to-end transaction management platform. DebtMarket sellers pay a percentage fee only after a portfolio sale closes.
“First Associates offers the experience, outstanding technology, infrastructure and scalability to meet the servicing needs of the schools, banks, credit unions and other credit providers DebtMarket serves,” said First Associates CEO Doug Henkel. “Partnering with DebtMarket brings a whole new dimension to the lenders we already serve at a time when liquidity and establishing market pricing for portfolios has been an issue for them.”
“Our partnership with First Associates is another step in the direction of a more efficient and transparent process for pricing and selling consumer debt portfolios,” said DebtMarket Co-Founder and President Mike Sheridan. “In addition to providing a potential solution to our financial system’s liquidity crisis, our intent is to partner with market leaders like First Associates to bring value-added services and relationships to our clients and leverage new marketing channels with select business partners.”
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Residential, Secondary, Trends