Fannie Mae Announces Reperforming Loan Sale Results

Fannie Mae has awarded a pool of reperforming loans to JP Morgan Mortgage Acquisition Corp., the government-sponsored enterprise said today.

The sale included a pool of approximately 5,460 loans totaling $663.3 million in unpaid principal balance (UPB). The pool, which was marketed with Citigroup Global Markets Inc. as advisor, is expected to close on Aug. 26. 

The loan pool awarded in this most recent transaction includes 5,460 loans with an aggregate UPB of $663,261,375. The average loan size was $121,476, and the weighted-average note rate was 4.49%. The weighted-average broker's price opinion loan-to-value ratio was 48%.

The approximate weighted-average bid, as a percentage of UPB, was in the low 90s for this pool, Fannie Mae said.

Reperforming loans are loans that have been or are currently delinquent but have reperformed for a period of time. The terms of Fannie Mae's reperforming loan sale require the buyer to offer loss-mitigation options to any borrower who may re-default within five years following the closing of the reperforming loan sale. 

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 also said that purchasers must offer delinquent borrowers a waterfall of loss-mitigation options, including loan modifications, which may include principal forgiveness, prior to initiating foreclosure on any loan.