Freddie Mac Sells $5.7 Million in Non-Performing Loans

By klrw460 April 30, 2024

MCLEAN, Va., April 30, 2024 — Today, Freddie Mac (OTCQB: FMCC) disclosed the sale of 20 significantly overdue non-performing residential first lien loans from its mortgage investments portfolio. These loans, totaling around $5.7 million, were auctioned to GITSIT Solutions, LLC. Specialized Loan Servicing LLC and NewRez LLC, operating as Shellpoint Mortgage Servicing, currently manage these loans. This sale, which is expected to finalize in June 2024, is part of the Extended Timeline Pool Offering (EXPO®) initiative.

The loans were likely considered for various loss prevention measures due to their delinquent status. Around 27 percent of the total pool balance includes mortgages that were modified but later defaulted again. Buyers must adhere to previous loss mitigation agreements and seek further options to assist distressed borrowers, except in specific circumstances, while ensuring the completion of ongoing mitigation processes.

Key details of the transaction are:

  • EXPO Pool #1 includes an unpaid principal balance of $5.7 million across 20 loans.
  • The loans have a broker price opinion (BPO)-weighted combined loan-to-value (CLTV) ratio of 49 percent, and an unpaid principal balance (UPB)-weighted CLTV of 52 percent.
  • The average delinquency stands at 21 months, with loans mostly located in New York.
  • GITSIT Solutions, LLC emerged as the winning bidder.
  • The advisors on this transaction are BofA Securities, Inc. and First Financial Network, Inc., a woman-owned enterprise.

Freddie Mac’s approach to managing its seasoned loans aims to economically decrease its holdings of less liquid assets. This strategy includes selling non-performing loans (NPLs), and securitizing re-performing loans (RPLs) and structured RPL transactions. Since 2011, Freddie Mac has sold over $10.2 billion in NPLs and securitized about $78.3 billion in RPLs. These efforts are designed to improve outcomes for borrowers and help stabilize communities. More details on Freddie Mac’s seasoned loan offerings can be found on their website.

For more information, read the original press release from: