Fannie Mae has released the details of its pilot sale of reperforming loans.
The government-sponsored enterprise plans to sell a pool of 3,600 loans with $806 million in unpaid principal balance, Fannie Mae said Tuesday. The sale is part of Fannie Mae's efforts to reduce its retained mortgage portfolio.
The loans in the portfolio were previously delinquent, but returned to current status with or without the use of a loan modification plan. The sale's terms require the buyer to offer "sustainable" loss mitigation options to any borrowers who redefault following the sale. The buyer is also barred from "walking away" from homes that become vacant.
In April, Fannie Mae said it planned to securitize reperforming loans. Freddie Mac hasalso securitized reperforming loans in its portfolio.
Bids on the pool are due Nov. 1. The sale is being marketed in collaboration with Citigroup Global Markets.