Fannie Working on RFP for NPL Pilot

Fannie Mae is moving closer to launching a pilot program to dispose of some of its nonperforming residential loans, according to industry advisors familiar with the GSE’s plans.

The GSE, said one source, likely will issue a "request for proposal" sometime this summer to find a loan advisory firm to assist it. Several high profile Wall Street firms that run trading desks for NPLs are expected to file an application.

At this point it’s unclear how much in nonperforming loans Fannie might unload. A Fannie Mae spokesman declined to comment. At last check the GSE held $247 billion of whole loans in its on-balance sheet portfolio.

Fannie has a ‘credit enhanced’ delinquency rate of 8%, which means the GSE potentially owns $20 billion in mortgages that are in arrears with most of it likely tied to alt-A loans.