In recent weeks Bank of America has been telling analysts and shareholders that it is actively selling mortgage servicing rights while offering little, or no, details on what exactly it unloaded – and at what price.
Servicing advisors who track the market have cited two large BofA MSR offerings: a Fannie Mae package of $73 billion, and a smaller Freddie Mac portfolio of $10 billion.
Advisors, speaking under the condition their names not be used because they have clients interested in the portfolios, said they have heard no confirmation that any sales have actually taken place.
“These type of deals require a lot of NDAs [non-disclosure agreements],” said one manager. “Sometimes I wonder if we'll ever know the truth. Is this considered a material event [for SEC disclosure purposes]?”
To date, BofA and the GSEs have declined to provide any insight into the packages being discussed in the marketplace.
Two weeks ago rumors surfaced that Green Tree Loan Servicing, St. Paul, Minn., was a bidder on the Fannie package, but the company declined to discuss the matter.
Green Tree was recently purchased by the publicly traded Walter Investment Management Co., Tampa, Fla.
Speculation has since turned to Green Tree being a subservicer of the $73 billion – and not the actual owner of the servicing strip.
Earlier in the month The Wall Street Journal reported that Fannie Mae actually bought the MSRs from BofA, but there has been no confirmation whatsoever on that front.
Fannie has said for the record that it is not in the business of servicing mortgages. Still, some advisors believe that Fannie may be financing the sale or partnering with a buyer through a joint venture.
As for the Freddie portfolio of $10 billion, its original size was said to be $50 billion but then scaled back when bids came in too low for B of A's liking.
Almost all of the MSRs being offered involved legacy loans that are considered high touch or delinquent – and almost all were originally funded by Countrywide Financial Corp., the troubled lender that BofA bought back in 2008.