Federal National Mortgage Association (OTCMKTS:FNMA) has released the pricing of its ninth Multi-Family DUS REMIC, for 2016, amounting to a total of $1.08 billion. The company priced the program on October 4, 2016. Josh Seiff, the VP of Capital Markets and trading at Fannie Mae, claimed that 10-year fixed-rate loans continued to play a crucial part under the DUS MBS program, for varying types of borrowers.
Mr. Seiff pointed out that the recently $615 million MBS, from the Group 1 collateral, had median loan size of $9.6 million and had come from 23 different states. Moreover, the loan translated to a loan-to-value ratio of 69%. However, the company is not solely relying on returns from these loans to fund its future plans. Recently, Fannie Mae sold approximately 73,000 loans, worth $1.39 billion in unpaid principal balance. All of these loans are non-performing and are up for sale through Wells Fargo Securities, LLC, to qualified bidders.
Joy Cianci, another senior VP of FNMA, reaffirmed Fannie Mae’s commitment to stabilizing neighborhoods, by offering borrowers additional options to avoid foreclosure. He also claimed that the recent move was aimed at reducing the number of seriously delinquent loans from the portfolio. It should be noted here that the sale of loans has been divided into five pools, with bids for each pool due on November 3.
In its press release, the company noted that buyers would be required to pursue loss mitigation options, in a way that is sustainable for borrowers. Moreover, in an event where foreclosure cannot be avoided, the property must be marketed first to the owner/occupants and non-profits exclusively. However, if this is not possible, the property can be offered to investors. FNMA had earlier begun the pilot sale of its reperforming loans as well, with a pool of 3,600 loans, worth $806 million. This pool is being marketed through the Citigroup Global Markets, Inc, with bids due on November 1.
Federal National Mortgage Association (OTCMKTS:FNMA) did not record an overall change in its share value, during the October 12 trading session, despite a trade volume of 1.29 million, to close at $1.88 per share.