Firm Run by Kurland Buys FDIC Portfolio
Washington-Investment funds affiliated with PennyMac - a "scratch and dent" firm headed by former Countrywide top executive Stanford Kurland - have purchased a $558 million portfolio of 2,800 residential loans from the government using a cash-flow sharing arrangement.
The portfolio includes both performing and nonperforming mortgages. PennyMac will service the loans and try to bring them current.
Initially, the Federal Deposit Insurance Corp. will receive 80% of the cash flow on the mortgage portfolio with the balance going to the investor group.
A spokesman said eventually the FDIC will receive 60% of the cash flow after a certain threshold is reached on the portfolio.
He declined to say what that threshold is but added, "This gives them (PennyMac) an incentive to improve the cash flows."