$3.7B package of Fannie Mae and Freddie Mac MSRs goes up for bid

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Incenter Mortgage Advisors is facilitating the sale of almost $3.7 billion in mortgage servicing rights tied to Fannie Mae and Freddie Mac loans, roughly one-third of which have private mortgage insurance.

The loans have a weighted average loan-to-value ratio of more than 76%, and nearly half of them are concentrated in Texas, according to seller representations.

More than three-quarters of the mortgages are Fannie loans, and the PMI concentration within the each of the two agencies' loan groups is similar. Both government-sponsored enterprises recently tightened their capital rules for PMI companies.

The loans tied to the MSRs also have an average balance of $232,294 and a weighted average loan age of more than 17 months. The loans are primarily 10- to 30-year fixed-rate products mixed in with some adjustable-rate mortgages.

In addition, the mortgages have a 0.8% delinquency rate. They have no serious delinquencies, foreclosures or bankruptcies. Owner-occupied, single-family homes secure most of the loans.

Investor properties secure almost 11% of the mortgages, and more than 7% of the collateral properties are condominiums. Almost 2% of the collateral properties are townhomes. Seven of the 15,843 loans lack a property-type description.

Cenlar subservices all the loans on the Black Knight servicing system, and electronic data transfer is available. The loan files are imaged.

An unnamed independent mortgage banker "with strong net worth and experienced management team" is selling the servicing, according to IMA.

The seller would prefer to sell to a buyer that could have due diligence and a purchase and sale agreement executed by Dec. 31 for a Jan. 1, 2019 sale date. The financial strength and quality of the bidder, as well at the quality of the bidder's current servicing, will be factors in the seller's decision as to who to sell to.

IMA is accepting written, emailed bids for the package. The bid deadline is 2 p.m. Eastern on Oct. 30.

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MSR Subservicing PMI GSEs Document imaging Fannie Mae Freddie Mac IMA