Moves Ahead with Second Transaction After Successful Pilot
MCLEAN, VA--(Marketwired - May 18, 2017) - Freddie Mac (OTCQB: FMCC) today announced an approximate $292 million structured sale of a pool of seasoned re-performing loans from its mortgage investments portfolio. The pool is comprised of loans with step-rate modifications (primarily HAMP) and loans modified under GSE proprietary modifications. The pool consists of re-performing and moderately delinquent loans. The loans are currently being serviced by Select Portfolio Servicing, Inc.
This transaction will involve a two-step process. The initial step involves the sale of the loans via a competitive bidding process. The sale will be executed on the basis of economics, subject to meeting Freddie Mac's internal reserve levels. The second step will require the purchaser of the loans to securitize the loans and retain the first loss subordinate tranche. Freddie Mac will guarantee and acquire the senior security issued from such securitization and simultaneously re-securitize such interest. The resulting securities will be the Freddie Mac SLST Guaranteed Securities, Series 2017-1.
It is a key requirement of this transaction that the purchaser of the loans be an investor with substantial experience managing "high-risk" mortgage loans as well as substantial experience in securitizations.
Advisors to Freddie Mac on this transaction are Wells Fargo Securities, LLC, Credit Suisse Securities (USA) LLC and CastleOak Securities, L.P.
To date, Freddie Mac has sold $7 billion in nonperforming loans (NPLs), securitized $26 billion in re-performing loans (RPLs), and transacted $2 billion in structured offerings. Additional information about the company's seasoned loan offerings is at http://www.freddiemac.com/seasonedloanofferings/index.html.
This announcement is not an offer to sell any Freddie Mac securities. Offers for any given security are made only through applicable offering circulars and related supplements, which incorporate Freddie Mac's Annual Report on Form 10-K for the year ended December 31, 2016, filed with the Securities and Exchange Commission (SEC) on February 16, 2017; all other reports Freddie Mac filed with the SEC pursuant to Section 13(a) of the Securities Exchange Act of 1934 (Exchange Act) since December 31, 2016, excluding any information "furnished" to the SEC on Form 8-K; and all documents that Freddie Mac files with the SEC pursuant to Sections 13(a), 13(c) or 14 of the Exchange Act, excluding any information "furnished" to the SEC on Form 8-K.
Freddie Mac's press releases sometimes contain forward-looking statements. A description of factors that could cause actual results to differ materially from the expectations expressed in these and other forward-looking statements can be found in the company's Annual Report on Form 10-K for the year ended December 31, 2016, and its reports on Form 10-Q and Form 8-K, filed with the SEC and available on the Investor Relations page of the company's Web site at www.FreddieMac.com/investors and the SEC's website.
Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we've made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog FreddieMac.com/blog.
MEDIA CONTACT:
Lisa Gagnon
703-903-3385
Lisa_Gagnon@freddiemac.com
The financial and other information contained in the documents that may be accessed on this page speaks only as of the date of those documents. The information could be out of date and no longer accurate. Freddie Mac does not undertake an obligation, and disclaims any duty, to update any of the information in those documents. Freddie Mac's future performance, including financial performance, is subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect the company's future results are discussed more fully in our reports filed with the SEC.