A portfolio of nonperforming loans is scheduled for auction by the U.S. Department of Housing and Urban Development.
In a public filing Friday, the Federal Housing Administration disclosed the upcoming sale of residential loans.
Details of the loans were released on Aug. 31 in a bidder’s information package. The bid date is scheduled for Sept. 22, while the winning bid is expected to be made that same day. Closings will occur on Sept. 22 and Oct. 27.
While no amount was listed in the filing, one source put the aggregate principal balance at $100 million.
The loans will not be subsidized by HUD or insured by FHA. The portfolio is being sold on a servicing-released basis. Bids will be accepted on individual loan pools based on the location of the properties securing the mortgages.
In order to qualify as a bidder, investors must complete, execute and submit a confidentiality agreement and a Qualification Statement acceptable to HUD. Bids must be accompanied by deposits based on the bid price. The deposits will not be refunded for successful bids.
Ineligible bidders include HUD employees and people in their households; anyone can’t do business with HUD because they’ve been debarred or suspended by HUD; and “any contractor, subcontractor and/or consultant or advisor (including any agent, employee, partner, director, principal or affiliate of any of the foregoing) who performed services for or on behalf of HUD in connection with SFLS 2010.”
Parties that serviced or owned any of the loans during the past two years are also ineligible, as are individuals or entities that do business with any of the excluded parties.
