WASHINGTON, DC—DebtX is selling a $4.8-billion portfolio of non-performing residential loans for the US Department of Housing and Urban Development on behalf of SEBA Professional Services.
The loan sale consists of two parts: On June 11, a national offering of approximately 23,200 loans totaling $4 billion in unpaid principal balance will be offered in 16 pools, ranging from $93 million to $1 billion. These loans are collateralized by properties across the US with one pool concentrated in the Southwest.
Then, on June 25, a Neighborhood Stabilization Outcomes Pool offering of approximately 4,800 loans in eight regions totaling $800 million in unpaid principal balance will go to bid. The eight regions are Philadelphia, Miami, Chicago, Detroit, San Antonio, Atlanta, San Bernardino County in California and Cumberland County in New Jersey.
This is HUD’s fifth, multi-billion dollar sale of single-family non-performing loans in the past eighteen months. All together SEBA and DebtX have brought more than 72,000 non-performing, single-family HUD loans to market, for a total sale of $17 billion.
This offering will bring HUD over the 100,000-loan milestone, DebtX CEO Kingsley Greenland, notes. “This is no longer a one-off transaction type for HUD, the agency is now selling billions and billions of dollars of these loans on a regular basis,” he tells GlobeSt.com.
It is a significant development for the market as it points to the high pricing, and strong demand, not to mention available liquidity and the alternative exit strategy HUD wants to take regarding these loans, instead of foreclosure.
“The market is incredibly deep on the buy side,” Greenland said. “On the sell side, HUD is far and away the largest seller.”