MReport November 2017

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Freddie Mac Sells $817 Million in Seasoned Loans The deal marked the completion of the GSE's third Seasoned Loan Structured Transaction. L ast month, Freddie Mac sold $817 mil- lion worth of seasoned loans, which completed its third Seasoned Loan Structured Transaction (SLST) of sea- soned reperforming loans (RPLs) and moder- ately delinquent loans serviced by Mr. Cooper. According to a recent report by Freddie Mac, the SLST securitization program auctioned 3,514 seasoned RPLs. In addition, the report notes that the GSE's program is a key factor to seasoned loan offering initiatives, which were designed to "reduce less liquid assets in its mortgage-related investments portfolio, and shed credit and market risk via economically reasonable transactions." Essentially, the transaction involves a two-step process. First is the sale of the loans via a "com - petitive bidding process subject to a securitization term sheet." According to Freddie Mac, the sale will be implemented on the basis of econom- ics, subject to meeting its internal reserve levels. Second, the transaction requires the purchaser of the loans to securitize the loans. The major requirement of Freddie Mac's SLST transaction is that the buyer of the loans be an investor with extensive experience in managing both performing and moderately delinquent mort - gage loans, as well as securitizing mortgage loans. The servicing of the loans is in accordance with RPL protocol and similar to FHFA require- ments. Freddie Mac's RPL requires servicers to apply a waterfall of resolution tactics, with fore- closure as the last option in the waterfall. The FHFA nonperforming loan (NPL) require- ments draw from experiences of sales of NPLs over the past year. According to the FHFA, as of the end of February 2016, the GSEs had sold over 29,000 mortgages, with a total unpaid principal balance of $5.8 billion. In total, Freddie Mac has sold $7 billion in NPLs and securitized $31 billion in RPLs to date. THE LATEST LOCAL EDITION SECONDARY MARKET 62 | TH E M R EP O RT Representing the Underserved Freddie Mac's Chief Diversity Officer discusses inclusion initiatives in the mortgage industry. MISSISSIPPI // In an effort to better represent underserved communities, as well as support ongoing diversity initiatives in the mortgage industry, Freddie Mac has announced the opening of a Borrower Help Center in McComb, Mississippi, accord - ing to a recent post by Dwight Robinson, SVP of Human Resources, Diversity and Inclusion, and Chief Diversity Officer at Freddie Mac. Robinson notes that this initiative isn't new—it is the 14th center of its kind throughout the country; however, what makes this location unique is its locale. It is the first located in the lower Mississippi Delta, where it serves a rural community with a median household income of $29,720. African-Americans also makeup 66 percent of the total population, and have a home - ownership rate—50.0 percent— much lower than that of the regional average of 70.9 percent. Freddie Mac's effort hasn't gone unnoticed. According to Robinson, "Staff at our bor - rower help centers primarily help consumers by phone or appoint- ment, but McComb is different. Since February, the McComb site has seen a tremendous number of walk-ins per month, making it far and away the most popular of our 14 centers." Overall, 500-plus people have walked through the door to fur - ther their education on mortgage education and foreclosure as- sistance in the last three months. Demand for the location's services was so great that Freddie Mac expanded its reach from three to 11 counties in the region. Fulfilling the dream of home - ownership for these underserved communities is one of Freddie Mac's main goals, and it is initiatives such as this that are

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