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MCLEAN, Va. - Freddie Mac, a prominent player in the Financial Services industry with a market capitalization of $15.53 billion, has finalized the sale of a pool of non-performing loans (NPLs) from its mortgage-related investments portfolio, the company disclosed today. According to InvestingPro analysis, the company currently appears overvalued based on its Fair Value assessment, though it has demonstrated remarkable strength with a 230.93% return over the past year. The 28 deeply delinquent residential first lien loans were sold to VRMTG ACQ, LLC, with the transaction expected to settle in June 2025.
The loans, serviced by NewRez LLC, doing business as Shellpoint Mortgage Servicing, have an aggregate unpaid principal balance of approximately $5.3 million. This sale is part of Freddie Mac’s Extended Timeline Pool Offering (EXPO®), a strategy aimed at reducing less-liquid assets in its portfolio. The company maintains strong financial health with a current ratio of 131.78, indicating robust liquidity management. For deeper insights into Freddie Mac’s financial metrics and 10+ additional ProTips, consider exploring InvestingPro’s comprehensive research report.
Freddie Mac began marketing the loans on March 6, 2025, targeting bidders with a presence in the NPL market. The loans in question are significantly delinquent, and it is likely that the borrowers have been assessed for loss mitigation or are already in foreclosure. Notably, about 55% of the pool balance is comprised of mortgages that were previously modified and have since become delinquent again.
Purchasers of these loans are required to comply with existing loss mitigation agreements and are expected to reach out to distressed borrowers to offer further assistance, except in specific circumstances. They must also complete all pending loss mitigation actions.
The EXPO pool was sold with the following details: an unpaid principal balance of $5.3 million across 28 loans, with an average delinquency of 16 months and an average loan balance of $188,000. The geographical distribution of the pool is concentrated in Texas. VRMTG ACQ, LLC emerged as the winning bidder, with the cover bid price hovering around the 100s area of the unpaid principal balance percentage.
BofA Securities, Inc. and First Financial Network, Inc. served as advisors to Freddie Mac for this transaction. The company’s approach to seasoned loan offerings, which includes the sale of NPLs, securitizations of re-performing loans (RPLs), and structured RPL transactions, is part of its broader strategy to promote liquidity, stability, and affordability in the housing market.
Since 2011, Freddie Mac has sold $10.4 billion in NPLs and securitized roughly $80.3 billion in RPLs through various programs, all with the objective of improving outcomes for borrowers and community stabilization. The company’s strategic initiatives have contributed to its strong financial performance, with annual revenue reaching $23.44 billion and an overall Financial Health Score of "GOOD" according to InvestingPro’s comprehensive analysis framework, which evaluates over 100 financial metrics and market indicators.
This sale reflects Freddie Mac’s ongoing efforts to reduce the number of less-liquid assets in its portfolio, as stated in the press release.
In other recent news, Freddie Mac has announced plans to auction approximately $290 million in non-performing loans as part of its strategy to manage its mortgage-related investments portfolio. This move is designed to reduce less-liquid assets and involves loans serviced by entities including Select Portfolio Servicing Inc., Newrez LLC, and Nationstar Mortgage LLC. The auction will be structured through four pools, with specific offerings to encourage participation from diverse businesses. Meanwhile, Freddie Mac’s Primary Mortgage Market Survey® reported that the 30-year fixed-rate mortgage remains stable at 6.65%, offering potential benefits for homebuyers during the spring season. The consistency in mortgage rates, as noted by Freddie Mac’s Chief Economist, Sam Khater, aligns with a slight increase in purchase applications from the previous year. Additionally, recent remarks by Bill Pulte, Director of the Federal Housing Finance Agency, highlighted a shift towards operational efficiency at Freddie Mac and Fannie Mae, emphasizing a business-oriented approach. These developments are part of broader efforts to enhance affordability and stability in the housing market.
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