Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.
Notice of sales of mortgage loans.
This notice announces HUD's intention to competitively sell certain unsubsidized single family mortgage loans, in a sealed bid sale offering called SFLS 2012-1, without Federal Housing Administration (FHA) mortgage insurance. This notice also generally describes the bidding process for the sale and certain persons who are ineligible to bid. This first sale of Fiscal Year (FY) 2012 is scheduled for December 7, 2011. FHA also expects to conduct two additional sales in FY 2012 in April and September 2012.
For this sale action, the Bidder's Information Package (BIP) was made available to qualified bidders on or about November 9, 2011. Bids for the SFLS 2012-1 sale must be submitted on the bid date, which is currently scheduled for December 7, 2011 (Bid Date). HUD anticipates that award(s) will be made on or about December 8, 2011 (the Award Date).
To become a qualified bidder and receive the BIP, prospective bidders must complete, execute, and submit a Confidentiality Agreement and a Qualification Statement acceptable to HUD. Both documents are available via the HUD Web site at: http://www.hud.gov/sfloansales or via: http://www.DebtX.com. Please mail and fax executed documents to SEBA Professional Services: SEBA Professional Services, c/o The Debt Exchange, 133 Federal Street, 10th Floor, Boston, MA 02111, Attention: HUD SFLS Loan Sale Coordinator, Fax: 1-(617) 531-3499.
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FOR FURTHER INFORMATION CONTACT:
John Lucey, Deputy Director, Asset Sales Office, Department of Housing and Urban Development, 451 Seventh Street SW., Room 3136, Washington, DC 20410-8000; telephone number (202) 708-2625, extension 3927. Hearing- or speech-impaired individuals may call (202) 708-4594 (TTY). These are not toll-free numbers.
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HUD announces its intention to sell in SFLS 2012-1 certain unsubsidized non-performing mortgage loans (Mortgage Loans) secured by single family properties located throughout the United States. A listing of the Mortgage Loans is included in the due diligence materials made available to qualified bidders. The Mortgage Loans will be sold without FHA insurance and with servicing released. HUD will offer qualified bidders an opportunity to bid competitively on the Mortgage Loans.
The Bidding Process
The BIP describes in detail the procedure for bidding in SFLS 2012-1. The BIP also includes a standardized non-negotiable Conveyance, Assignment and Assumption Agreement (CAA Agreement). Qualified bidders will be required to submit a deposit with their bid. Deposits are calculated based upon each qualified bidder's aggregate bid price.
HUD will evaluate the bids submitted and determine the successful bid, in terms of the best value to HUD, in its sole and absolute discretion. If a qualified bidder is successful, the qualified bidder's deposit will be non-refundable and will be applied toward the purchase price. Deposits will be returned to unsuccessful bidders. For the SFLS 2012-1 sale action, settlements are expected to take place on or about December 22, 2011 and February 14, 2012.
This notice provides some of the basic terms of sale. The CAA Agreement, which is included in the BIP, provides comprehensive contractual terms and conditions. To ensure a competitive bidding process, the terms of the bidding process and the CAA Agreement are not subject to negotiation.
Due Diligence Review
The BIP describes how qualified bidders may access the due diligence materials remotely via a high-speed Internet connection.
Mortgage Loan Sale Policy
HUD reserves the right to remove Mortgage Loans from SFLS 2012-1 at any time prior to the Award Date. HUD also reserves the right to reject any and all bids, in whole or in part, and include any Mortgage Loans in a later sale. Deliveries of Mortgage Loans will occur in two monthly settlements and the number of Mortgage Loans delivered will vary depending upon the number of Mortgage Loans the Participating Servicers have submitted for the payment of an FHA insurance claim. The Participating Servicers will not be able to submit claims on loans that are not included in the Mortgage Loan Portfolio set forth in the BIP.
There can be no assurance that any Participating Servicer will deliver a minimum number of Mortgage Loans to HUD or that a minimum number of Mortgage Loans will be delivered to the Purchaser.
The SFLS 2012-1 sale of Mortgage Loans are assigned to HUD pursuant to section 204(a)(1)(A) of the National Housing Act as amended under Title VI of the Departments of Veterans Affairs and Housing and Urban Development and Independent Agencies Appropriations Act, 1999. The sale of the Mortgage Loans is pursuant to section 204(g) of the National Housing Act.
Mortgage Loan Sale Procedure
HUD selected an open competitive whole-loan sale as the method to sell the Mortgage Loans for this specific sale transaction. For the SFLS 2012-1, HUD has determined that this method of sale optimizes HUD's return on the sale of these Mortgage Loans, affords the greatest opportunity for all qualified bidders to bid on the Mortgage Loans, Start Printed Page 73655and provides the quickest and most efficient vehicle for HUD to dispose of the Mortgage Loans.
In order to bid in the 2012-1 sale as a qualified bidder, a prospective bidder must complete, execute and submit both a Confidentiality Agreement and a Qualification Statement acceptable to HUD. If any of the following apply to (i) A prospective bidder, (ii) the prospective bidder's significant (>10%) owners and persons with authority or control over the prospective bidder; (iii) any individuals/entities related to the prospective bidder (“Related Entities” as defined below) or (iv) significant (>10%) owners and person with authority or control of such Related Entities, then the prospective bidder is ineligible to bid on any of the Mortgage Loans included in SFLS 2012-1. Related Entities, as used in this Notice, is defined as: (a) two entities that have, (i) significant common purposes and substantial common membership or (ii) directly or indirectly, substantial common direction or control; or (b) Either entity owns (directly or through one or more entities) a 50 percent or greater interest in the capital or profits of the other. For this purpose, entities treated as related entities under this definition shall be treated as one entity.
1. An employee of HUD, a member of such employee's household, or an entity owned or controlled by any such employee or member of such an employee's household with household to be inclusive of the employee's father, mother, stepfather, stepmother, brother, sister, stepbrother, stepsister, son, daughter, stepson, stepdaughter, grandparent, grandson, granddaughter, father-in-law, mother-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law, first cousin, the spouse of any of the foregoing, and the employee's spouse.
2. An individual or entity that is currently debarred, suspended, or excluded from doing business with HUD pursuant to the Governmentwide Suspension and Debarment regulations at Title 2 of the Code of Federal Regulations, Parts 180 and 2424;
3. An individual or entity that has been suspended, debarred or otherwise restricted by any Department or Agency of the Federal Government or of a State Government from doing business with such Department or Agency;
4. An individual or entity that has been debarred, suspended, or excluded from doing mortgage related business, including having a business license suspended, surrendered or revoked, by any federal, state or local government agency, division or department;
5. A 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 single family asset sales;
6. An individual or entity that uses the services, directly or indirectly, of any person or entity ineligible under subparagraphs 1 through 3 above to assist in preparing any of its bids on the Mortgage Loans;
7. An individual or entity which employs or uses the services of an employee of HUD (other than in such employee's official capacity) who is involved in single family asset sales;
8. An entity or individual that serviced or held any Mortgage Loan at any time during the 2-year period prior to the Award Date is ineligible to bid on such Mortgage Loan or on the pool containing such Mortgage Loan;
9. An entity or individual that is: (a) any affiliate or principal of any entity or individual described in the preceding sentence (sub-paragraph 8); (b) any employee or subcontractor of such entity or individual during that 2-year period prior to Award Date; or (c) any entity or individual that employs or uses the services of any other entity or individual described in this paragraph in preparing its bid on such Mortgage Loan; or
10. An entity that has had its right to act as a Government National Mortgage Association (Ginnie Mae) issuer and its interest in mortgages backing Ginnie Mae mortgage-backed securities extinguished and terminated by Ginnie Mae.
Freedom of Information Act Requests
HUD reserves the right, in its sole and absolute discretion, to disclose information regarding SFLS 2012-1, including, but not limited to, the identity of any successful qualified bidder and its bid price or bid percentage for any pool of loans or individual loan, upon the closing of the sale of all the Mortgage Loans. Even if HUD elects not to publicly disclose any information relating to SFLS 2012-1, HUD will have the right to disclose any information that HUD is obligated to disclose pursuant to the Freedom of Information Act and all regulations promulgated thereunder.
Scope of Notice
This notice applies to SFLS 2012-1 and does not establish HUD's policy for the sale of other mortgage loans.
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Dated: November 23, 2011.
Acting Assistant Secretary for Housing—Federal Housing Commissioner.
[FR Doc. 2011-30775 Filed 11-28-11; 8:45 am]
BILLING CODE 4210-67-P