HUD Archives: News Releases
October 11, 2002
FHA MORTGAGE SALE SAVES GOVERNMENT $110 MILLION
WASHINGTON - Housing and Urban Development Assistant Secretary for Housing-
Federal Housing Commissioner John C. Weicher, today announced the results of
FHA's Multifamily and Healthcare Loan Sale 2002-1 (MHLS 2002-1). The auction
generated proceeds of approximately $291 million, and resulted in $110 million
in savings to the government. Total savings from mortgage loan sales held since
1994 now surpass $2.46 billion.
"The results of this sale are consistent with FHA's goal to increase recoveries
on HUD-held mortgage loans," said Commissioner Weicher. "The sale enables HUD
to transfer the mortgage loans to the private sector, for servicing and asset
management, and has the effect of increasing HUD's recoveries compared to maintaining
the properties in HUD's portfolio."
The sale drew bids from numerous bidders, including global investment banking
firms, financial services companies, regional savings banks, real estate operators,
nursing home operators, private investment funds and individuals. Seven different
bidders were awarded loans.
The sale, which closed on September 12, 2002, consisted of 114 mortgage loans
secured by unsubsidized apartment properties, assisted living facilities and
nursing home facilities, located throughout the United States, totaling approximately
$502 million in unpaid principal balance. The mortgage loans were offered in
12 separate pools, 5 multifamily pools and 7 assisted living and nursing home
The pools included performing and non-performing loans and ranged in size from
4 to 30 loans and from $16 million to $65 million in terms of unpaid principal
balance. 57 loans were secured by multifamily properties. 57 loans were secured
by assisted living and nursing home facilities. Bidders were permitted to submit
bids on any of the twelve mortgage loan pools. In addition, mortgagors of loans
in the sale portfolio that were not in default under any HUD mortgage loan were
permitted to submit individual bids on their mortgage loans.
The sales were managed by FHA's Office of Asset Sales, which estimates it will
conduct at least two mortgage loan sales per year. FHA's next sale of multifamily
and healthcare loans, Multifamily and Healthcare Loan Sale 2002-2 (MHLS 2002-2),
is tentatively scheduled to take place this winter. FHA's
Office of Asset Sales is maintaining a website for up to date information regarding the loan sales program.
HUD is the nation's housing agency committed to increasing homeownership, particularly
among minorities, creating affordable housing opportunities for low-income Americans,
supporting the homeless, elderly, people with disabilities and people living
with AIDS. The Department also promotes economic and community development as
well as enforces the nation's fair housing laws. More information about HUD
and its programs is available on the Internet.
Content Archived: April 9, 2010