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A public-private partnership headed by the Illinois Housing Development Authority has emerged as one of the winning bidders in a September auction of delinquent mortgages held by the Federal Housing Administration.
Mortgage Resolution Fund will use $25 million of federal hardest-hit funds awarded to the state to buy 324 delinquent loans on Chicago-area properties. The loans, which were part of a neighborhood stabilization pool have an unpaid principal balance of about $62 million and the properties are valued at $40 million.
After the note sale closes, homeowners whose delinquent mortgages are part of the loan pool will be contacted by a new servicer in early 2013 that will offer to write down the principal balance of the loans and set up more affordable repayment terms to eligible homeowners. Those homeowners pay no cost to receive the loan modifications.
"We want to help as many borrowers as possible achieve long-term stability so they can stay in their homes without the fear of foreclosure," said Mary Kenney, executive director of the Illinois Housing Development Authority.
Separately, Florida-based Bayview Acquisitions LLC submitted a winning bid of about $70 million for 1,430 other Illinois loans in a neighborhood stabilization pool that had an unpaid principal balance of about $269 million and an estimated property value of $155 million. Another 299 delinquent Illinois mortgages were sold as part of other pools.
Nationally, the note sale involved about 9,400 distressed loans. Bids were submitted to U.S. Department of Housing and Urban Development in September.
HUD said plans to sell another 10,000 to 15,000 distressed loans during the first quarter of 2013, and at least 40,000 during the next year in an effort to remove distressed loans from its portfolio.
mepodmolik@tribune.com | Twitter @mepodmolik
Public-private group wins bid for delinquent mortgages
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Public-private group wins bid for delinquent mortgages
