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Non-Performing Loan (NPL) Offerings

Subject to market conditions, Freddie Mac plans to periodically sell seriously delinquent non-performing loans (NPLs) it owns via competitive auctions. NPL sales are an important tool for the company to more effectively manage credit losses on its delinquent loan portfolio.


Freddie Mac determines the loan criteria and works with its legacy servicers to identify loans that meet the selection criteria. Freddie Mac controls all pooling and auction related decisions; consistent with FHFA requirements and guidelines governing NPL Sales by Government Sponsored Enterprises (GSEs).

Pools will be offered in two forms:

  1. Standard Pool Offering® (SPO®): These pools are likely to be large, geographically diverse pools, although they may be geographically concentrated.

  2. Extended Timeline Pool Offering® (EXPO®): These pools will be smaller sized pools, and may or may not be geographically concentrated. The timeline between transaction announcement and the date bids are due will be extended approximately two weeks from the typical marketing period for SPOs. This is intended to provide smaller potential investors extra time to secure funds to participate in the auctions.

All eligible bidders, including private investors, MWOBs, non-profits and neighborhood advocacy funds, are encouraged to participate in all of Freddie Mac's NPL offerings – both SPOs and EXPOs. Winning bidders are chosen on the basis of price, subject to meeting Freddie Mac's internal reserve levels.

How to Participate

Potential bidders in any offering must complete a Bidder Qualification Statement (BQS) and meet the bidder and servicer qualification requirements in the BQS.  Those requirements are summarized below.

Interested potential investors may register to request to be added to the distribution list for Freddie Mac’s NPL offerings.


Loan Selection Process

Each auction will generally include NPLs serviced by one servicer, and may include one or more pools of loans. The loans included in each pool may vary significantly by servicer, depending on each servicer's geographical and servicing footprint.

Bidder and Servicer Qualification Requirements

To participate in an offering, potential bidders are required to be approved by Freddie Mac to both access the secure data room containing information about the NPLs and to bid on the NPL pool(s):

  • Data Room Pre-access Qualification.
    Prior to obtaining data room access, requirements for potential bidders include:
    1. A signed Bidder non-disclosure agreement (NDA) to protect borrower level information in the secure data room
    2. Adequate experience managing a portfolio of single-family mortgage loans or bonds
    3. Attestation, among other things, that bidder is not currently disbarred or suspended from doing business by any federal, state or local government agency
    4. Proof of adequate funds to purchase the pool(s) that they propose to bid on
  • Approval to bid.
    Obtaining approval to bid is contingent upon, among other things:
    1. A background check of principals and owners of 10% or more of the bidder
    2. Potential bidder completing a questionnaire for the Freddie Mac, Fannie Mae, FHA or Ginnie Mae approved servicer it intends to use to service the NPLs

If a pool is awarded, the winning bidder is required to make a non-refundable good faith deposit within two business days.

In the event that an auction winner either (i) fails to pay the deposit or (ii) fails to close on the transaction, Freddie Mac reserves the right to deny that auction winner from participating in future transactions.