[Federal Register Volume 87, Number 126 (Friday, July 1, 2022)]
[Notices]
[Pages 39543-39545]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-14147]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-6333-N-01]


Notice of HUD-Held Vacant Loan Sales (HVLS 2022-2, Parts 1 and 2)

AGENCY: Office of the Assistant Secretary for Housing--Federal Housing 
Commissioner, U.S. Department of Housing and Urban Development (HUD).

ACTION: Notice of sales of reverse mortgage loans.

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SUMMARY: This notice reports HUD's recent June 8th competitive sale 
offering of 1,406 reverse mortgage loans secured by vacant or abandoned 
properties with a loan balance of approximately $336 million (June sale 
or HVLS 2022-2, Part 1). The June sale consisted of one national pool 
and one single-asset pool secured by a vacant lot in Omaha, Nebraska 
(Single asset pool or Land only asset). The Secretary offered these 
assets to qualified nonprofit or unit of state or local government 
bidders and joint ventures with a charitable 501(c)(3) nonprofit 
organization or unit of government carrying out a governmental public 
purpose. This was the eighth sale offering of its type. For the June 
sale, approximately 700 of these mortgage loans were awarded on or 
about June 13, 2022. The approximately 700 remaining mortgage loans, 
including the Land only asset, will be offered again on or about July 
27th in one national pool (July sale or HVLS 2022-2, Part 2). Terms and 
conditions of that July sale are outlined later in this document. Also, 
this notice generally describes the bidding process for the sale and 
certain persons who are ineligible to bid.

DATES: For the July sale, the Bidder's Information Package (BIP) will 
be made available to eligible bidders at least fourteen to twenty-one 
days prior to the sale. Bids for the July sale will be accepted on the 
Bid Date of on or about July 27, 2022 (Bid Date). HUD anticipates that 
awards will be made on or about July 28, 2022 (Award Date).

ADDRESSES: HUD has expanded the eligible bidder types for the July sale 
to include for-profit entities. To become an eligible bidder and 
receive the BIP for the July sale, prospective bidders must complete, 
execute, and submit a Confidentiality Agreement and Qualification 
Statement acceptable to HUD. The documents will be available in preview 
form on the Transaction Specialist (TS), Falcon Capital Advisors, 
website: http://www.falconassetsales.com. This website contains 
information and links for sale registration and electronically 
completing and submitting the documents.
    If you do not submit electronically, please submit executed 
documents via mail or facsimile to Falcon Capital Advisors: Falcon 
Capital Advisors, 427 N Lee Street, Alexandria, VA 22314, Attention: 
Glenn Ervin, HUD HVLS Loan Sale Coordinator. eFax: 1-202-393-4125.

FOR FURTHER INFORMATION CONTACT: John Lucey, Director, Office of Asset 
Sales, Room 3136, Department of Housing and Urban Development, 451 
Seventh Street SW, Washington, DC 20410-8000;

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telephone 202-708-2625, extension 3927 (this is not a toll-free 
number). Persons with hearing or speech impairments may access this 
number through TTY by calling the toll-free Federal Relay at 800-877-
8339 (this is a toll-free number).

SUPPLEMENTARY INFORMATION: This notice announces HUD's sale of due and 
payable Secretary-held reverse mortgage loans in HVLS 2022-2, Part 1 
that took place on June 8th. In that June sale, HUD offered 1,404 
reverse mortgage loans but awarded approximately 700 reverse mortgage 
loans.
    Additionally, this notice announces HUD's upcoming HVLS 2022-2, 
Part 2 sale of the approximately 700 remaining reverse mortgage loans 
that were not awarded in the June sale. The reverse mortgage loans 
offered for the July sale have a loan balance of approximately $141 
million. The reverse mortgage loans consist of first liens secured by 
single family, vacant residential properties, where all borrowers are 
deceased, and no borrower is survived by a non-borrowing spouse. The 
Land only asset is secured by a vacant lot in Omaha, Nebraska.
    For the July sale, a listing of the approximately 700 reverse 
mortgage loans will be included in the due diligence materials made 
available to eligible bidders. The mortgage loans will be sold without 
FHA insurance and with servicing released. HUD will offer eligible 
bidders an opportunity to bid competitively on the reverse mortgage 
loans.

The Bidding Process

    The BIP describes in detail the procedure for bidding in the July 
sale. The BIP or a BIP Supplement, as applicable, will include a 
standardized non-negotiable Conveyance, Assignment and Assumption 
Agreement, and any attached riders, for the July sale (CAA). The CAA 
will contain mission outcome requirements.
    Eligible bidders will be required to submit a deposit with their 
bid. Deposits are calculated based upon each eligible bidder's 
aggregate bid price.
    HUD evaluates the bids submitted and determines the successful bid, 
in terms of the best value to HUD, in its sole and absolute discretion. 
If an eligible bidder is successful, the eligible bidder's deposit will 
be non-refundable and will be applied toward the purchase price. 
Deposits will be returned to unsuccessful bidders.
    This notice provides some of the basic terms of sale. The CAA, 
which will be released in a BIP or BIP Supplement, as applicable, 
provides comprehensive contractual terms and conditions. To ensure a 
competitive bidding process, the terms of the bidding process and the 
CAA are not subject to negotiation.

Due Diligence Review

    The BIP describes how eligible 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 a sale at any 
time prior to the Award Date and the settlement date for the mortgage 
loans. HUD also reserves the right to reject any and all bids, in whole 
or in part, and include any reverse mortgage loans in a later sale. 
Deliveries of mortgage loans will occur in conjunction with settlement 
and servicing transfer no later than 60 days after the Award Date.
    The reverse mortgage loans offered for sale were insured by and 
were assigned to HUD pursuant to section 255 of the National Housing 
Act, as amended. The sale of the reverse 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 reverse mortgage loans for this specific sale transaction. For 
the July sale, HUD has determined that this method of sale optimizes 
HUD's return on the sale of these reverse mortgage loans, affords the 
greatest opportunity for all eligible bidders to bid on the reverse 
mortgage loans, and provides the quickest and most efficient vehicle 
for HUD to dispose of the due and payable reverse mortgage loans.

Bidder Ineligibility

    To bid in the July sale as an eligible bidder, a prospective bidder 
completes, executes, and submits both a Confidentiality Agreement and a 
Qualification Statement acceptable to HUD. In the Qualification 
Statement, the prospective bidder must provide certain representations 
and warranties regarding the prospective bidder, including but not 
limited to (i) the prospective bidder's board of directors, (ii) the 
prospective bidder's direct parent, (iii) the prospective bidder's 
subsidiaries, (iv) any related entity with which the prospective bidder 
shares a common officer, director, subcontractor or sub-contractor who 
has access to Confidential Information as defined in the 
Confidentiality Agreement or is involved in the formation of a bid 
transaction (collectively the ``Related Entities''), and (v) the 
prospective bidder's repurchase lenders. The prospective bidder is 
ineligible to bid on any of the reverse mortgage loans offered if the 
prospective bidder, its Related Entities, or repurchase lenders, are 
any of the following, unless other exceptions apply as provided for in 
the Qualification Statement.
    1. 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 2 CFR parts 180 and 2424;
    2. An individual or entity that is currently 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;
    3. An individual or entity that is currently 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;
    4. An entity that has had its right to act as a Government National 
Mortgage Association (``Ginnie Mae'') issuer terminated and its 
interest in mortgages backing Ginnie Mae mortgage-backed securities 
extinguished by Ginnie Mae;
    5. An individual or entity that is in violation of its neighborhood 
stabilizing outcome obligations or post-sale reporting requirements 
under a CAA Agreement executed for any previous mortgage loan sale of 
HUD;
    6. An employee of HUD's Office of Housing, 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;
    7. A contractor, subcontractor, and/or consultant or advisor 
(including any agent, employee, partner, director, or principal of any 
of the foregoing) who performed services for or on behalf of HUD in 
connection with the sale;
    8. An individual or entity that knowingly acquired or will acquire 
prior to the sale date material non-public information, other than that 
information which is made available to Bidder by HUD pursuant to the 
terms of

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this Qualification Statement, about mortgage loans offered in the sale;
    9. An individual or entity which knowingly employs or uses the 
services of an employee of HUD's Office of Housing (other than in such 
employee's official capacity); or
    10. An individual or entity that knowingly uses the services, 
directly or indirectly, of any person or entity ineligible under 1 
through 9 to assist in preparing any of its bids on the mortgage loans.
    The Qualification Statement has additional representations and 
warranties which the prospective bidder must make, including but not 
limited to the representation and warranty that the prospective bidder 
or its Related Entities are not and will not knowingly use the 
services, directly or indirectly, of any person or entity that is, any 
of the following (and to the extent that any such individual or entity 
would prevent the prospective bidder from making the following 
representations, such individual or entity has been removed from 
participation in all activities related to this sale and has no ability 
to influence or control individuals involved in formation of a bid for 
this sale):
    (1) An entity or individual is ineligible to bid on any included 
reverse mortgage loan or on the pool containing such reverse mortgage 
loan because it is an entity or individual that:
    (a) Serviced or held such reverse mortgage loan at any time during 
the six-month period prior to the bid, or
    (b) Is any principal of any entity or individual described in the 
preceding sentence;
    (c) Any employee or subcontractor of such entity or individual 
during that six-month period; or
    (d) 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 reverse mortgage loan.

Freedom of Information Act Requests

    HUD reserves the right, in its sole and absolute discretion, to 
disclose information regarding HVLS 2022-2, Parts 1 and 2, including, 
but not limited to, the identity of any successful eligible 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 reverse mortgage loans. 
Even if HUD elects not to publicly disclose any information relating to 
HVLS 2022-2, Parts 1 and 2, HUD will 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 HVLS 2022-2, Parts 1 and 2 and does not 
establish HUD's policy for the sale of other reverse mortgage loans.

Julia R. Gordon,
Assistant Secretary for Housing--FHA Commissioner.
[FR Doc. 2022-14147 Filed 6-30-22; 8:45 am]
BILLING CODE 4210-67-P