[Federal Register Volume 88, Number 211 (Thursday, November 2, 2023)]
[Notices]
[Pages 75302-75304]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2023-24163]


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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-6396-N-02]


Notice of HUD Vacant Loan Sales (HVLS 2024-1)

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 announces HUD's intention to competitively offer 
approximately 1,610 reverse mortgage notes secured by vacant properties 
with a loan balance of approximately $395 million. The sale will 
consist of due and payable Secretary-held reverse mortgage loans. The 
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 Secretary will 
prioritize up to 50 percent of the offered assets for award to 
nonprofit organizations or governmental entity bidders with a 
documented housing mission. This notice also generally describes the 
bidding process for the sale and certain entities who are ineligible to 
bid. This is the eleventh sale offering of its type and will be held on 
December 5, 2023.

DATES: For this sale action, the Bidder's Information Package (BIP) 
will be made available to qualified bidders on or about October 31, 
2023. Bids for the HVLS 2024-1 sale will be accepted on the Bid Date of 
December 5, 2023 prior to 12:00 ET (Bid Date). HUD anticipates that 
award(s) will be made on or about December 8, 2023 (the Award Date).

ADDRESSES: To become an eligible bidder and receive the BIP for the 
December 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 with free login on 
the Transaction Specialist (TS), Falcon Capital Advisors, website: 
http://www.falconassetsales.com. This website contains information and 
links to register for the sale and electronically complete and submit 
documents.
    If you cannot 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; telephone 202-708-2625, 
extension 3927 (this is not a toll-free number). HUD welcomes and is 
prepared to receive calls from individuals who are deaf or hard of 
hearing, as well as individuals with speech or communication 
disabilities. To learn more about how to make an accessible telephone 
call, please visit https://www.fcc.gov/consumers/guides/telecommunications-relay-service-trs.

SUPPLEMENTARY INFORMATION: This notice announces HUD's intention to 
sell in HVLS 2024-1 due and payable Secretary-held reverse mortgage 
loans. HUD is offering 1,610 reverse mortgage notes with a loan balance 
of approximately $395 million. The 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.
    In this offering, HUD also intends to awarda single asset pool 
consisting of a reverse mortgage loan secured by a New York single 
family property (``Mark House'') in Albany County that was listed on 
the National Register of Historic Places on August 29, 2022. This 
single asset pool has a loan balance of approximately $325 thousand. 
For the single asset pool, HUD will only accept bids from nonprofit 
organizations or units of State or local government with a housing 
mission that qualify as Priority Bidders in this sale.
    A listing of the 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 mortgage loans.

The Bidding Process

    The BIP describes in detail the procedure for bidding in HVLS 2024-
1. The BIP also includes the applicable standardized non-negotiable 
Conveyance, Assignment and Assumption Agreements for HVLS 2024-1 
(CAAs). The CAAs will contain first look requirements and mission 
outcome goals.
    HUD will evaluate the bids submitted and determine the successful 
bids, in terms of the best value to HUD, in its sole and absolute 
discretion. If a bidder is successful, it will be required to submit a 
deposit which will be calculated based upon the total dollar value of 
the bidder's potential award. Award will be contingent on receiving the 
deposit in the timeframe outlined in the deposit letter. The deposit 
amount will be applied towards the purchase price at settlement.
    This notice provides some of the basic terms of sale. The CAAs will 
be released in the BIP or BIP Supplement, as applicable. These 
documents provide comprehensive contractual terms and conditions to 
which eligible bidders will acknowledge and agree. To ensure a 
competitive bidding process, the terms of the bidding process and the 
CAAs 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.

[[Page 75303]]

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 
HUD's authority in 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 HVLS 2024-1 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

    In order to bid in HVLS 2024-1 as an eligible bidder, a prospective 
bidder must complete, execute, and submit a Confidentiality Agreement, 
a Qualification Statement (HUD-9611), and an Addendum for Nonprofit and 
Government Pools and Sub-pools (HUD-9612), as applicable (collectively, 
for these bidders, the Qualification Statement (HUD-9611) and Addendum 
for Nonprofit and Government Pools and Sub-pools (HUD-9612), as 
applicable, shall be defined as the Qualification Statement) that is 
acceptable to HUD. Eligible bidders seeking to be awarded loans on a 
priority basis must submit the Confidentiality Agreement, Qualification 
Statement (HUD-9611), and Addendum for Nonprofit and Government Pools 
and Sub-pools (HUD-9612), and Housing Mission Supplemental 
Certification (collectively, for these bidders, the Qualification 
Statement (HUD-9611) and Addendum for Nonprofit and Government Pools 
and Sub-pools (HUD-9612), and Housing Mission Supplemental 
Certification shall be defined as the Qualification Statement), that is 
acceptable to HUD. In the Qualification Statement, the prospective 
bidder must provide certain representations and warranties regarding 
the prospective bidder, including (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 included in HVLS 
2024-1 if the prospective bidder, its Related Entities, or its 
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 Conveyance, Assignment and Assumption 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 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 10 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.

[[Page 75304]]

    In addition, for those eligible bidders seeking to be awarded 
mortgage loans on a priority basis and signing the Housing Mission 
Supplemental Certification, each prospective bidder must provide 
documentation and certify that its charitable or government purpose has 
a qualifying housing mission and that its participation in the sale is 
a furtherance of that housing mission.

Freedom of Information Act Requests

    HUD reserves the right, in its sole and absolute discretion, to 
disclose information regarding HVLS 2024-1, 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 HVLS 2024-1, 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 2024-1 and does not establish HUD's 
policy for the sale of other mortgage loans.

Julia R. Gordon,
Assistant Secretary for Housing FHA Commissioner.
[FR Doc. 2023-24163 Filed 11-1-23; 8:45 am]
BILLING CODE 4210-67-P