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[Federal Register Volume 89, Number 208 (Monday, October 28, 2024)]
[Notices]
[Pages 85553-85555]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-24994]

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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

[Docket No. FR-6497-N-01]

Notice of HUD-Held Non Vacant Loan Sales (HNVLS 2025-1)

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

ACTION: Notice.

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SUMMARY: This notice announces HUD's intention to competitively offer 
approximately 1,180 home equity conversion mortgages (HECM, or reverse 
mortgage loans) secured by occupied properties with a loan balance of 
approximately $500 million. The sale will consist of due and payable 
Secretary-held reverse mortgage loans. The mortgage loans consist of 
first liens secured by real property that is occupied, where the 
borrower and co-borrowing spouse are deceased, and heirs have not come 
forward in the time elapsed. 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 first sale 
offering of its type and will be held on December 11, 2024.

DATES: For this sale action, the Bidder Information Package (BIP) will 
be made available to qualified bidders on or about November 12, 2024. 
Bids for the HNVLS 2025-1 sale will be accepted on the Bid Date of 
December 11, 2024. HUD anticipates that award(s) will be made on or 
about December 16, 2024 (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 HNVLS Loan Sale Coordinator. eFax: 1-202-393-4125.

FOR FURTHER INFORMATION CONTACT: John Lucey, Director, Office of Asset 
Sales, Room 9216, 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 HNVLS 2025-1 due and payable Secretary-held reverse mortgage 
loans. HUD is offering 1,180 reverse mortgage notes with a loan balance 
of approximately $500 million. The mortgage loans consist of first 
liens secured by real property that is occupied, where the borrower and 
co-borrowing spouse are deceased, and heirs have not come forward in 
the time elapsed.
    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 HNVLS 
2025-1. The BIP also includes the applicable standardized non-
negotiable Conveyance, Assignment and Assumption Agreements for HNVLS 
2025-1 (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

[[Page 85554]]

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.

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 HNVLS 2025-1 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 HNVLS 2025-1 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 HNVLS 2025-1 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):

[[Page 85555]]

    (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.
    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 HNVLS 2025-1, 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 HNVLS 2025-1, 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 HNVLS 2025-1 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. 2024-24994 Filed 10-25-24; 8:45 am]
BILLING CODE 4210-67-P
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