2011-4029. Notice of Single Family Loan Sales (SFLS 2011-1)

AGENCY:

Office of the Assistant Secretary for Housing—Federal Housing Commissioner, HUD.

ACTION:

Notice of sales of mortgage loans.

SUMMARY:

This notice announces HUD's intention to sell certain unsubsidized single family mortgage loans, without Federal Housing Administration (FHA) mortgage insurance, in a series of competitive, sealed bid sales, commencing with the first sale offering (SFLS 2011-1). This notice also generally describes the bidding process for the sale and certain persons who are ineligible to bid. The sales are scheduled for March 9, June 22 and September 14, 2011.

DATES:

For the first sale action, the Bidder's Information Package (BIP) was made available to qualified bidders on February 9, 2011. Bids for the loans must be submitted on the bid date, which is currently scheduled for March 9, 2011. HUD anticipates that award(s) will be made on or about March 10, 2011.

ADDRESSES:

To become a qualified bidder and receive the BIP, prospective bidders must complete, execute, and submit a Confidentiality Agreement and a Qualification Statement acceptable to HUD. Both documents will be available on the HUD Web site at: http://www.hud.gov/​sfloansales. Please mail and fax executed documents to HUD's Asset Sales Office: Asset Sales Office, United States Department of Housing and Urban Development, 451 7th Street SW., Room 3136, Washington, DC 20410, Attention: Single Family Sale Coordinator, Fax: [phone].

FOR FURTHER INFORMATION CONTACT:

John Lucey, Deputy Director, Asset Sales Office, Room 3136, Department of Housing and Urban Development, 451 Seventh Street, SW., Washington, DC 20410-8000; telephone [phone], extension 3927. Hearing- or speech-impaired individuals may call 202-708-4594 (TTY). These are not toll-free numbers.

SUPPLEMENTARY INFORMATION:

HUD announces its intention to sell in SFLS 2011-1 certain unsubsidized non-performing mortgage loans (Mortgage Loans) secured by single family properties located throughout the United States. A listing of the Mortgage Loans will be included in the due diligence materials made available to bidders. The Mortgage Loans will be sold without FHA insurance and with servicing released. HUD will offer qualified bidders an opportunity to bid competitively on the Mortgage Loans.

The Bidding Process

The BIP will describe in detail the procedure for bidding in SFLS 2011-1. The BIP will also include a standardized non-negotiable Conveyance, Assignment and Assumption Agreement (CAA Agreement). Bidders will be required to submit a deposit with their bid. Deposits are calculated based upon each bidder's aggregate bid price.

HUD will evaluate the bids submitted and determine the successful bid, in terms of the best value to HUD, in its sole and absolute discretion. If a bidder is successful, the bidder's deposit will be non-refundable and will be applied toward the purchase price. Deposits will be returned to unsuccessful bidders. For the first sale action, closings are expected to take place on March 30, 2011 and May 5, 2011.

These are the essential terms of sale. The CAA Agreement, which will be included in the BIP, will contain additional terms and details. To ensure a competitive bidding process, the terms of the bidding process and the CAA Agreement are not subject to negotiation.

Due Diligence Review

The BIP will describe how 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 SFLS 2011-1 at any time prior to the award date. HUD also reserves the right to reject any and all bids, in whole or in part, without prejudice to HUD's right to include any Mortgage Loans in a later sale. Mortgage Loans will not be withdrawn after the award date except as is specifically provided in the CAA Agreement.

This is a sale of unsubsidized mortgage loans, which are to be assigned to HUD pursuant to section 204(a)(1)(A) of the National Housing Act, amended under Title VI of the Departments of Veterans Affairs and Housing and Urban Development and Independent Agencies Appropriations Act, 1999. The sale of the loans is pursuant to section 204(g) of the Act.

Mortgage Loan Sale Procedure

HUD selected a competitive sale as the method to sell the Mortgage Loans. This method of sale optimizes HUD's return on the sale of these Mortgage Loans, affords the greatest opportunity for all qualified bidders to bid on the Mortgage Loans, and provides the quickest and most efficient vehicle for HUD to dispose of the Mortgage Loans.

Bidder Eligibility

In order to bid in the sale, a prospective bidder must complete, execute and submit both a Confidentiality Agreement and a Qualification Statement acceptable to HUD. The following individuals and entities are ineligible to bid on any of the Mortgage Loans included in SFLS 2011-1:

(1) An employee of HUD, 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;

(2) An individual or entity that is debarred, suspended, or excluded from doing business with HUD pursuant to Title 24 of the Code of Federal Regulations, Part 24, and Title 2 of the Code of Federal Regulations, Part 2424;

(3) An individual or entity that has been 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.

(4) An individual or entity that has been 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;

(5) A contractor, subcontractor and/or consultant or advisor (including any agent, employee, partner, director, principal or affiliate of any of the foregoing) who performed services for or on behalf of HUD in connection with the Sales;

(6) A individual or entity that uses the services, directly or indirectly, of any person or entity ineligible under subparagraphs 1 through 3i above to assist in preparing any of its bids on the Mortgage Loans;

(7) A individual or entity which employs or uses the services of an employee of HUD (other than in such employee's official capacity) who is involved in the Sales;

(8) A entity or individual that serviced or held any Mortgage Loan at any time during the 2-year period prior to the bid is ineligible to bid on such Mortgage Loan or on the pool containing such Mortgage Loan, and

(9) A entity or individual that is: (a) Any affiliate or principal of any entity or individual described in the preceding sentence (paragraph 8); (b) any employee or subcontractor of such entity or individual during that 2-year period; or (c) 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 Mortgage Loan.

Freedom of Information Act Requests

HUD reserves the right, in its sole and absolute discretion, to disclose information regarding SFLS 2011-1, including, but not limited to, the identity of any successful 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 SFLS 2011-1, HUD will have the right to 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 SFLS 2011-1 and does not establish HUD's policy for the sale of other mortgage loans.

Dated: February 17, 2011.

David H. Stevens,

Assistant Secretary for Housing—Federal Housing Commissioner.