FANNIE MAE DUS®
Negotiated Pools
BENEFITS
- Optimize balance sheet management by strategically selling or swapping pools of loans for MBS.
- Improve portfolio liquidity.
- Manage and mitigate concentration risk, whether credit, geographic or borrower.
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ELIGIBILITY
- Permanent loans on multifamily rental properties comprised of five or more units.
- Loans must be closed, or “seasoned,” prior to purchase.
- Pool minimum size of $100 million.
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EXECUTION OPTIONS
MBS Swap: Exchange whole loans for Fannie Mae MBS to be held in portfolio or sold to a capital markets investor for immediate liquidity.
Wisconsin Avenue Security (WAS) REMIC: Fannie Mae tranches risk in a senior/subordinate capital structure, giving the lender the option of retaining the bonds or selling the bonds (to capital markets investors or to Fannie Mae).
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PROCESS
A pool transaction is a complex and intricate process that affects many aspects of a lender’s business. Fannie Mae has a dedicated and experienced team of credit, capital markets, legal, disclosure, operations and other professionals that will work with the lender from beginning to end, including:
- Pricing: Includes (1) evaluating and scrubbing the ‘data tape’ to ensure initial compliance, (2) determining the best execution based on the lender’s preferences and market conditions, and (3) providing indicative bids.
- Loan Level Due Diligence: Thorough data, credit, and legal review.
- Rate Lock: Manages the lender’s interest rate exposure.
- Closing and Funding: Executing transaction documents and releasing funds.
Although each transaction varies depending on pool size, data quality, and loan characteristics, the entire process – from initial tape to funding – generally takes 8 to 12 weeks.
