A deal has been struck for the sale of mortgage servicing rights on more than $10 billion in Fannie Mae loans.
The current servicer on the underlying loans is CitiMortgage Inc., a news release Wednesday from parent Citigroup Inc. stated.
A definitive agreement was signed by the New York-based firm to sell MSRs on around 64,000 residential first mortgages.
The aggregate unpaid principal balances on the loans is approximately $10.3 billion.
The MSRs are currently owned by Citi Holdings.
Citi noted that the pool represents the majority of delinquent loans that CitiMortgage services for Fannie and 20 percent of all of its loans that are at least 60 days past due.
The deal enables Citi to resolve pending and future compensatory fee claims related to Citi’s servicing practices on the loans.
Transferring of the servicing will begin in the first quarter and is expected to be completed by the third quarter.
“This transaction advances Citi’s ongoing objective to reduce assets and expenses within Citi Holdings and more efficiently aligns Citi’s mortgage servicing operations with current business needs,” the statement said. “Citi will continue to explore opportunities to further reduce Citi Holdings assets.”
Citi didn’t identify the buyer, but published reports say that Fannie, itself, acquired the MSRs with the intention of passing them on to another servicer.
