Citi Announces Sale of Mortgage Servicing Rights for Loans with Unpaid Principal Balance of $10.3B
Citi (NYSE: C) announced it has signed a definitive agreement for the sale of Mortgage Servicing Rights for approximately 64,000 Fannie Mae residential first mortgage loans. The Mortgage Servicing Rights primarily reside in Citi Holdings and are tied to Fannie Mae loans with outstanding unpaid principal balances of approximately $10.3 billion.
The sale includes the majority of the delinquent loans serviced by CitiMortgage for Fannie Mae, and it represents nearly 20% of the total loans serviced by CitiMortgage that are 60 days or more past due. As part of the agreement, Citi and Fannie Mae substantially resolved pending and future compensatory fee claims related to Citi's servicing practices on these loans.
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. Citi will continue to explore opportunities to further reduce Citi Holdings assets.
The transfer of servicing will begin in the first quarter and will continue into the third quarter of 2014. Citi will work diligently to ensure a smooth transition in the servicing of these loans for impacted customers.
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