In a potential deal valued at upwards of $43 million, MetLife Bank is making a play for reverse mortgage assets owned by the former Lehman Brothers empire.
Bankruptcy court documents in the Southern District of New York outline a deal proposed by Lehman Brothers Holdings Inc. to sell two loan portfolios owned by the former investment bank to MetLife for an estimated purchase price of $43,415,000.
The price was calculated as an amount equal to the sum of 81.01% of the unsecuritized balances of the HMBS loans, plus the outstanding balance of the Lehman loans and factors repurchase costs. The HECM portfolios come with all obligations and rights, according to the documents, which state there is a hearing scheduled June 15 to determine LBHI’s authority in being able to “sell certain residential reverse mortgage loans and LBHI’s interests in the unsecuritized balances of two portfolios of fixed and floating rate reverse mortgage loans” to MetLife.
The portfolios, which were securitized under Ginnie Mae’s HMBS program, included securitization pools in the amounts of $220.5 million and $32.1 million in early 2008. As of April 30, 2011, the future funding obligations is estimated to be as much as $75 million according to court documents.
The deal factors into a larger effort to sell off remaining LBHI assets, amounting to a collective $60 billion estate, that would aid in paying back the company’s creditors following its bankruptcy in September 2008.
Written by Elizabeth Ecker