How big a hole is the FDIC in? They just sold a portfolio of mortgages with a face value of $491 million to a company in Charlotte NC. The buyer gets 50% of the money they recover, the FDIC gets half. The winning bid was $34 million.
Home mortgages are first in line before all creditors. In theory the mortgage is worth the value of the land and buildings, after the expenses to fix the property and sell it.
So that’s saying that $491M in mortgages has a net value of only $68 million… Or a loss of 87%…
Since the president wants to block foreclosures and force mortgage holders to write down principal, I am surprised anyone made a bid at all.
