Bank of America Corp. is set to auction off $90 million in nonperforming and current loans, and PHH Corp. is sending out feelers on a $15 million portfolio, indicating that the toxic asset market might be reviving.
A notice of the B of A auction provided to National Mortgage News said the Charlotte banking company took over the loans as part of a collateral pledging agreement dating from 2006.
The circular on the deal said the mortgages will be sold "all in, as is" and for cash to the highest bidder, though B of A reserves the right to reject all bids. The auction deadline is Aug. 25.
Few details were available about the potential PHH auction. One bidder said the portfolio has been offered before but that the Mt. Laurel, N.J., mortgage company did not like the prices offered. A PHH spokeswoman did not return a telephone call about the matter.
Meanwhile, American International Group Inc. may try to liquidate more nonprime whole loans out of its American General Financial Services unit in Evansville, Ind.
A hedge fund executive familiar with the deal said the insurer might once again use securitization. In July AIG announced plans to securitize $1.6 billion of performing and nonperforming mortgages. Its remaining portfolio totals $9 billion.