Hedge Funds Eye Troubled Home Loans

November 7, 2011

As U.S. banks increase efforts to shed troubled residential mortgage assets, more hedge funds are considering opportunities to buy pools of whole home loans at discount prices.

Finance officials expect the pace of portfolio sales to pick up as banks look to boost capital and avert potential litigation with regard to their foreclosure practices. The Federal Reserve reports that U.S. commercial banks owned $3.5 trillion of outstanding mortgage debt as of Sept. 30.

Source: "Hedge Funds Eye Opportunities Posed by Troubled US Home Loans," Hedge Funds Review (Nov. 7, 2011)

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