Accession Number : ADA290721

Title :   Resolution Trust Corporation: Assessing Portfolio Sales Using Participating Cash Flow Mortgages.

Corporate Author : GENERAL ACCOUNTING OFFICE WASHINGTON DC GENERAL GOVERNMENT DIV

PDF Url : ADA290721

Report Date : FEB 1992

Pagination or Media Count : 45

Abstract : RTC was created to manage and dispose of the assets of insolvent thrifts. As of September 30, 1991, it held an inventory of assets totaling about $147 billion. Commercial real estate and land totaled about $15.7 billion of the inventory. These two categories include some of RTC's hardest-to-sell assets. RTC sells real estate assets using a variety of methods, including individual sales, auctions, and portfolio sales. Portfolio sales can be structured using cash, RTC seller financing, or other more flexible financing terms. This report will focus on portfolio sales using participating cash flow mortgages. Cash flow mortgages are financing structures in which the principal and interest payments (debt service) are determined by cash flow generated from the financed asset. They may also have a participating structure in which the lender and the borrower share in the cash flow and sales proceeds. The General Accounting Office's objectives were to assess the overall structure and implementation of RTC's pilot program of real estate portfolio sales using participating cash flow mortgages; and analyze at least three specific transactions in order to assess whether the disposition of RTC assets using this strategy was fair, reasonable, and economical. P.2-3 (KAR)

Descriptors :   *INVESTMENTS, *FINANCIAL MANAGEMENT, COMMERCE, ACCOUNTING, INVENTORY, PILOT STUDIES, FINANCE.

Subject Categories : Economics and Cost Analysis

Distribution Statement : APPROVED FOR PUBLIC RELEASE