Freedom Mortgage launches $350 million term B at Libor plus 600 bps

By Sara Rosenberg

New York, Jan. 31 – Freedom Mortgage Corp. launched on Tuesday its $350 million five-year term loan B (B1/BB-) with price talk of Libor plus 600 basis points with a 1% Libor floor and an original issue discount of 98, according to a market source.

The term loan has 101 hard call protection for one year and amortization of 2.5% per annum, the source said.

Covenants include maximum consolidated corporate debt to consolidated tangible net worth of 1.35 times with step-downs, maximum loan-to-value (LTV) ratio of 60% with step-downs to 45%, tangible net worth of $600 million, and minimum liquidity of the greater of $45 million and the Ginnie Mae liquidity requirement.

Barclays, J.P. Morgan Securities LLC and Nomura are the bookrunners on the deal.

Commitments are due at 5 p.m. ET on Feb. 14, the source added.

Proceeds will be used for general corporate purposes, including potential strategic acquisitions of Mortgage Servicing Rights.

Freedom Mortgage is a Mount Laurel, N.J.-based top tier residential mortgage company engaged in the origination, servicing, selling and securitizing of primarily agency-eligible residential mortgage loans.

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