A loan sale agreement — also called a loan purchase agreement — is the contract by which a lender sells a loan, its documents, and its collateral rights to a buyer. It sets the price, the cut-off date, and the closing deliverables (the endorsed note or allonge, an assignment of the mortgage or deed of trust, and the loan file), and it typically transfers the loan as-is, with limited representations by the seller.
The seller’s representations usually cover only what the seller can know with certainty: that it owns the loan, has authority to sell it, has not previously assigned it, and that the stated balance is accurate. Everything else — collateral condition, borrower defenses, collectability — is priced by the buyer. A short, standard agreement with limited representations is a large part of what makes a sale fast. See how to sell a commercial loan.
Why credits like this reach a workout desk: bank noncurrent commercial real-estate loans have risen while reserve coverage slips at community banks (FDIC Quarterly Banking Profile), and roughly $957 billion of commercial and multifamily mortgage debt was scheduled to mature in 2025 — against a total market of about $4.8–5.0 trillion, ~38% of it held by banks and thrifts (Mortgage Bankers Association). See the CRE distress statistics hub for the full figures and sources.
Primary sources: FDIC Quarterly Banking Profile, Mortgage Bankers Association, and interagency (FDIC / OCC / Federal Reserve) guidance on CRE loan accommodations and workouts. Figures are directional and updated periodically; confirm the latest release before relying on a specific number.
Title to the loan, authority, no prior assignment, and the accuracy of the balance and payment history. Broader representations about the collateral or borrower are uncommon in as-is sales.
The agreement allocates it; usually the seller sends a goodbye letter and the buyer a hello letter, and servicing transfers on a stated date.
With a buyer that uses a short, standard form, days rather than weeks. Request a confidential review.