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Secondary Market

More CMBS Loans Moving to Special Servicing: Fitch

Loans within commercial mortgage-backed securities (CMBS) are transferring to special servicing in larger batches and with increasing speed, Fitch Ratings said in its weekly U.S. CMBS newsletter. Last month saw 248 loans totaling $4.27 billion move into special servicing. That figure is four times the balance that transferred in January of last year.

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Commercial Real Estate Losses Could Hit $300 Billion: TARP Panel

Losses from defaults on commercial real estate loans maturing in the next few years could go as high as $300 billion, threatening to topple nearly 3,000 community banks nationwide, a federal watchdog group has concluded. Market analysis by the Congressional Oversight Panel, charged with keeping tabs on the government's Troubled Asset Relief Program (TARP), shows that none of the banks classified by federal guidelines as having a ""CRE Concentration"" are among the nation's largest holding companies.

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Company Proposes Paying Homeowners Not to Walk Away

With tumbling property values leaving nearly a quarter of borrowers owing more on their mortgage than the home is worth, some may find it tempting to walk away - either to get out from under the debt completely or to force the servicer's hand for a modification. This idea of ""strategic default"" has become a universal concern within the industry, but one New Jersey company says it has a plan to counter such calculated flights of exodus. According to the Loan Value Group LLC, it's time to pay current borrowers to stay that way.

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Keystone Completes Market’s First Multi-Borrower CMBS in Two Years

Keystone Property Group, a real estate developer, manager, and investor of office and industrial properties, announced this week that it has completed a $53.5 million refinancing for one of its properties in the Pittsburgh submarket with what the company says is the first multi-borrower commercial mortgage-backed securities (CMBS) deal in nearly two years. With the entire commercial real estate industry concerned about the ability to obtain financing, Keystone says this loan may signify that lending has begun to return to the market.

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BOK Financial Acquires Rights to Service $4 Billion of Mortgages

BOK Financial Corp. in Tulsa, Oklahoma, has acquired the rights to service a $4.1 billion portfolio of mortgage loans from Albuquerque, New Mexico's Charter Bank. The acquisition boosts BOK's current $7.4 billion servicing portfolio by 46 percent. The loans are predominantly held by Fannie Mae, Freddie Mac, and Ginnie Mae, with approximately three quarters from customers in New Mexico.

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Homebuilder Buys $3B in Troubled Real Estate Loans from FDIC

One of America's largest homebuilders is getting into the loan restructuring business. Lennar Corporation has purchased two loan portfolios from the FDIC worth $3 billion. Lennar paid $243 million for the portfolios, which include 5,500 distressed residential and commercial real estate loans from 22 failed banks. The Miami-based builder says acquiring and working out troubled real estate loans was an ""extremely profitable"" part of its business during the last real estate down cycle.

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Bernanke Gives Blueprint for Stimulus Pull-Back

Federal Reserve Chairman Ben Bernanke on Wednesday laid out the central bank's plan for exiting the private credit market and pulling back the trillions of dollars its funneled into the economy to stave off a repeat of the Great Depression. Bernanke stressed that the programs were implemented with no cost to taxpayers, have helped to restart the flow of credit, and are already being ""substantially"" phased out.

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Former ProLogis COO Joins Cassidy Turley

According to a recent company announcement, Diane S. Paddison has been appointed as chief strategy officer at Cassidy Turley, a commercial real estate service provider headquartered in St. Louis. In addition, she will serve as a member of the board of directors and the executive committee of the company.

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Fannie Mae to Purchase Delinquent Loans from MBS Trusts

Following in the steps of its sibling company, Fannie Mae has announced that it too will be buying back bad loans from mortgage-backed securities (MBS) investors in bulk. The GSE said it will begin ""significantly"" picking up the pace of its purchases of loans that are at least 120 days past due, beginning in March. Fannie did not disclose an exact dollar amount of the repurchases, but did say that as of December 31, the total of such loans was $127 billion.

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Freddie Mac to Buy Back More than $71B in Delinquent Loans

Freddie Mac said Wednesday that it will purchase ""substantially all"" mortgages that are 120 days or more delinquent from the company's fixed-rate and adjustable-rate mortgage Participation Certificate (PC) securities. With new accounting rules that took effect January 1, the company said it is cheaper to buy and hold these nonperforming loans on its books than to pay guarantee fees to security investors. As of December 31, 2009, the aggregate balance of such loans was just over $71 billion.

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