Capital
Consortium Releases Revised Documents
The Capital Consortium
continues to be a viable forum for addressing economic and regulatory developments as they
impact the commercial capital markets. For those of you who may not be familiar with the
Consortium, it is comprised of:
- The Mortgage Bankers Association of America
- The National Realty Committee
- The National Association of Realtors
- The Bond Market Association
- And Commercial Mortgage Securities Association
Recent activity of the Consortium
includes:
- A release at the end of April of a streamlined set
of documents designed to expand the secondary market for commercial mortgages and
encourage the flow of capital to income-producing real estate properties, including
multifamily properties.
- The Capital Markets Initiatives, as these
documents are known, are meant to be used as guidelines to promote greater efficiency,
credit availability and cost savings in the capital markets for commercial and multifamily
real estate loans.
The updates are the result of feedback from
lenders, borrowers, rating agencies, mortgage-backed securities investors and other users
of the Initiatives over the past three years. These updates are:
A revised Capital Markets
Mortgage and Security Agreement- a template for commercial mortgages that can be easily
and predictably rated to facilitate the pooling of multiple mortgages for securitization
and sale into the secondary market
A revised Assignment of Leases and
Rents- provides broader lender protection in the event of a borrower bankruptcy filing
A revised Promissory Note
The original Initiatives
released in 1996 also included:
A Due Diligence Checklist-
identifies whether specific information is located within a loan document file
Data Elements Guidelines- acts as
a framework to better manage reporting information for security holders
National Policy Initiatives-
recommendations for reducing legislative and regulatory barriers to the development of an
efficient, commercial secondary mortgage market
A number of lenders and investors
have used these highly customizable templates to tailor individual transactions
and create more efficient processes.
These documents are part of the
reason that originating, packaging, and securitizing commercial and multifamily loans is
easier, faster and more affordable.
The recently released documents
are available on the internet at www.capitalconsortium.org.
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