This is one of several pieces that will need to fall into place to stave off massive defaults and foreclosures on overleveraged or de-valued CMBS deals. As a commercial loan modification advisory firm, we have close relationships with several special servicers, and one comment that is repeated over and over is that there is misalignment and conflicting interests between all the parties (i.e. servicer, master servicer, special servicer, controlling class, Trust, bondholders etc...) on the debt side of the transaction which prohibits sensible actions. If a universal protocol for dealing with troubled CMBS loans could be enacted, the overall damage to the financial system and the economy as a whole would be significantly reduced.
This is one of several pieces that will need to fall into place to stave off massive defaults and foreclosures on overleveraged or de-valued CMBS deals. As a commercial loan modification advisory firm, we have close relationships with several special servicers, and one comment that is repeated over and over is that there is misalignment and conflicting interests between all the parties (i.e. servicer, master servicer, special servicer, controlling class, Trust, bondholders etc...) on the debt side of the transaction which prohibits sensible actions. If a universal protocol for dealing with troubled CMBS loans could be enacted, the overall damage to the financial system and the economy as a whole would be significantly reduced.
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