SAN ANTONIO, TEXAS (June 22)—The Mortgage Bankers Association’s Commercial Multifamily Business Group today released three guidelines to help
bring uniformity to the commercial real estate finance industry for commercial-mortgage backed securities (CMBS).
These initiatives deal with a description of contracts surrounding CMBS transactions, the roles of primary servicers and master
servicers in a CMBS transaction, and a commercial property inspection form.
- MBA has published a document describing the types of contracts commercial mortgage bankers must negotiate and execute to originate
and service loans for CMBS. Titled Commercial Mortgage-Backed Securities Origination and Servicing Agreements for Commercial Mortgage Bankers, the publication includes a summary of controlling documents used in CMBS originations and servicing.
"For the first time in the eight-year evolution of CMBS, the industry now has a primer encapsulating the key elements of documents
that essentially comprise standard industry operating procedures today," commented Mark Hill, senior vice president of Laureate
Capital and vice chairman of MBA’s Asset Administration Committee.
- The roles and responsibilities of servicers in CMBS transactions are outlined in an MBA white paper and accountability matrix
describing guidelines for the industry to ensure that all functions are accounted for and thereby facilitate faster turnaround
times for borrowers. The guidelines also serve as a starting point for contract negotiations between primary and master servicers
"In addition to helping educate new primary servicers, we expect these documents to reduce rating agency concerns regarding
the absence of clearly defined roles and responsibilities in CMBS transactions," stated Ann Hambly, managing director of Prudential
Mortgage Capital and chairman of MBA’s CMBS Roles and Responsibilities Task Force.
- MBA’s Property Inspection Task Force developed a standard form for commercial property inspections—an Excel file—that can
be downloaded directly from MBA’s Web site (www.mortgagebankers.org) and used on laptop computers in the field.
"This property inspection form establishes a standard, portable, electronic format," said Janice Smith, vice president of Chase
Manhattan Bank and chairman of MBA’s Asset Administration Committee. Co-chaired by Smith and Lisa Traylor of First Union Bank,
the task force included representatives from life companies, mortgage bankers, CMBS master and special servicers, and vendors.
"The task force found that the different forms currently required by investors have approximately 85 percent of the same data
elements. With so much consensus in the market, the time seemed right to adopt a standard form."
The guidelines do not represent standards the industry must follow but are intended as statements of the generally accepted business practices currently in use, according to the MBA
Commercial Multifamily Business Group.
|