Multifamily Lending Update Week of 7/27/20
Your Multifamily Lending Update by EM CAPTIAL LLC.
Here’s the latest news from the major multifamily lenders:
Shares of mortgage loans in forbearance continues to decline for the 6th straight week.
Fannie Mae: Fannie processed $7.5 billion in June, totaling $30.3 billion for the year. Demand for Fannie SBL’s remain strong and rates remain somewhat competitive.
Freddie Mac: Freddie processed $33.7 billion dollars in new business volume in June down about 3.5% from 2019 YTD. Freddie continues to beat Fannie in application activity across the board, though both remain steady and confident in their processing abilities.
CMBS: The secondary market continues to strengthen.
Over the past few weeks, the AAAs have tightened by 10 basis points while BBBs have come in 20 basis points. This reveals strong investor demand for conduits but exposes the shortfall of new offerings in the market. Analysts project the single asset borrower (SASB) market will bounce back quicker given the higher quality nature of the assets and the lenders exposure to volatility.
Life Insurance Companies: The life insurance market has stabilized as more lenders begin increasing volume. Floor interest rates are declining slightly, rates have come down mid-to-high 2’s for some borrowers. Leverage currently sits around 60-65%.
FHA/HUD: High volume persists
Rates remain very low and continues to encourage demand for FHA loans. Volume continues to strain the FHA team and discussions regarding a queue process has begun, HUD recently announced a new program that allows borrowers to refinance new properties that are 3 years old.