CMBS Loan Modifications

This chart outlines the circumstances under which modifications may be made to CMBS loans included in REMICs or grantor trusts without causing the related REMIC or grantor trust to fail to qualify as such, both before and after default on a loan is "reasonably foreseeable" or has occurred. This chart applies only for loans that were acquired when default was not reasonably foreseeable; different rules may apply to loans that were distressed when acquired. Although REMIC and grantor trust rules provide flexibility to modify loans (where default is reasonably foreseeable), there may be less flexibility in modifying or amending the terms of certificates (e.g., changes in waterfalls, waivers of current interest); these amendments would require further analysis on a case-by-case basis.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.