OUTSTANDING CRE DEBT CONTINUES TO INCREASE, IN SPITE OF TIGHTER CREDIT STANDARDS

 


Today’s post is written by Michael Green, Commercial Loan Originator for Counsel Mortgage Group, LLC

Credit is the lifeblood of the economy, therefore a substantial tightening in credit conditions could cut the current recovery short. The latest Senior Loan Officer Opinion Survey points to banks tightening credit across all major loan categories. But loans at commercial banks account for only about 30% of the total credit extended to the U.S. private non-financial sector. Debt capital markets are more or less wide open again, which has helped keep credit flowing to larger businesses, and to households indirectly.

The level of commercial/multifamily mortgage debt outstanding rose by $43.6 billion to $3.76 trillion, or 1.2% increase, during Q2-20, according to the Mortgage Bankers Association’s (MBA) latest Commercial/Multifamily Mortgage Debt Outstanding quarterly report.  Multifamily mortgage debt alone increased $32.2 billion to $1.6 trillion from Q1.

Despite a drop-off in originations during Q2, “the total amount of mortgage debt outstanding continued to rise,” said Jamie Woodwell, MBA’s VP of commercial real estate research. “The pandemic is having different impacts on various property types and capital sources. Loans backed by multifamily properties accounted for almost three-quarters of the total growth, and Fannie Mae, Freddie Mac, and FHA accounted for nearly three-quarters of that amount.”

The four largest lender groups are:

  1. banks and thrifts;
  2. GSE portfolios and MBS;
  3. life insurance companies; and
  4. asset-backed securities including CMBS.

If you think we might help you with your development, acquisition, or refinancing project, give us a call at the Counsel Mortgage Group.

 

We offer a variety of products and services, ask us how we can assist you today:
Counsel Mortgage Group®, LLC
480-502-1000
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AZ MB #0909580
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