TALF CMBS Expansion Raises Hopes

Earlier this week, the Federal Reserve announced that it is expanding the TALF (Term Asset-Backed Securities Loan Facility) to include real-estate backed bonds that were created before this year. Previously, the TALF program only accepted newly issued CMBS as collateral. Bonds for both new and legacy are being required by the Fed to have at least two AAA ratings from DBRS, Fitch Ratings, Moody’s Investors Service, Realpoint or Standard & Poor’s and if a rating below AAA from any one of these agencies would disqualify the collateral from the program. This move should be applauded by the CRE as it is another way to help stimulate the CRE industry and make a significant comeback.

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