Posted on Thursday, 09.17.2009
IRS Issues Rules to Improve Mortgage Financing on Commercial Real Estate
It will soon be easier to refinance Miami commercial real estate
loans. The IRS issued new rules this week designed to ease the process.
The rules would allow Miami commercial real estate loans
that are part REMICs (Real Estate Mortgage Investment Conduits) or, to be refinanced without setting off tax penalties for investors.
The investment pools were intended to encourage mortgage-backed securities by offering tax benefits not normally available through other investment tools. But under the old rules investors could have lost those benefits if loans in the portfolio were reorganized.
As Wall Street braces for a wave of defaults on Miami commercial real estate loans the new regulations emerge. Hundreds of more banks are expected to crash over the next few years mostly because of souring loans for commercial real estate. Over 90 United States banks have already failed this year.
Lenders, borrowers, servicers, and sponsors of securitizations of mortgages in REMICs will be affected by these changes.
However, commercial mortgage loans held by investment trusts will not be affected. Tuesday, the Internal Revenue Service said it is soliciting comments on possibly expanding the changes to other investment vehicles.