The Internal Revenue Service on April 13 issued safe harbor guidance to help spur the modification of multifamily loans held by real estate mortgage investment conduits (REMICs). The guidance will augment the ability of REMICs to provide payment forbearances and make certain types of loan modifications without threatening their tax status or creating other negative tax consequences.
Loans eligible for assistance include those under which forbearance is made possible by the: (1) the Coronavirus Aid, Relief, and Economic Security (CARES) Act; or (2) voluntary or state-mandated forbearance programs available to borrowers experiencing direct or indirect hardship due to COVID-19.
This second prong is designed to, for example, cover non-Federally-backed CMBS loans. REMICs are used as securitization vehicles for mortgages, including multifamily mortgages and, thereby, help to generate liquidity in the marketplace.
For more information on the latest federal actions and guidance, please visit NMHC’s COVID-19 Legislative/Regulatory Relief webpage.
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