A few years ago, the CRE Finance Council, a trade association for the commercial real estate finance industry, set up a task force to propose improvements to address long-running borrower complaints regarding the servicing of CMBS conduit loans. The formation of the task force resulted from concerns that poor customer service would drive borrowers away from CMBS conduit loans.
Borrowers report seeing improvements as the CREFC task force, lenders and servicers all move to improve borrower servicing experiences. In February 2018, the task force recommended ten voluntary guidelines for CMBS lenders to follow in crafting loan documents. Those recommendations are largely designed to improve consistency and remove ambiguities that can later lead to disagreements between borrowers and loan servicers. These recommendations are starting to be included in the Master Servicing and Pooling Agreements, the guideline document for servicing CMBS loans.
Meanwhile, lenders and servicers have adopted varying changes aimed at improving communication with borrowers, reducing or eliminating certain fees, and streamlining the approval process for new tenants, property releases, loan assumptions and other borrower requests. Borrowers should continue to see servicing improvements as other recommendations are adopted in the future.