92496 Resource 78777 78860 1071 1118711677113 1215929242732 Controlled Commercial Financing and Understanding Conduits

What is a Real Estate Mortgage Investment Conduit?

<p>A <span style="FONT-WEIGHT: bold; FONT-STYLE: italic">conduit</span> is short for a REMIC, which is the acronym for a Real Estate Mortgage Investment Conduit.<br /><br />About ten years ago Congress passed a law that said if a bunch of commercial mortgages were contributed to a trust, and the trust did not make new mortgages or modify the old ones, the trust could then issue bonds backed by the mortgages in the pool and <span style="TEXT-DECORATION: underline">the trust would not have to pay income taxes on the mortgage income</span>. &nbsp; Only the bondholders would have to pay taxes on their interest income.<br /><br />This new tax law was huge.&nbsp; In effect, it created the wonderful commercial mortgage securitization market that thousands of commercial borrowers now enjoy.&nbsp; The trust described above is the REMIC; i.e., the conduit through which securitized commercial mortgages now pass tax-free.<br /><br />However, in the venacular of the industry, the mortgage bankers or investment banks that originate the commercial mortgages that go into the REMIC's are now called <span style="FONT-WEIGHT: bold; FONT-STYLE: italic">conduits</span> or <span style="FONT-WEIGHT: bold; FONT-STYLE: italic">conduit lenders</span>.<br /><br />You can apply to scores of conduit lenders on C-Loans.<br /><br /><br /></p> 9 application/xml false CMBS financing CMBS loan commercial financing commercial loans commercial mortgage commercial real estate loan conduit financing conduit loan Apply to Scores of Conduit Lenders http://www.c-loans.com/onlineapp Mozilla/4.0 (compatible; MSIE 7.0; Windows NT 5.1; .NET CLR 1.1.4322; .NET CLR 2.0.50727) 127.0.0.1 127.0.0.1 johngaudio 216.87.92.57 false true false false true 198508 false false true false false false true 78777 blog blogsite/CLoans/web