Under this new process, when Precept presents a commercial mortgage securitization to S&P that includes commercial real estate loans, the CMBS rating process is accelerated. Because S&P analyzes the loans at origination, there is no need for further evaluation when the loan is securitized, as long as this takes place within a specified time period.
The site is said to free brokers from showing preliminary transactions to different lenders to determine interest, and then coming back to them for commitments. All due diligence requirements are finalized by Precept, which then offers the transaction at auction. The site allows lenders to review the underwriting documentation and then to place bids online. Advantages of this approach are more stable pricing and quicker closings.
John Westerfield, a managing director of Morgan Stanley Dean Witter, notes that, "Precept has a strong potential for enhancing the mortgage origination and underwriting process. It's been established by experienced mortgage professionals, and their approach offers value to brokers, lenders and borrowers."Precept is a privately held firm formed in 1999 by Frank Scavone and Joseph Heil.
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