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Fannie Mae and Freddie Mac announced new lending caps last month. Starting October 1, the agencies have new caps of $100 million for each agency. At the GlobeSt Apartments conference this week in Los Angeles, speakers on the Financing Strategies: Developing an Approach that Meets your Goals panel said the announcement has revived certainty in the market. The panel conversation included Jeff Burns, managing director at Walker & Dunlop; Jerry Fink, managing partner at The Bascom Group; Greg Reed, SVP of originations at Capital One Multifamily Finance; Ron Rossi, VP of investor management services; Jim Wiegandt, EVP and head of real estate banking at Banc of California.

“It is fantastic for everyone in this room to have the certainty in place for the next five quarters,” said Burns on the panel. The agencies have a new regulator, and there was nervousness in the market about how the regulator would approach the business. In fact, there was such uncertainty, lending activity came to a screeching halt in the agency business. “Now, they have set out clear guidelines,” added Burns.

The new guidelines include getting rid of the separate green program so that all lending is under the lending caps. They also put a mandate that 37.5% has to qualify as affordable housing, which is roughly in line with the current rate. The new announcement has been well received by the market. “There is certainty now, and we have seen in the last few weeks that they have turned the spigot back on,” said Burns.

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Kelsi Maree Borland

Kelsi Maree Borland is a freelance journalist and magazine writer based in Los Angeles, California. For more than 5 years, she has extensively reported on the commercial real estate industry, covering major deals across all commercial asset classes, investment strategy and capital markets trends, market commentary, economic trends and new technologies disrupting and revolutionizing the industry. Her work appears daily on GlobeSt.com and regularly in Real Estate Forum Magazine. As a magazine writer, she covers lifestyle and travel trends. Her work has appeared in Angeleno, Los Angeles Magazine, Travel and Leisure and more.

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