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the latest ORIGINATION Or ig i nat ion s e r v ic i ng Freddie Mac Lists 2012's Top Multifamily Lenders C The Federal Reserve's Senior Loan Officer Survey reveals banks are a little more willing to lend as consumer demand cools. T he percentage of banks reporting stronger demand for mortgage loans dropped in the first quarter from the fourth quarter last year, and a slightly greater percentage are reporting easing lending standards, the Federal Reserve Reported. The results in the quarterly Senior Loan Officers Opinion Survey are consistent with anecdotal reports that mortgage loans are becoming easier to obtain. The survey results are reported as a diffusion index; that is, the percentage of respondents saying they are easing lending standards somewhat or considerably is subtracted from those who report they are tightening standards for a range of different lending products. In the case of "traditional" mortgage loans, 1.5 percent of respondents reported "somewhat" tighter standings, while 4.6 percent reported standards easing somewhat, and 1.5 percent reported standards easing considerably for a net 6.1 percent easing. Meanwhile, 92.3 percent said standards were unchanged. In the fourth quarter of 2012, a net 1.6 percent reported an easing in standards. While the survey results suggest a direction of lending standards, they could be misleading: A bank that has tightened lending standards as much as possible may not necessarily ease them but cannot tighten any further. (It would be the equivalent of tightening a faucet as far as possible—not tightening further does not mean loosening it.) In the survey, a net 2.9 percent of respondents reported tightening standards for "nontraditional" mortgages, and 20 percent reported tighter standards for subprime loans, though 61 of the 71 banks surveyed said they do not make subprime loans. Non-traditional mortgages, the Federal Reserve said, include but are not limited to adjustable-rate mortgages with multiple payment options, interest-only mortgages, and "Alt-A" products such as mortgages with limited income verification and mortgages secured by non-owneroccupied properties. A net 19 percent of banks surveyed said demand for prime mortgages was stronger in the first quarter than in the fourth. In the previous survey, a net 21 percent of banks said demand for prime mortgages was strengthening. se c on da r y m a r k e t BRE Capital Markets was 2012's top seller of multifamily loans, according to a release from Freddie Mac. The GSE reported a record $28.8 billion in new multifamily mortgage volume last year, comprising 435,000 rental units and resulting in more than $21 billion in mortgage securitizations. According to the company, the bulk of the credit for this achievement goes to six sellers in particular whose combined efforts accounted for 65 percent of Freddie Mac's total settlement volume for 2012. CBRE topped the list of sellers with a reported $6.2 billion in multifamily volume. It was followed by Berkadia Commercial Mortgage ($3.6 billion), Wells Fargo Multifamily Capital and Holliday Fenoglio Fowler ($2.4 billion each), Walker & Dunlop ($2.3 billion), and NorthMarq Capital ($1.9 billion). "These lenders are MVPs of multifamily finance, and we just won the Super Bowl by working well as a team. Together, we had a record year in loan purchases, with new and repeat borrowers," said John Cannon, SVP of sales and marketing for Freddie Mac Multifamily Production. Lending Standards Continue to Ease a na ly t ic s CBRE Capital Markets ranks No. 1 on the list of lenders with a reported $6.2 billion in multifamily volume. As many respondents said demand for nontraditional mortgage loans in the first quarter had strengthened as those who said demand weakened; in the previous quarterly survey, a net 3 percent said demand for nontraditional loans was stronger. Net demand for subprime loans in the first quarter was flat to the prior report. According to the survey, a net 2 percent of banks reported looser standards for credit card loans in the first quarter compared with a net 11 percent in the fourth quarter. A net 4 percent of banks surveyed said demand for credit cards had weakened somewhat in the first quarter compared with the fourth, when a net 8.5 percent of banks reported stronger demand for credit cards. Demand for commercial real estate (CRE) loans continued to strengthen in the first quarter with a net 40.3 percent of banks reporting stronger demand compared with a net 44.1 percent in the fourth quarter (after a net 23.4 percent in the third). A net 13.4 percent of banks reported easing standards on CRE loans in the first quarter compared with a net 8.8 percent in the fourth. The M Report | 51