Best Practices for Executing a Defeasance A successful defeasance requires the timely execution of a number of critical steps. Having an expert on your side is essential to ensure the defeasance is executed properly and fairly. Chatham’s defeasance consultants will help you navigate the process and will ensure you receive the best terms, market standards, and a fair cost. To help you understand borrower requirements and to illustrate how Chatham can assist with your defeasance, the following guide outlines the critical steps involved in a defeasance transaction: Printer-Friendly Version

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When deciding to prepay your fixed rate CMBS debt, whether through yield maintenance or defeasance, most borrowers have questions. Here are a few of the more common ones, but if you have others, or just want to talk to a defeasance expert, don’t hesitate to contact us.

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Best Practices for Executing a Defeasance A successful defeasance requires the timely execution of a number of critical steps. Having an expert on your side is essential to ensure the defeasance is executed properly and fairly. Chatham’s defeasance consultants will help you navigate the process and will ensure you receive the best terms, market standards, and a fair cost. To help you understand borrower requirements and to illustrate how Chatham can assist with your defeasance, the following guide outlines the critical steps involved in a defeasance transaction. Download This Bulletin

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Defeasance Frequently Asked Questions When deciding to prepay your fixed rate CMBS debt, whether through yield maintenance or defeasance, most borrowers have questions. Here are a few of the more common ones, but if you have others, or just want to talk to a defeasance expert, don’t hesitate to contact us. 610.925.3120 Download Defeasance FAQs

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Understanding Yield Maintenance Both yield maintenance and defeasance allow borrowers to unencumber the underlying real estate asset. However, from a legal and economic perspective, the two processes are fundamentally different. Yield maintenance is the actual prepayment of the loan. Defeasance on the other hand entails a substitution of collateral and assumption of the loan by the Successor Borrower. Download This Bulletin

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On-time closing, low out of pocket fees, value return When deciding to prepay your fixed rate CMBS debt, you are generally faced with two options: yield maintenance or defeasance. The intent of each method is to protect the investment of the bondholder, but each carries intricacies and pitfalls that can have a dramatic effect on return. As the first firm in the market to bring transparency to residual value in the defeasance process, Chatham enables property and portfolio owners to make informed, lucrative prepayment decisions. Regardless of the loan’s size or complexity, Chatham will provide clear explanation to help clients realize cost savings, enhanced quality of work and documentation, and eliminate associated risk to avoid delaying closing. How Chatham’s experience handles defeasance Chatham’s dedicated experts in defeasance and prepayment are focused on preparing accurate and timely analysis and estimates, ensuring…

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Exit Strategies May/June 2008 An indepth look at the difference between Yield Maintenance and Defeasance provisions and how different market conditions impact the cost of each. Download Now

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