Once a Yield Maintenance
penalty is paid, the lien is released from the real property, allowing the borrower to simultaneously either refinance, or sell their property free and clear.
Almost all conduit loans now require the loan to be defeased rather than paid off with a prepayment fee or yield maintenance
once the lock-out period expires.
Additionally, Freedom will pay yield maintenance
to the company as partial consideration for the sale, which equals USD750,000 per quarter in 2017.
The Lender charged a no commitment fee and the loan has a yield maintenance
penalty in the case of prepayment.
The Addendum to the note deals with such matters as prepayments, yield maintenance
The loan has a 15-year term with five-years of interest-only followed by a 30-year amortization period and a 14.5-year yield maintenance
This cash-out refinancing was underwritten with a 10-year term, including 9.5 years of yield maintenance
and a 30-year amortization schedule.
Since Fitch's last rating action, six loans totaling $174 million were prepaid prior to their scheduled loan maturities with yield maintenance
penalties or during their open period.
The fixed-rate loans have a seven-year term with five years of yield maintenance
Although credit enhancement has increased since Fitch's last rating action from scheduled loan amortization and the prepayment of two loans, Station Place and Promenade on Providence, with yield maintenance
penalties, the pool has become increasingly more concentrated.
The fixed-rate loan has a 10-year term, with 2.5 years interest only, yield maintenance
of seven years, and a 30-year amortizing schedule.
While properties that have freely prepay-able mortgages have been actively refinancing their mortgages, more and more owners of multifamily and healthcare properties are paying sometimes large prepayment penalties--often in the form of defeasance or Yield Maintenance
payments --for the sake of locking in today's low rates for the longest term possible.