Small-balance CRE loan extension and modification actions by banks reached a five-month high during June while loan originations took another hit.
Boxwood's latest analysis of procurement data on clients’ use of Boxwood's FieldSmart Evaluation reports signals further distress ahead for borrowers of small-balance commercial loans as the severity of the pandemic increases in large swaths of the country.
Key takeaways from our June analysis include:
As national small-cap CRE market conditions certainly weaken in the months ahead, we expect that monitoring of portfolio loans will increase with heightened concerns over loan performance generally and, more specifically, loans that remain delinquent after forbearance periods expire. Indeed, perhaps as a harbinger of things to come the June figures showed an increasing number of valuation uses supporting workouts and foreclosures in the growing Miscellaneous category.
Check these blog pages later this month for a report on small-cap market conditions updated through second quarter. Our next update of FieldSmart order procurement data will be published in August.
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