Borrower complaints regarding CMBS loan servicing are resulting in action by industry participants to improve the loan servicing experience. Industry leaders are recognizing that poor servicing experiences are driving borrowers to other loan products, depressing already relatively low CMBS loan origination volume.
Borrowers cite difficulty in communicating with their loan servicer (assuming they can even figure out who it is) as the number one complaint. Servicers simply do not get back to borrowers in a timely manner, if at all.
As a result, the industry’s trade group, the CRE Finance Council (CREFC), has set up a task force to propose customer service improvements. Meanwhile, some lenders and servicers are implementing initial changes on their own in an effort to streamline borrower servicing requests. CREFC set up its Servicing and Issuer Task Force in September to craft a set of uniform standards and practices for CMBS lenders and servicers. Immediate plans call for drafting a basic framework, possibly by year-end, that would address some of the long-time concerns raised by borrowers about conflicting provisions or lack of clarity in loan documents. The framework will also try to prevent excessively complicated review procedures for relatively minor issues.