Tax-Exempt Securitization

SPONSOR

Small financial institutions, community banks, investment vehicles, Community Development Financial Institutions, Housing Finance Agencies, aggregators of tax-exempt collateral.
DEAL SIZE

Optimal loan pool size of at least $150 million in aggregate UPB.
DEAL COLLATERAL
Tax-exempt collateral backed by multifamily housing:
- M-deals collateralized by tax-exempt bonds
- ML-deals collateralized by tax-exempt loans
SERVICING

Freddie Mac (or Freddie Mac-approved third party) will be the Master Servicer. With Freddie Mac approval, the sponsor may retain subservicing of loans.
REPS AND WARRANTIES

The sponsor will be required to provide representations and warranties to the securitization trust.
COLLATERAL DUE DILIGENCE

Freddie Mac will be entitled to conduct a full underwriting and due diligence review of all the loans/bonds, including interior and exterior physical inspections, borrower and guarantor credit, property financials and rent rolls, environmental, compliance, valuation, and collateral files and servicing files. Freddie Mac will determine which loans/bonds will be securitized based on its review.

The sponsor transfers loans from the balance sheet in exchange for certificates via the following structures:

M- and ML-Deals:	M- and ML-Deals:	ML-Deals:
Senior and Subordinate (A/B) Structure	100% Guarantee with Reimbursement Structure	Multi-Sponsor ML (A/B Structure Only)
Senior, guaranteed certificates (Class A) with subordinate certificates (Class B) are issued by the trust. The Class B certificate can be retained by the sponsor or sold to an approved third-party investor.	Only guaranteed certificates are issued by the trust. Sponsor retains a first-loss position through a reimbursement obligation. A reimbursement agreement between sponsor and Freddie Mac is required for any losses up to a certain percentage of the pool’s UPB. This may be secured via a letter of credit, cash or pledged securities (rated and marked to market)	Qualified pools of similar collateral from multiple sponsors will be sold into a single third- party securitization trust. Single senior, guaranteed certificates (Class A) with one or more subordinate certificates (Class B). The Class B certificates can be retained by the sponsor or sold to a third-party investor.