The Internal Revenue Service (IRS) is set to implement new rules that will give certain owners and developers of commercial real estate more flexibility to pursue loan modifications even if their loan has been securitized.
Market reports indicate that the new rule will apply to loans backed by shopping malls, office parks and other commercial properties that have been securitized and sold to Real Estate Mortgage Investment Conduits (REMICS).
IRS rules have, in the past, limited the types of loan modifications allowed so REMICS can retain their tax status. Under the new rules, those restrictions would be relaxed.
The new rules are set to take effect later this week.