SOFR

Four tranches of AAA-rated notes in the $342.2 million JPMorgan Mortgage Trust 2020-8 may utilize a term-SOFR rate should the benchmark improve on the weighted-average coupon of the deal.

While using the 30-day SOFR as its index, Freddie Mac structured the deal so it could shift to a one-month term if and when that rate is approved.

A New York-state proposal to shift trillions of dollars in securities contracts from Libor- to SOFR-based benchmarks is gathering dust. That worries bankers and investors on on how to proceed with the next steps toward a replacement rate as Libor's post-2021 expiration grows nearer.

The restrictions on the pooling of loans with any interest term based on Libor will be effective for traditional mortgage-backed securities issued starting Jan. 21, 2021, and earlier for reverse-mortgage securitizations.

Bondholders could see principal losses if, due to the way the documents are worded, the rate is frozen at the last published amount.

This proposed Libor replacement is an imaginary, backward-looking benchmark dreamed up by the economists at the Fed with no discernible market.

As the discredited Libor interest rate benchmark enters its last months, some banks are turning away from the repo-based alternative that regulators prefer. What could go wrong?

Newly published conventions from an industry-led benchmark replacement study group could spark adoption of more built-in rate transition plans into loan documents.

The Consumer Financial Protection Bureau seeks to address challenged posed by the sunset of the London interbank offered rate at the end of 2021.

Fannie Mae and Freddie Mac have different timelines for the switch.