TEXT-Fitch assigns Freddie Mac initial CMBS servicer rating

Tue Nov 13, 2012 3:42pm EST

Nov 13 - Fitch Ratings assigns Freddie Mac an initial commercial
mortgage-backed securities (CMBS) special servicer rating of 'CSS2-'. The rating
reflects the ability of the multifamily division of Freddie Mac to work out
commercial mortgage loans, secured by apartment buildings with five or more
units, acquired by Freddie Mac from its network of seller/servicers. The rating
does not address the single family residential aspect of Freddie Mac's business.

Freddie Mac's commercial servicer special servicer rating reflects Fitch's 
assessment of Freddie Mac's management team, asset management capabilities, 
technology, financial strength, and knowledge of the multifamily lending 
environment combined with the support of its seller/servicer network.  Although 
Freddie Mac does not currently perform special servicing functions for 
securitized mortgages backed by newly originated loans, the asset management and
operations group has extensive multifamily workout experience across the United 
States. 

As of Sept. 30, 2012, Freddie Mac was special servicer for more than 8,800 loans
totaling $94.4 billion secured by multifamily properties that are held by 
Freddie Mac. As of the same time, the asset management and operations group of 
Freddie Mac was actively working out in excess of 100 loans and several real 
estate owned (REO) assets totaling approximately $1.5 billion. The group also 
successfully resolved more than $1.0 billion of loan defaults in 2011. The 
loans, which were collateralized by properties throughout the U.S., were 
resolved through modifications, foreclosure and liquidations, and forbearances 
with an average loss of below that of typical Fitch rated CMBS special 
servicers.  

The servicer rating is based on the methodology described in Fitch's reports 
'U.S. Commercial Mortgage Servicer Rating Criteria,' dated Feb. 18, 2011, and 
'Global Rating Criteria for Structured Finance Servicers' dated Aug. 16, 2010, 
available on Fitch's web site 'www.fitchratings.com'.

Additional information is available at 'www.fitchratings.com'. The ratings above
were solicited by, or on behalf of, the issuer, and therefore, Fitch has been 
compensated for the provision of the ratings.

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