What happens if an ABS that was eligible for TALF financing is downgraded by an NRSRO?
Nothing happens to existing TALF loans secured by that ABS. However, the ABS may not be used as collateral for any new TALF loans until it regains its status as eligible collateral. If a legacy CMBS is downgraded or placed on review or watch for downgrade after the subscription date for a loan with respect to such legacy CMBS, the legacy CMBS will not lose its status as eligible collateral for such loan request solely for that reason.
Related Questions
- Must an eligible borrower own newly issued ABS it plans to pledge as collateral for a TALF loan at the time it subscribes for the loan?
- What level of assurance will be required from the sponsor’s accountants that a non-mortgage-backed ABS is TALF eligible?
- What happens if an ABS that was eligible for TALF financing is downgraded by an NRSRO?
