The rent roll and operating statements standards we’ve been working on for the past six months are finished. They are posted on MISMO’s Commercial Mortgage Specifications page. Now it’s time to promote the benefits of compliance to ensure widespread industry adoption.
I will be at the CMSA Conference next week in Washington, DC and the MBA CREF Conference in Las Vegas in early February drumming up support. If not now, when?
Keep reading for the MISMO press release.
Commercial MISMO Releases Standards For Rent Roll and Operating Statements
RESTON, VA, January 12, 2010 – The Mortgage Industry Standards and Maintenance Organization (MISMO) announces the release of two new commercial real estate XML standards for the exchange of financial data. The Rent Roll and Operating Statement Version 2.0.1 specifications began their 30 day IPR Disclosure period on January 6, 2010. These standards provide a normalized way for borrowers, servicers, lenders, investors, and regulators to share critical financial information on all types of commercial real estate collateral.
Currently, most participants in commercial real estate finance are unable to access critical financial data contained in rent rolls and operating statements in a timely and useable format to perform easy and accurate valuations of the underlying collateral. These new standards provide the road map to move and access this data in XML format from one system to another and from one company to another. MISMO believes adoption of these standards will serve at least two immediate needs:
Internal Risk Management: Within financial organizations, the need to report on asset valuation for all business lines has increased. For commercial real estate, the most important data elements needed to perform accurate asset valuations are found on rent rolls and operating statements. Normalizing the data structure for such critical information allows valuation models to work. These standards provide that road map.
External Reporting Transparency: Increased transparency in securitized finance is generally supported by both industry players and regulators alike. The concept that rating agencies and investors should have access to enough information to value the underlying assets in any securitization is common sense and a key component of regulatory reform that enjoys bipartisan congressional support. These standards provide a foundation for parties that are required to report to investors, rating agencies or regulators on their commercial real estate portfolios.
The Mortgage Industry Standards Maintenance Organization (MISMO), a not-for-profit subsidiary of the Mortgage Bankers Association (MBA) and managed by MERSCORP, Inc., is the leading technology standards development body for both the Residential and Commercial industry segments. MISMO promotes data consistency throughout the broader industry, reduces processing costs, increases transparency, and boosts investor confidence in mortgages as an asset class, while passing cost savings on to the consumer. More information on MISMO can be found at www.mismo.org.
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Jim Flaherty is CEO of CMBS.com and the creator of the Backshop loan origination system. He is a trained credit professional with experience installing enterprise underwriting systems for commercial real estate lenders, rating agencies and investors.