Mexico Preps for Fannie Mae
A federal guarantee for a securitization of real
estate development loans is a significant step in Mexico's
evolution to capital markets-based mortgage
Mexico's federally owned Sociedad Hipotecaria Federal (SHF) laid the groundwork for its evolution into a federal mortgage lending agency in October, when it partially guaranteed a $50 million securitization of bridge loans for private sector real estate development financing company Metrofinanciera. The guarantee enables Metrofinanciera to reduce its dependence on financing from SHF and cultivate local institutional investors. This in turn should cut its financing costs and enable it to lend more competitively to real estate developers. J. Armando Guzmán, executive director of Metrofinanciera, says the transaction represents a significant step toward SHF's entering the local debt markets and shows the continued efforts by local finance companies in Mexico, called sofoles, to take a bigger role in the housing market. Juan Pablo de Mollein, associate director of Latin American...
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