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Published on Dec 17, 2010
Defeasance and Yield Maintenance are two methods that borrowers have for getting out of existing real estate debt. Yield Maintenance is an actual prepayment of a loan, and is most common in agency loans and those originated by balance sheet lenders. Defeasance is actually a substitution of collateral and assignment of debt and is most often seen in securitized, CMBS debt. Chatham has vast experience with both alternatives and invites you to take advantage of our online calculator to estimate your yield maintenance penalty or to estimate the cost of defeasing your loan.