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MortgagePoint ยป Your Trusted Source for Mortgage Banking and Servicing News 46 January 2025 J O U R N A L has been an indispensable partner in our transition from paper to electronic closings." Quantifying the Return on Digi- tization Armando Falcon, Chairman and CEO of Falcon Capital Advisors, under- scored the value of eClosing technology in optimizing lender strategies. "Quantifying the value of fast- er loan delivery enables lenders to accurately assess the true return on digitization, whether evaluating new technology investments or measuring the impact of their current solutions," Falcon said. The findings highlight the transfor- mative potential of eClosing technol- ogy. The study further revealed that the financial benefits grow as lenders increase the level of digitization, from hybrid closings to full remote online notarization (RON). Michael Sachdev, CEO of Snapdocs, highlighted the broader implications of the research. "Our research with Falcon Capital confirms that investing in eClose tech- nology not only drives efficiency and is a step toward modernization, but also unlocks significant financial gains for lenders," Sachdev said. "By shortening the time from closing to investor deliv- ery, lenders gain f lexibility and secure better pricing, creating measurable sav- ings and a distinct competitive edge." Q3 OUTSTANDING COMMERCIAL/ MULTIFAMILY MORTGAGE DEBT TRENDS A ccording to the most recent Commercial/Multifamily Mortgage Debt Outstanding quarterly report from the Mortgage Bankers Association (MBA), the amount of outstanding commercial/ multifamily mortgage debt rose by $47.7 billion (1.0%) in Q3 2024. By the conclusion of Q3, the total amount of outstanding commercial and multifamily mortgage debt had increased to $4.75 trillion. From Q2 2024, multifamily mortgage debt alone climbed $29.8 billion (1.4%) to $2.12 trillion. "Every major capital source for commercial mortgage debt increased its holdings of mortgages during the third quarter of 2024," said Jamie Woodwell, MBA's Head of Commercial Real Estate Research. "Life insurance companies led the way, accounting for 44% of the quarterly increase and boosting their commercial mortgage holdings by nearly three percent. That increase con- trasts with banks, which increased their balances of CRE mortgages during the quarter by only 0.3%. For the ninth quarter in a row, aggregate balances backed by multifamily properties increased more than those backed by other property types." Banks and thrifts, govern- ment-sponsored enterprise (GSE) and federal agency portfolios, mort- gage-backed securities (MBS), life insurance companies, commercial mortgage-backed securities (CMBS), collateralized debt obligation (CDO), and other asset-backed securities (ABS) issues are the four biggest investor groups. With $1.8 trillion in commercial/ multifamily mortgages, commercial banks still maintain the greatest pro- portion (38%) of the market. At $1.03 trillion, agency and GSE portfolios and MBS constitute the second-larg- est share of commercial/multifamily mortgages (22%). CMBS, CDO, and other ABS concerns hold $619 billion (13%), while life insurance companies possess $757 billion (16%). CMBS, CDO, and other ABS issues are bought and held by numerous banks, life insurance companies, and the GSEs. These loans fall under the "CMBS, CDO, and other ABS" category in the report. MBA's analysis provides a summary of the loan holdings or, if the loans are securitized, the type of security. Many life insurance companies, for instance, invest in both whole loans for which they own the mortgage note (which are listed under Life Insurance Companies in this data) and in CMBS, CDOs, and other ABS for which the note is held by the trustees and security issuers (which are listed under CMBS, CDO, and other ABS issues in this data). Examining Outstanding Multi- family Mortgage Debt In Q3 2024, if you only consider multifamily mortgages, agency and GSE portfolios, and MBS made up 49% of the total amount of multifamily debt outstanding, with $630 billion (30%) coming from banks and thrifts, $244 billion (12%) from life insurance companies, $99 billion (5%) from state and local government, and $68 billion (3%) from CMBS, CDO, and other ABS issues. Measuring Changes in U.S. Com- mercial, Multifamily Outstanding Mortgage Debt In terms of cash gains, life insur- ance companies' holdings of commer- cial and multifamily mortgage debt increased by $21.2 billion (2.9%) in the third quarter. Their holdings climbed by $12.3 billion (1.2%) for agency and GSE portfolios and MBS, $9.6 billion (1.6%) for CMBS, CDO, and other ABS issues, and $6.1 billion (0.3%) for banks and thrifts. The biggest gain in percentage terms was seen by life insurance firms, whose holdings of commercial and multifamily mortgages increased by 2.9%. On the other hand, assets held by private pension funds fell by 8.8%. Identifying Significant Changes in Multifamily Mortgage Debt Out- standing A quarterly gain of 1.4% is rep- resented by the $29.8 billion rise in multifamily mortgage debt outstand- ing from Q2 2024. The highest gain in terms of dollars was $12.3 billion (1.2%) for agency and GSE portfolios and MBS offerings in their holdings of multifami-