The rating service its stepping away from rating new commercial MBS backed by single-borrower hotel loans due to uncertainty prompted by the coronavirus. Only one such deal has been issued since April.
Loans backing securitized products are holding up fairly well even though the use of forbearance has increased. A combination of investor protections and changes in underwriting practices is helping.
Rating services are requiring higher credit enhancement levels and taking negative actions on outstanding deals due to problems stemming from the coronavirus. Fitch finalized new criteria for residential MBS late last week.