This month’s spotlight focuses on financing from life insurance companies also known as LifeCo lenders or LifeCo financing. Supported by their large portfolios and annual inflows of insurance premiums, life insurance companies have been a leading source of long-term, fixed-rate financing for senior mortgages. Due to their conservative standards in loan underwriting, life companies had fewer bad loans to work out after the 2008 financial crisis. This also meant that they held a strong capital position and were able to expand their share of the real estate debt market. While still conservative in nature, life companies are able to draft customized financing products for clients that other lenders often cannot.
For life insurance loans, lenders have continued and even strengthened their conservative approach toward underwriting the cash flow of the collateral and sponsors. As part of the