Kushner Biz won $ 850 million in US guaranteed loans on special terms: report
The Kushner family real estate company, partly owned by the senior White House adviser Jared kushner, obtained $ 850 million in government guaranteed loans on “exceptionally good terms” New York Public Radio and ProPublica reported.
Loans guaranteed by the government-sponsored Federal Home Loan Mortgage Corp. – known as Freddie Mac – made last year to Kushner companies enabled the company to purchase thousands of apartments in Maryland and Virginia in its biggest contract in a decade, according to the joint survey conducted by WNYC and ProPublica.
Jared Kushner stepped down from running the company after his stepfather chairman Donald trump gave him a post of advisor to the White House. But there is one key stakeholder in the company, and has earned millions of dollars through the business, including through deal-related operations backed by Freddie Mac, according to his financial statements.
Sixteen of the loans were first reported last year by Bloomberg, but details of the favorable terms of the Kushner companies have not been disclosed so far.
A total of 18 loans the company secured with Freddie Mac over the past year resulted in more borrowing and lower monthly payments than was typical for similar loans, the survey found.
The arrangement allows the company to pay only interest for 10 years, deferring payments on the principal for a decade, according to the articles. This increases the risk for investors who buy bonds that include Kushner mortgages, and for Freddie Mac and taxpayers in the event of default. According to the WNYC and ProPublica survey, only 6% of the 3,600 loans guaranteed by the agency last year only bore interest for a decade or more.
Additionally, Freddie Mac’s estimates of the profitability of Kushner’s properties – the basis for the rationale for loans – seemed overly optimistic. All Top 16 Properties Purchased With Help From Freddie Mac achieved lower profits in 2019 than expected by Freddie Mac, despite a then strong economy now battered by COVID-19.
Freddie Mac insisted in a statement that it “does not take into account the political affiliations of borrowers or their family members” and that the terms of the deal “fit perfectly into our credit standards and subscription available to the public “.
Neither Kushner nor Kushner Companies commented.
After government guaranteed loans were first disclosed last year, Sen. Elizabeth warren (D-Mass.) And Sen. Tom carper (D-Delaware) wrote to CEO Freddie Mac expressing concerns about the transaction “due to the history of Kushner Companies seeking to make deals that raise conflict of interest issues” with Jared Kushner . Nothing has apparently changed.
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