Although U.S banks are relaxing their lending terms for commercial real estate loans (a response to increased demand and growing competition in the financing market), it is important to realize that domestic banks aren't lowering their credit standards.

While it may be easier now than several months ago for good borrowers to obtain an interest-only loan, or one with less recourse in terms of guarantees of principal and interest, "bad boy" provisions and other carveouts still remain, and are in heavy use (when the situation dictates).

As we shared with a reporter from Law360 recently, "The first thing borrowers want to negotiate is the recourse carveouts, [and] it's happening earlier in the process than it ever used to. But banks are still very firm in what goes into recourse carveouts and reluctant to change those."

While it's true that most banks are more comfortable lending with looser general terms because they've seen loan-to-value ratios creeping up, they still require significant equity in deals and are, in my mind, a long way from the practices of 2006 and 2007 that preceded the real estate lending market crash.