HVCRE: The Continuing Saga of Lenders
If you develop or build on real property in Oregon, your progress payments to contractors on future projects will be affected by a new law, effective on March 7, 2024. If you are a construction lender, your borrower may...more
The Ballard Spahr Team was thrilled to be here in Miami at the CREFC Conference and we wanted to share some day one takeaways with our clients and friends....more
As Coronavirus (COVID-19) continues to ravage the nation’s health and economy, in-progress deals are being reassessed by buyers, sellers and lenders. We review a number of issues that parties to financed transactions should...more
Numerous reports have documented the softening condominium market in New York and other large cities resulting from the excess capacity of expensive units. The softening could lead to developers not meeting their repayment...more
In a recent Arizona Court of Appeals case, Helvetica Servicing, Inc., v. Pasquan, 2019 WL 3820015, (8/15/19), the Court of Appeals addressed the distinction between (1) a construction loan (or refinance of same) and (2) a...more
Last year, a California Bankruptcy Court wiped out $10.2 million in default interest (“DRI”) when it ruled that a 5% DRI was an unenforceable penalty in a Chapter 11 bankruptcy case where the construction lender fully...more
Most construction loans contemplate multiple advances or disbursements of funds at various stages of the construction project. The construction loan agreement will set forth the conditions that the borrower must satisfy to...more
This post follows, almost two years to the day, Rick Erickson’s post of August 29, 2014. As noted by Rick Erickson in his August 29, 2014 post, the Arizona Supreme Court in the Weitz case (2014) had determined that equitable...more
Lenders who finance wind and solar farms often require the EPC contractor to consent to the developer’s assignment of the EPC Contract to the lender to secure the developer’s obligations under the loan documents. Such...more
Believe it or not, lenders can breach loan agreements too…and when they do, there can be significant consequences. In Great Western Bank v. LJC Dev., LLC, 726 Ariz. Adv. Rep. 21 (Ariz. Ct. App. Nov. 10, 2015), the Court of...more
As the competition for construction loan projects remains at unprecedented levels in much of the country, lenders are frequently being asked to waive, modify or re-visit their standard construction loan credit enhancement...more
In a recent decision written by Judge Sykes, affirming a decision from the Western District of Wisconsin, in an issue governed by Wisconsin law, the Seventh Circuit ruled that a title insurer has no duty to indemnify a...more
Or perhaps Prometheus had it right in its original form. “Whom the Gods would destroy they first make mad.” Look at what we are doing to construction lending in the name of our seemingly endless safety and soundness crusade....more
For those of us who commonly represent lenders, there is nothing more unsettling than hearing the words “course and pattern of conduct” or “dominion and control” or some variation of the same. Any suit where someone seeks to...more
In This Issue: - Construction Contract Claims Against a Third-Party Lender? The Unforeseen Consequences of a Standard Practice: For those of us who commonly represent lenders, there is nothing more unsettling...more
The 7th Circuit has ruled that a lender is not insured by a title company for liens that arise after a construction loan became significantly out of balance and the lender stopped funding. In BB Syndication Services, Inc v....more
On March 12, 2015, the United States Court of Appeals for the Seventh Circuit entered an opinion interpreting “the most litigated provision in the standard-form title-insurance policy purchased by real-estate lenders to...more
Lenders and contractors may want to take additional precautions before they take title to a newly constructed home through foreclosure (or deed in lieu of foreclosure) following a recent decision by the Colorado Supreme...more
On December 19, 2014, the Utah Supreme Court issued its opinion in Lane Myers Construction, LLC v. National City Bank, et al. 2014 UT 58 (UT 2014). In this case, a total of nine Utah jurists considered the question of whether...more
Construction loans typically do not get refinanced before a project is completed. A construction loan is short-term in nature and both the lender and its customer expect that they will stay on the project until the project is...more
In 1791, Thomas Jefferson and James Madison proposed the first mechanics liens legislation in order to promote development in Washington. The Maryland Assembly (which governed Washington at that time) passed the...more