A secured creditor's right to "credit bid" the amount of its allowed claim in a bankruptcy sale of its collateral is an important creditor protection codified in section 363(k) of the Bankruptcy Code. Even so, a ruling...more
The primary investment thesis of a private credit lender is simple — get the loan repaid at maturity. Private credit lenders do not make loans as a means to acquire their borrower’s business. There are circumstances, however,...more
What is a credit bid? In certain circumstances, a secured lender can ‘bid’ its secured claim against the purchase price in a sale of the secured assets. The secured lender can compete with cash bids for the collateral,...more
Under Massachusetts law, a foreclosing lender has a duty of good faith and reasonable diligence to obtain the highest possible price for a property at auction. Until recently, it was considered appropriate for the lender to...more
Recently, in Official Comm. of Unsecured Creditors v. Victory Park Capital Advisors, LLC (In re Katy Indus., Inc.), Case No. 17-50937 (Bankr. D. Del. July 6, 2018), the Bankruptcy Court for the District of Delaware dismissed...more
The Arizona Supreme Court recently addressed what impact, if any, a lender’s credit bid at an Arizona trustee’s sale has on an insurer’s liability under Sections 2, 7 and 9 of the standard’s lender’s title policy (“Policy”),...more
The dust has yet to settle on the landmark decision of High Point Bank & Trust Co. v. Highmark Properties, LLC, 776 S.E.2d 838 (N.C. 2015). Before delving into the decision that should serve as a harbinger of imminent and...more
REAL PROPERTY UPDATE - Default Judgment/Voidable: because default judgment was merely voidable, rather than void, where complaint upon which judgment was based failed to state a cause of action, Rule 1.540(b) was not...more
This is the fifth in a series of Alerts regarding the proposals made by the American Bankruptcy Institute Commission to Reform Chapter 11 Business Bankruptcies. This alert covers the Commission’s recommendations regarding the...more
Despite lower-than-average Chapter 11 activity in 2014, the legal landscape for distressed investors has continued to evolve, with significant legal developments in credit bidding, make-whole premiums and intercreditor...more
As is well known, the right to credit bid is the entitlement of a secured lender to bid the amount of its outstanding claims at the sale of its collateral. If the secured lender places the winning bid, no money is exchanged...more