News & Analysis as of

Foreclosure › Borrowers › Default

Foreclosure is a legal process whereby a lender seeks to force the sale of a mortgaged property in order to recover the balance of a delinquent loan. Recently, the foreclosure process has been the subject of... more +
Foreclosure is a legal process whereby a lender seeks to force the sale of a mortgaged property in order to recover the balance of a delinquent loan. Recently, the foreclosure process has been the subject of greater legislative and judicial scrutiny after systemic abuses were uncovered during the widespread foreclosure crisis resulting from the Great Recession. less -
Holland & Knight LLP

CFPB Proposes New Restrictions on Mortgage Servicers Before Commencing Foreclosures

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The Consumer Financial Protection Bureau (CFPB) on July 10, 2024, announced a proposed rule that would require servicers to more intently assist borrowers throughout a "loss mitigation review cycle" before being permitted to...more

Morrison & Foerster LLP

Deed in Escrow

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Is a “deed in escrow,” sometimes referred to as a “deed in a box,” enforceable in New York? While many real estate attorneys believe that it is not, a recent court ruling illustrates that the answer may not be as...more

Morrison & Foerster LLP

UCC Foreclosure Commercially Reasonable

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In a recent case, U.S. District Judge Edgardo Ramos ruled that a foreclosure sale governed by Article 9 of the New York Uniform Commercial Code (UCC) was “commercially reasonable” when viewed as a whole, denying claims made...more

Vinson & Elkins LLP

[Hybrid Event] Navigating Workout Discussions with Lenders – Trends from 2023 - November 9th, New York, NY

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In this program, attorneys in Restructuring & Reorganization, Real Estate, and Tax will discuss commercial real estate loan workouts and amendments: the path most often taken by commercial real estate lenders in 2023 when a...more

Vinson & Elkins LLP

[Hybrid Event] Navigating Workout Discussions with Lenders – Trends from 2023 - November 9th, Dallas, TX

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In this program, attorneys in Restructuring & Reorganization, Real Estate, and Tax will discuss commercial real estate loan workouts and amendments: the path most often taken by commercial real estate lenders in 2023 when a...more

Miller Starr Regalia

A New Class Of Redemptioners: The Enhanced Position Of Tenants, Prospective Owner Occupants, And Nonprofit Or Governmental...

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The borrower has no post-sale redemption right in California’s nonjudicial foreclosure process. This redemption bar has long been justified as a trade-off for the lender’s post-sale deficiency bar under Civ. Proc. Code, §...more

ArentFox Schiff

Remote Work and Higher Interest Rates Drive Office Defaults Across the United States

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With some of the nation’s largest real estate owners defaulting on, and looking to restructure, loans backed by commercial office buildings, what may have seemed like an impossibility a few short years ago, is now very much a...more

Cadwalader, Wickersham & Taft LLP

Further Developments in Mezzanine Foreclosures

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The New York State Supreme Court, New York County Commercial Division (the “Court”) decided in U.S. Bank, N.A. v. 342 Property LLC, on February 14, 2022, that a mezzanine lender that is not a party to loan documents that...more

Farrell Fritz, P.C.

An Interesting Tale of New York’s One-Action Rule

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As mortgage loan transactions continue to become increasingly complex, lenders often worry about the remedies they have if borrowers fail to live up to their obligations. In the event of a default, lenders have the choice...more

Cadwalader, Wickersham & Taft LLP

The ESG Factor, January 2022 - One of These Things Is Not Like the Other: New York State Court Upholds Commercial Reasonableness...

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On November 10, 2021, the owner of the State Street Financial Center in Boston, Massachusetts defaulted on its debt, consisting of a mortgage loan in the amount of $535,000,000 and three mezzanine loans in the aggregate...more

Locke Lord LLP

The Massachusetts Supreme Judicial Court Ends Confusion on Right to Reinstate Prior to Foreclosure

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On November 25, 2020, the Supreme Judicial Court of Massachusetts (“SJC”) issued a decision in Thompson v. JPMorgan Chase Bank, N.A., SJC-12798, ___ Mass ___ (2020), holding that state law overrides the requirement in the...more

Goodwin

Issues To Consider On The Path Forward For The Hospitality Industry

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It is hard to pick any event or series of events that has adversely impacted the hospitality industry as hard as the COVID-19 pandemic. While the summer witnessed increased RevPAR in the U.S. as compared to the depths of...more

Rosenberg Martin Greenberg LLP

Pennsylvania Supreme Court Clarifies Applicability of Act 6 To Residential Mortgage Foreclosures (Sort Of)

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When the loan documents provide for confession of judgment and the collateral encumbered by the mortgage securing the loan is commercial real property, the foreclosure process in Pennsylvania is straightforward.  The lender...more

Hinshaw & Culbertson - Consumer Crossroads

Rhode Island Supreme Court Demands Strict Compliance with Fannie Mae/Freddie Mac "Paragraph 22" in Foreclosures

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In a case of first impression, the Rhode Island Supreme Court concluded in Woel v. Christiana Trust that mortgage default notices sent to borrowers must strictly comply with the notice requirements included in a mortgage. The...more

Locke Lord LLP

Rhode Island Supreme Court Requires Strict Compliance with Notice of Default Requirements in Mortgage, Following Federal Courts

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On June 2, 2020, the Rhode Island Supreme Court issued its long-awaited decision regarding the requirements of declaring a default and acceleration under the requirements of paragraph 22 of the standard mortgage form. See...more

Dechert LLP

Mezzanine Foreclosures in the Time of Coronavirus: Chapter 2

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As a follow up to our OnPoint from last week, Mezzanine Foreclosures in the Time of Coronavirus, regarding a New York County Supreme Court’s halting of a mezzanine UCC foreclosure sale, here is our promised update. ...more

Bilzin Sumberg

Legal Magic: Turning Real Property Foreclosures Into Uniform Commercial Code Sales

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Remedies for defaults under loans secured by real property varies on a state-by­-state basis. In the eastern part of the country, enforcement is mostly by mortgage foreclosure. In the western states, there are enforcement...more

Patton Sullivan Brodehl LLP

Can a Loan Modification Waive the Borrower’s Right of Reinstatement?

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Loans secured by a deed of trust typically provide that upon default (commonly, missed interest payments) the lender may elect to “accelerate” the loan, making the entire balance of principal and interest due....more

Woods Rogers

Guarantor Provisions to Negotiate in Non-Recourse Financing

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Many commercial real estate loans are “non-recourse,” which means in general terms that foreclosing on the real estate securing the loan is the lender’s sole remedy for a borrower’s failure to repay the loan.  The lender is...more

Patton Sullivan Brodehl LLP

The Tender Rule — Reinstatement and Redemption are Different

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Under California’s “tender rule,” a borrower suing to halt or unwind a wrongful foreclosure sale generally must allege that it tendered the amounts due on the loan before the sale. The rationale underlying the tender rule is...more

Blank Rome LLP

NY Appellate Court Holds Default Letter Stating Debt “Will Be Accelerated” Does Not Accelerate the Debt, De-Acceleration Must Be...

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Mortgagees and their servicers should take note that a New York appellate court has confirmed that a default letter, stating the mortgage debt “will be accelerated” if the default is not cured, does not clearly and...more

Blank Rome LLP

Does the Word 'Will' Clearly Accelerate a NY Mortgage Debt?

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Mortgage servicers and other financial institutions have been battling the issue of what affirmative act “clearly and unequivocally” accelerates a mortgage debt for years. Currently, there is a split in authority between the...more

Ballard Spahr LLP

U.S. District Court for the Southern District of Florida Narrows the Definition of Borrower Under RESPA

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In 2014, the Consumer Financial Protection Bureau (CFPB) promulgated a number of mortgage servicing rules, including rules governing loss mitigation procedures. ...more

Orrick, Herrington & Sutcliffe LLP

Deed of Trust Provisions Allowing Lenders/Servicers to Enter, Maintain, and Secure Encumbered Properties May be Unenforceable...

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On July 7, 2016, the Supreme Court of the State of Washington issued its opinion in Jordan v. Nationstar Mortgage, LLC, which, prior to foreclosure, may prevent servicers from securing property after a default or, at least,...more

Baker Donelson

Avoiding a Limitations Fight by Rescinding Acceleration

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Texas recently added a new statute aimed at providing lienholders and loan servicers an unambiguous method for unilaterally abandoning the acceleration of a loan's maturity. When a borrower defaults in paying an...more

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