Williams Mullen's Comeback Plan: Part IV - How Banks Think About Loan Defaults: Lessons for Borrowers in Troubled Times
Updating Lenders' Form Loan Documents
Podcast: Questions & Concerns About Documentation: A Conversation with Colin Adams, M-III Partners
Podcast: Credit Funds: Credit Default Swaps in the Distressed Limelight
In the ever-evolving world of mortgage lending, a scenario often arises where a borrower refinances their existing mortgage with a new lender, but the payoff funds tendered by the new lender are less than the full amount...more
Although second lien loans in subscription line finance have been discussed with interest over the years, their use has been sporadic and it has only been very recently that we have started to see a real uptake in the use of...more
After an Event of DefaultContract occurs, it is important to understand the options available to the Lender other than demanding repayment or simply waiving the default. A Forbearance Agreement allows the Lender to preserve,...more
It should go without saying that people make mistakes. After all, people are human, and humans make mistakes. When people draft a document, especially a lengthy or complex one, it is not uncommon for a mistake to be...more
The Federal Reserve's most recent Financial Stability Report addressed what many industry watchers had been convinced of for some time: the commercial real estate sector is in a precarious state. The Federal Reserve Bank...more
In light of the current economic climate, real estate lenders and borrowers will certainly be communicating with one another frequently concerning potential loan modifications and accommodations. It is prudent for lenders to...more
When is a loan not a loan? When it’s something else – for example, equity. This is one of those pesky facts and circumstances issues that plague courts, taxpayers, and tax advisers to no end. Debt- On one end of the...more
Although they have been around for many years, it is becoming more common for a commercial loan lender to require that the borrower’s counsel provide it with an opinion letter. At first blush, this may seem like an oddity:...more
In real estate financing, most loan documents restrict a Borrower’s right to alter the collateralized real property. Alterations provisions in loan documents pertain to any alterations, improvements, or demolition of any...more
While some commercial real estate loans are fully funded at loan closing, others are funded in whole or in part through future advances. Some loans provide for future advances to fund tenant improvement work and leasing...more
With the use of LIBOR being phased out by the end of 2021 and its prevalence in corporate loans, adjustable-rate mortgages, floating rate notes, securitized products and derivatives products, nearly all lenders and borrowers...more
Following the expiry of the transition period which ended on 31 December 2020 at 11pm GMT (known as “IP Completion Day”), the UK is no longer a member of the EU. ...more
In sophisticated real estate financing transactions, most prudent lenders attempt to deter borrowers from filing for bankruptcy before loans are paid in full by providing in loan documents that such a filing constitutes an...more
A recent decision of New York’s highest court potentially strengthens the ability of lenders to bring suits against third parties for participation in a borrower’s breach of single purpose entity/bankruptcy remote loan...more
In the final installment of our video series aimed at helping borrowers in uncertain times, Matt Cheek, chair of Williams Mullen’s Financial Services Industry Group, and Mike Mueller, chair of our Restructuring, Bankruptcy...more
Most real estate attorneys would typically be dismissive of a transaction that places a deed in escrow as collateral for a loan. This is because it is universally known that any loan term that interferes with a borrower’s...more
In a prior practice pointer, we discussed the importance of reservation of rights letters. However, there are times when a lender will want to start enforcing one or more rights or remedies....more
Since the end of 2017, we have been talking about the discontinuation of LIBOR as a reference rate for borrowers who finance with floating rate loans. The December 2021 end date is fast approaching, but much work remains to...more
Leveraged loan agreements form key aspects of capital structures, balancing lender protection against allowing the borrower to run its business according to its business plan. In recent times, the length of such loan...more
On May 27, 2020, the Federal Reserve Bank of Boston released updated Frequently Asked Questions (FAQs) and certain operational documents with respect to the Main Street Lending Program. The additional materials provide...more
The disruptive impact of the current novel coronavirus (“COVID-19”) global pandemic on virtually all aspects of the social and economic fabric of the United States and most of the rest of the world is unprecedented in recent...more
Example 1. Borrower’s loan documents provide that borrower may obtain the release of noteholder’s lien on a portion of the collateral (Parcel C) if: (1) borrower pays a $1.5 million release price to pay down part of the...more
The development of real estate projects, including hotels and master planned communities in Los Cabos and other places in Mexico, commonly requires financing by banks and other institutional lenders. This article presents an...more
Legal opinion letters (“Opinion Letter”) have become a very valuable piece of a loan transaction for all parties involved. More often, Lenders are now requiring that a Borrower’s counsel provide an Opinion Letter at the...more
It used to be so easy. The borrower and lender would enter into a loan and security agreement, fund the loan and perfect the security interest in the collateral. A year or two later the borrower might want an additional...more