News & Analysis as of

Non-Recourse Loans Guarantors

Mandelbaum Barrett PC

Three Major Differences Between Recourse and Non-Recourse Loans

Mandelbaum Barrett PC on

Borrower / Guarantor Liability Recourse – The borrower (or guarantor) is personally liable for the full amount of the loan, including any debt remaining after the collateral is foreclosed upon and sold. To satisfy the...more

ArentFox Schiff

Non-Recourse Carve-Outs: Borrower and Guarantor Considerations

ArentFox Schiff on

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

Woods Rogers

Guarantor Provisions to Negotiate in Non-Recourse Financing

Woods Rogers on

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

Miles & Stockbridge P.C.

New Guidance on Bad Boy Guarantees

The IRS Office of Chief Counsel recently released a memorandum (#AM2016-001) addressing the proper tax treatment of nonrecourse carve-outs (or bad boy guarantees) in the partnership context. According to the memorandum, such...more

Locke Lord LLP

Tax and Non-Tax Reasons to be Cautious about “Bad Boy Nonrecourse Carve-out Guarantees” - IRS Backtracks on Recent Conclusion that...

Locke Lord LLP on

On April 15, 2016 the IRS reversed its controversial position that bad boy guarantees may convert nonrecourse debt into recourse debt. General Legal Advice Memorandum Number AM2016-001 released April 15, 2016 effectively...more

Butler Snow LLP

IRS Reverses Position on “Bad Boy” Guarantees

Butler Snow LLP on

Earlier this year, the IRS issued Chief Counsel Advice 201606027 (February 5, 2016) concluding that, for purposes of the basis and at-risk limitations, an LLC member’s guarantee of entity-level nonrecourse debt conditioned...more

McDermott Will & Emery

The IRS Releases CCA 201606027

McDermott Will & Emery on

On February 5, 2016, the Internal Revenue Service (IRS) released Chief Counsel Advice 201606027 (the 2016 CCA) in which the IRS concluded, among other things, that guarantees by a partner of a partnership’s liabilities that...more

Snell & Wilmer

Guarantors Remain Liable for “Carve-out” Obligations, Despite Non-recourse Loan

Snell & Wilmer on

Believe it or not, guaranty contracts mean what they say. If a guarantor agrees to reimburse a lender for misappropriated security deposits, unpaid taxes, and the cost of enforcement, then – not surprisingly – courts will...more

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