Special Assets Lawyer Blog

All of the forbearances in the world will not help a property that has little chance of recovering in value. The market value of a property can and does change over time, and as many of our borrowers (and lenders) have discovered, that value can go down even faster than it goes up. Identifying and creating or preserving value is often a key to a successful workout, but many borrower and lenders fail to think dynamically and often miss critical factors. The second installment of my Urban Land article, "What to Do Before Defaulting," suggests that commercial real estate borrowers get a handle on the true current value of their property and how that value is likely to change as the market changes.

Continue reading "How Commercial Real Estate Borrowers Should Approach Their Lender: What to Do Before Defaulting (Part 2)" »

JMBM's Special Assets Team welcomes Juan Galvan and Kevin Chen, two talented young attorneys, to our San Francisco office. Juan and Kevin will represent major institutional lenders and creditors in negotiating, documenting, and restructuring commercial and real estate loans and in enforcement actions in federal and state court and in bankruptcy court.

Continue reading "Special Assets Team welcomes two new associates" »

This blog is aimed at the lending community - so why are we giving hints to commercial real estate borrowers as to how to approach their lenders? There is, of course, a simple answer.

The goal here is to get the bank paid as quickly and inexpensively as possible. It is easiest to accomplish the goal while working with a motivated and cooperative borrower. One of the telltale signs of an experienced workout professional is the ability to help the borrower past the "denial stage" to face the stark reality of a troubled loan so that a thoughtful strategic workout plan can be formulated and implemented. Many borrowers are poorly counseled to take a combative approach with their lender. Others are not counseled at all and come totally unprepared to their first meeting with the workout team. Still others have no idea what has happened to them and even less grasp as to what is going to happen next.

Recently, at the request of Urban Land magazine, I wrote an article (with the assistance of two attorneys who were then associates here at JMBM) addressed to commercial real estate borrowers who are on the brink of defaulting. Entitled "What to Do Before Defaulting," workout professionals will find this article helpful in making it clear to their troubled borrowers exactly what they need to do. We've segmented the article into five separate posts, the first of which follows.

Continue reading "How Commercial Real Estate Borrowers Should Approach Their Lender: What to Do Before Defaulting (Part 1)" »

As promised, here are the Rules of the Court governing receivership:

Continue reading "2010 Receivership Rules of the Court" »

Many people have asked for an easy place to locate statutes and Rules of the Court that govern Receivership. I have republished the California Codes Code of Civil Procedure Sections 564-570 here and will republish the Rules of the Court on Monday:

Continue reading "Receivership Statutes and Rules of the Court" »

In 2005, the California Supreme Court overruled the practice of including waivers of the right to a trial by jury in commercial agreements and loan documents before a lawsuit has been filed. For many years, sophisticated commercial businesses and institutional lenders included a clause in their agreements providing that the parties waive the right to a jury trial. A jury trial waiver authorizes a judge to try the case without a jury, resulting in a speedier, less costly trial and avoiding the possibility of jury prejudice against banks and institutional lenders.

Continue reading "Special Assets Law--What is Judicial Reference?" »

No one pays much attention to preparing a Notice of Trustee's Sale or a Uniform Commercial Code ("UCC") Notice of Intended Disposition. Both are regulated by statute, and a Notice of Trustee's Sale is usually prepared by the foreclosure company here in California (and other states where non-judicial foreclosure of real estate is commonly used). A Notice of Trustee's Sale is also used in California to conduct a "unified" foreclosure sale of both real and personal property collateral.

The concern here is to double check exactly the description of the collateral that is being sold at foreclosure. Where the notice is prepared by an outside vendor, it is critical to make certain that the vendor has all of the necessary information to prepare the notice properly. Even then, costly mistakes can be made, so it is very important to check carefully.

Continue reading "Foreclosure Notices of Sale Must Be Carefully Drafted - Or Unintended Consequences May Follow" »

I've given the Receivership 101 program many times, and it always generates an enthusiastic turnout. We figured our large conference room here at JMBM could handle the event, but the response was so great that we sold out almost immediately. Due to popular demand, the Bay Area Chapter of the California Receivers Forum decided to move our program, "Receivership 101" to a larger room at the Omni Hotel, in the heart of San Francisco's Financial District at the corner of California and Montgomery Streets. This is only a few blocks away from the JMBM office in Embarcadero Center.

If you haven't signed up yet, now is your chance.

To download a copy of the registration form below, click here.

Continue reading "Receivership 101 program has been moved to a larger venue to accommodate the tremendous response!!" »