By Anastasia N. Kaup and Melissa A. Sharp
It is critically important, for both lenders and borrowers, to confirm that the borrower is actually authorized to enter into a financing transaction, borrow money, and pledge assets as security for those obligations (if the financing is secured). If a borrower (entity) acts without express legal authority or beyond the stated scope of authority in its charter, operating agreement, or offering documents (collectively, the “Fund Documents”), the entity may be sued by its investors, the transaction may be voided by a court, the lender may suffer a loss, and/or other negative consequences may result. Continue reading “Best Practices for Fund Document Diligence in Fund Financing Transactions”
So far, much of the focus has been on getting lenders to stop originating LIBOR loans in favor of loans based on alternative, risk-free rates. As we get closer to that becoming a reality on a broad scale, it’s worth taking a look at the issue from a borrower’s perspective. Borrowers have no say in the phaseout of LIBOR, but to varying degrees they will have a say in which alternative rates will become prevalent in the market.
To learn about what a borrower should do in light of the availability of alternative reference rates in the very near future, check out our Alert here.
Duane Morris’ LIBOR Transition Team: Roger S. Chari, Chair, Joel N. Ephross, Amelia (Amy) H. Huskins, and Phuong (Michelle) Ngo.
Duane Morris LLP, CleanFund and California MBA will present “What’s Shaking? A Conversation About Real Estate Finance, Mortgage Banking and Earthquakes!” on Thursday, September 22, 2016, from 5:00 p.m. to 8:00 p.m. in the Duane Morris San Francisco office. This California MBA MCLE networking reception offers a ground-moving educational event featuring a discussion on financing solutions for mandatory seismic compliance. The panel will also discuss the latest developments in real estate financing in the Bay Area and recent case law and regulatory issues impacting the mortgage banking industry in California. Attendees will have the opportunity to network with banking executives, real estate developers, property owners, lenders and in-house counsel from all over Northern California. One hour of General MCLE credit is pending.
The panelists for this program are Chris Robbins, Managing Director, CleanFund; Bob Bednarz, Loan Advisor, Guarantee Mortgage; and Terrance J. Evans, Partner, Duane Morris. Jolie-Anne S. Ansley, also a Partner at Duane Morris, will serve as program moderator.
If you are interested in attending this program, please visit the event registration page.
Many states have enacted consumer collection practices laws that impose addition hurdles for lenders in their efforts to collect debts and foreclose mortgages. A Florida appellate court has just addressed what it considers may be a case of first impression in Florida: whether a collection practices statute can impose a condition precedent to provide written notice of the assignment of a mortgage loan to the borrower, and bar commencing foreclosure notwithstanding the lender’s compliance with its contractual obligations to assign the mortgage and provide notice of acceleration. Although Florida’s Second District Court of Appeal held in Brindise v. U.S. Bank National Association that the notice of assignment required by the Florida Consumer Collection Practices Act (“FCCPA”) is not a condition precedent to foreclosure, “because innumerable foreclosure cases are pending in the trial and district courts where defendants have raised section 559.715 as a bar to foreclosure,” it certified the question to the Florida Supreme Court as one of great public importance. Brindise v. U.S. Bank National Association, __ So. 3d __, 41 Fla. L. Weekly D223a (Fla. 2d DCA January 20, 2016).
To read the Alert, written by Duane Morris partner Steven Ginsburg, in its entirety, please visit the Duane Morris website.