Law.com Subscribers SAVE 30%
Call 855-808-4530 or email [email protected] to receive your discount on a new subscription.
Challenges for Real Estate Lenders When Borrowers Default
During periods of distress in the real estate industry, when mortgage and mezzanine loans are being placed in default at a higher frequency, if a lender is not going to enter into a consensual workout or loan restructuring with their defaulted borrower, the lender will be presented with the choice of either enforcing rights under its loan documents or marketing and selling the distressed loan. Two recent cases demonstrate the challenges lenders may encounter when employing each of such options.
|'BBVA v. Bagwell'
In BBVA Compass and Sam Meade v. David Bagwell et al. (Court of Appeals, Fifth District of Texas at Dallas, Dec. 14, 2020), David Bagwell, a land developer, through three limited partnerships, borrowed $11 milllion from Texas State Bank in order to develop three luxury subdivisions in Colleyville, Texas. Bagwell guaranteed the loan, individually and through several entities. BBVA acquired the loans from Texas State Bank. The loans became due on Feb. 1, 2008, and BBVA extended the maturity date first to May 1, 2008 and then subsequently to Dec. 1, 2009 through written modifications.
Bagwell spoke with Sam Meade, a loan officer, in November of 2009 regarding obtaining an additional extension. Meade emailed Bagwell stating that he wanted to extend the loan for 60 days. However, the Bank never offered Bagwell an extension. After the maturity date, Bagwell heard from colleagues that the Bank was offering the loans for sale. Meade twice told Bagwell that the Bank was not in the process of selling the loans and, contrary to the terms of the loan documents, that that the Bank would require Bagwell's approval to sell the loans.
This premium content is locked for Entertainment Law & Finance subscribers only
ENJOY UNLIMITED ACCESS TO THE SINGLE SOURCE OF OBJECTIVE LEGAL ANALYSIS, PRACTICAL INSIGHTS, AND NEWS IN ENTERTAINMENT LAW.
- Stay current on the latest information, rulings, regulations, and trends
- Includes practical, must-have information on copyrights, royalties, AI, and more
- Tap into expert guidance from top entertainment lawyers and experts
Already a have an account? Sign In Now Log In Now
For enterprise-wide or corporate acess, please contact Customer Service at [email protected] or 877-256-2473
How Secure Is the AI System Your Law Firm Is Using?
In a profession where confidentiality is paramount, failing to address AI security concerns could have disastrous consequences. It is vital that law firms and those in related industries ask the right questions about AI security to protect their clients and their reputation.
COVID-19 and Lease Negotiations: Early Termination Provisions
During the COVID-19 pandemic, some tenants were able to negotiate termination agreements with their landlords. But even though a landlord may agree to terminate a lease to regain control of a defaulting tenant's space without costly and lengthy litigation, typically a defaulting tenant that otherwise has no contractual right to terminate its lease will be in a much weaker bargaining position with respect to the conditions for termination.
Pleading Importation: ITC Decisions Highlight Need for Adequate Evidentiary Support
The International Trade Commission is empowered to block the importation into the United States of products that infringe U.S. intellectual property rights, In the past, the ITC generally instituted investigations without questioning the importation allegations in the complaint, however in several recent cases, the ITC declined to institute an investigation as to certain proposed respondents due to inadequate pleading of importation.
The Power of Your Inner Circle: Turning Friends and Social Contacts Into Business Allies
Practical strategies to explore doing business with friends and social contacts in a way that respects relationships and maximizes opportunities.
Authentic Communications Today Increase Success for Value-Driven Clients
As the relationship between in-house and outside counsel continues to evolve, lawyers must continue to foster a client-first mindset, offer business-focused solutions, and embrace technology that helps deliver work faster and more efficiently.