 Review Carefully  Check Note repayment terms  Check names  Check collateral  Check equity  Check use of proceeds.

Slides:



Advertisements
Similar presentations
Credit Instruments and Legal Documentation
Advertisements

Privileged and Confidential Mortgage Creation and Security Enforcement IFMR Capital June, 2013.
Slides developed by Les Wiletzky Wiletzky and Associates Copyright © 2006 by Pearson Prentice-Hall. All rights reserved. PowerPoint Slides to Accompany.
Secured Transactions UCC Title 9. Security Interest An interest in personal property or fixtures that secures payment or performance of a obligation.
Deficiency Judgments Susan Francis Maryland Volunteer Lawyers Service
Renting vs. Buying Housing. Rental Terminology Landlord Owner of property –Expects rent to be paid on time and for tenant to keep the property in reasonable.
Florida Real Estate Principles, Practices & Law 38th Edition
AN OVERVIEW OF PROJECT FINANCE IN PRIVATE-PUBLIC PARTNERSHIPS FINANCE 101 T ERRI S MALINSKY Managing Director B.C.
Financial Management F OR A S MALL B USINESS. FINANCIAL MANAGEMENT 2 Welcome 1. Agenda 2. Ground Rules 3. Introductions.
Real Estate Law An Introduction to the Closing Real Estate Law An Introduction to the Closing.
SHORT SALES Guidelines and Tips for a Successful Escrow Transaction.
©2011 Cengage Learning Chapter 11 Processing: DOCS, FUNDING, AND CLOSING By Dr. D. Grogan M.C. “Buzz” Chambers.
The High Credit Risk Customer and Credit Terms: Using Credit Enhancements to Make the Sale Scott E. Blakeley, Esq. Jerry Bailey Executive.
Credit Cards. CREDIT DEFINITIONS Credit Trust given to another person for future payment of a loan, credit card balance, etc. Creditor A person or company.
Affordable Housing Production Program Inclusionary Housing.
1 Secured Transactions Assignment 29 Lienors vs. Secured Creditors: Future Advances.
How to read a FINANCIAL REPORT
Presented January 12, 2010 by Cheryl Fatnassi, Opportunities Credit Union.
Chapter 13 Loan Origination, Processing, and Closing © OnCourse Learning.
Capital Mortgage Partners BIBLE Capital Mortgage Partners BIBLE BY: JACK GETTER III.
Chapter 27 Secured Transactions and E-Filing
ECONOMICS Year in review. Market economy – economic system in which the people, rather than the government, own the resources and run the business Mixed.
CHAPTER FIFTEEN Lending Policies And Procedures The purpose of this chapter is to learn why sound lending policies are important to banks and other lenders.
David M. Harrison, Ph.D. Real Estate Finance Texas Tech University Common Covenants and Clauses Promise to Pay - Specifies principal, interest, penalties,
Chapter 18 Acquisition, Development, and Construction Financing © OnCourse Learning.
BUSINESS VENTURE VALUATION. ALTERNATIVES FOR BUYING EXISTING BUSINESS ADVANTAGES DISADVANTAGES.
Year 15: Nonprofit Transfer Strategies for Expiring LIHTC Properties Supportive Housing Network of New York May 5, 2009 Presenters: Gregory Griffin, Director,
Mechanics’ Liens or Broken Priority. If Contractor Not Paid By statute, anyone who furnishes labor or materials for the improvement of real property may.
CRISSY NMLS # Presentation for Real Estate Professionals Only HECM for PURCHASE.
CONTRACT DRAFTING DEFAULTS ASSIGNMENT GROUP - I. Agenda Our client - Overview Client’s goals Our objectives assumptions Our mode of action Practice Summary.
© Copyright 2012 Milady, a part of Cengage Learning. All Rights Reserved. Chapter 2 Financing the New Business.
1. Operations Planning Creating & Running a Legitimate Business Finalizing the plan What is the Size & Scope of Your Business Entity (Forms of Business)
CFPB AND THE REO TRANSACTION
Legal Document Preparation Class 2Slide 1 Elements of a Contract to be Considered in Drafting The writing should clearly indicate the presence of an offer.
© 2012 Baird Holm LLP Agricultural Lending Counterparty/Third Party Risks: What You Don’t Know or Didn’t Plan For Can Be Bad Jacqueline Pueppke ICBA Annual.
Entrepreneurship: Ideas in Action 5e © 2011 Cengage Learning. All rights reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible.
Apply procedures for preparing corporate financial statements.
Copyright © 2007 Pearson Education Canada 1 Chapter 20: Audit of the Capital Acquisition and Repayment Cycle.
Financing Principles Chapter 14 Zaharopoulos. 3 Financing Instruments 1. Mortgage 2. Deed of Trust 3. Carryback, Installment, Land Contract, Contract.
Regional Economic Development Group Since THREE LOAN PROGRAMS  Revolving Loan Fund Program (RLF)  SBA 504 Loan Fund Program (SBA 504)  Intermediary.
Chapter 43 Construction Supervision Procedures. 2 Links for Chapter 43 Contracts Completion Notices Bids Inspections Loans Appraisals Change Orders Building.
CHAPTER 25 SECURED TRANSACTIONS: ATTACHMENT AND PERFECTION DAVIDSON, KNOWLES & FORSYTHE Business Law: Cases and Principles in the Legal Environment (8.
© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license.
Chapter 3 Financial Management Part 2 BCN 4772 Summer 2007.
Residential Real Estate Closings in Georgia
© 2012 Cengage Learning. Residential Mortgage Lending: Principles and Practices, 6e Chapter 2 Real Estate Law and Security Instruments.
Mitchel Ronacher, Isaac Hill, Adam Luehmann, Corey Plath.
© 2007 Prentice Hall, Business Law, sixth edition, Henry R. Cheeseman Chapter 26 Credit and Security Interests in Real Property.
15-1 Copyright © 2016 McGraw-Hill Education. All rights reserved. No reproduction or distribution without the prior written consent of McGraw-Hill Education.
Checking Accounts and Other Banking Services Understanding and Managing.
Credit Cards. When thinking of getting a Credit Card follow the Three C’s: Character: Will you repay the debt? How you used credit before? Do you pay.
What is a security interest? Who is a secured party? What is a security agreement? What is a financing statement? What is a security interest? Who is a.
Reverse Mortgage HECM Purchase Program Kevin Walton
SBA 504 Loan Program Long Term Fixed Asset Financing For Small Businesses.
FINANCING TECHNIQUES: SHORT TERM. UNSECURED CREDIT I. UNSECURED CREDIT A. How is it provided? line of credit promissory note that can be rolled over B.
The Costs and Methods of Obtaining Credit Morgan Napier and Kaitlin Nelke.
Chapter 16 Credit in America. What is Credit?  Money borrowed to buy something now, with the agreement to pay for it later  Over 80% of all purchases.
Renting vs. Buying Housing
Mortgage 101 Training for The ________ Team
Reverse Mortgage HECM Purchase Program
4.04 Statement of Cash Flows
Fundamentals of SBA Lending
Celtic Express Loans Product Overview
Reverse Mortgage HECM Purchase Program
Celtic Express Loans Product Overview
The Paper Chase: Effective loan documentation and closing processes
SBA 504 Lender Training for Region IX
Commercial Real Estate Closings – A Paralegal Primer
Leasehold Transactions
CREDITOR’S AND DEBTOR’S RIGHTS
Presentation transcript:

 Review Carefully  Check Note repayment terms  Check names  Check collateral  Check equity  Check use of proceeds

 If Authorization is incorrect, prepare change letter and send  If you have any doubt about what is in the Authorization do a change letter

 Collect and submit timely

 Only get one form signed  MUST HAVE AN AUDIT TRAIL  Must comply with use of proceeds in Authorization  Must match disbursements with use within 10%  Watch out for EPC/OC. No Working Capital

 Have reviewed by experienced person  Less is more, the more exceptions the less coverage  Watch out for:  Use covenants  Existing liens  Some standard Endorsements  Oil and Gas

 Should have with new construction  Look for encroachments  Look for access

 Verify balance  Determine if Open End  Watch for HELOC  Future Advances

 Check all jurisdictions  Check Bankruptcy  Check Judgments  Credit Report will have  Order right away to avoid problems POST CLOSING UCC SEARCH:  Verify Priority  Good to pre-file

 Be certain of name  Be certain of where to file  Watch out for collateral that must be in possession of Secured Party (stocks)  Process filing takes 7-10 business days  Pre-file

 Similar to Security Agreement  Sometimes done if business is licensed  May need to posses stock

 Need for uncertificated stocks, investment accounts, etc.  Only way to get to the Collateral and only way to perfect security interest

 Done with Stock Certificates  Sign in blank

 Must match term of Loan  If you don’t care do a change letter because Authorization requires the term of the lease to be as loan as the loan  May include renewal options as long as tenant can exercise unilaterally

 Subordinate Landlord lien to Bank lien  Must be able to cure default, so need notice of default and opportunity to cure  Must have access to collateral  Problem if you don’t get it

 Rare, but sometimes required  Difficult to get  May not want it

 A license is a privilege  In Pennsylvania you can take security interest but subject to Liquor Control Board  You can get interest in the ability to transfer  General Intangible under UCC-1; someone else may have a lien already  Should be mentioned in both the Security Agreement and the UCC-1  If the business closes down, you may want to remove the license

 Good to have so that you can work with Liquor Control Board and taxing authorities, Pennsylvania Department of Revenue  Allows lender to execute transfer documents and fill out forms

 Whole process in SOP  Be sure you have all the Franchise Documents and all signed  Franchisor should certify that these are all the documents  Careful! May render Loan ineligible!

 Requires notice of default and opportunity to cure  Defer franchise fees is Loan is in default (hard to get)  Access to Franchisor’s books as they pertain to Borrower

 Make sure in place  Change Endorsement  Copy of Declarations page  Mortgagee/Lender Loss Payee

 Must have if they have employees

 Be certain Insured is correct  Owner may be other than insured  Copy of the policy  Term long enough for loan?  Be sure in correct amount

 Must be signed by OWNER of the policy  Must not be assigned to anyone else  Must be correct Insured  Must be correct Amount  Must be assigned as Collateral, NOT CHANGE IN BENEFICIARY

 Check all parties  Be sure allow for Confession of Judgment whether a GP or an LP  If not all Partners must sign authority of one Partner to sign Confession of Judgment

 Get copy of Standby Note  Compare to be sure it is correct  Be sure you have payee on Note as Standby Creditor

 If no Note, tell them to draft one  Have Note endorsed as follows:  “This Note is subject to the terms and conditions of a Standby Creditor’s agreement between Payee and ____________ (Bank) dated the _____ day of _____________, 20__”

 Critical  I prefer an Affidavit  One of the first things looked at  Cash is King  In kind must be supported by appraisal (I would be sure SBA agrees)  Careful about where it comes from, there are many specific rules about this

 Purchase of more than 51% of assets  Pennsylvania Department of Revenue clearance  Escrow/Indemnification  Verify payment of seller taxes

 Important as this is required by Authorization under collateral where security interest is listed  Should have list of all equipment  All equipment over the value of $5,000 should have a complete description with serial number

 Good way to track use of proceeds

 Same as a Deed for personal property

 Must have EIN  If Borrower requires a license, need a copy (attorney, barber, restaurant with liquor license, dentist, doctor, etc.)  Pennsylvania contractors are required to have permits

 Good to have in a business acquisition  Be sure the principal or principals of the seller are bound. No good if seller is a corporation and person that can compete is an individual. They are not bound.

 Protects Lender and Borrower  Must match use of proceeds

 Need if you have to complete work

 Post closing  Very important for new construction and leasehold improvements

 New construction only