(PRWEB) April 10, 2012
More than the previous couple of months, we have been seeing an improve in Chapter 11 bankruptcy reorganizations as a tool utilized by commercial genuine estate borrowers in their negotiations with lenders, stated Kevin M. Levine, Executive Vice President of Peak Asset Solutions (http://www.peakassetsolutions.com). A lot more and a lot more loans financed on a short-term basis of five to 7 years are maturing, but lowered property values are a barrier to refinancing, he said. So if the borrower and lender can’t come to agreement and the lender is threatening foreclosure, the borrower may have no option but to seek bankruptcy court protection. The automatic stay resulting from the bankruptcy petition filing will buy time for the borrower to seek alternative investor financing.

Levine explained that if the lenders loan documents are legally sound, it may file a motion to lift the keep allowing it to proceed with the foreclosure. Even so, if the borrower can submit a feasible strategy to pay the lender in a reasonable time, the bankruptcy court could give it that chance. The speedy non-judicial foreclosure that the lender was contemplating will be delayed for at least some period of time, and the lender now is faced with further legal expense. These negative prospects may persuade the lender to become much more reasonable with regard to negotiating a restructure and extension of the loan.

Levine pointed out that there are a quantity of adverse elements to any commercial true estate bankruptcy reorganization. A Chapter 11 proceeding is a reasonably expensive additional burden for a borrower currently strapped for cash, and the filing and lawyer fees need to be paid up front, he mentioned. If there is a strong guarantor who has unconditionally agreed to repay the loan, the lender nonetheless will be free of charge to go following that guarantor. And the borrower may possibly not be able to submit a feasible reorganization program or find option financing in the course of the period in which the keep is in spot, so the time and funds spent will not have accomplished any permanent advantage, Levine added.

Peak Asset Options offers commercial loan modification and brief sale services in California and throughout the nation. The companys personnel bring substantial commercial genuine estate expertise to every assignment, which includes industry analysis, valuation, legal, and negotiation knowledge. Each and every borrowers special lending scenario is completely analyzed, and the borrower is assisted in preparing current operating reports and projections. Then, Peak Asset Solutions drafts and submits to the lender a loan modification proposal. That proposal may consist of a principal reduction, interest rate reduction, and waiver of penalty charges. In these situations where a loan modification will not operate to the mutual benefit of the borrower and lender, we will try to broker a quick sale of the commercial actual estate at a considerable discount from the loan balance, or will seek to negotiate a sale of the note to a third-celebration.

Peak Asset Options is 1 of the entities in the Peak Corporate Network headquartered in Woodland Hills, California. In addition to industrial loan modifications, the Peak Corporate Network entities provide mortgage lending, loan servicing, brief sale solutions, 1031 exchange services, escrow services, trustee work, foreclosure services, and actual estate sale brokerage solutions. These services are available primarily throughout the Western United States for each residential and commercial true estate properties and loans. For more info, go to http://www.peakcorp.com.

The Peak Corporate Network is a brand that represents a group of separate legal entities, every single providing its unique set of real estate solutions.