Banking Misconduct Blog


CMBS Mortgages and B Piece Buyers

CMBS Mortgages and B Piece Buyers

In today’s commercial real estate market, commercial loans are often pooled together to create commercial mortgage backed securities (CMBS). These loan pools typically have several tranches. Each varies in credit quality and payment priority.
The first-to-be paid tranches of bondholders...

Hotel Values Plummet – Borrowers Seeking Help

Hotel Values Plummet – Borrowers Seeking Help

Anyone who owns an office building, shopping center or other commercial space has probably seen their property values decrease since the pandemic began. Particularly hard hit are hotels, especially those in tourist areas.

The Financial Times reported in September that values are down...


Pre-Negotiation Agreements – Beware the Lurking Danger

Pre-Negotiation Agreements – Beware the Lurking Danger

Watch any reality cop show and you will likely hear the words, “Anything you say can and will be used against you.” Pre-Negotiation Agreements (often called PNAs) are much the same. Many unscrupulous lenders will stuff these agreements with one-sided waivers and clauses favoring the...

Springing Guaranties and Bad Boy Provisions

Springing Guaranties and Bad Boy Provisions

Banks want as much security as they can when they loan money. Conversely, borrowers want to avoid as much personal liability as possible. It is been that way since the beginning of banking.

One tool that has found favor in recent years is a “springing guaranty” or...

Borrower Defaults, Sues Banks... But Who One?

Borrower Defaults, Sues Banks... But Who One?

[Post updated through December 2020] We love when the underdog wins. Why? We are one of the very few lender liability law firms that only sue banks. Most lawyers that practice banking law represent the banks and not borrowers. Needless to say, borrowers are almost always the underdogs.
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Economic Duress (Another Tale of LNR Partners Wrongdoing)

Economic Duress (Another Tale of LNR Partners Wrongdoing)

We are not a fan of special servicers, especially LNR Partners and CWCapital. Somewhere along the way, both companies forgot their mission and began to be motivated by their own financial gain and not the well-being of their clients, the public or property owners.

Few property owners...

Wells Fargo Sanctioned for Illegal Fees

Bankruptcy is designed to provide a fresh start for honest but unfortunate debtors and to ensure creditors are treated fairly. A federal bankruptcy court judge in Manhattan recently ruled that Wells Fargo failed miserably in its treatment of several of its business clients. By taking money to which...

Special Servicing: the Ultimate Hardball Tactics

An article recently appeared on Syracuse.com. The title of the article was Inside Destiny USA’s Mortgage Emergency… Crisis or Hardball Bargaining? Destiny USA is the 6th largest retail mall in the United States. The journalist who wrote the article, Rick Moriarty, noted that the...

Second Mortgage Grounds for a Default? (Material vs Technical Breach)

Can a Lender Put Me in Default for a Technical Breach?
Here is a chilling scenario that happens more than you think. Borrower secures commercial mortgage back securities (CMBS) or other financing for the purchase of an office building or shopping mall. After a major tenant leaves, the...