The challenges of non-performing loans are significant in any economy and our Special Assets Team recognizes that fact. A one-size-fits all mentality is rarely cost effective, so we work with our special assets clients to tailor strategies at every stage of the recovery process.
Our Team has advised clients on thousands of workouts. Many can be resolved at an early stage through forbearances and loan restructuring, but we recognize that sometimes you may need to seek legal counsel to tailor strategies for dealing with specific problem loans. For this reason our Team routinely advises bank clients on whether they can declare a default and how the workout should proceed when loans stop performing.
Monetization of Collateral
In the event that loans are secured by collateral (real or personal property), several team members are available to assist with the recovery and monetizing of that collateral. We handle numerous foreclosures and conformations every year, and routinely assist banks to gain access to property for inspection and evaluation in preparation for foreclosure. To the extent that the transfer of collateral is consensual, we can draft and negotiate settlements and deeds in lieu of foreclosure. We are experienced in the recovery of personal property and the preservation of rights against third party obligors.
Litigation against borrowers and guarantors is an unfortunate reality in today’s economy and our Team has handled hundreds of lawsuits in the last few years alone. Our strategy is very simple — obtain a settlement or judgment as quickly and efficiently as possible so that the bank does not throw good money after bad and tie up valuable resources. In the event the debtors contend that a debt is not owed, we have straightforward strategies to address groundless defenses, such as serving written discovery with the complaint and filing summary judgment motions as early as possible.
We recognize that judgments are worth very little unless the bank can recover its debt, so unlike many large firms, we work closely with special assets departments to recover those debts. Though there is rarely a perfect way to locate and obtain the assets of guarantors, our Team focuses on finding solutions that are appropriate and cost-effective under the circumstances. Whether it involves garnishment of bank accounts, seeking the business assets of debtors, or simply investigating their basic financial position, our goal is always the same — finding assets that the bank can convert to cash or otherwise monetizing the debt, such as a sale to a third party.
Bankruptcy is all too often the end result for troubled loans and our Team routinely advises banks on their rights and remedies during the various types and stages of bankruptcy. While some bankruptcies do not warrant significant interaction, to the extent there is a chance of recovery, we can assist with that process and actively protect the bank’s rights.