Long Island Residential & Commercial Foreclosure Lawyers

Facing Commercial Foreclosure in Suffolk and Nassau Counties

In this troubled economy, commercial property foreclosures are becoming common than ever before. But there are ways you can avoid foreclosure—or lessen the damage—if foreclosure is unavoidable. If you are in danger of foreclosure, the Law Offices of Kyle Norton has commercial foreclosure attorneys in Long Island, practicing throughout Suffolk and Nassau Counties who can help.

When a mortgage borrower is unable to make payments to his or her lender as required by the mortgage agreement, that lender can begin court proceedings to take possession of the property and sell it to satisfy the amount that the borrower owes. Even worse, in New York, if the property sells for less than what the borrower owes, the lender can still obtain a judgment against the borrower for the remaining debt. And if you had more than one mortgage on the foreclosed property, you may have to continue making payments to your other lenders even after you lose the property.

A Long Island commercial foreclosure attorney can help

There is hope for those facing commercial foreclosure. A Long Island commercial foreclosure lawyer can help you deal with foreclosure in a number of ways.

Because lenders normally take a loss when foreclosing on property, they are often willing to renegotiate your mortgage rather than foreclose. A commercial foreclosure attorney can negotiate on your behalf to reduce your payments to a manageable level. Even if your lender is unwilling to negotiate, a property owner can avoid foreclosure by paying the past due payments to the court before it enters a judgment of foreclosure. This allows the borrower to keep the property even if the lender wants to foreclose.

In cases where foreclosure is unavoidable, a skilled Long Island foreclosure attorney can ensure that your lender adheres to legal requirements during foreclosure and gets the best price possible, thereby minimizing your remaining debt after foreclosure.

How to Modify a Commercial Loan

83 Billion dollars in Commercial Loans are in default with more than one trillion coming due in 2011. If and when CMBS (COMMERCIAL MORTGAGE BACKED SECURITIES) come back online the rules will be different and it will take time for the market to adjust.

The need to restructure or modify commercial loans will continue to increase putting pressure on both lenders and the government to save trillions in loans that are coming due.

Know your situation by asking yourself these basic questions:

1. Is the current loan a CMBS or Portfolio loan?
2. Is the current commercial loan backed by Fannie Mae?
3. Is the loan current, in arrears or default?
4. What is the net operating income (NOI) now vs. prior to the recession?
5. What is the property type (apartment, office, retail, etc.)?
6. When is the loan coming due?
7. Is there any clause in the current loan agreement for extension?
8. What is the debt coverage ratio (DCR) now? NOI divided by the outstanding loan balance?
9. Once you establish where you are it is easier to litigate and/or negotiate your loan status.
10. Contact the lender. When making contact with either have the following documents ready:
    a.    Updated personal finance statement (PFS).
    b.    Updated income and expense report (I/E).
    c.    Updated rent roll.
    d.    Current mortgage statement.
    e.    Historical I/E and rent roll to show contrast of before and during recession.
11. If the loan is a portfolio loan the lender will be more agreeable to work it out because they don’t want it to default and show as such on their balance sheet. The important thing to remember is that if the NOI is still positive the lender will feel safe.
12. If you have a CMBS loan there are laws and regulations that require conditions to exist in order for it to be moved from the Master Servicer to a Special Servicer. Only the Special Servicer has the ability legally to modify the terms and only if they conclude it is in the best interest of the investors. To get the loan from Master to Special servicer it must be in default or default must be imminent.
13. Lastly, you will need to put together a proposal encompassing the foregoing to present to the lender or special servicer with your idea of what a reasonable workout should be and how it should be structured.

 If you come to the lender with numbers that make sense and a plan to resume regular payments or have the loan refinance later by another bank your proposal has a good chance for success.

Save your property.  Change your life.  Get a fresh start.

For effective, professional help with out-of-control debt, you need an experienced Long Island bankruptcy attorney who regularly works with lenders to create repayment plans that work for you.  We genuinely want to help you escape these burdens.  Request our free newsletter and/or sign up for our seminars using the message field on our contact form.  Call our emergency legal hotline at 877-871-6179 or contact the Law Offices of Kyle Norton, P.C. online for a free consultation that could possibly save your home, change your life, and get you on track toward a fresh, new start in Long Island.

Your initial, in-person consultation is free.