Being a lender with a portfolio of multi-million dollar properties and a delinquent borrower, your first instinct may be to panic. After all, you have assets on which you must move quickly in order to protect. Additionally, the legal aspects of commercial foreclosures are necessarily complicated and arduous. But it’s important to resist your instinct and avoid panicking. The best way to do this is to rely on the expertise of your foreclosure partner.
Foreclosure trustees like the team at Total Lender Solutions have had years of experience handling the legal aspects of the most complicated foreclosure cases across seven major states.
Learn more about the legal requirements lenders may expect to face when enacting a commercial foreclosure.
What Agencies Regulate Commercial Foreclosures?
In order to understand the legal process of a commercial foreclosure, it helps to have insight into the organizations and legal codes which regulate commercial real estate and lending practices. Just a few of the legal entities lenders may encounter when dealing with the legality of their foreclosure include:
- The Federal Trade Commission (FTC) FTC enforces federal laws that protect consumers from deceptive and unfair practices. The FTC can take action against lenders, servicers, or other entities engaged in fraudulent, deceptive, or unfair practices related to lending.
- Consumer Financial Protection Bureau (CFPB): The CFPB describes themselves as a “U.S. government agency dedicated to making sure you are treated fairly by banks, lenders and other financial institutions.” They enforce many aspects of lending practices and are involved in regulating and enforcing rules related to foreclosure.
- State and Federal Courts: The legal system, including both state and federal courts, have the authority to adjudicate foreclosure cases, ensure due process is followed, and protect the rights of borrowers.
What are the Legal Aspects of Commercial Foreclosure I Should Know?
Due to the oversight of the above agencies and many more, it is crucial to have a foreclosure partner who knows the ins-and-outs of foreclosure. Your foreclosure officer will handle many of the legal requirements that crop up during a foreclosure, including:
- Locating Documentation: Foreclosure servicers gather and review loan agreements, promissory notes, and security instruments, ensuring compliance with deeds of trust and state laws.
- State and Federal Compliance: A foreclosure service like Total Lender Solutions can educate lenders about specific foreclosure regulations in the property’s location.
- Due Process: Lenders must protect borrowers’ rights by following the state-mandated timeline for foreclosure, which typically includes providing the borrower with notice and an opportunity to cure the default.
- Post-Foreclosure Obligations: After successfully foreclosing on a property, there may be additional legal obligations, such as securing the property and transferring ownership.
Related Article: Legal Considerations for Hard Money Lenders in Commercial Foreclosure
If you are a lender facing foreclosure, hiring a reputable foreclosure partner known for tackling large foreclosures and staying on top of the legal aspects of commercial foreclosure is paramount, as any mistakes can result in costly expenses for the lender.
A Chosen Partner Lenders Enacting Commercial Foreclosure
Hiring Total Lender Solutions can make a significant difference for your business. Our expertise and experience can create a personalized solution for you, guiding you to a favorable outcome.
If you’re currently dealing with foreclosure, don’t hesitate to contact our team by filling out our contact form.
