The effort by employers to return employees to the office is a hard-fought battle and is lending to many workers demanding the flexibility to enter jobs that can be performed either remotely or on a hybrid schedule.
“Already, we are seeing a change in the way workers think about work,” says Total Lender Solutions CEO Randy Newman. Total Lender Solutions has been turning complicated processes into clear resolutions for institutional and private lenders for over 15 years. “It makes sense. No one wants to spend long hours commuting or to be separated from the comfort of home if they don’t have to. We’re seeing that, increasingly, firms that focus on lending for office spaces are having to rethink how they move forward.”
With office real estate foreclosures on the rise, lenders should seek a partner in enacting nonjudicial foreclosures. A third-party trustee partner can keep up with the influx of foreclosures, leaving teams to focus on their customers.
How to Enact an Office Foreclosure
According to Gallup, “approximately 56% of full-time employees in the U.S. — more than 70 million workers — say their job can be done working remotely from home.” Current trends reflect this, as leasing activity fell by 10.8% in the fourth quarter of 2022. Less leasing activity has led to increased office foreclosures.
For commercial office buildings secured through a deed of trust, the real estate can be foreclosed non-judicially. A deed of trust agreement features three parties, the lender, the borrower, and the third-party trustee, and therefore protects both the lender and the borrowers from predatory lending practices and liability.
Once a commercial real estate property secured by a deed of trust goes into default, many states require a waiting period before lenders may issue the first step in the foreclosure process. For many states, this process begins with a Notice of Default or some other legal document that notifies the borrower that they are now in the preforeclosure stage. If the borrower continues to fail to cure the default, the foreclosure process will continue until the property is sold at auction.
The foreclosure process is simple, but not easy. Each state has its own set of compliance laws that must be followed precisely. Failure to comply can result in the state or the borrowers seeking punitive or actual damages. All lenders must have a third-party trustee enact the foreclosure for them. The smartest solution is to rely on a foreclosure service with years of experience enacting foreclosures on office spaces.
Keep Your Team Educated About Foreclosure Law
Increased remote work has done wonders for workers and job satisfaction. On the other side of that, office spaces are facing a drop in rental numbers, and lenders are expecting to enact more foreclosures as the number of defaults rises. In fact, Fortune predicts that office vacancies will rise to 55% in 2023.
At Total Lender Solutions, we advocate for lenders looking to maximize recoveries on defaulted loans. For over 15 years, our team of highly experienced real estate professionals and legal experts has transformed complicated processes into clear resolutions for institutional and private lenders.
We work as a vigorous extension of your team to provide comprehensive solutions and seamless communication, from pre-foreclosure and notice of default to the final sale phase. Our dedication and persistence when it comes to the foreclosure process ensures that our clients feel confident in reaching a successful outcome. Contact us today.
