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Florida Banking Law Blog Legal developments impacting banking, finance and loan enforcement in Florida

Tag Archives: Special Assets

Holding a Deed in Lieu in Escrow

Posted in Special Assets Litigation

To avoid foreclosure, a borrower might agree to execute a deed in lieu of foreclosure to be held in escrow.  In these circumstances, the borrower would execute a deed-in-lieu of foreclosure to the mortgaged property in favor of the lender.  The deed would be held by the lender or other third party in escrow for… Continue Reading

The FDIC’s Administrative Claims Process for Failed Banks

Posted in FDIC Related Issues, Residential Foreclosure, Special Assets Litigation

Enacted by Congress after the Savings and Loan Crisis of the 1980s, the Financial Institutions Reform, Recovery, and Enforcement Act (“FIRREA”) gives the FDIC sweeping authority to resolve the problems posed by a failed financial institution. This authority includes a mandatory administrative claims process to help the FDIC efficiently identify all claims against the receivership… Continue Reading

What is an Allonge?

Posted in Commercial Lending, Debt and Judgment Collection, Residential Foreclosure, Special Assets Litigation

Given the importance of the allonge in establishing a bank’s standing in commercial foreclosure cases, you may be surprised that the term “allonge” is nowhere to be found in Florida’s Commercial Code. In one case, the court describes an allonge as “simply an elegant-sounding legal term for a supplemental attachment to a note in which endorsements… Continue Reading

Discovery of Loss-Share Payments in Litigation: Public Policy

Posted in FDIC Related Issues, Special Assets Litigation

Financial institutions seeking to challenge discovery relating to Loss-Share Agreements and payments from the FDIC should be able to do so on the grounds of relevance, as we previously discussed. A second argument against such discovery is based on the public policy underlying Loss-Share Agreements. Reducing a creditor’s claim based on the amount that it… Continue Reading

Managing Litigation Cost – Florida’s Expedited Foreclosure Procedure

Posted in Debt and Judgment Collection, Loan Workouts, Special Assets Litigation

This article is the final article of a series and is excerpted from my book entitled Mortgage Foreclosure and Loan Collection: A Practical Guide for Lenders which is now available at Amazon.com. Here, we discuss Florida’s show cause procedure as a means of expediting mortgage foreclosure cases and therefore reducing cost. On average, a Florida… Continue Reading

Managing Litigation Cost – Discovery and Summary Judgment Motions

Posted in Debt and Judgment Collection, Loan Workouts, Special Assets Litigation

This article is the second of a series and is excerpted from my book entitled Mortgage Foreclosure and Loan Collection: A Practical Guide for Lenders which is now available at Amazon.com. Here, we discuss the impact of the discovery process and summary judgment motions on litigation cost. The discovery process can be a very expensive… Continue Reading

Discovery of Loss-Share Payments in Litigation: Irrelevant

Posted in FDIC Related Issues, Special Assets Litigation

In foreclosure actions based on assets of a failed bank, borrowers sometimes attempt to discover whether and how much the FDIC has reimbursed the acquiring institution for its loss under the loan. In doing so, borrowers hope to claim that their liability for the debt should be set-off by any amount the acquiring institution has… Continue Reading

Enforcing a Lost Promissory Note

Posted in Banking Operations, Commercial Lending, Commercial Real Estate Lending, Debt and Judgment Collection, Dischargeability of Debts, Loan Sales and Syndications, Residential Foreclosure, Residential Real Estate Lending, Special Assets Litigation

In Florida, it is well established that the original promissory note must be surrendered to the court as a condition of its enforcement. What do you do when you cannot find the original promissory note? Florida Statutes 673.3091 sets out a procedure to follow in order to  “reestablish” a lost note and provides that a… Continue Reading

Managing Litigation Cost: Pre-Lawsuit File Review

Posted in Debt and Judgment Collection, Loan Workouts, Special Assets Litigation

In today’s environment, clients are more cost-conscious than ever and this is in direct conflict with the ever-increasing cost of litigation. There are, however, some common sense ways in which a case can be managed in order to help minimize the associated fees and costs. This article is the first of a series and is… Continue Reading

HB 87 – A Summary of Florida’s New Foreclosure Law – Part 1

Posted in Residential Foreclosure, Special Assets Litigation

In prior posts we analyzed the main components of HB 87, the bill introduced in the Florida legislature which proposed significant changes to certain aspects of Florida’s mortgage foreclosure process. The bill was signed into law by Governor Scott and was effective as of June 7, 2013. In this and future posts we will review… Continue Reading

HB 87 – Florida’s Foreclosure Bill Becomes Law

Posted in Debt and Judgment Collection, Special Assets Litigation

In two prior posts, we analyzed the main components of HB 87, the bill introduced in the Florida legislature which proposed significant changes to certain aspects of Florida’s mortgage foreclosure process. Last week, the bill was signed into law by Governor Scott. There are, of course, both proponents and opponents to this new law but… Continue Reading

Post-Judgment Recovery of Attorney’s Fees and Costs

Posted in Debt and Judgment Collection, Special Assets Litigation

One of the issues faced by a judgment creditor in pursuing collection of the judgment is the amount of attorney’s fees and costs that will be incurred in the collection efforts. They can be substantial and are generally not recoverable. There are, however, a few statutory provisions which may facilitate recovery of fees and costs… Continue Reading

Transfers of Real Property for Estate Planning and Other Purposes and Their Effect on the Mortgage Lender

Posted in Commercial Real Estate Lending, Residential Real Estate Lending

I receive frequent inquiries from bank clients who are concerned because their mortgage borrower has requested permission to transfer the collateral real property to another entity. These requests commonly are made for estate planning purposes (though other reasons are often cited) and may involve transferring the property to other entities such as a trust. The… Continue Reading

New Equity Auctions

Posted in Bankruptcy, Special Assets Litigation

Seventh Circuit holds that new equity in a Chapter 11 debtor must be auctioned…and that a creditor may credit bid. In a Chapter 11 bankruptcy, if the debtor’s owners want to continue to own the debtor after confirmation, they must (1) pay the unsecured creditors in full; or (2) get the consent of the unsecured… Continue Reading

Use of FDIC Special Powers: Knowledge by the FDIC or its Assignees is Irrelevant

Posted in Special Assets Litigation

In previous posts, we introduced the protections afforded the FDIC by the D’Oench Doctrine and 12 U.S.C. § 1823(e), which bar claims and defenses against the FDIC and its assignees by private parties based on improperly documented  “agreements” (the term has been interpreted broadly) with failed banks. The policy underlying this bar is to prevent such… Continue Reading

Use of FDIC Special Powers: The Expanded Scope of the Term “Agreement”

Posted in Special Assets Litigation

In previous posts, we introduced the protections afforded the FDIC by the D’Oench Doctrine and 12 U.S.C. § 1823(e), which bar claims and defenses against the FDIC and its assignees by private parties based on improperly documented agreements with failed banks. Parties sometimes attempt to get around the special powers hurdle by challenging the breadth… Continue Reading

Use of FDIC Special Powers: Overview

Posted in Special Assets Litigation

Last month, the Federal Deposit Insurance Corporation reported that 470 financial institutions have failed since 2007. It is no wonder, then, that many institutions are embroiled in litigation involving loans made by failed banks and subsequently assigned to them by the FDIC. Borrowers often try to raise defenses against the acquiring institutions based on allegations… Continue Reading

Using Contempt Power to Force Repatriation of Offshore Trust Assets

Posted in Bankruptcy, Special Assets Litigation

Offshore asset protection trusts (OAPT) typically have the following characteristics: (1) the trust is governed by the laws of a foreign jurisdiction that does not recognize the judgments or orders of courts of the United States; (2) the trustee is a foreign entity that cannot be sued in the United States because it lacks sufficient… Continue Reading

How Does a Bank’s Claim For Set-Off Fare in the Face of a Garnishment?

Posted in Banking Operations, Debt and Judgment Collection, Special Assets Litigation

In Florida, it is well established that a bank has a common law right of set-off against funds held in a depositor’s account if the depositor has defaulted under a loan from the bank. This allows the bank the option to apply the funds in the depositor’s account as needed to pay the outstanding obligation… Continue Reading

Changes in Florida’s Post-Judgment Statutory Interest Rates

Posted in Debt and Judgment Collection, Special Assets Litigation

If you obtain a judgment in Florida, you generally are entitled to interest on the amount of the judgment from the date the judgment is entered until the date it is paid.  The rate of interest is controlled either by the terms of the contract between the parties, in which case the rate must be incorporated into… Continue Reading