Banking & Finance Law Report

Archives: Real Estate

Subscribe to Real Estate RSS Feed

Potential Changes for HVCRE Loans

In this blog, we have described some of the original concerns with the “high volatility commercial real estate” loan regulation as well as some suggestions for change. These rules apply to certain real estate loans for acquisition, development and construction. Recently, there have been suggestions that changes are possible regarding “high volatility commercial real estate” loans … Continue Reading

Sixth Circuit Underscores Importance Of Moving For A Stay After Entry Of Judgment In Foreclosure Proceedings

  On September 9, 2016, the United States Court of Appeals for the Sixth Circuit issued a decision that parties in foreclosure proceedings should read carefully. In MSCI 2007-IQ16 Granville Retail, LLC v. UHA Corporation, LLC, Case No. 15-3524, the court addressed whether the sale of foreclosed property during the pendency of an appeal moots … Continue Reading

Federal Reserve Expresses Openness to Relaxation of HVCRE Regulations on Community Banks

Last year, as noted by this blog, the FDIC, OCC, and Federal Reserve imposed harsher capital requirements on certain “high volatility commercial real estate,” or HVCRE, exposures, in accordance with the Basel III international banking standards. These new requirements were opposed not only by the real estate industry but also by banking associations, particularly the … Continue Reading

Ohio Revised Code §1301.401 – A Powerful Tool for Lenders with a Defective Mortgage

For years, it was generally accepted that mortgage creditors and bankruptcy trustees could assert the status of a bona fide purchaser and treat a defectively notarized mortgage as if that mortgage did not exist.  On February 16, 2016, our Supreme Court provided clarity regarding the legal effects of R.C. §1301.401 and provided protection to lenders … Continue Reading

Newly Effective HVCRE Loan Rules

Lenders who finance commercial real estate exposures should be aware of new regulations that impose harsher capital requirements on certain “high volatility commercial real estate,” or HVCRE, exposures. In June 2013, the FDIC, OCC, and Federal Reserve jointly approved proposed rules intended to implement new international banking standards, known as the Basel III Capital Accords, … Continue Reading

Ohio Supreme Court Confirms That A Foreclosure Plaintiff May Submit Proof Of Standing Subsequent To Filing The Complaint

In what most pundits agreed would be a swift reversal, the Ohio Supreme Court did in fact unanimously reverse the Ninth District Court of Appeals in Wells Fargo Bank, N.A. v. Horn, Slip Opinion No. 2015-Ohio-1484, a 20-paragraph decision that helps to explain a sometimes-misunderstood line from Schwartzwald. In Horn, Wells Fargo filed the foreclosure … Continue Reading

The Modernization of Ohio’s Receivership Statute

I.  Introduction Effective March 23, 2015, Ohio’s antiquated receivership statute (Ohio Rev. Code Chapter 2735) will be modernized, particularly as it relates to the appointment of a receiver in commercial mortgage foreclosures and the ability of a receiver to sell real estate free and clear of liens.  II.  Appointment of a Receiver Previously, commercial mortgagees … Continue Reading

Constructively charged with having retroactive actual notice when challenging an improperly recorded defective mortgage…wait, what?

“Great cases…make bad law” declared Supreme Court Justice Oliver Wendell Holmes Jr. in his dissenting opinion in the Northern Securities antitrust case of 1904. One of the most oft-quoted phrases any aspiring lawyer will hear in law school, this maxim stands for the proposition that decisions in cases of great importance from a public or … Continue Reading

Ohio Foreclosure Procedure . . . Twice the Appeal

Earlier this month the Supreme Court of Ohio resolved a split of authority between the Fifth District and Seventh District regarding whether a foreclosure decree is a final appealable order when it includes unspecified amounts advanced by the mortgagee for inspections, appraisals, property protection and the like. Prior to the May 15 decision in CitiMortgage, … Continue Reading

Planning For Leasehold Financing

Commercial leases often lack leasehold financing provisions despite the significant impact such provisions can have on the business dealings of the tenant during the term of the lease. Long-term, creditworthy tenants, those who have value in their leaseholds such as restaurants and hotels, are often prime candidates for leasehold financing. A leasehold mortgage is very … Continue Reading

Ohio’s 10th Appellate District Finds Debtor Lacks Standing to Challenge Assignee’s Power to Enforce Loan Documents

In a decision that will hearten commercial lawyers, on April 23, 2013, Ohio’s Court of Appeals for the Tenth Appellate District relied on lack of standing to reject a mortgagor’s attempt to avoid the consequences of his undisputed payment default by accusing the mortgagee, which was the assignee of his note mortgage, of lacking standing … Continue Reading

10th District Court of Appeals Upholds Subordination and Flow Down Provisions in Commercial Construction Documents

On March 29, 2013, the Court of Appeals for the 10th Appellate District in Columbus issued a decision of significance for mortgage lenders that rely on contractual subordination and flow down provisions in construction contracts.  In KeyBank Natl. Assn. v. Southwest Greens of Ohio, L.L.C., 10th Dist. No. 11AP-920, 2013-Ohio-1243, the 10th District Court of … Continue Reading

The Mystery of Mineral Rights: A Lesson for Lenders

By now, you have probably heard about some of the changes in title policies and title searches caused by the recent oil and gas activity in Ohio.  Title insurers also recently added to their policies a standard exception for any “lease, grant, exception or reservation of minerals or mineral rights.” Essentially, this language means that … Continue Reading

Ohio property data to remain free online

Put your wallet away and hit print as many times as you like. Because for now, there will be no new charge to download or print property records in Ohio. As a welcomed early holiday gift, the proposal to charge fees for property records has died in committee. The office of Senate Judiciary Committee chair … Continue Reading

Ohio Supreme Court Foreclosure Decision

On Halloween, the Supreme Court of Ohio issued a ruling that should scare lenders who do not do their own due diligence before filing a foreclosure action, particularly with respect to loans pooled into mortgage-backed securities, or that have otherwise been assigned one or more times from the originator of the loan. The Court, in … Continue Reading

Ohio Supreme Court to Hear Oral Arguments Regarding Adequacy of “Website Notice” of Sheriff Sales

On May 23, the Ohio Supreme Court will hear oral arguments in an appeal by PHH Mortgage Corporation that concerns whether a sheriff’s website can provide constitutionally sufficient notice of the date, time, and location of a sheriff’s sale of foreclosed property. Real estate lenders of all sorts will be interested in the outcome which has important … Continue Reading

Obtaining Property Tax Relief in Ohio

The real estate market in Ohio continues to face significant challenges. With many property values declining throughout the state, challenging property tax assessments to obtain tax relief is an important strategy for financial institutions to consider. How does the complaint process work? Property taxes in Ohio are paid in "arrears," meaning taxes paid in 2011 … Continue Reading
LexBlog