Distressed Real Estate, Creditor’s Rights & Workouts

The current state of the real estate market has created both challenges and opportunities. From the first hint of trouble for a lender with real estate assets on a watch list, or for an owner who has real estate floundering through workout, bankruptcy or litigation, Stark provides a highly skilled, integrated team of transactional, bankruptcy and litigation lawyers to take problem real estate assets and turn them into income producing successes for our banking clients.

Our capabilities include:

Pre-workout Services

For our lender clients we perform pre-workout analyses for troubled loans, loan portfolios and lender liability avoidance by utilizing the experience of our seasoned real estate practitioners. Our team regularly assists clients in performing rapid due diligence reviews for key components.

Workout

In troubled real estate workouts we help our clients identify and implement a wide array of solutions for their specific needs. We assist both our lender and borrower clients with all aspects of loan workouts, including forbearances, loan modifications, project entitlement and development issues, and negotiations to bring the lender, borrower and other interested parties together to successfully restructure and document their deal. We also provide counsel in all types of real estate matters in bankruptcy, including single asset real estate case issues, adequate protection of the lender’s interest in collateral, stays against lien enforcement, valuation of collateral and restructuring loan terms through a confirmed plan of reorganization.

Often times, as a sub-set and in direct relation to bankruptcy, the firm also routinely negotiates and prepares workout and forbearance agreements for secured lenders, and can quickly prepare such agreements with little notice from the client. The firm is familiar with all aspects of workouts and forbearance terms.

Enforcement/Collection Actions – Asset Recovery

When enforcement actions are necessary, our collaborative team of skilled lawyers work closely and efficiently to pinpoint the most effective remedies for our lender. For example, Stark attorneys regularly handle a variety of matters including judicial and non-judicial foreclosure proceedings, deeds-in-lieu, receivership actions, deficiency collections, confession of judgment and related litigation. We defend lenders against lender liability claims, countersuits, and other claims arising from distressed real estate loans, in both state and federal courts across the numerous jurisdictions nationwide.

Stark combines the firm’s strengths of commitment to delivering value that exceeds expectations and our national geographical reach to provide a comprehensive collection service to meet all of the needs of any lender client seeking to collect on deficiency claims and the like. Unlike a collection agency or many law firms, Stark is organized to take a deficiency claim from the pre-litigation, demand-letter stage through litigation and post-judgment recovery, if necessary.

We have the knowledge and resources to efficiently and successfully collect large accounts that are delinquent. Stark represents clients in many different types of commercial and debt collection matters. These matters include actions to collect debts owed under loan agreements, retail installment contracts, negotiable instruments, promissory notes, and goods sold and delivered. We file actions seeking judgments, including confessions of judgment, against business owners and other third parties on personal guaranties of corporate debts. The firm also has extensive experience representing creditors owed balances; including filing replevin actions.

Foreclosures

On a national basis, the firm has represented banks and other financial services companies in connection with foreclosure matters, both commercial and residential, since the firm’s founding in 2003. As such, the firm is very familiar with the process of quickly moving uncontested residential and commercial foreclosures through the judicial and non-judicial processes throughout the country. The firm has litigated over many defendants’ efforts to contest, and thereby prolong, the foreclosure process. We are well equipped to suppress defenses and strike answers that are not germane to the foreclosure. The firm is also experienced in prosecuting so-called “strict” foreclosures, negotiating deeds-in-lieu of foreclosures and workouts, applying for rent receivers, and executing on absolute assignments of rent without resorting to time-consuming and expensive applications to the court.

We have never delegated the work of lawyers to paralegals, never exposed our clients to liability, reduced our clients’ mortgages to unenforceable mortgage interests, or subjected our clients to adverse publicity. At Stark, we believe it is our mission to exceed client expectations in every case, and this can never be achieved unless we remain loyal to our core values.

Evictions

In connection with our foreclosure practice, the firm has successfully litigated commercial and residential evictions, representing landlords and REO creditors in the following areas: (a) residential leases involving Section 8 tenancies, (b) residential leases involving other subsidized housing issues, (c) commercial leases, (d) nonpayment of rent, (e) forfeiture, (f) safety, (g) quiet enjoyment, (h) damage to property, (i) security deposit disputes, (j) holdovers, and (k) criminal activity and criminal convictions. Our substantial eviction experience includes representing landlords in the abandonment of property, eligibility for reduced rent and actions seeking damages relating to such tenancies.

UCC Litigation

UCC litigation often revolves around the secured creditor’s effort to negotiate a voluntary repossession of the business assets or, in the alternative, a temporary restraining order application with the court and a motion for a prejudgment writ of attachment. UCC litigation in this field also relates to enforcing the rights of a secured creditor under UCC section 9-406 in connection with the enforcement of the rights granted in accounts and account receivables as collateral. We have assisted commercial lenders in replevin actions involving other assets, such as aircraft, boats, office equipment, motorcycles, trucks, and cars. Our approach is to take expedient action to avoid situations in which the assets have been diluted in value or have been fraudulently transferred to other businesses. We have often litigated these issues successfully for secured creditors as well as many other aspects of the UCC. We are also regularly called upon in a consultative capacity to advise on various UCC issues for our clients. This includes presenting UCC seminars to bankers and credit officers.

The firm’s concentrated capabilities include debt transactions such as secured lending transactions, subordinated debt, loan restructuring and loan syndication and trading. Our commercial litigation experience includes all areas of lender liability, defense of consumer fraud claims and litigation, including class actions; and UCC and secured transactions litigation.

REO

In the event an asset is held, post foreclosure or post deed-in-lieu by a lender client in REO, Stark uses its depth of experience to resolve any outstanding issues relating to entitlements, community associations, zoning, permitting, municipal relationships, leasing, and environmental issues. Whether a client plans to hold the asset for a period of time while waiting for a stronger market, or intends to instantly reposition the asset and sell it into the current market place, we are experienced in the sale and acquisition of real property assets, including marketing and brokerage issues for lenders.

Our clients routinely call upon our skills and capabilities to help them make essential business decisions when faced with a distressed real estate situation. We stand ready to assist them in their endeavors.