In this May/June 2018 issue of Community Banker we discuss why, if you are a secured lender, you should periodically review your collateral.
An excerpt:
We know that secured creditors in a bankruptcy case are at the top of the food chain. A secured claim is entitled to be paid in full out of the proceeds of the collateral that secures it before any of those proceeds may be used to pay unsecured claims. Even better, if a claim is oversecured, the allowed secured claim includes interest accrued after the petition date, plus reasonable costs and attorneys’ fees as provided for in the loan agreements up to the value of the collateral. Also, in a Chapter 11, a Plan cannot be crammed down on a class of secured creditors that did not accept the Plan, unless the Plan can show that the secured creditor is receiving a combination of cash or secured debt equal to the value of its collateral.
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The Community Banker is prepared by attorneys at Olson & Burns P.C. to provide information pertaining to legal developments affecting the field of banking. In order to accomplish this objective, we welcome any comments our readers have regarding the content and format of this publication. Please address your comments to olsonpc@minotlaw.com.
