HVCRE: The Continuing Saga of Lenders
A recent case out of Georgia involved a contractor's licensing failure voiding the construction loan that was financing the project. However, there was a twist....well, several twists—a contractor who was also a lender, an...more
If you develop or build on real property in Oregon, your progress payments to contractors on future projects will be affected by a new law, effective on March 7, 2024. If you are a construction lender, your borrower may...more
On November 21, the CFPB announced it approved an application from a community banking trade organization to pilot disclosures for construction loans. The application was submitted pursuant to the CFPB’s trial policy programs...more
The CFPB recently approved an application (Application) from the Independent Community Bankers Association (ICBA) for alternative disclosures under the Truth in Lending Act (TILA)/Real Estate Settlement Procedures Act (RESPA)...more
Construction lenders beware – a recent Arizona Supreme Court decision interpreting Exclusion 3(a) of standard-form title-insurance policies could mean lenders are not insured against a senior mechanics’ lien if the lender’s...more
Key Highlights - - Interest of innocent third party without notice not an absolute bar on rescission remedy. - Lenders, project companies, subcontractors and suppliers should seek risk mitigation measures to decrease...more
After a number of controversial bills proposed from various industry groups over the last few years, the Tennessee construction community came together in 2020 to push through legislation intended to protect members of the...more
The CFPB recently updated the TILA/RESPA Integrated Disclosure (TRID) rule FAQs to address construction loans. The guidance falls well short of what the industry is seeking from the CFPB....more
On Friday, March 23, 2018, the President signed a $1.3 trillion Omnibus Spending bill that had been passed by Congress. Two (2) provisions of the bill are important to those involved in the Low-Income Housing Tax Credit...more
Most construction loans contemplate multiple advances or disbursements of funds at various stages of the construction project. The construction loan agreement will set forth the conditions that the borrower must satisfy to...more
It goes without saying that a construction project involves a plethora of competing interests. There is a lender, a main contractor, subdivision improvers, architects, and many different subcontractors, all of which are...more
Lenders who finance wind and solar farms often require the EPC contractor to consent to the developer’s assignment of the EPC Contract to the lender to secure the developer’s obligations under the loan documents. Such...more
Bankers and other professionals who have worked on construction loans in states other than Connecticut will know how much of a pain it can be to make construction loan advances. You usually need to perform a title update and...more
The Consumer Financial Protection Bureau (CFPB) staff presented an informational webinar on March 1, 2016, to address several issues with the TILA/RESPA Integrated Disclosure (TRID) rule in connection with...more
Historically low interest rates have led to the substantial growth in real estate lending, especially construction lending. Unfortunately, the lead article in the Business Section of the January 28, 2016, issue of the Los...more
The Consumer Financial Protection Bureau (CFPB) has issued a "fact sheet" regarding the disclosure of construction-to-permanent loans under the TILA/RESPA Integrated Disclosure (TRID) rule, which the CFPB refers to as the...more
On January 12, the CFPB released a Construction Loans Fact Sheet reviewing the basics of construction loan disclosures under the TILA/RESPA Integrated Disclosure (“TRID”) Rule. This resource briefly summarizes the TRID...more
BB Syndication Services, Inc. v. First American Title Ins. Co., 785 F.3d 825 (7th Cir. 2015) – A construction lender sued a title insurance company seeking defense and indemnification in connection with claims in a...more
In This Issue: - Construction Contract Claims Against a Third-Party Lender? The Unforeseen Consequences of a Standard Practice: For those of us who commonly represent lenders, there is nothing more unsettling...more
The 7th Circuit has ruled that a lender is not insured by a title company for liens that arise after a construction loan became significantly out of balance and the lender stopped funding. In BB Syndication Services, Inc v....more
On March 12, 2015, the United States Court of Appeals for the Seventh Circuit entered an opinion interpreting “the most litigated provision in the standard-form title-insurance policy purchased by real-estate lenders to...more
Lenders and contractors may want to take additional precautions before they take title to a newly constructed home through foreclosure (or deed in lieu of foreclosure) following a recent decision by the Colorado Supreme...more
Construction loans typically do not get refinanced before a project is completed. A construction loan is short-term in nature and both the lender and its customer expect that they will stay on the project until the project is...more
Atlantic Builders Group, Inc. v. Old Line Bank (In re Prince Frederick Inv., LLC), 516 B.R. 778 (Bankr. D. Md. 2014) – A construction contractor contended that the claim of the debtor’s construction lender should be...more
In California, a general contractor can usually rest assured that in the event of nonpayment, it can rely upon the remedy of a mechanics lien, which remedy is, in fact, even a constitutional right....more