Commercial real estate is an important part of the Florida economy. It gives businesses of all types the opportunity to operate their company in a facility that is zoned specifically for this type of real estate holding. As a lender, backing loans on commercial real estate can be an excellent investment.
In most cases, the company buying the property will want to operate out of it for the long term, making most types of commercial real estate lower risk than many other options. There are times, however, when a business does not go as planned and the company falls behind on their payments. When this occurs, you need to know the best ways to recover the assets and minimize any potential for loss.
Is Foreclosure the Best First Step
Foreclosure is often looked at as the last option that a lender can take to try to recover their assets. This is in large part due to the fact that a foreclosure in Florida simply forces the sale of the property at auction. The sale may not generate enough revenue to cover the outstanding loan balance, which still leaves you at risk.
That being said, however, you cannot simply take possession of a property, or take over a business, in order to satisfy the debt. For this reason, starting the foreclosure process as soon as possible is often a desirable option. You can continue to negotiate with the borrower to try to come up with a solution that will allow them to get caught up on their payments, but moving forward on this process soon will often give you more options to consider.
Commercial Foreclosure Process
Another thing to keep in mind is that the commercial real estate loan foreclosure process can take some time. Florida is a judicial foreclosure state, meaning as the lender, you will have to go through the proper judicial proceedings in order to push the property into a sale at auction. Some contentious foreclosures can take a year or more to complete, which is why it is so important to start as soon as you can and have the assistance of an experienced attorney to ensure things go smoothly.
Contact Reyes Law Group
Reyes Law Group represents asset managers, loan portfolio managers, investors, and private lenders. This means we will be fighting for your rights to protect your commercial real estate investments. When a loan falls behind for any reason, we can help evaluate the situation and provide advice on what the best way to protect your investment going forward. Contact us to schedule a consultation today.
Reyes Law Group
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- Is a Commercial Loan Foreclosure a Good Option for Recovering Assets - January 14, 2022
