Today, the Utah Department of Financial Institutions closed MagnetBank, Salt Lake City, Utah , and the FDIC was named as receiver. The FDIC was unable to find another financial institution to assume the banking operations of MagnetBank.
Yesterday afternoon, the House delayed a vote on H.R. 1106, “Helping Families Save Their Homes Act of 2009” (the “Act”) after a little over an hour of debate, amidst unexpected opposition from some Democrats.
For the first time, individuals filing for bankruptcy protection may soon be able to reduce principal and interest on home mortgage obligations and prevent enforcement of certain mortgages even after entry of a foreclosure judgment.
On April 10, 2009, the North Carolina Office of Commissioner of Banks closed Cape Fear Bank, headquartered in Wilmington, North Carolina, and the FDIC was named as receiver.
As if buying distressed debt is not challenging enough given the underlying business considerations, the possible, and perhaps likely, bankruptcy filing of your soon-to-be borrower presents a maze of issues the note purchaser should consider before acquiring the debt.
1. Know Your Seller
In a recent decision, the Bankruptcy Court for the District of Delaware allowed the collateral agent for senior lenders to credit bid for the debtors’ assets even though all of the senior lenders had not authorized the bid. One of the senior lenders had objected to the group’s acquisition of the debtors’ assets by the credit bid. In re GWLS Holdings, Inc., 2009 WL 453110 (Bankr. D. Del. Feb. 23, 2009) (Walsh, J.).
Yesterday, U.S. Bankruptcy Judge Arthur Gonzalez approved a motion by Chrysler LLC requesting that GMAC LLC become the preferred lender for its dealer network, and be permitted to provide wholesale, retail and other product-related financing for Chrysler dealers and customers to purchase vehicles.
In the last decade, commercial landlords have favored obtaining from tenants standby letters of credit over security deposits because standby letters of credit provided added security in the event of a tenant’s bankruptcy.
Today, the Office of the Comptroller of the Currency closed Citizens National Bank, headquartered in Macomb, Illinois, and the FDIC was appointed receiver.
Today, after an extended auction, the OTS closed BankUnited, FSB, headquartered in Coral Gables, Florida and named theFDIC as receiver.