| The cast of characters. Everyone knows what a | | | | as accounts receivable. |
| bank is. Most of us understand what a lender is - an | | | | Lien. A lien is a description of an encumbrance on |
| institution from whom money is borrowed. Adding | | | | property: "a claim . . . on property for payment of |
| the word "commercial" to describe a lender simply | | | | some debt." Black's. In the context of my blog, a lien |
| means that the financial entity deals with businesses | | | | arises by written contract between a lender and a |
| as opposed to individuals. Black's Law Dictionary | | | | borrower - either a real estate mortgage agreement |
| defines "commercial loans" as: "loans made to | | | | or a personal property security agreement. The lien |
| businesses as distinguished from personal-consumer | | | | granted by a borrower to a lender gives a lender the |
| credit loans." Although a lender could make both | | | | right to foreclose upon the subject property |
| commercial and consumer loans, this blog is dedicated | | | | (collateral) for payment of the debt in the event of a |
| primarily to commercial matters. | | | | default. |
| The field of law. To me, commercial foreclosure law | | | | Commercial foreclosure. Turning again to Black's, a |
| refers to the rules and procedures applicable when a | | | | foreclosure is defined, in part, as the "enforcement |
| business defaults on a loan secured by some kind of | | | | of a lien . . . or mortgage . . .." Paraphrasing Black's, |
| collateral. So, if you work for an institution that | | | | foreclosure is the legal process by which real or |
| loaned money to a business, and if the borrower | | | | personal property subject to a lien is sold in |
| defaulted under the terms of the loan agreement, | | | | satisfaction of a debt. To foreclose means to |
| then commercial foreclosure law provides the judicial | | | | terminate a borrower's rights in the subject property. |
| framework for the protection of your rights. | | | | A foreclosure that is commercial merely refers to the |
| Typically, those rights involve the ability to collect | | | | termination of a business borrower's rights in its |
| money owed by the borrower through the sale of | | | | property. |
| the loan collateral. | | | | A form of collection. Commercial foreclosure law is a |
| Collateral. Black's states that collateral is property | | | | special kind of collection law. It's a body of rules |
| pledged as security for the satisfaction of a debt. If | | | | governing how banks and financial institutions recover |
| a business defaults on a loan, the lender can initiate a | | | | money by asserting rights in, and selling, collateral that |
| foreclosure action to compel the sale of the loan | | | | a business granted to secure the loan. It's the set of |
| collateral and therefore collect the amounts owed by | | | | legal principles applicable to a lender needing to collect |
| the borrower through proceeds from the sale. There | | | | money owed by a business, which failed to make its |
| are all kinds of business-related collateral. Perhaps the | | | | loan payments or otherwise defaulted under the |
| most recognizable is real estate - the land a business | | | | terms of the loan documents. If any of these |
| owns. Some of the most interesting cases, however, | | | | matters are relevant to what you do for a living, I |
| deal with personal property collateral, which can be | | | | welcome your visits to my blog and hope that you |
| any property imaginable that is owned by a business | | | | will e-mail me with your questions or comments. |
| - a fleet of cars, office furniture or intangibles such | | | | |