Best Practices: Effective May 1, 2017, Variable Rate Notes Must Include First Rate Adjustment Language
As interest rates have been rising over the past year and a half, the Small Business Administration (“SBA”) wants to be sure that SBA borrowers understand when their interest rate will adjust. Therefore, effective May 1, 2017, the SBA now requires Colson to verify that every SBA note includes the date of the first rate ... Read More
Best Practices: Protecting Your Mortgage’s Priority From Mechanic’s Liens
Mechanic’s lien laws are statutes that exist in every state to protect contractors, subcontractors and material suppliers that furnish work or materials to construction projects. As the name suggests, these laws allow contractors, subcontractors and suppliers to impose a lien on an owner’s property if the property has been improved by the goods, labor or ... Read More
Best Practices: Obtaining Sufficient Title Insurance on Your Construction Loan
Whether you are closing a conventional loan or a SBA loan, you want to make sure that you obtain sufficient title insurance coverage when financing a construction project. First and foremost, you need to instruct your borrower to neither commence construction nor to file a notice of commencement until after the lender’s mortgage/deed of trust ... Read More
Best Practices: SNDA Fundamentals
Lenders financing the acquisition of real property or leasehold improvements should consider obtaining a Subordination, Non-disturbance, and Attornment Agreement (“SNDA”) when third party tenants lease a portion of the subject property. A SNDA can ensure that a lender’s lien on property required to be taken as collateral by SOP 50 10 5(I) is senior to ... Read More
Best Practices: Getting the SBA Fundamentals Right
SBA lenders are often overwhelmed by the myriad rules, regulations and guidelines associated with SBA lending. However, by focusing on a handful of core concepts, Lenders can develop the tools which, when applied consistently to their SBA operations, will help them to understand SBA requirements in various situations and circumstances, and which will lead them ... Read More
Best Practices: Seller Notes in Business Acquisitions
Under the Change of Ownership section of SOP 50 10 5(I), when the purchase price of a business includes intangible assets in excess of $500,000.00, the borrower and/or seller must provide an equity injection of 25% or more of the purchase price for the application to be processed under delegated authority. If seller is contributing ... Read More
