Principals of Loan Documentation
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More than ever these challenging economic times make proper loan documentation essential. The likelihood of loan defaults is at its highest in decades. Bankruptcy filings are rising. These events present the ultimate test of the quality of a lender’s documentation practices. Loan documents are all that stand between charging off a loan or recovering against collateral and/or guarantors. The environment of a loan in default is highly adversarial. Documentation is scrutinized by highly experienced attorneys whose job it is so find “holes” in a lender’s documents. For this reason, loans must be documented to withstand the highest level of scrutiny & legal challenge. The Principles of Loan Documentation seminar is designed to help those who make, manage or review loans become “proactive” in minimizing loan losses. This one-day seminar focuses on the major concepts, specific requirements & common problems of loan documentation, with a particular emphasis on avoiding loan losses due to faulty documentation that even cutting-edge documentation software cannot always effectively eliminate. Our philosophy is to develop “hands-on” instruction so that participants can return to their jobs and apply what they have learned.
I. Problem Method
Throughout the program the problem method will be used to challenge the participants in important areas of loan documentation. The instructor will demonstrate the difficulty & challenges often times hidden in every day/routine lending transactions by posing problems to the participants based on “real world” situations faced by actual lenders who, unfortunately, documented the loan incorrectly resulting in a costly legal challenge. The use of the problem method will involve the participants and challenge their ability to identify documentation errors and deficiencies.
The seminar will illustrate how to:
- Perfect security interests under Revised Article 9 of the UCC
- Identify the borrower & document the authority to borrow
- Understand and deal effectively with various entity types (ptsp, corp, LLC)
- Understand contract basics: notes, security agreements, mortgages, pledges and other essential loan contracts
- Use commitment letters
- Understand the implications of loan default(s)
- Protect against tax liens & other conflicting encumbrances
- Understand bankruptcy implications
- Recognize and prevent violations of ECOA
Participants will learn a step-by-step process to recognize problems and take action to prevent loan loss exposure from faulty documentation. Those involved in the loan review process will also find this program insightful as it emphasizes the fundamental building blocks of a well-documented commercial loan.
II. Essentials of Article 9 of the Uniform Commercial Code
Revised Article 9 of the Uniform Commercial Code that went into effect in most states on July 1, 2001 and which has now been adopted by all states, has substantially impacted how lenders perfect security interests in all collateral except real estate. This seminar emphasizes the key changes under Revised Article 9. Participants will learn how to interpret and apply the principles of this important body of law that governs all transactions intended to create a security interest in personal property and/or fixtures.
The course will examine the most common problems encountered with UCC Article 9 and provide practical guidance in critical areas, including:
- Impact of 2010 Amendments effective July 1, 2013
- Basic scope of Revised Article 9
- Collateral classification and description under Revised Article 9
- Perfecting security interests in deposit accounts under Revised Article 9
- Cover, in detail, the “where to file” rules under Revised Article 9
- Creating enforceable security interests in various types of collateral
- Different perfection methods under Revised Article 9 and when to use them
- Lien priorities and lien searches
- Enforcing unperfected security interests
- Gaining priority through purchase money transactions
III. Real Estate Mortgages/Deeds of Trust
Participants will learn the basic requirements of securing loans with real estate examining such problems as perfection, future advance clauses and loan renewals. Participants will be exposed to proper “due diligence” procedures when a loan is secured by real estate including the use of title insurance, surveys and environmental audits.
Who Should Attend
These seminars are designed for loan officers, loan review officers, internal auditors, documentation specialists and bank counsel.
Lewis C. Laderer, Jr. is a partner in the law firm of Laderer & Fischer, P.C. in South Bend, Indiana. Laderer & Fischer focus their practice almost exclusively on the representation of commercial banks and other commercial lenders in the areas of banking law, commercial litigation, and bankruptcy. Mr. Laderer has extensive experience in assisting community banks in structuring loan transactions, developing loan contracts, and in the management of problem loans and bankruptcies. Mr. Laderer has for years provided training and consulting services to lenders and state banking associations throughout the country. Mr. Laderer holds a B.S. degree from Miami University, Oxford, Ohio and a J.D. degree from the University of Notre Dame. He has practiced law since 1968.
The following fees include the program, materials, continental breakfast, lunch and refreshments:
$225 Principles of Loan Documentation
$425 Both Days Principles of Loan Doc & Advanced Loan Doc (Same Person)
$450 Principles of Loan Documentation
$850 Both Days Principles of Loan Doc & Advanced Loan Doc (Same Person)
Participation in IBA programs is limited to members, associate members, and nonmembers from an eligible membership category at applicable member or non-member rates.
As of Jan. 1, 1994, only 50 percent of business food and beverage can be deducted. For tax purposes the cost of food and beverage for this program is $25.
Agenda (All Days)
8:30 a.m. Registration
9:00 a.m. Program begins
12:00 noon Lunch (included)
1:00 p.m. Program resumes
4:00 p.m. Program adjourns
IBA Center for Professional Development
6925 Parkdale Place
Indianapolis, IN 46254
The IBA Center for Professional Development is located on the westside of Indianapolis just off of I-465. From I-465 take the 38th Street West Exit (Exit 17). When you exit go west on 38th street. Turn north/right onto Eagle Creek Parkway and then east/right onto Parkdale Place. Our address is 6925 Parkdale Place, Indianapolis, IN 46254. Click here for a map and a list of local hotels. Dress is business casual.
Everyone who registers online will receive an e-mail confirmation after the registration is submitted. Within three or more business days prior to the day of an educational program, no cancellation charge will be assessed. Within two days prior, 50% of the fee is assessed. Refunds are not provided for cancellations or absences which occur on the day of the program. Substitutions are welcome at any time.