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UCC Foreclosures: Overcoming Obstacles to the Sale and Evaluating Receivership and Bankruptcy Alternatives

Recording of a 90-minute CLE video webinar with Q&A

This program is included with the Strafford CLE Pass. Click for more information.
This program is included with the Strafford All-Access Pass. Click for more information.

Conducted on Wednesday, April 24, 2024

Recorded event now available

or call 1-800-926-7926

This CLE course will provide attorneys dealing with defaulted loans secured by personal property with a review of when an Article 9 foreclosure will maximize value for the secured creditor. The panel will discuss the Article 9 foreclosure process and outline best practices to address obstacles in Article 9 foreclosures. The panel will also review alternatives to Article 9 foreclosures as a method of transferring distressed assets to the secured creditor. Alternatives include a receivership in aid of foreclosure and an assignment for the benefit of creditors.

Description

Secured creditors face challenges protecting their interests if a loan defaults. Practitioners and their clients must evaluate foreclosures, loan workouts, and other pre-bankruptcy solutions to determine whether they are adequate to protect the lender's interests.

While secured creditors may often prefer bankruptcy, a foreclosure under UCC Article 9 is better in certain situations. When appropriate, foreclosure under Article 9 is quicker, less expensive, and more predictable than a Bankruptcy Code Section 363 sale. Other alternatives include a receivership in aid of foreclosure or an assignment for the benefit of creditors.

The Article 9 foreclosure process contains pitfalls and obstacles for creditors, but with careful planning, counsel can overcome these issues and minimize the risks. Counsel can also consider other alternatives to achieve for the secured creditor the same or possibly an even better result.

Listen as our authoritative panel of secured transaction specialists offers its perspective on foreclosure under UCC Article 9, including how to avoid unexpected difficulties that arise with such sales. They will also compare UCC sales to other alternatives, including receiverships in aid of foreclosure, assignments for the benefit of creditors, and bankruptcies.

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Outline

  1. Comparing UCC Article 9 foreclosure to other options
    1. Loan workouts, receiverships in aid of foreclosure, and assignments for the benefit of creditors
    2. Sale in bankruptcy
  2. Effectuating a UCC Article 9 sale
    1. Evaluating default
    2. Adequate lien search
    3. Strict foreclosure
    4. Public vs. private sale
  3. Obstacles to Article 9 proceeding
    1. Notice
    2. Commercial reasonableness
    3. Successor liability
    4. Clear title

Benefits

The panel will review these and other relevant issues:

  • What key factors determine whether a UCC foreclosure is a better choice than loan workouts and other pre-bankruptcy and bankruptcy alternatives?
  • How can counsel decide which type of Article 9 foreclosure sale will maximize value for the secured creditor?
  • How can counsel guide clients to avoid the pitfalls presented by Article 9 foreclosure sales including liability exposure for the secured creditor?

Faculty

Smith, Edwin
Edwin E. Smith
Partner
Morgan, Lewis & Bockius

Mr. Smith concentrates his practice in commercial law, debt financings, structured financings, workouts, bankruptcies,...  |  Read More

Weise, Steven
Steven O. Weise
Partner
Proskauer Rose

Mr. Weise practices in all areas of commercial law and has extensive experience in financing, especially in those...  |  Read More

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