Loan Workouts

When a debtor fails to meet its loan or lease obligations, the creditor is faced with several choices, such as whether to sue immediately, attempt to recover the collateral, work with the debtor on a revised payment plan or refer the debt to a third party to collect. The right response depends on numerous factors and the totality of circumstances.

If your company finds itself in this situation, our Business & Financial Services attorneys can walk you through loan workouts to address the specific challenges your company might face. Banks, asset-based lenders, equipment financiers, and other service providers regularly seek KMK’s representation of their rights in connection with defaults by commercial borrowers. We view workouts as the process of maximizing lender recovery by directing the borrower to refinance or repay the loan on mutually agreeable terms rather than default. Our lawyers work closely with our clients to review loan documentation, establish strategic objectives, draft loan amendments or forbearance agreements, and implement a workout plan aimed at enhanced protections and a streamlined path to judgment if problems reoccur.

We also advise lenders about appropriate responses to borrower fraud, accusations of lender liability, environmental risks, regulatory restrictions in the borrower’s industry, competing creditor claims, and other pitfalls they may face during the workout process. After an agreement is reached, KMK attorneys continue to monitor the file to ensure that the agreement is being properly honored and, in the event of a breach, KMK promptly advises clients on the next steps to take to enforce the agreement. Finally, if litigation becomes necessary, our clients can rely on KMK’s seasoned business litigators to represent their interests and place them in the most secure position possible. KMK attorneys will work with you to develop viable solutions that get your business's receivables back on track and reestablish the company's cashflow. To learn more, call us at (414) 962-5110 or send us an email at kmksc@kmksc.com.
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