Sometimes disagreements arise between the lending party and the borrowing party over a commercial mortgage and litigation – or the resolution of such disputes via legal action in a court of law – is required to settle them. In cases like this, litigation lawyers for each side argue their positions before the court and a judgment is reached in favor of one party or the other.
What is the Difference Between Commercial and Residential Mortgages?
There are a few differences between a residential mortgage and a commercial mortgage, the primary of which is whether the mortgaged property in question is being used for housing purposes or business purposes. Other differences include the size of the mortgage itself, as well as the repayment options available for each. The size of a commercial mortgage tends to be significantly larger than that of a residential mortgage because commercial mortgages cover larger properties such as shopping centers or apartment buildings. The period of repayment for commercial mortgages also tends to be shorter than residential because commercial mortgages are expected to be paid via the profits of the borrowing business.
What Sort of Commercial Mortgage Disputes May Require Litigation?
The most common dispute to arise between a mortgage lender and a borrower is foreclosure, which occurs when the borrower falls behind on payments and the lender is forced to recover the property through the legal system. Often this results in the property being sold via public auction to cover any remaining outstanding debts the borrower owes. Another situation where the borrower may be at fault is mortgage fraud, a crime that occurs when the borrower lies on a loan application. One example of this would be reporting false income. In other cases, the dispute may be due to accusations against the lender rather than the borrower. Predatory lending would be an example of this, and occurs when a lender deliberately targets a vulnerable borrower with abusive or unreasonable rates. Other examples include falsifying a mortgage contract or discriminating against borrowers on the basis of their race, gender, religion, or any other protected characteristic.
Should I Speak to a Litigation Lawyer About My Commercial Mortgage Dispute?
If you find yourself embroiled in a legal dispute over a commercial mortgage – either as the lender or the borrower – seeking out the advice of a litigation lawyer can put your mind at ease. We can assist you by reviewing your mortgage agreement, communications between yourself and the other involved parties, and any other documents or paperwork relevant to the situation at hand. Our goal is to give you a solid grasp on the options available to you as well as a full understanding of any obstacles or problems you might be unable to foresee on your own.