Your borrower has defaulted: When do you pull the trigger?
How to act when a borrower encounters problems? Bill Schwartz of MSI's Illinois law member firm Levenfeld Pearlstein, with the help of a sliding scale of troubled loans, provides clarity on what to do and when.
Bad news! The bridge loan you made to that great borrower nine months ago has defaulted. The borrower says it is just a temporary glitch, but you are now faced with a decision: Do you pull the trigger and exercise your remedies, or do you work with the borrower to see if the ship can be righted?
If you are an active private money lender and have never been in this position, you are either very lucky or you are deluding yourself (and have the holes in your bank account to prove it). For those who are willing to admit that they have made a bad loan, it’s time to face the music and figure out what to do next.
Read the full article to find out more about which steps to take next
