Jonathan Mechanic and Janice Mac Avoy speak to The <em>Mortgage Observer </em>about “bad-boy” guarantees and CMBS loans

Jonathan Mechanic and Janice Mac Avoy speak to The Mortgage Observer about “bad-boy” guarantees and CMBS loans

Real estate partner Jonathan Mechanic and litigation partner Janice Mac Avoy were quoted by The Mortgage Observer in an article discussing “bad-boy” guarantees that have created headaches for borrowers when they default on a CMBS loan. The piece highlights a 2011 case in Michigan whereby the ruling “‘meant, in effect, that a non-recourse loan – a loan that is asset-based, where you’re only looking at the property – all of sudden became a recourse loan,” said Mr. Mechanic. The article also cites CP III Rincon Towers v. Richard Cohen in which Ms. Mac Avoy is currently representing borrower Mr. Cohen. The appeal should be decided next year and many believe the NY courts will take the side of CMBS borrowers.

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