 |
|
 Attorney Spotlight
 | |
Ethan Smith, Esq |
Ethan focuses his practice in business law, with an emphasis on commercial lending, government guaranteed lending, mergers and acquisitions, real estate, contracts, commercial and corporate law. He is a closing attorney for various lenders nationwide, including PNC Bank, Live Oak Bank, Wells Fargo/Wachovia Bank, Beneficial Bank, US Bank, 44 Business Capital, Eagle National Bank, Susquehanna Bank and Univest National Bank and Trust Co. Ethan is also a designated closing counsel for several Certified Development Companies that operate in Pennsylvania, New Jersey and Delaware. In addition to representing commercial lenders, Ethan represents and counsels a number of small businesses in a variety of contexts, including mergers and acquisitions, corporate governance, and contract and real estate matters.
As a closing attorney for commercial lenders, Ethan prepares and reviews loan files for conventional, SBA 7(a) and 504, and USDA B&I loans, confers with loan processors and in-house counsel, and drafts, analyzes and negotiates loan documents. He has closed hundreds of government guaranteed commercial loans through the SBA 7(a) and 504 loan programs, through the USDA B&I program, and has closed numerous conventional commercial financing transactions, including asset-based, real estate, and factoring arrangements. Ethan has closed numerous complex commercial transactions, often involving multi-jurisdictional issues and collateral. As a licensed title agent in Pennsylvania and New Jersey, Ethan provides title insurance for commercial projects including purchases, refinancing and ground up construction. Through his underwriters' national networks, Ethan coordinates title insurance, escrow and closing services for his clients nationwide. | |
| |
|
|
Starfield & Smith, P.C. is on Facebook!
Become a fan of Starfield & Smith, P.C. on facebook to receive updates, articles, and news pertaining to SBA and lending related topics. Just click on the badge above to get started!
Not on facebook? Sign up for free here.
|
Starfield & Smith, P.C. is on twitter! Follow us for links to our most recent news and articles. Click here to follow us:
Back to Top
|
|
|
|
Best Practices: Refinancing of Same Lender Debt:
Limits Imposed Upon PLP Lenders
By Amy Brownstein, Esq.
 | | Amy Brownstein, Esq. |
SBA lenders are generally not permitted to approve the refinancing of same institution debt, i.e., obligations already owed to that lender by the borrower, under their PLP delegated authority. This limitation reflects the SBA's concern that lenders might approve refinancings in order to shift potential losses to the SBA. Such refinancings may be approved under PLP authority only in extremely limited circumstances.
Pursuant to Subpart B, Chapter 2(IV)E.5.b of SOP 50 10 5(C),
"[a]pplications that include the refinancing of same institution debt may not be processed using PLP procedures unless...
(1) The debt is an interim loan that has been made for other than real estate construction purposes and was approved by the lender with in 90 days prior to the issuance of a PLP loan number; or
(2) The debt is a construction loan that has not been disbursed."
This rule is not set forth only in the SOP; it is also codified in the Code of Federal Regulations at 13 C.F.R. §130.452(a)(2), which provides that:
"[a] Lender may not make a PLP business loan which reduces its existing credit exposure for any Borrower, except in cases where an interim loan(s) has been made for other than real estate construction purposes to the Borrower which was approved by the Lender within 90 days of receipt of the issuance fo [sic] a subsequent PLP loan number.
What does this mean for PLP lenders? Unless a PLP lender is refinancing its own non-construction interim debt and obtains the PLP loan number within 90 days of the approval of the interim loan, or the existing loan is an undisbursed construction loan, the PLP lender must submit proposed refinancings of obligations owed to that lender for SBA approval by standard processing.
Lenders should be extremely careful to act in strict compliance with these provisions. Because the restriction is set forth in the C.F.R., it is unlikely that the SBA will be willing to consider granting exceptions to allow PLP lenders to approve same debt refinancing of loans other than non-construction interim loans or undisbursed construction loans, or to allow such refinancings to be approved outside of the permitted 90 day period. Any lender that fails to comply with these provisions is likely to receive a denial of a guaranty purchase request submitted to the SBA in connection with such refinancing, and may face scrutiny in audits and other oversight proceedings for using proceeds for an ineligible purpose.
For more information regarding PLP refinancing of same-lender debt, contact Amy at abrownstein@starfieldsmith.com, or 215-542-7070.
|
| |
Did you know... | |
 ...that Starfield & Smith, P.C. helps lenders nationwide preserve and protect the SBA guaranty? From eligibility issues, to documentation and closing, to servicing and liquidation, we assist lenders that place a premium on protecting the guaranty.
For more information about this and other services Starfield & Smith, P.C. provides its clients, please call Ethan at 215-542-7070 or by email at esmith@starfieldsmith.com
Back to Top
|
|
|
Seminars and Events | |
Break Out Session:
Handling SBA Loan Closings (7(a) & 504)
Presented by Ethan Smith
Date: August 10, 2011 - 11:00 AM - 12:00 PM
Location: Fort Worth, TX
Mid America Lenders Conference
The Worthington Renaissance Fort Worth Hotel
For more information, click here
Extended Training Course: Lender Oversight and Liquidation/Guaranty Purchase Process
Presented by Ethan Smith
Date: August 10, 2011
Time: 12:15 PM - 3:15 PM
Location: Fort Worth, Texas
Mid America Lender's Conference
The Worthington Renaissance Fort Worth Hotel
For more information, click here
Coleman Publishing's Fresno SBA Loan Servicing Workshop Presented by Ethan Smith Date: August 26, 2011
Time: 8:30 AM - 4:00 PM
Location: Fresno, CA For more information, click here Ask the Lawyer: Avoid Closing and Documentation Pitfalls Presented by David Starfield
Date: September 22, 2011
Time: 1:00 - 2:30 PM EDT
Location: Webcast For more information, click here Advanced SBA Loan Documentation and Closing Presented by David Starfield
Date: October 24, 2011
Time: 8:30 AM - 4:30 PM
Location: Huntington Beach, CA For more information, click here The Guarantee Purchase Process Presented by Ethan Smith
Date: October 25, 2011
Time: 8:30 AM - 4:30 PM
Location: Huntington Beach, CA For more information, click here
Back to Top |
|
|
|
|
