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In the Spotlight
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Greg focuses his national practice on representing financial institutions in business restructuring, bankruptcy and financial services matters and other creditors' rights issues. He has extensive experience in all facets of bankruptcy litigation and transactions, including asset purchases and other types of acquisitions. Greg also develops risk management strategies to mitigate his client's losses when their customers enter bankruptcy.
Greg has particular expertise in litigation, bankruptcy and other liquidation activities surrounding government guaranteed loans. Greg's primary focus is maximizing his client's recovery on the government guaranty and developing liquidation strategies that are regulator-approved, effective and reimbursable. Beyond litigation and liquidation, Greg has significant experience successfully preparing SBA guaranty purchase packages and satisfying requests for information from the SBA.
Additionally, Greg assists commercial lenders with loan documentation, closing issues and with the drafting of corporate and finance documents related to conventional loans and government guaranteed loans through the SBA 7(a) and 504 loan programs.
ADMISSIONS:
- Pennsylvania
- Supreme Court of Pennsylvania
- Supreme Court of New Jersey
- United States District Courts for the Eastern and Middle Districts of Pennsylvania
- United States District Court for the District of New Jersey.
To read more about Greg, click here.
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| FEATURED ARTICLE
Best Practices: NEW Credit Elsewhere Rules Effective 10/1/2015
By: Ethan W. Smith, Esquire
This is a reprint of our newsletter article which originally ran on July 29, 2015. A friendly reminder of the new Credit Elsewhere rules that become effective next week.
Over the past weeks, SBA lenders have been anxiously watching as the SBA 7(a) program approached, and then hit, the congressional limit of $18.75 billion of authorized 7(a) loans, temporarily halting 7(a) loan approvals with more than 60 days remaining in fiscal year 2015. Fortunately, thanks to the hard work of the National Association of Government Guaranteed Lenders and the quick action of the SBA, Congressional leadership, and the President, H.R. 2499 was quickly passed and signed into law, increasing the authorized lending limit from $18.75 billion to $23.5 billion for the remainder of FY 2015, and thereby averting a prolonged interruption to the flow of capital to America's small business community. 7(a) loan approvals resumed the afternoon of July 28, 2015. NAGGL, the SBA and the political leadership should all be applauded for their swift, decisive action in resolving this matter.
In addition to the increase in the loan level authorization, H.R. 2499 also contains provisions that amend the provisions of the Credit Elsewhere Test, effective as of October 1, 2015. The Credit Elsewhere Test, which is set forth at 13 CFR §120.101, provides that "SBA provides business loan assistance only to applicants for whom the desired credit is not otherwise available on reasonable terms from non-Federal sources." Historically, circumstances that would satisfy the Credit Elsewhere Test included items such as i.) the borrower requiring a longer maturity than permitted by lender's policy; ii.) the loan exceeding the lender's legal lending limit; iii.) the lender's liquidity depending upon its ability to sell into the secondary market; iv.) a collateral shortfall; or v.) the lender's policy restricting loans to startups or businesses in a particular industry. See SOP 50 10 5(H), Subpart B., Chapter 2, Paragraph III.C.4.
H.R. 2499 changed the acceptable credit elsewhere requirements to restrict lenders from relying upon the legal lending limit or the liquidity from sale into the secondary market provisions as the sole justifications for meeting the Credit Elsewhere Test. Accordingly, beginning October 1, 2015, lenders must provide a credit elsewhere justification other than the liquidity and lending limit justifications set forth above to meet the Credit Elsewhere Test. Because credit elsewhere is one of the fundamental underpinnings of eligibility for a 7(a) loan guaranty, lenders that fail to comply with these new rules may be subject to a denial of the SBA guaranty in the event of default or an enforcement action for failure to comply with program requirements.
For more information regarding the revisions to the SBA Credit Elsewhere Test, please contact Ethan at 267-470-1186 or at esmith@starfieldsmith.com.
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EVENTS & SEMINARS
Instructor: Kimberly A. Rayer
Date: October 8, 2015
For more information about this event and/or to register, click here.
Date: November 2, 2015 - November 6, 2015
How to get SBA to Honor Its Guaranty
Instructor: Ethan W. Smith
Date: November 5, 2015
For more information about this event and/or to register, click here.
Advanced SBA Loan Closing & Documentation
Instructor: David W. Starfield
Date: November 5, 2015 & November 6, 2015
For more information about this event and/or to register, click here.
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A. Diane Gallion / Sr. Vice-President / The Bancorp Bank
Starfield and Smith has been the exclusive law firm of the Bancorp Bank's commercial division, providing all of our closing needs for both SBA and conventional loans. The team at the Bancorp has collectively worked with Starfield and Smith for more than 10 years. Throughout this working relationship, we have always found them to be on the leading edge of process and industry knowledge. We consider them to be a valued member of our team, and we plan to continue our successful partnership as we continue to grow. |
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