Construction Loans and Opportunity Zones: How to Get the Highest Leverage for OZ Projects

In 2021, SB-1079 went into effect bringing drastic changes to CA’s nonjudicial foreclosure process in an attempt to encourage individual home ownership and affordable housing over entity property ownership. The idea was to bridge the gap at foreclosure sales between prospective homeowners and savvy investors by creating categories of “Eligible Bidders” with certain advantages.

Unfortunately, the structure highly incentivizes the unscrupulous to call themselves “Eligible Bidders” to gain these advantages over their competitors. AB-1837 is an attempt to address this issue, and this Webinar will examine the potentially far-reaching changes AB-1837 brings to SB-1079.

For AB-1837, we will specifically discuss the following:

AB-1837 redefines and clarifies several categories of entity Eligible Bidders, attempting to more closely tie them to affordable housing goals.
AB-1837 implements a 30-year (!) affordability covenant on properties acquired by Eligible Bidder entities at these foreclosure sales.
AB-1837 establishes an enforcement mechanism through the Attorney General for related violations.

Finally, we’ll briefly discuss the related AB-2170 which requires entities that foreclose on over 175 properties a year to provide a 30-day window for any REO listings in which only offers by certain Eligible Bidders may be accepted.

Lenders should always be prepared to manage loans that don’t pan out the way they are supposed to, and lenders must be tactical when understanding what to do when a borrower defaults. Geraci’s team of experts is always available to provide guidance and strategy on how to manage loan defaults with discipline and proactivity. Our attorneys are expert strategists in loss mitigation and default management and will provide attendees with the best methods to navigate non-performing loans. Our team will also help prepare you to manage your California loan defaults in light of the recent Honchariw v. FJM decision as it relates to default interest.

You will learn:
The available pre-foreclosure and pre-litigation options for lenders when a borrower defaults.
The foreclosure restrictions or hurdles are currently in place in California, and how these affect foreclosure timelines and strategy.
Extraordinary Relief Options, including unlawful detainer, judicial foreclosure, receivership, breach of guaranty suits, and collection remedies.Options related to the accrual of default interest post-Honchariw v. FJM.

This webinar discussed REITs and other tax preferential strategies for real estate and mortgage funds. We’ll discuss the core benefits of REITs, the specific ongoing compliance needs, and the ongoing obligations to manage day-to-day issues including loan sales, foreclosures, and property sales. We’ll also discuss the outlook for the Tax Cuts & Jobs Act as 2025 approaches.

Lender Lounge with Kevin Kim hosted a special livestream featuring industry legends Daren Blomquist, VP of Market Economics at Auction.com and Rick Sharga, Executive Vice President at ATTOM.

Watch the recording of May 18th LIVE episode below and hear these industry leaders’ thoughts on housing demand, build to rent, interest rates, inflation, and everyone’s favorite doomsday question: is a recession coming?