Legal Question in Real Estate Law in Pennsylvania
Personal Residence Attached Via Lien to Commercial Property
Our real estate company closed on two commercial properties with a bank at which time the bank also attached two liens on our personal residence in the full amount of each mortgage. We paid them down payments and closing costs, but they told us these were ''Good Faith Liens'' and that in one year from the closing date it would be a simple matter of reviewing our payment history and occupancy rates and removing the liens from our home. I'ts now one year and they are saying we have to pay them thousands of dollars to get commercial appraisals done and give them all our company and personal tax returns in order to have these liens removed from our home. They not only did not tell us these terms and conditions but did not tell us the amount of the liens at the time of closing. These liens significantly exceed the value of our home. What recourse to we have? We do not have the money they are requesting nor would we want to pay it if we did. Is this considered predatory lending? They also established a prepayment penalty on both properties so we can't refinance with another bank.
1 Answer from Attorneys
Re: Personal Residence Attached Via Lien to Commercial Property
It is essential in commercial transactions, including purchase of properties and financing, to have a lawyer representing you or your company.
Your rights depend on what the loan agreement, note and mortgage and any other documents, including possibly a guaranty, say about the nature of the liens, your rights to have them removed, and the conditions for removing the liens.
Without knowing a lot more, I couldn't say that this is "predatory lending". Usually, predatory lending refers only to residential mortgage loans, not to mortgages placed on residences as part of a commercial loan.
You should consult a real estate lawyer in your area who has experience with commercial lending.
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