Legal Question in Business Law in Wisconsin
Business Foreclosure
My mother lives in Wisconsin and owns a gas station that is not doing well. The expenses outweigh the gains, therefore she puts a lot of money out of pocket into the business. The gas station has been in real estate a few different times and no one will purchase it. She is strongly considering closing the doors and giving the business to the bank. The concern is . . . can the bank touch her other assets (cars, house, bank accounts)?
1 Answer from Attorneys
Re: Business Foreclosure
While your mother's real estate probably secures her obligation to the bank, the underlying obligation is called a "note." The note probably indicates that if she defaults, the bank has a choice of foreclosing on the real estate and/or going after her for the difference, if it doesn't sell for enough. Before she just gives the property to the bank, she should have an attorney negotiate for her to see if her release of the property could be exchanged for the bank releasing her, since the bank will avoid the cost of the foreclosure. Good luck!
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