Commercial Finance Practice Forum

[Anonymous User]

I have an interview coming up for an office that specializes in commercial finance transactions. I've researched the practice heavily and found very little on it. Maybe someone can enlighten me?

1) What does the practice entail? What service does a lawyer perform?
2) Where does this fall on the scale of enjoyable/miserable practice areas?

[lawschoolftw]

I have an interview coming up for an office that specializes in commercial finance transactions. I've researched the practice heavily and found very little on it. Maybe someone can enlighten me?

1) What does the practice entail? What service does a lawyer perform?
2) Where does this fall on the scale of enjoyable/miserable practice areas?

I personally don't do much of it, but other folks around my firm do. Effectively, it involves drafting loan documents (loan agreements, promissory notes, mortgages, deeds of trust, indemnity deeds of trust, guaranties, certificates of authority to borrow, etc.) to document a commercial loan. It might also involve drafting modifications/forbearance of loans that are currently in default or at risk of being defaulted on. As with most transactional practices, the lawyer primarily documents the deal the financial institution has already made with the borrower. For example, the bank will generally provide the lawyer with a commitment letter detailing the major terms of the loan, which will then be documented by the lawyer. Additionally, the lawyer is generally responsible for ensuring that all collateral has clean title to it and all security interests are perfected in the collateral. By way of example, if the borrower will pledge his house as security for the loan, one of our jobs is running title to make sure that there are no additional liens on the collateral that would impair its value to the lender. Similarly, we would also be responsible for making sure that the mortgage/deed of trust to the house is recorded so as to perfect the lien.

As to where it falls on a scale of enjoyability, it will, like other things, depend on your preference. I'm a litigator and I personally find most transactional work dreadfully boring. Many of my transactional colleagues would the say the same about much of my litigation experience. At a high level, complex financial transactions can be intellectually challenging and interesting in trying to appropriately structure the deal to avoid fraudulent conveyance issues, tax liability etc. At the junior level, however, it is pretty boring work; mostly entering the details that have already been agreed to on the business side into forms (most of the major banks have their own forms which they make you use). As some of the transactional lawyers on here will likely tell you, though, this is more or less true for all transactional practices.

For those of you who actually practice in this field and are not regurgitating second-hand knowledge, please correct anything I've said that is wrong.

[Anonymous User]

I have an interview coming up for an office that specializes in commercial finance transactions. I've researched the practice heavily and found very little on it. Maybe someone can enlighten me?

1) What does the practice entail? What service does a lawyer perform?
2) Where does this fall on the scale of enjoyable/miserable practice areas?

I personally don't do much of it, but other folks around my firm do. Effectively, it involves drafting loan documents (loan agreements, promissory notes, mortgages, deeds of trust, indemnity deeds of trust, guaranties, certificates of authority to borrow, etc.) to document a commercial loan. It might also involve drafting modifications/forbearance of loans that are currently in default or at risk of being defaulted on. As with most transactional practices, the lawyer primarily documents the deal the financial institution has already made with the borrower. For example, the bank will generally provide the lawyer with a commitment letter detailing the major terms of the loan, which will then be documented by the lawyer. Additionally, the lawyer is generally responsible for ensuring that all collateral has clean title to it and all security interests are perfected in the collateral. By way of example, if the borrower will pledge his house as security for the loan, one of our jobs is running title to make sure that there are no additional liens on the collateral that would impair its value to the lender. Similarly, we would also be responsible for making sure that the mortgage/deed of trust to the house is recorded so as to perfect the lien.

As to where it falls on a scale of enjoyability, it will, like other things, depend on your preference. I'm a litigator and I personally find most transactional work dreadfully boring. Many of my transactional colleagues would the say the same about much of my litigation experience. At a high level, complex financial transactions can be intellectually challenging and interesting in trying to appropriately structure the deal to avoid fraudulent conveyance issues, tax liability etc. At the junior level, however, it is pretty boring work; mostly entering the details that have already been agreed to on the business side into forms (most of the major banks have their own forms which they make you use). As some of the transactional lawyers on here will likely tell you, though, this is more or less true for all transactional practices.

For those of you who actually practice in this field and are not regurgitating second-hand knowledge, please correct anything I've said that is wrong.

OP here. Thank you for this.

[Anonymous User]

This is correct. You might want to look up the Hillman Commercial Lending treatise available through PLI on Bloomberg Law. It's spot on. I took Commercial Lending last year. The previous response was helpful.

I would also look at the firm bios for the people who practice in that area. Good luck!