Finance Insights
Analysis and practical guides on finance.
39 articles, checklists, and guides on finance law, written by the attorneys at MC Law. Every piece is general information, not legal advice—for a specific matter, contact the firm.
Debt Restructuring and Workout Toolkit
A troubled loan is a negotiation conducted in the shadow of remedies neither side wants to use, and the outcome is largely determined in the first thirty days by whether the lender preserved its rights before talking, whether the borrower produced credible information, and whether the collateral position is what the loan file says it is. This toolkit runs the sequence from both sides: recognizing default and preserving rights, the file audit that determines what the lender actually holds, the pre-negotiation agreement and the information package, structuring a forbearance with real milestones, the restructuring alternatives and their tax consequences, and then the remedies—Article 9 dispositions with their commercial reasonableness requirements, real property foreclosure and its anti-deficiency traps, receiverships, assignments for the benefit of creditors, and what changes when the borrower files. Written for both sides, it emphasizes the two asymmetries that govern: the lender's leverage is highest before it says anything accommodating, and the borrower's leverage is entirely in the quality of its information. It closes with the borrower's playbook and the trust fund tax exposure that is personal and non-dischargeable.
Fintech Licensing and Money Transmission Checklist: A Practical Checklist
Whether a payments or lending product requires licensing is determined by the flow of funds and by who owes an obligation to whom, not by what the product is called, and the analysis has to be run before anything is built. A company that discovers the answer after launching has customer balances in states where it is not licensed, which is a problem with no cheap solution. This checklist runs the analysis in order: map the flow of funds, identify whether the company ever holds or controls funds it owes to someone else, test the available exemptions, choose among direct licensing, a bank partnership, and a restructured model, and then work through the registrations, program requirements, and consumer protection obligations that attach regardless of the licensing answer. The organizing point is that the flow-of-funds analysis must precede any engineering, because a company that launches first has customer balances in states where it is not licensed and no cheap way to unwind them.
Fintech and Payments Regulatory Toolkit
A payments, deposit, or credit product is regulated financial services from the first transaction, and the obligations attach whether or not anyone has read them. The framework is fragmented across federal prudential regulators, the Consumer Financial Protection Bureau, FinCEN, OFAC, and fifty state banking departments, and the same product can be lawful in one structure and unlicensed money transmission in another. This toolkit runs the sequence a company actually needs: mapping the flow of funds and identifying the licensing question, choosing among direct licensing, a bank partnership, and a restructured model, building the anti-money-laundering and sanctions programs that apply regardless, meeting the consumer protection obligations that attach to accounts and credit, satisfying the sponsor bank's third-party risk expectations, and running the compliance function that keeps all of it working. It closes with the compliance management system a sponsor bank's examiner expects and the ongoing reconciliation, complaint handling, and change control that keep the program working.
Commercial Loan Closing Checklist: A Practical Checklist
A loan closing is a documentary exercise in which the lender's collateral position is created and the borrower's obligations are fixed, and nearly everything that goes wrong later traces to a step that was skipped or deferred here. A financing statement filed against a slightly wrong debtor name is an unperfected lien. A control agreement the depository bank never signed is no control at all. A landlord waiver deferred to post-closing is a waiver that never arrives. This checklist runs the closing in sequence: the organizational and authority documents, the credit and security documents, the perfection steps for each collateral type, the third-party deliverables that take the longest and are started last, the insurance and opinion requirements, the funds flow, and the post-closing items that must actually be tracked to completion.
Filing a Chapter 13 Plan: A Practical Guide
A Chapter 13 plan is a payment proposal that becomes a binding court order, and drafting one badly produces a case that fails eighteen months later with nothing accomplished. The plan must be filed with or shortly after the petition, payments must begin within thirty days whether or not the plan is confirmed, and the numbers must satisfy three separate tests—disposable income, best interests, and feasibility—that constrain each other. Most of the real work happens before filing: gathering the income history that fixes the commitment period, valuing the collateral that determines what secured creditors receive, and testing whether the household can actually sustain the payment for the full term. This guide walks the preparation, the plan's provisions section by section, the confirmation process and the objections to expect, and the post-confirmation management that keeps a case alive.
Using Letters of Credit in Commercial Transactions
A letter of credit is a bank's independent undertaking to pay against documents, and its entire commercial value comes from that independence: the issuer pays if the paperwork conforms, without regard to whether the underlying contract was performed. Two very different instruments share the name—the commercial documentary credit, which pays the seller in a goods transaction against shipping documents, and the standby, which functions as a substitute for a guarantee and is drawn only when something has gone wrong. Both are governed by a layered set of rules that includes UCC Article 5, the applicable ICC practice rules, and the terms of the credit itself, and disputes turn almost entirely on document examination rather than on the merits. This guide covers the structures, the drafting decisions that determine whether the beneficiary can actually draw, and the mechanics of presentation, discrepancy, and dispute.
Preference and Fraudulent Transfer Claims: When a Trustee Claws Back What You Were Paid
Getting paid by a customer who later files bankruptcy is not the end of the story, and a demand letter arriving two years afterward asking for the money back is a routine event that catches most businesses by surprise. Preference law lets a trustee recover payments made in the ninety days before a filing so that similarly situated creditors share equally, and fraudulent transfer law reaches back much further to undo transfers that were either intentionally evasive or simply not paid for. This article explains the elements of both, works through the defenses in the order a defendant should actually assert them, and covers who can be sued under the recovery provisions and which transferees escape. It also addresses the transactions that generate the largest claims—leveraged buyouts, upstream guaranties, dividends, and Ponzi scheme payouts—and the record-keeping habits that make these cases cheap to defend.
Secured Transactions Under UCC Article 9: Attachment, Perfection, and Priority
Article 9 governs every transaction that creates an interest in personal property to secure an obligation, and it decides who gets paid when a business fails. This article explains the system in the order it actually operates. It covers what counts as collateral and how classification drives everything downstream, the three requirements for attachment, and the perfection methods that make a security interest good against the rest of the world, including the filing rules where a single error in the debtor's name can void a lien. It then works through priority: the basic first-to-file-or-perfect rule, the purchase money superpriority and its strict timing requirements, the buyer-in-ordinary-course rule that lets inventory move, and the special regimes for deposit accounts, investment property, and fixtures. Sections on proceeds, default and repossession, commercially reasonable disposition, and deficiency judgments follow, with a worked example, a filing checklist, an FAQ, and related reading.
Investment Adviser and Broker-Dealer Regulation: Registration, Fiduciary Duty, and Examinations
Two federal regimes govern people who give investment advice and people who effect securities transactions, and the line between them determines everything that follows. An investment adviser is a fiduciary registered with the SEC or a state, filing a public disclosure document and subject to rules on custody, compliance, marketing, and recordkeeping. A broker-dealer registers with the SEC, joins FINRA, maintains net capital, and owes retail customers the obligations of Regulation Best Interest rather than a general fiduciary duty. This article explains who falls into each category and how the exemptions work, covers the substantive obligations that generate the most enforcement, and walks through what an SEC examination actually involves. It closes with the recent enforcement patterns that should shape any compliance program.
Chapter 11 First-Day Filing Checklist: A Practical Checklist
The first seventy-two hours of a Chapter 11 case determine whether the business survives long enough to reorganize, and the work that makes those hours succeed is done before the petition is filed. A debtor that files without a cash collateral stipulation, a thirteen-week budget, a payroll motion, and utility adequate assurance will run out of usable cash in the second week. This checklist covers the pre-filing preparation, the petition and required filings, the first-day motions in order of urgency, the operating requirements that begin immediately, and the early deadlines—including the compressed Subchapter V schedule—that must be calendared on the day of filing. It runs from the pre-filing preparation through the first-day hearing itself, and flags the motions that must be filed with the petition rather than in the following week.
Small Business Finance Toolkit: SBA Loans, Lines of Credit, and Guaranties
Small business borrowing is a sequence of decisions in which the terms that matter most are set before the loan documents arrive and are rarely revisited afterward. This toolkit runs the whole arc: diagnosing what kind of capital the business actually needs, comparing the products honestly including the ones that look cheap and are not, negotiating the term sheet where nearly all the leverage exists, understanding the SBA programs and their eligibility and structural requirements, reviewing the loan agreement and the personal guaranty, satisfying closing conditions and perfecting collateral, living with the covenants and the reporting, and handling a default before it becomes a liquidation. It ends with default and workout, where the guaranty, the collateral, and the personal exposure negotiated at the outset finally matter. A separate stage covers the guaranty itself, including the defenses a borrower's spouse or minority owner may still have.
Bank Loan Workouts, Forbearance, and Receiverships
A troubled loan is a negotiation conducted in the shadow of remedies neither side wants to use, and the outcome is usually determined in the first thirty days by three things: whether the lender preserved its rights before talking, whether the borrower produced credible information, and whether the collateral position is what the loan file says it is. This article walks through the workout in sequence—recognizing default and preserving rights, the pre-negotiation agreement, diligence on collateral and guarantees, the structure of a forbearance agreement, and the restructuring alternatives. It then covers the remedies: Article 9 dispositions and their commercial reasonableness requirement, real property foreclosure and anti-deficiency limits, receiverships, assignments for the benefit of creditors, and what changes when the borrower files bankruptcy. Throughout, the emphasis is on the loan file audit that determines what the lender actually holds and on the sequence of remedies that a single misstep can forfeit.