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.
Commercial Loan Agreements: Covenants, Defaults, and What Borrowers Should Negotiate
A loan agreement is not primarily about the interest rate. It is a set of promises about how a business will be run for the next five years, backed by the lender's right to demand immediate repayment if any of them is broken. This article explains what those promises are and which ones are negotiable. It walks the term sheet and commitment letter, the conditions precedent that decide whether the loan ever funds, and the representations that become continuing obligations through the bring-down mechanic. It then covers affirmative, negative, and financial covenants in detail, including how the EBITDA definition quietly determines whether a company is in default, and the events of default and cross-default provisions that let one small failure trigger everything at once. Later sections cover guaranties, intercreditor and subordination arrangements, what happens in a default, the anatomy of a forbearance agreement, SBA-specific issues, a worked example, a negotiation checklist, and an FAQ.
Chapter 13 Bankruptcy: The Wage-Earner Plan, Lien Stripping, and the Discharge
Chapter 13 is the reorganization chapter for individuals with regular income, and it does two things Chapter 7 cannot: it stops a foreclosure and lets a homeowner cure arrears over years, and it lets a debtor keep property that would otherwise be liquidated. The price is a three- to five-year plan funded from disposable income, calculated under a formula that leaves less room for judgment than most debtors expect. The mechanics that decide whether a case is worth filing are the debt limits, the means-test-derived commitment period, the treatment of secured claims including the anti-modification rule for principal residences, and the priority claims that must be paid in full. This article works through eligibility, plan construction, confirmation, the life of a case, and the discharge that arrives at the end of it.
Personal Guaranty Review Checklist: A Practical Checklist
A personal guaranty is usually presented at a closing table with the loan proceeds waiting, and it is signed without negotiation because the alternative appears to be no loan. That is frequently wrong: several terms are negotiable, a few are not, and one federal rule can void the document entirely. This checklist gives an owner and their counsel a structured review—what the guaranty actually covers, whether it is capped or unlimited, what defenses have been waived and which survive waiver, whether the spousal signature was lawfully required, and how the guarantor exits when they leave the business. It also includes the lender's drafting checklist, because the same document is read from both sides.