Business Line of Credit

Grand Rapids, Michigan, Lawsuit Attorney

With the economy slowing down and credit availability contracting, many banks and lending institutions have arbitrarily cancelled many commercial lines of credit. After many years of automatic renewal, a business is suddenly told that its credit line will not be renewed, and is then given a 90-day Forbearance Agreement.

Unfortunately, conventional wisdom holds that a bank is not obligated to lend money, and that the business has no choice but to sign the forbearance agreement. You should know that most businesses that sign a forbearance agreement will not be able to obtain a line of credit elsewhere, and without cash flow will likely go under.

Business owners must realize that if a bank that has been lending them money for 10 to 25 years decides that it will no longer do so, neither will a new bank. In most circumstances, signing a forbearance agreement is the first step down a fast track to closing the business.

We strongly suggest that you not sign any forbearance agreement until you have first talked to an attorney who is knowledgeable in this area of the law. Forbearance agreements are always one-sided in favor of the bank, and you waive all of your rights to challenge the bank’s action if you sign.

Spousal Signature. Many banks require that the spouse of a business owner co-sign a business loan or a line of credit. Unless the cosigning spouse is a member, officer, or shareholder of the company, asking him/her to co-sign a business loan or credit line may be against the law. The Equal Credit Opportunity Act (ECOA) has strict requirements that banks and lending institutions must follow. Our attorney has the knowledge to advise you in this situation.

There are many state and federal laws that regulate granting credit and terminating a line of credit. Attorney Bruce Alan Block is experienced in handling cases where a business credit line or a construction line of credit has been cancelled or terminated. He does not believe that a bank can arbitrarily deny your access to credit. Our attorney is knowledgeable in this area of the law. Put his experience to work for you. The banks have lawyers advising them, shouldn’t you?

If your line of credit or equity was cancelled by your banking institution, or if you were asked to cosign a business debt for your souse, you should see our attorney to make sure your rights were not violated.

Contact our West Michigan civil lawsuit lawyer for a consultation. Call (616) 458-8585.

Located on the corner of Cascade Rd. and Kenmoor Ave., just east of Interstate I-96, six miles from the Kent County Courthouse.

Bruce Alan Block, PLC represents clients in Grand Rapids, Michigan, and West Michigan communities of Ada, East Grand Rapids, Kentwood, Cascade, Wyoming, Byron Center, Wyoming, Caledonia, Cascade, Rockford, Holland, Grand Haven, Grandville, Kent County, Ottawa County, Muskegon County, Barry County, Ionia County, Newaygo, Montcalm, and Allegan County.

We represent students from Calvin College, Aquinas, Grand Valley State, Cornerstone, Grand Rapids Community College, and Michigan State University.

    
  

Bruce Alan Block, PLC

Attorney and Counselor at Law
4251 Cascade Road SE, Grand Rapids, MI 49546
Phone: (616) 458-8585
Fax: (616) 454-0849
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