Case Study 1

THERE IS MORE THAN ONE WAY TO PEEL AN ORANGE

We had a client who wanted to invest in a multifamily property in Central Phoenix. We were able to find a great property that the client loved but there was a prepayment penalty on the seller’s loan. Basically, the price of the property was artificially high because the seller had to account for the large financial penalty incurred for paying the loan off early.

So, we turned to Attorney Ely W. Sluder of Sluder Law Firm PLC, one of the many professionals in our Talent Pool. With his assistance, we eventually discovered that the property was held in a legal entity, a limited liability company (LLC), and, by reviewing the LLC’s operating agreement and relevant loan documents, were able to find a loophole whereby the entity could be sold without it amounting to an assignment of the loan itself. Thus, our client was able to purchase the LLC that owned the property, rather than the property directly, at a much lower price than the seller was originally willing to accept. The client simply filed a change of address with the commercial lender and continued to pay on the loan until it could be paid off without incurring a penalty.