TRY ME!
Legal Document Simplification
Ask Your Question For FreeSummary
The borrower must set up a reserve fund with the lender for office repairs, contribute monthly, and the lender can inspect and adjust contributions. The loan-to-value ratio must be 45% or less, requiring a new property valuation or partial repayment. If the borrower defaults, the lender can use income to pay off the debt, prioritizing unpaid interest, principal, and future installments. The lender can reallocate loan amounts if the borrower defaults, but the borrower cant demand changes unless allowed. When the loan becomes permanent, the lender can reduce the loan amount, except for specific allocations, and is not obligated to lend removed amounts.Full Conversation
Dumb this down "he Loan-to-Value Ratio (based on an updated or new appraisal obtained by Lender (at Borrower's sole cost and expense) within thirty (*) days prior to the Original Maturity Date or First Extended Maturity Date, as applicable,) is less than or equal to forty-five percent (*%); provided, however, this subsection of Section *.* shall be deemed alternatively satisfied if Borrower should prepay a portion of the Outstanding Principal Balance such that, after giving effect to such payment, the Loan-to-Value Ratio is then less than or equal to forty-five percent (*%);
This means:
*. The borrower needs to get a new property valuation, paid by them, 30 days before the loan due date.
*. The amount of the loan cannot be more than *% of the property's value.
*. If there's a large balance remaining, the borrower can pay some of it off to meet the *% requirement.
*. The borrower needs to get a new property valuation, paid by them, 30 days before the loan due date.
*. The amount of the loan cannot be more than *% of the property's value.
*. If there's a large balance remaining, the borrower can pay some of it off to meet the *% requirement.
Dumb this down "Application of Proceeds. While an Event of Default exists, Lender shall be entitled to apply any proceeds or payments or other sums received (including, without limitation, any Rents, Net Proceeds or other proceeds of sale, lease or other disposition of all or any portion of the Mortgaged Property) in such order and priority against the Indebtedness and Obligations as Lender may elect. Absent a provision herein to the contrary, provided no Event of Default exists, proceeds or payments shall be applied in the following order and priority: (i) first, to the remaining accrued but unpaid interest, second, to the matured portion of principal of the Indebtedness, and third, to prepayment of the unmatured portion, if any, of principal of the Indebtedness applied to installments of principal in inverse order of maturity; (ii) the balance, if any and to the extent applicable, remaining after the full and final payment of the Indebtedness and full performance and discharge of the Obligations to the holder of any inferior liens covering the Mortgaged Property, if any, in order of the priority of such inferior liens (Lender shall hereby be entitled to rely exclusively upon a commitment for title insurance issued to determine such priority); and (iii) the cash balance, if any, to Borrower. The application of proceeds of sale or other proceeds as otherwise provided herein shall be deemed to be a payment of the Indebtedness like any other payment. The balance of the Indebtedness remaining unpaid, if any, shall remain fully due and owing in accordance with the terms of the Note or the other Loan Documents. The application of proceeds described herein shall not apply to any proceeds which may be realized by Lender with respect to any of the Mortgaged Property following a foreclosure (or foreclosures) of the Lien Instrument."
This means:
*. If the borrower defaults, the lender can use any income (like rent or sale proceeds) to pay off the debt.
*. Payments are used first for unpaid interest, then the principal, and lastly for early payment of future installments.
*. Any remaining money goes to other lien holders, then the borrower.
*. Remaining debt stays due.
*. These rules don't apply to money the lender gets from selling the property after foreclosure.
*. If the borrower defaults, the lender can use any income (like rent or sale proceeds) to pay off the debt.
*. Payments are used first for unpaid interest, then the principal, and lastly for early payment of future installments.
*. Any remaining money goes to other lien holders, then the borrower.
*. Remaining debt stays due.
*. These rules don't apply to money the lender gets from selling the property after foreclosure.
Dumb this down "Reallocations. Lender reserves the right, at its option upon the occurrence and during the continuance of an Event of Default, to disburse Loan proceeds allocated to any of the Allocations for such other purposes or in such different proportions as Lender may, in its sole discretion, deem necessary or advisable. Except for a Permitted Change or as otherwise permitted under Section *.*(a), Borrower shall not be entitled to require that Lender reallocate funds among the Allocations; provided, however, so long as no Event of Default has occurred and is continuing, Lender shall not unreasonably withhold, condition or delay its consent to a proposed reallocation of Cost Savings so long as (i) such reallocation is only to an Allocation for true hard costs of construction or payments to a Design Professional or engineer, and (ii) no such reallocations move monies to any line item attributable to payments to Borrower or any Affiliate of Borrower or Guarantor. "
This means:
*. If the borrower defaults, the lender can decide how to use the loan amounts.
*. The borrower can't demand changes to these allocations, unless allowed by the agreement.
*. If no default has occurred, the lender can't unreasonably deny the borrower's request to reallocate funds, but only for specific expenses and not for payments to the borrower or related parties.
*. If the borrower defaults, the lender can decide how to use the loan amounts.
*. The borrower can't demand changes to these allocations, unless allowed by the agreement.
*. If no default has occurred, the lender can't unreasonably deny the borrower's request to reallocate funds, but only for specific expenses and not for payments to the borrower or related parties.
Dumb this down "Permanent Loan Conversion; Loan Curtailment. Upon achieving the Permanent Loan Conversion Date, the Loan shall be categorized by Lender as a permanent loan. To the extent that there are then any unadvanced and available portions of the Loan Amount remaining (the “Remaining Loan Proceeds”), then Lender may, in its sole discretion, declare that all or a part of any Remaining Loan Proceeds are no longer available for Advance hereunder, whereupon the Loan Amount shall be deemed reduced and the Budget revised accordingly (as Lender may designate) (any such reduction, a “Loan Curtailment”); provided, however, no part of the unfunded balance of the TI/LC Allocation shall be subject to Loan Curtailment. From and after a Loan Curtailment, Lender shall have no obligation to Advance any amounts which have been removed from the Budget by virtue of such Loan Curtailment. "
This means:
*. When the loan becomes a permanent loan, the lender can decide not to lend any remaining amounts.
*. This reduces the loan amount and changes the budget accordingly.
*. Any unfunded balance from the TI/LC allocation is not affected.
*. After a reduction, the lender is not obligated to lend any amounts removed from the budget.
*. When the loan becomes a permanent loan, the lender can decide not to lend any remaining amounts.
*. This reduces the loan amount and changes the budget accordingly.
*. Any unfunded balance from the TI/LC allocation is not affected.
*. After a reduction, the lender is not obligated to lend any amounts removed from the budget.