My family bought a car wash/gas station in early 2007. The seller had just refinanced the place and showed the appraisal that valued the property at 9MM. We paid 7.5MM. When it was found out that we could not qualify to assume the loan, the loan officer at the bank said that she would just keep the loan in the previous owner's name. As it turns out, the appraisal was based on obviously bogus numbers. Anyone doing any kind of investigating would have found it. Now the bank has foreclosed and the previous owner is broke. Can we recover from the bank even though there was no contract between my family and the bank? It looks like the loan officer pushed the loan through knowing it was based on bogus numbers and did not inform the bank that the borrower had sold the facility (a violation of the covenants). The bank is treating it as a loan gone bad and is not treating it as mortgage fraud. Is the bank responsible to at least report it to regulators? Is there any way for my family to collect from the bank?
If you think you have a case for recovery from the bank, you should contact an attorney. We are not in a position to know who convinced whom of the viability of the business, but in most business investment decisions that turn out bad, there is more than one place to point fingers. Discuss the details of the case with an attorney and find out whether you have any reason to pursue a case against the bank.
BankingQuestions.com is a free service made possible by the generous support of our advertisers. Advertisers are not responsible for site content. Please help us keep BankingQuestions.com FREE by supporting our advertisers. When you see an ad for a product or service you may have an interest in, click through to learn more.
Accounts
Article
Q&A
Podcast
Video
Blog
Discussions
PDF
Powerpoint
If you think you have a case for recovery from the bank, you should contact an attorney. We are not in a position to know who convinced whom of the viability of the business, but in most business investment decisions that turn out bad, there is more than one place to point fingers. Discuss the details of the case with an attorney and find out whether you have any reason to pursue a case against the bank.
