Where can I find rules regarding commercial loans, proper forms, and disclosures?
If a Kansas bank issued a secured commercial loan in 2006 for a property located in Missouri, should the bank have used Kansas or Missouri loan documents? The loan docs and modifications were signed in both states. All of the property is located in Missouri. I am looking for a specific statute, regulation, or similar rule that can be used to substantiate your answer. Thanks so much! In Missouri, the only documents that are recorded are the Deed of Trust and Assignment of Rents. The Recorder of Deeds only verifies that the lender complies with its office rules regarding margins, page numbers, property legal descriptions, etc. My question refers more to the actual loan documents such as the promissory note, commercial security agreement, etc. I can find a lot of rules as they relate to consumer loans, but I am looking for commercial or business loan rules. I appreciate the help!
Those documents would have had to be recorded in the county and state where the property is located. If the documents were improper the Courty Recorder would have refused to let them be recorded. County Recorders examine all recorded documents to make sure that they are legal before they allow them to be recorded.
The reason you're having a problem finding them is because overall they don't exist in your state. Only a few states regulate the financing of commercial real estate and Missouri isn't one of them. Just as the laws that protect consumers against unfair credit reporting don't protect businesses, the laws that protect consumers when financing a home don't protect business owners when financing commercial property.
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