MCLE Self-Study Test

Answer the following questions after reading the article on juror perceptions of trial issues. Use the answer form provided to send the test, along with a $20 processing fee, to the State Bar. Please allow at least eight weeks for MCLE certificates and answer rationales to reach you in the mail.

1. A lender has a duty to:

2. The primary aim of the borrower during workout negotiations should be:

3. All lenders share a similar philosophy concerning their troubled loans, which is:

4. In reviewing the client's documents prior to engaging in a workout, counsel should be sure to examine:

5. After counsel for the borrower has determined who is the client and who is the lender, counsel should always enter into a pre-negotiation agreement with the lender to provide the borrower with written assurance that the lender will not pursue its post-default remedies during the negotiations.

6. In determining whether the borrower has any legitimate lender liability claims, counsel should consider the following:

7. The best alternative to a workout is always:

8. When faced with a pending trustee's sale, a borrower's best option is to file a bankruptcy petition to stop the sale.

9. The tax consequences of a workout agreement should be addressed by the borrower after the workout agreement has been finalized with the lender so as not to unnecessarily complicate the workout negotiations with the lender.

10. Bankruptcy may be an acceptable alternative to a workout because:

11. A deed in lieu of foreclosure usually provides the following benefits to the borrower:

12. It is always in the best interests of the lender, rather than the borrower, to execute a pre-negotiation agreement.

13. A borrower should agree to affirm facts in a pre-negotiation agreement, such as that the borrower is in default or the amount of the debt.

14. Bringing the borrower's financial problems to the lender's attention before the lender raises them is generally the best strategy in dealing with a lender.

15. By agreeing to a release in the final renegotiated loan documents, the borrower is giving up all past, present and future claims against the lender.

16. A borrower can interrupt a trustee's sale that has been properly noticed only by filing a bankruptcy petition.

17. After the borrower has decided to pursue workout negotiations, borrower's counsel generally should, as the next step, approach the lender and request a workout.

18. A threat to file a lender liability lawsuit is always an effective way to get a lender to agree to a workout.

19. A lender who insists on approving the borrower's every business decision as part of a workout is entitled to do so with little risk of incurring liability.

20. If a workout cannot be negotiated and real property secures the loan, most lenders will proceed against the borrower through a judicial foreclosure rather than a trustee's sale.