Chris and Mark go deep on what it is like to make the jump to your own attorney practice and small business. What's it like to work full-time and build a real estate portfolio? Credit unions around the country can connect with Chris at riceparklaw.com. 

IN THIS EPISODE:

• (00:00) Intro: Meet Chris Rice
• (01:49) Chris Rice's professional background journey
• (07:25) Chris shares his experience working with credit unions and what it was like starting Rice Park Law firm
• (13:02) The differences between commercial and consumer collections
• (16:51) Do not delay on a default notice
• (22:06) Chris advises on selecting an attorney and he gives his outlook on the future

KEY TAKEAWAYS: 

• Attorney Chris Rice has launched Rice Park Law, focusing on credit union representation. His extensive background in real estate and restaurant ownership gives him unique insights into business operations and challenges.
• Commercial and consumer collections differ: Commercial loan collections are often more straightforward due to tools like the "confession of judgment" and the use of secured assets. Consumer collections, however, are more complex due to regulations and typically involve unsecured debt.
• Early legal intervention in loan defaults is key. Don’t delay sending default notices and involve legal counsel early in commercial loan defaults. This helps avoid "lender liability claims" and allows for effective workout solutions like forbearance agreements, saving time and money.

RESOURCE LINKS

Mark Ritter - Website

Mark Ritter - LinkedIn

Rice Park Law - Website

Chris Rice - LinkedIn

BIOGRAPHY:

Chris Rice is the founder of Rice Park Law. For the past twenty years, Chris has helped numerous credit unions with contractual, regulatory, loan closing, and workout issues. Chris is an entrepreneur who lives and practices out of Carlisle, PA.

KEYWORDS: Credit Unions,  Chris Rice, Rice Park Law, Commercial Collections, Consumer Collections, Small Business, Real Estate Portfolio,  Business Lending, Commercial Lending, Real Estate, Renovation Projects, Restaurant Ownership, Carlisle Community, Lending Institutions

Credit Union Conversations - Ep 85 - Attorney Talk with Chris Rice of Rice Park Law

[00:00:33] But today I'm in my capacity as the host of Credit Union Conversations, and I am excited about today because I have resisted bringing him on in the past just because it was too easy to bring him on. But now I have decided the timing is right with all of his new ventures. Everybody should have a small group of people that they [00:01:00] rely on, can talk to, and and our guest today, we have had a 20 plus year relationship, which means we're both getting very old.

[00:01:20] Chris Rice of Rice Park Law: Thanks for having me, mark. Excited to be here

[00:01:35] But for those of you who don't know Chris, 'cause many credit unions also work with Chris. Kind of give people your, I'll say your origin story, your background, and your journey. And what you're up to today.

[00:01:55] No. But it was, it was a good run. And I'm still trying to keep up with you, but yeah, [00:02:00] I was born in Lancaster, Pennsylvania. Went to Lancaster Catholic, off to Villanova. You may have heard, we have a recent alum that's pretty famous now as a pope. I, I hear, I

[00:02:12] So that's

[00:02:34] Ended up focusing at Villanova to go into law enforcement. I was home junior year and my father said, during spring break, why don't you think about law school? And I thought, that'd be great. I can get into law enforcement easier. Long story short, ended up gonna law school at Penn State. Dickinson. Loved being an attorney.

[00:03:18] So I went into, uh, a law firm for 20 plus years and handle transactional work. LE Lending work, collection work. But on the side I was working real estate deals. Some mornings before and after work I'd be doing construction myself, renovating apartments that we had purchased. And it got to the point where we have over 150 units.

[00:03:59] [00:04:00] Now, I'm really invested in the Carlisle community. Most of my portfolio is within two blocks of where I work, and I'm right downtown Carlisle. I recently started a law firm April 1st with another partner day park, and so far so good. We've been busy. We've built our team up. There's 11 of us now, and we're focusing on the future.

[00:04:37] Mark Ritter - Host: So I'm not gonna let you get away with a plug for the restaurant that easy 'cause it is my favorite restaurant in central Pennsylvania.

[00:04:48] Chris Rice of Rice Park Law: Thank you. I appreciate that.

[00:05:13] Chris Rice of Rice Park Law: I think you'll like the atmosphere. The food is delicious. The two bars offer Dr. Great Drinks. I was just there last night with my family and it's sort of our flagship for starting future restaurants. We wanted to make that one our best, and I think most people would be impressed on the atmosphere and the food.

[00:05:59] Chris Rice of Rice Park Law: Well, [00:06:00] I still have one finger that, that reminds me why I'm not into construction anymore as a late night. Or maybe it was an early morning hammer hit it as we're trying to finish property renovation before they moved in the next morning. But no, it's just, I think Mark, I realized the scale of what I wanted to do.

[00:06:38] And once I did and I delegated to people, I found there's people better than me. I had many things, mark, and I felt it made me better surrounding myself around the people that can swing, that hammer better, the architects, the engineers, the contractors, my paralegals, my fellow attorneys. So it was forced upon me, but I thank goodness it was.[00:07:00]

[00:07:25] Chris Rice of Rice Park Law: Sure. And I have to give you a plug mark. You've helped me. Build those relationships with your trust in me. For many of the credit unions, I probably represent in the Commonwealth of Pennsylvania and outside of the Commonwealth, over 20 different lending institutions. For me, it's been a blessing because I've gotten to develop a practice that I enjoy.

[00:08:12] And because of those relationships we now have with the credit unions, we're also helping out in between. It's odds and ends that they have contract reviews. Maybe it could be just a new software that they're implementing and they're all fabulous to work with. I really feel blessed that I get to work with so many different credit unions because it's the people within that make those institutions what they are and prosper.

[00:08:48] Mark Ritter - Host: Now you're an entrepreneurial guy. Lots of business ventures, lots of life lessons learned along the way, but what was, when you were starting up that [00:09:00] law firm, what was a surprise, something you weren't expecting compared to your other business ventures?

[00:09:14] Chris Rice of Rice Park Law: Mark, I'll tell you, I tell people I failed more than anybody else in this world. But you're talking about specifically with the law firm, you know, this was a lot more work than I ever imagined. I'm very lucky to have the business partner, Dave Park, who I've been working with for seven years now, who took on the large projects.

[00:09:52] You had to rely upon, you know, interior designers or contractors that were available at the time because [00:10:00] you're trying to move quickly to get something done. We were fortunate enough to find a building that we were able to purchase. It's an old church. And awesome setting for us. We've, we've been hitting the ground running with different projects and renovations, so for me it was really the amount of work to go into a startup.

[00:10:38] This is one of the largest transactions of their life. But when someone's starting a business, I think I'm gonna be better. I think I'm gonna have more empathy towards them and more understanding and be able to guide them better. 'cause it is a, it's a tough project to open up a business and keep running.

[00:10:59] Chris Rice of Rice Park Law: It could be [00:11:00] 99% mark. It was pretty high up there. And it, it's something you can't, you can't prepare for. You know, it's sort of like having a child. People are like, well, I wanna wait till I'm ready. You're never gonna be ready. You just have to jump in and you have to struggle, and you have to do your best to find out how to be a business owner and model the business the way you want it to, to go.

[00:11:33] Mark Ritter - Host: MBFS is on the same system.

[00:11:50] Mark Ritter - Host: Great. So. Me and you have worked together for a long time. We had some fun times during the Great recession and some [00:12:00] adventures of working out some deals.

[00:12:03] Mark Ritter - Host: and and, and then from there, there wasn't a lot of action with regards to collections and workouts, and we're starting to see that pop up a little bit.

[00:12:14] Chris Rice of Rice Park Law: mark, I don't know if you remember, but I did a presentation post COVID for you. And I gave a forecast and admittedly I was wrong. Then the next 12 months we're gonna see a lot of credit card collection work and it did not happen. What happened is the can got kicked down the road and currently after COVID.

[00:12:38] Mark Ritter - Host: There was so much forbearance. Everything is fine, but rates were so low. Mm-hmm It was tough to make a bad deal.

[00:12:47] Mark Ritter - Host: And then interest rates skyrocketed, liquidity tightened inflation had a huge impact. And I hate to say that we're getting back to a historically normal environment, but I [00:13:00] feel like that's where we're at.

[00:13:26] Mark Ritter - Host: So almost everybody who listens to this show, uh, other than my wife is a credit union professional, we're in the in financial services industry. So I wanna talk a little bit about collections and workouts and just many people that we work with are under the lending umbrella. They grew up on their consumer lending side.

[00:14:10] Chris Rice of Rice Park Law: Sure. So the consumer collection uh, world is a lot different and I'd say the two main points of the regulations behind it, you have the Fair Debt Collection Practices Act, and if it's a residential foreclosure.

[00:14:54] That's not how it works in the commercial world. Commercial world, you can confess judgment, [00:15:00] which a lot of credit unions that aren't as into business lending at large scales may not see it. But confessing judgment in the commercial world is a blessing for many reasons. One, it gives the credit union time to, or, or reduce the time it takes to collect and it brings the borrower to the table.

[00:15:48] And I see the consumer debt being a harder struggle to deal with because they're gonna keep increasing and people are just not gonna have money to pay back because they're choose usually unsecured. And [00:16:00] when you have a business debt, and most times you're gonna have some security, maybe it's through a personal guarantee of the individual, but you might have their personal assets, business assets, or even better a commercial property.

[00:16:32] Mark Ritter - Host: Now, under the commercial side, are there things that a lender can do before the delinquency, before it goes south? What are some of those common? Errors that you see where lenders can do things to protect themselves before the loan goes south.

[00:16:56] You don't need to take action. But if you don't [00:17:00] abide by the loan documents to a T, if it says on the 16th day you need to provide notice to put them on default, and you wait for the 31st day and then they cure it, and the next time you wait for the 45th day, you're rewriting the loan documents. Maybe not to the point that it'll hold up in court, but in the perception of the borrower.

[00:17:46] Because you get a really good loan officer who has had this relationship with a borrower for five or 10 years trying to help them out and get them over this hump because they're not able to pay their bills. They may offer advice, they [00:18:00] may make a suggestion, they may say something that puts the credit union at risk.

[00:18:31] Bring them to the table, find out what they can do, see what you're willing to agree to internally, and then put in writing in the form of a modification to your loan documents. Or even better forbearance agreement and the value of a forbearance agreement. Two part one, it rewrites for a limited period of time, the forbearance period, what the terms are, and two, it allows for you to clean up any errors in the loan documents and have [00:19:00] the borrower and guarantors waive any potential claims they had.

[00:19:21] Mark Ritter - Host: credit.

[00:19:49] Chris Rice of Rice Park Law: And we've seen that mark firsthand many times

[00:20:15] Whereas there's a big chasm in the commercial world of that lone workout and, and people need to, and, and, and sometimes it takes a little bit of time, but it's a longer timeframe. But it, it is important and it's much, much better than going through a complete foreclosure process for a commercial plan.

[00:20:43] Chris Rice of Rice Park Law: mark I've always said with credit unions. You know, because of their relationships with the borrower and their willingness to attempt to negotiate and resolve issues, it doesn't always work out. Generally, when they go down the right path and it does work out, they're staving [00:21:00] thousands and hundreds of thousands of dollars on larger commercial deals because the foreclosure process, we know how it ends.

[00:21:25] Mark Ritter - Host: So I'm gonna pivot to, to something else. And that's when it comes to picking an attorney for a lender for a credit union. I see. You know, we deal nationwide now, you know, over a hundred credit unions, and I always find this piece interesting. What's your advice on picking an attorney other than just, we know this guy is in our town and we've kind of worked with him for 20 years.

[00:22:06] Chris Rice of Rice Park Law: Well, I think it, it, there's two factors that come into play personally when I look at this and, and I think you need to look for somebody that has the experience, understanding how credit unions think, how they operate, what their end result should be for them to feel successful in resolving a workout.

[00:22:46] You need to be that representative, that liaison for the credit union that can communicate sternly, but get to a, a trusted relationship with the borrower to come up with a way that they don't lose everything and the [00:23:00] credit union stays on top. And I've seen this work time and time again. The funny thing is, you know, I form many relationships with borrowers that are having a hard time because I become the person that they talk to with their woes, and I can't do this or that, and I have to be stern.

[00:23:35] Mark Ritter - Host: So it, it's the last, let's see, as we record this, it's may, it'll drop in June. You know, the, the, the last six months have been kind of crazy to say the least. You know, one day there's an executive order, a new rule regulation, so people, you know, there's lawsuits filed. Then it's over and you know, the world is changing.

[00:24:14] Chris Rice of Rice Park Law: Oh, and I've been told I'm an optimist, mark, so I only have good news to share, but I am seeing the lending world starting to p its head out.

[00:24:47] I'm seeing it around me in South Central Pennsylvania. The housing market is just exploding right here, right now. And I know that's not the same for every place, but you can always tell when things are going well, they're gonna [00:25:00] go well for a while. As far as how politics will play into it and regulations change and, you know, trade and I, I don't wanna say it doesn't affect me personally, but when I have a good year, a good year could be, I'm doing a lot of loan doc work or a good year could be the opposite.

[00:25:42] And it's been a great indicator for me over the years on how I should prepare my practice. I think you're gonna still have quite a few, uh, consumer debts that you know explode over the next 12 months. But I think it's gonna level out as time goes [00:26:00] on, because you need one year of, not to get political, but of our president in office to feel comfortable where the future looks like it's going before people start settling in on what they're gonna make decisions on spending and not, and that goes for consumers and business owners.

[00:26:37] Tell people any of our credit union friends, other businesses where people can connect with you and Rice Park law.

[00:27:03] We are specializing in helping businesses and credit unions, uh, likes, so feel free to reach out.

[00:27:17] Chris Rice of Rice Park Law: Yeah, we do work throughout the country. Thank you, mark.

[00:27:39] Have a great day, and we will talk to you soon.