Commercial investors say banks failed to honor pre-payment waivers
Two commercial investment companies from Madison County are suing their lending banks for not complying with an alleged promise.
Wilken Development Group LTD and Crown Pointe LTD filed the lawsuit Feb. 25 in Madison County Circuit Court against Citibank, FSB and OneWest Bank, FSB.
According to the complaint filed Feb. 25 in Madison County, Wilken Development took out a mortgage with Citibank in March 2005 for a property in Highland. In January 2009, CrownPointe signed a promissory note with Citibank for another Highland property.
In May 2010, Citibank allegedly told both companies they had stopped issuing commercial loans. The lender also allegedly promised to waive all pre-payment penalties associated with the respective loans.
Both Wilken and Crown Pointe informed Citibank they would look for more favorable financing elsewhere, but say they believed the promise to waive pre-payment penalties. Wilken and Crown Pointe claim Citibank then sold their loans to OneWest Bank.
The investment companies say that in November 2010 OneWest also promised to waive pre-payment penalties associated with the loans.
When Wilken and Crown Pointe obtained financing through Bradford National Bank in December 2010, they say they were informed by Citibank that the pre-payment penalties would not be waived. The investment firms were allegedly charged more than $70,000 in penalties.
Wilken and Crown Pointe accuse Citibank and OneWest Bank of a breach of contract and fraud.
They are asking to be awarded more than $630,000 in damages, both compensatory and punitive. They are also asking that their loans be allowed to transfer to Bradford National Bank.
Attorney David W. Dugan of East Alton is representing Wilken and Crown Pointe.
Madison County Circuit Court case No. 11-L-186