United Development Funding IV, the embattled UDF-sponsored program, disclosed yesterday in a filing with the Securities and Exchange Commission that it had defaulted on a $35 million loan and had entered into a forbearance agreement with the lender.

According to the filing, UDF IV acknowledged that certain events of default had occurred and stated that its lender would not exercise any default-related rights until August 4, 2016 pursuant to certain conditions in the forbearance agreement.

The filing also states that UDF IV has suspended distributions to shareholders during the forbearance period.

According to UDF’s filing, during the forbearance period, interest will accrue at the rate of one-month LIBOR plus 11.5%. UDF’s filing states that UDF has agreed not to originate new mortgage loans, incur additional debt, grant additional collateral or substitute collateral to any other lender, or to dispose of assets without first obtaining the consent of the lenders. UDF IV also stated that the balance of the loan, as of May 23, 2016, is approximately $28.5 million.

The Peiffer Wolf securities attorneys, Jason kane and Joe Peiffer, are continuing their investigation into United Development Funding IV (“UDF IV”) a Texas-based real estate investment trust whose share price has recently plunged after allegations of misconduct, resulting in its delisting from NASDAQ. The Peiffer Wolf lawyers have been contacted by numerous investors and are preparing to take action against some of the broker-dealer firms that, they believe, sold UDF to investors without conducting adequate due diligence prior to such sales.

Investors who believe they have lost money as a result of their investments in United Development Funding or other programs may contact the securities attorneys at Peiffer Wolf , Jason kane, Colin Ray, or James Booker, for a free, no-obligation evaluation of their recovery options, at 216-589-9280, via email at jbooker@pwcklegal.com, or through the contact form on this website. An attorney will respond promptly to inquiries through the website during business hours.

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