Knowing what to expect in any new business situation is vital. Surprises at Christmas and on birthdays are fine, but in business, not so much. In this economic downturn, many businesses with loans will find themselves in default and subsequently working with a bank workout officer. In many cases, this will be for the first time.

As a banking attorney, I have seen too many business owners and managers hinder their chances for a workout because they didn’t understand the rules of the road. They either reacted to the lender with hostility or were unwilling (or worse, unable) to produce information requested by the lender.

Of course, some workout situations will defy a successful outcome. But the more a newly defaulted borrower understands about the workout setting, the greater the chances for success.

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