The lender that financed Orange County Choppers’ new headquarters in the Town of Newburgh has filed a foreclosure action against the company, alleging that it missed its July mortgage payments.
Orange County Choppers has two mortgages through GE Commercial Finance Business Property Corp., one for $11 million and one for $1.5 million.
The foreclosure action claims that the Choppers missed mortgage payments of approximately $96,000 and $14,000 on July 1 and July 27, respectively.
The Choppers stopped making mortgage payments in order to put pressure on the lender to modify the terms of the loans, according to Choppers’ lawyer Richard Mahon. Mahon said that when the property was built in 2007, it was valued at about $12 million. Because of the economic downturn, the building is now worth between $7 million and $8 million, Mahon estimated.
“This is just a bump in the road,” Mahon said. “We believe the parties will reach a resolution and the headquarters will continue in this location.”
The Orange County Industrial Development Agency is also named as a defendant in the action, since it technically owns the property under a payment-in-lieu-of taxes arrangement with Orange County Choppers.
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