Your loan procedure would proceed with the careful examination of your credit standing in order to determine your repayment capabilities. For those who have stained financial credits, there is a suggestion for you. You must consider non status lending so that the banker or broker will not consider your credit scores while approving your loans. This means that ccj, bankruptcy or arrears does not affect the banker in any way.
You are approved for the loan amount based on the collateral value. Also, consider the Loan to Value known as LTV, this is a percentage calculated on the loan amount which is further divided by its purchase price. In this case, it is your property, building, office or factory that is your collateral.
Request for a payment holiday if you think you can’t repay. You can inform the bank that you will be unable to pay for few months and they may make some arrangements so that you pay only the interest rate for some time and so that your equated monthly installment will come down.
The other option is to resort to ‘unenforceable agreement’. When you have some pending debts and you are unable to pay back, find out if there are any loop holes in the loan agreement that you have signed. If there is not enough proper documentation then you can make use of this. A lender will not be in a position to claim the loan amount from you if the agreement has some facts missing and it becomes invalid.
Vijay K Shetty
Commercial Finance
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