About Our Loans
What is a Private Mortgage?
This is a business to business loan of private capital to a borrower who commits security in the form of some or all of the following:
Real Estate, either Residential, Commercial or Industrial
Charge over a Business or Business Assets
Charge over Private Assets
This security is listed in a loan agreement that protects the private mortgage lender in case of default.
Why a Private Mortgage?
- Businesses in today’s harsh economic environment find it difficult to obtain short term funds from traditional banks due to the strict and lengthy process and time it takes from application to decision to hopefully, approval and receipt of funds.
- The inability of the borrower to reflect serviceability of the new loan and/or bad credit rating.
- The credit regulations are continuing to be tightened due to the uncertain global financial situation and the option of private funds are now becoming a part of the mix of options.
- You are dealing directly with the lender so the relationship is close and contact is maintained on a regular basis to monitor the progress of the facility and to ensure funds are re paid on time.
- Decision making process is usually quick, within 5 days if all the information is supplied at application.
- Settlement within 2-3 days from approval.
How is a Caveat Loan different from a 1st or 2nd Mortgage?
Most borrowers will be familiar with 1st and 2nd mortgage loans, much as you require for the purchase of a private dwelling from traditional lenders such as banks.
Business Equity offers this facility to businesses as well but only for business purposes and the quality of the security reflects the rate of interest applicable on these loans.
A Caveat loan is by way of Loan Agreement and an unregistered Mortgage and/or charge against the relative security offered by the borrower. The lodged caveat reflects the Lenders equitable interest in the transaction.
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