Special Opportunities for Larger Lenders

Whilst Lenders contributing £10k or so to any syndicate are very important and very welcome, our ability to make larger loans (in excess of £500k) depends on interest from Lenders capable of making much larger sums available.

We believe that businesses seeking such loans are likely to be more established and offer generally lower risks and such deals should be of interest to pension funds, family trusts, investment clubs and other serious investors. It is possible that we will be able to replace all existing bank loans and thus get a first charge on the assets.

For those interested in larger loans we can offer enhanced access and additional opportunities. Whilst it is not practical to allow every potential lender to meet the Borrowers it does make sense to allow larger Lenders or their advisors to meet individual Borrowers in advance of an auction being held. This provides you as a lender with four key advantages:

• An opportunity to conduct your own due diligence and get to know the Borrowers;
• Early notice of pending Loan propositions and an opportunity to get involved with setting the terms such as the security to be taken, the loan term and possible additional rights;
• An opportunity to keep the whole deal all for yourself, avoiding an auction and agreeing your own terms with the Borrower;
• An opportunity to underwrite a Loan (for a fee) at an interest rate you would be happy with. The loan is then auctioned with the underwriting in place and any Lender offering a lower rate displaces some (or all) of your funds on offer.

The underwriting system gives the Borrower certainty that the deal will ‘get away’ at a pre-defined maximum interest rate and the potential of getting a considerably better rate.

Underwriting also means that the auction will definitely succeed and the terms will almost certainly be accepted by the Borrower. It also gives other bidders confidence that someone else is prepared to lend and pays the Underwriter a fee even if others eventually fund the whole deal.

Of course, if the Underwriter is being undercut by other bidders there is nothing to prevent them making their own lower bids if they wish!

If you are interested in making individual loans in excess of £100k please contact Kevin Caley by email or telephone him on 07710 31458 for more information.