Post by bracknellboy on Apr 1, 2014 17:56:05 GMT
Need to choose my language very carefully here.
We seem to have a period where quite a number of loans are aggregating new requirement with outstanding balance and paying off the old loan. There was at least one loan recently (last couple of weeks or so ?) where on Q&A the borrower stated in response to a question that FC had required them to do it this way rather than take out an additional loan. Yet there are also plenty of instances where that has not been the case. This is something that has also been stated in more distant past as well.
Given the state of hte current market - one which FC would have been reasonably able to predict based on pipeline etc - this is inevitably going to drive up the cost of borrowing for two reasons: 1) 'average rates' are in general going to be higher than their prior loans and 2) increasing the size of the new loan which also generally increases the rate.
Is it just me that thinks that there is something not right about this ?
Also, slightly ironic but: by pushing up the amount of money required to be lent in total before funds are released from the original loans (which there is no guarantee will be relent), it puts a further strain on the borrower/lender balance; and by pushing some of these loans into >£100k when they otherwise wouldn't be, FC is now dipping its hands in its pockets to give cash back on such loans.
Also: as a lender, I have had to work pretty hard to build up my loan book. Yes this may give the opp. to secure lending with the same borrower at a significantly higher rate than previously, but I'd rather not keep having some of my loan book unnecessarily pulled from under me just to have to rebuild it again with the same borrower (well, unless I wanted out of hte loan of course).
We seem to have a period where quite a number of loans are aggregating new requirement with outstanding balance and paying off the old loan. There was at least one loan recently (last couple of weeks or so ?) where on Q&A the borrower stated in response to a question that FC had required them to do it this way rather than take out an additional loan. Yet there are also plenty of instances where that has not been the case. This is something that has also been stated in more distant past as well.
Given the state of hte current market - one which FC would have been reasonably able to predict based on pipeline etc - this is inevitably going to drive up the cost of borrowing for two reasons: 1) 'average rates' are in general going to be higher than their prior loans and 2) increasing the size of the new loan which also generally increases the rate.
Is it just me that thinks that there is something not right about this ?
Also, slightly ironic but: by pushing up the amount of money required to be lent in total before funds are released from the original loans (which there is no guarantee will be relent), it puts a further strain on the borrower/lender balance; and by pushing some of these loans into >£100k when they otherwise wouldn't be, FC is now dipping its hands in its pockets to give cash back on such loans.
Also: as a lender, I have had to work pretty hard to build up my loan book. Yes this may give the opp. to secure lending with the same borrower at a significantly higher rate than previously, but I'd rather not keep having some of my loan book unnecessarily pulled from under me just to have to rebuild it again with the same borrower (well, unless I wanted out of hte loan of course).
