Post by michaelc on Oct 17, 2016 21:12:00 GMT
Hi
Would someone be kind enough to answer a question or two I have about loan security. If I am to lend where the asset provided is on the basis of a second charge, is there anything to prevent the borrower increasing his facility with the first charge lender so that the overall LTV (on my second charge loan) increases ? Or perhaps all lenders (1st, 2nd, 3rd etc) need to agree before any further loans are issued on the security?
Similarly, in the p2p world, could the platform make further loans whenever it and the borrower feel like thus diluting the security of any loan take out prior to that point? I guess that is allowed when it is stated upfront such as in development loan tranches but can it also be done without such upfront clarity?
Would someone be kind enough to answer a question or two I have about loan security. If I am to lend where the asset provided is on the basis of a second charge, is there anything to prevent the borrower increasing his facility with the first charge lender so that the overall LTV (on my second charge loan) increases ? Or perhaps all lenders (1st, 2nd, 3rd etc) need to agree before any further loans are issued on the security?
Similarly, in the p2p world, could the platform make further loans whenever it and the borrower feel like thus diluting the security of any loan take out prior to that point? I guess that is allowed when it is stated upfront such as in development loan tranches but can it also be done without such upfront clarity?
