Security

How can Partner Lend guarantee the loan?

The Loan agreement between the Lender and Partner Lend protects the Lender by allowing them to have a registered security charge on the Personal Property Security Register (PPSR)

The PPSR has replaced the redundant ASIC company charges scheme and is the current method of registering a security against a company or individual

When lending with Partner Lend the Lender receives the following security under the PPSR

• Purchase Money Security Interest (PMSI) over the loan that they have contributed to via Partner Lend.
• A PMSI is a security interest in the loan that secures the position of the Lender and the assistance provided by the Lender to Partner Lend, to enable the loan to be facilitated between the Borrower and Partner Lend.
• A PMSI may provide a ‘superior priority’, which defeats all other security interests over Partner Lend in respect of the proceeds recovered from the loan

Partner Lend contributes much of its own funds to any loan in place at a current over all loan to value ratio (LVR) below 50%, meaning the value of Partner Lends own funds at work is more than the total funds available from its Lenders at any one time

• Due to this the risk of loss to Lenders is deemed negligible as the Lenders funds are secured against the loan, even if Partner Lend was insolvent as a company.

If Partner Lend could not honour its agreements with a Lender, then the lender would have rights to proceeds recovered by any third part involvement (via a Liquidator or Receiver and Manager)

As the Lenders funds are secured against the loan they are covered in the event that a Borrower defaults on the loan to Partner Lend, who can act commercially to recover monies owed under the under the loan – this may involve:

• Taking possession of the Security Property;
• Taking legal proceedings to obtain possession of the Security Property;
• Conducting building and improvement works on the Security Property;
• Selling the Security Property

Partner Lend typically has 100%+ profit margin above its Lender’s rate

Partner Lend always has cash reserves – even if all the borrowers stopped paying we would have enough in reserves to fund everyone’s monthly interest payments while pursuing any necessary actions to recover monies owed by Borrowers to Partner Lend

The Property Developer

A usual client is always at the mercy of the banks whether it is getting into the next project or finishing the last. The ‘property developer’ is always in need of a fast private loan to bridge projects. In this example our client needed funds to complete his last project and settle on a new acquisition. The bank was unable to accommodate settlement within the given time period of two weeks. We received a mortgage over both developments and the family home as security. The loan was prepaid for three months, but was repaid in two making the whole deal even more profitable…problem solved!!

The Car Dealer

Small businesses need funding for expansion, purchase of goods and most importantly for starting new ventures.

Short Term Loans come in handy in these kinds of situations like the one we recently encountered with a local car dealer.

An opportunity presented itself for a local dealer to purchase a number of cars cheaply from another caryard that went into liquidation. The ‘car dealer’ needed to refinance his home as he had a shortfall and settlement had to proceed within 7 days, otherwise the opportunity would pass him by. He was effectively going to double his money within a matter of months.

The ‘car dealer’ decided to call us as we could settle within the given time frame whereas the bank could only book an appointment with a local manager under the same conditions. We settled as expected and everyone was a winner!!!

The Entrepreneur

Short term loans can be granted to both new and existing businesses. Therefore, a promising entrepreneur can finance the startup costs of their business by obtaining a short term business loan.

Many businesses are cyclical in nature and there is often a gap between cash coming in and cash going out. If you know this is a temporary situation and your accounts receivables will be coming in the near future, a short term caveat loan or second mortgage will help you bridge the gap without falling behind on your bills and other business expenses. In this instance a young entrepreneur of a budding technology business needed to bridge the gap for a few months to keep her staff paid while waiting for an approved government grant to come through.

Although there was available security the bank decided against lending her the money needed. Again we saw the loan for what it was and provided the funds desperately needed within 72 hours taking a mortgage over real estate and also locking into the grant payment which arrived within 90 days.

The Resort Owners

Cash flow is the lifeblood of any business enterprise. Any business must first invest money and expect returns after a certain period of time. Therefore, the intervening gap between investment and returns must often be supported by short term loans. As was the case with a holiday resort owning couple who ran into trouble during the winter downturn.

Although this couple were asset rich they became cashflow poor and were unable to pay a large tax bill. When the couple went to the bank they asked their manager if they could have a temporary increase on their overdraft while they offloaded some properties to pay tax bills, to which the bank replied “sorry we are unable to assist until we can see business has picked up.”
We got the call and settled the deal on a four month prepaid term which fixed up the tax bill and allowed them to keep trading until they sold one of their investment properties.

If we didn’t help these people they could well have been at the mercy of the ATO who could have liquidated all of their assets to pay the bill and seriously undersold them undoing years of hard work not to mention destroying their business which is now doing remarkably well.