From Adviser Guide:
Short-term finance 1hr
Q: Can the asset be sold?
As with all secured loans, if ultimately the borrower cannot repay the loan then the lender would be entitled to repossess and sell the security property.
At the end of the loan term, Paul Aitken, chief executive of Borro, said if the client hasn’t paid off the interest to allow them to renew his staff actively worked with the client to understand their financial position.
Mr Aitken said: “We do our utmost to enable the client the opportunity to repay. However, if it is clear that the client cannot or does not want to redeem, we dispose of the asset through auction.
“Any surplus after outstanding interest, principle and admin costs such as auction fees, are returned to the client. Any deficit is absorbed by Borro.”
Finished reading all the other articles in this Guide? Bank 1hr of Structured CPD
More in this guide
- Q: What is short term finance?
- Q: What are the different types of short-term loan?
- Q: What are the pros and cons of different short term loans?
- Q: Who regulates short-term loans?
- Q: How are short-term asset loans secured?
- Q: What happens if the borrower misses a payment?
- Q: Do missed payments affect credit rating?
- Q: Is the bridging loan borrower protected by law?
- Q: Once a bridging loan is agreed can it be cancelled?
- Q: What will I be paid for arranging short term finance?
- Q: What if the asset is sold for more than the loan amount?