Making the Impossible Possible - Case Study


George is an existing client who has been in the construction industry for over 15 years. He contacted us seeking an increase on his existing lending facility to assist with a construction project that has already commenced. 


Prior to speaking with us, he had sought the advice of his Relationship manager to see what assistance his current bank could provide. Unfortunately they were not in a position to assist with any further lending. George was understandably disappointed having been a customer for a number of years.


We sat down with George and discussed his background, current situation and plans for the following year. From a business point of view, George had a number of jobs lined up and expected to turnover in excess of $5 million in the next 12 months, things were looking good. He required a flexible facility to assist in the increase of expenses throughout this period before he could invoice and collect funds. His current facility had been set up some time ago, the rate was noncompetitive and the product no longer met his requirements.


With a good understanding of George’s requirements and situation we moved to look at what solutions might be available. The initial search returned limited options given George’s owner occupied property was owned by a dormant company & his tax returns were not up to date. We needed to look at alternative method of confirming his income.


Through a major lender who adopts a Lo-doc style of assessment, we sought an approval subject to changing the ownership on the property into George and his wife’s personal names. Through this process we were able to source 2 loans, one to refinance the current debt and a second new facility which George would personally lend to the business. 


Going through this particular lender meant that he wasn’t penalised for getting the loan approved by the Lo-doc method in terms of rate and fees. We were able to reduce his current rate and also had $1,200 of switching costs covered. The home loan portion would reduce over time and investment portion would remain interest only for the next 5 years.


The facility was settled, George and his wife were extremely happy with the solution. Assuming the facility still meets their requirements it will stay in place for years to come and continue to assist with Georges growing business.