Borrowers risk Foreclosure

Home, business and farm borrowers are at risk of foreclosure if the loan to value of security ratio goes the wrong way as property values fall and the Australian economy falters.

Borrowers’ Voterlobby

Borrowers can to join together to convince the government to prevent ruthless money-lenders from foreclosing just because of any temporary fall in prices of homes, business premises and farms that have boomed in the recent past.

Drop is temporary

The values will be restored quite quickly and a temporary drop in the value of the security for a 15 or 30 year loan is of little consequence. Even the Great Depression of the 1930’s only lasted 6 years.

Communication is key!

It is important for borrowers to keep in good communication with their bank or other lenders to make sure that all goes well.  One of the factors that gets borrowers into strife is failing to read and understand the loan offer or contract presented to them when a loan is offered.

Consult a Consultant

Every borrower should consult a loan consultant about their loan documents before they sign. A consultant lawyer will check out and advise on the legal responsibilities of the contract. Buyers will be surprised at how many responsibilities they have taken on. Loan terms may not even disclose the amounts of money they have to repay and the dates on which they have to do it. Banks sometimes hide these details in very obscure places. We have discovered that a good few people to whom business and farm borrowers go for advice, either know little or nothing about managing bank debt in such circumstances where profit cannot always be guaranteed.

Chartered Accountancy to Loan consultant

When banks were deregulated, GBAC saw that there was a looming problem for bank customers. The ethics of lending changed. Emphasis moved from customer service to profitability. That took us into consulting farmers and business owners on their loans. Having run a number of family businesses and farms ourselves and borrowed money for them all, we knew just how ruthless the bankers could be.