Anyone experiencing difficulty in raising finance for property or business?

Just wondering if we are alone in this- but are many people experiencing difficulty in raising bank finance for property purchase, refinance or business expansion?

If so what are your experiences & did you eventually get sorted, and by which lenders?

I have a huge suspicion that many businesses, and indeed personal borrowers ae being "strangled" due to the banks having no appetite for lending- is this the case?

Hi Yellow Belly

I rang my bank today to look for a quote for a car loan, I have money in my personal account and business account, have heard nothing back. I'm tempted to move banks.

Regards

Hizzy

hizzy said:

Hi Yellow Belly

I rang my bank today to look for a quote for a car loan, I have money in my personal account and business account, have heard nothing back. I'm tempted to move banks.

Regards

Hizzy

Click to expand...

Moving is often "out of the frying pan into the fire" as it may take time to build up a relationship with your new bank.

I am ex bank & would often recommend that the devil you know is often the easiest option provided you find a way to be able to get a r/ship going and build trust. If this is not possible then a move could be benefitial.

Hi Yellow Belly

I moved from one bank that I did a lot of business with over a year ago because I wanted to change a direct debit and they wanted my 3 year accounts (don't ask) to this new bank, I have never been in the red, pay all my bills on time and have a fair bit of money in this bank. For me, its the principle of it, just return my call......sorry for the rant.

Regards

Hizzy

Can't beleive that this thread is up here for nearly an hour & only one person is having difficulty with his bank? Is this a fair reflection of what is really happening?

Well, I was considering moving my mortgage to my own personal bank a few weeks back. Mortgage is only twice my salary, with considerable equity still in the house also. They wouldn't look at me, even though I've been banking with them 7 years.

I don't want to go into too much detail as I don't want to identify the company concerned but here is the gist of what has happened to a family member within the past 2 months.

Joe Bloggs (sole trader) went to their bank (one of the big 3) to get finance on a €100,000 loan for a number of items which were to be imported and used for the purposes of their business. It's not the first time they have done this and the same bank has previously financed a loan for the same reason 5 years ago and it was paid back in full before the term was completed. The company is not in financial difficulty, in rude health actually and unaffected by the recession.

2 weeks after Joe's initial application he still didn't have a proper response from the bank so he went in person to meet with his manager who said he could not justify lending €100,000. However he suggested that if Joe spoke to the vendor and managed to get the purchase price reduced by 10% the bank would look at it again. Joe went to the vendor and got a 35% reduction on the price through some tough negotiation.

With the price reduction Joe went again to the bank with his plan and the bank said that they would consider his application again. Another 2 weeks passed so Joe went to his bank manager to find out why they hadn't got in touch. The bank manager said that Joe hadn't included the import duty and VAT on his plan for the items to be imported. As it happens, the items are duty & VAT exempt for various reasons. Joe explained this to the bank, the bank said they were not convinced. He then provided the bank with an exact declaration from the Revenue Commissioners that the item was exempt. The bank still refused to lend the money to Joe on the basis that they were right and the Revenue Commissioners were wrong.

Joe took his business to another bank.

My God, that's attrocious.

Our business recieved a small loan of 10,000 from BOI, and on the strength of this we received a grant from our local enterprise board to expand our business. I thank the Lord for BOI who have been very supportive. When are earning potential increases I will be remortgaging with them as F. Active wll not entertain us restructuring our current mortgage at present, despite numerous calls and letters. I would have
assumed lenders had an obligation to help customers in financial difficulty,
but I am very dismayed to find out otherwise. I just have to pay what I can, until our earning potential increases. There is a higher interest rate
charged on arrears, I think this may be the real reason certain lenders are dragging their feet.

I just got approved in principle for a mortgage recently (which took no time at all and was allot more than I wanted/needed) with AIB. A number of estate agents have told me most of the other banks are totally dragging there heels and refusing to approve the mortgage drawdowns (due to differences in valuations and other things). Anyone experience any problems like this?

Last week I received on an unsolicited letter from EBS asking me if I wanted a Top Up Loan from €5,000 to 85% of the house value.

I wasn't sure if I should laugh or cry.

I know of two people/couples who have drawn down ,mortgages since xmas. Both would have stable jobs and records and got huge reductions on the houses.

My boss got a verbal agreement for a business loan from AIB (large loan 7 figures +) last November, he went ahead with the plans and when back to the banks in january. AIB said the company would have to hire (at their own expense) a consultant specialist in the business to give a declaration that the business plans were viable. This was two people who flew up from dublin to the NW, spend 1 hour in the premises taking to the owner, flew back home and then wrote a report. All that cost my boss €10000. If the report had of come back negitive it would have pushed my boss over the edge and he would have had to wind up the whole company leaving nearly 30 people out of work. Did AIB care, dont think so.

I've talked to someone senior in a bank recently and he told me he didn't believe the big 2 were giving out loans as per their large advertisments saying they had x amount to lend. I asked would I get a loan of more than 50% if I was to purchase an investment property currently and the answer was probably not. This tells me that very few people can get loans unless they can put up a lot of cash themselves, have secure permanent employment and an excellent credit history. In other words you can only get money if you have money and there is no risk. Apparently there are some investors with a few houses in dire straits unable to pay back their mortgages and crying to the bank for lending them the money in the first place. The impression I got is that some banks are being sympathetic in some cases but it's a case of the debtors now having to take responsibility for the mess they are in and the bank really doesn't care.