02 Feb Case Studies – Private Lending
One case involved a family under significant pressure from their lender to exit the rural industry. Much of the clients poor financial position was aligned with the 2017-2019 drought which they were still recovering from, and where expenses were still exceeding income. The clients were caught between the pressure from the existing bank and the requirement from a number of potential new mainstream lenders who wanted to see the client’s situation improve further before committing. The financial trajectory was on the right trajectory, but not quite there.
A private lender was used as an interim measure (i.e. for 12-15 months) until clients could prove their viability to a mainstream lender. While private debt is expensive, it can be quickly implemented and can mean the difference between recovering and remaining in industry or exiting the industry and having to sell a property in what has been a rising property market.