Case Study – Oversecured

Client Position

A prospect contacted RSP to say they had given the bank a mortgage on every property because the bank was working off council rates notice values and not current market value. The clients were uncomfortable with the excessive security given to the bank despite the client offering to pay for valuations in order to have some properties released. Their frustration led to an engagement of RSP.


RSP Solution

The RSP tender process identified a new lender who was prepared to pay for the valuations. This in turn allowed the new lender to ask for security on only 1/2 of the land held by the current lender. The new bank also offered more competitive loan pricing and no loan covenants other than annual financial statements. Quite often RSP is approached by new customers not because of interest rate concerns, but by other matters such as excessive security and loan conditions; poor service; changing banker relationships; or the urgency of a transaction.


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