Borrowers risk Foreclosure

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

Borrowers’ Voterlobby

Borrowers need to join together in a Voterlobby.   That is the way to convince the government to act. It can prevent ruthless money-lenders from foreclosing just because of any temporary fall in prices.  Homes, business premises and farms that have boomed in the recent past share the risk.

Drop is temporary

The values will be restored quite quickly.  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. That way they can  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. Take it home to read and get advice on when a loan is offered.

Consult a Consultant

Every borrower should consult a 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 there are. Loan terms may not even disclose the amounts of money they have to repay.  Dates on which they have to do it may be hidden. Banks sometimes hide these details in very obscure places.

Chartered Accountancy to Loan consultant

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