A truck driver who had completed the first stage of a 24 allotment land division in an outer capital city suburb, with sales of more than 50% was advised by his bank that the loan term had expired and that the bank were not prepared to continue its support. In fact, the bank took control of the development as Mortgagees in possession.
For 6 months the project lay in limbo with a complete suspension of all work for the second stage and no efforts by the bank to sell the remaining 11 completed allotments in stage 1. When the borrower learned of the bank’s intention to sell the project as a whole (Stage 1 completed allotments and the Englobo land for stage 2) in one line for not much more than the amount that was owed to the bank, the borrower made representation to the bank to be able to redeem his project. The bank advised the borrower that it would release the security in return for full payment of the debt.
Eastwood Securities provided the funding allowing the borrower to repay the bank within an agreed timeline and to take control of the marketing plan and sale process for the remaining 11 completed allotments.
The borrower achieved the required allotment sales within the agreed term, and was allowed to retain a sufficient sum from the sale proceeds to commence the development of Stage 2.
The irony of it all is; the bank (identity withheld) upon observing the borrower’s recent successes approached the borrower, agreeing to resume the funding for the project.