Mounting outrage about RBS’s apparent ‘mis-selling’ of the Governments ‘Enterprise Finance Guarantee’ (EFG) scheme has been further fueled by news that the bank was calling upon the Directors of borrowing companies to repay debts which had already been repaid by the Government under the terms of the Scheme. I was once responsible for the central Read more about So what is this outrage about RBS and EFG loans about?[…]

Commercial mortgage lending can be a risky business; there’s a reason why LTV’s (Loan to Value’s) are lower and interest margins are higher than for most other types of lending. It is not unknown therefore for a lender with a broad range of lending products to make the strategic decision to pull out of lending for commercial investor clients.

A critical tool in the planning of a property development is the ‘Development Appraisal’, which sets out the financials of the project. Although a good builder knows from experience that they can build for £xxx per sq. ft., the complexity of developments now means that contingencies, professional fees and timings need careful scrutiny.

Let’s start by explaining what a ‘PG’ is and isn’t. A PG is most often asked for when a Company is seeking a loan from a bank and the bank seeks to tie in the Directors personally, it is basically an undertaking that if the company cannot pay back the loan then the Directors will do it themselves. This does of course serve to undermine the concept of a ‘Limited Liability Company’.