All looks standard for business lending terms.There's one section that seems a bit strange and I wonder am I reading this correctly and whether it's normal practice. The relevant section is set out below and it seems to me that the bank is asking me to make covenants about all my assets which seems excessive.
I must dig out other documentation to see what I covenanted to do in the past! Are these restrictive clauses a recently new development or has it always been so?
These clauses are pretty onerous. I would not have been aware of them had I not gone through the minutiae. I had understood that the bank was obliged to draw your attention to important aspects of the loan?
Thank you Bronte,
I do not intend to spend much time on this. The bank in question has been "courting" me for some time (it's not the bank that I've traditionally dealt with). I sent the (new) bank an e-mail in which I explained that I was not happy with these terms and was now considering my position. I'm pretty sure that my regular bank will finance me in any event so it will be interesting to see what happens and how much new bank wants my business.
In passing, I am aware of various debates about the inadvisability of people not reading banking documentation and assuming things. So, I find it amusing that when I go to the trouble of reading said material and enquiring about it, you seem to be encouraging a "just sign it" approach.
I'm actually saying they hold the cards....
Who's holding the cards now?].
....had these terms been put in place long ago, the games that were played of putting your assets out of reach while defaulting on your obligations would have been a pointless exercise.
I am, for example, disinclined to seek the bank's prior written permission to lease or sell my holiday home as required by (xi) and I'm similarly reticent to let the bank determine who I can enter partnership with, as per (xiv). These are silly provisions in my opinion.
Odds are they have no idea those terms are in there.
Why on earth would you have even let them know you had a holiday home.
You have got to be kidding, You make it sound like, it depends on who you get talking to at the bank, discretion and so on on, its either in the contracts or it not.
They also would not have the legal competency to fully understand the clauses. And I very much doubt that they have the power to waiver any of those clauses. All those kind of questions are sent to Legal Head Office who will come back with a blank no. Unless you're Larry Goodman, Smurfitt or Desmond. In which cases things are handled differently.The contract is a standard contract written by the bank solicitors. What I am saying is I doubt the bank managers know the terms of these standard contract and most probably haven't read the contracts.
I would assume it was to show how solvent WhiteC was, and with that in mind, the more you show your hand, the more details they want.
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