Hi all,
My solicitor is on vacation so I wonder if someone could help with my query please. I am in the process of buying the building in which I have my practice and am going to obtain a mortgage in this regard.
Given all the controversies regarding banking documentation, I decided to read the T&Cs. 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.
Thanks in advance for any guidance.
The Borrower covenants and agrees with and undertakes to the Bank that, for as long as any facility is available for utilisation or any amount is outstanding to the Bank in respect of any facility:
(i) the Borrower will not, without the prior consent in writing of the bank, create or agree to create or permit any mortgage, charge or other encumbrance of any nature over any of the assets or property of the Borrower; and....
(xi) the Borrower will not (and will not allow any other party on the Borrower’s behalf to) sell, transfer or lease the whole of or any part of the Borrower’s present or future material assets or otherwise dispose of the whole of or any part of any such asset either in a single transaction or in a series of transactions, whether related or not and whether voluntarily or involuntarily without the Bank’s prior written consent; and....
(xiv) the Borrower will not enter into any joint venture, partnership or similar arrangement with any other person or make any significant acquisitions without the Bank's prior written consent.
My solicitor is on vacation so I wonder if someone could help with my query please. I am in the process of buying the building in which I have my practice and am going to obtain a mortgage in this regard.
Given all the controversies regarding banking documentation, I decided to read the T&Cs. 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.
Thanks in advance for any guidance.
The Borrower covenants and agrees with and undertakes to the Bank that, for as long as any facility is available for utilisation or any amount is outstanding to the Bank in respect of any facility:
(i) the Borrower will not, without the prior consent in writing of the bank, create or agree to create or permit any mortgage, charge or other encumbrance of any nature over any of the assets or property of the Borrower; and....
(xi) the Borrower will not (and will not allow any other party on the Borrower’s behalf to) sell, transfer or lease the whole of or any part of the Borrower’s present or future material assets or otherwise dispose of the whole of or any part of any such asset either in a single transaction or in a series of transactions, whether related or not and whether voluntarily or involuntarily without the Bank’s prior written consent; and....
(xiv) the Borrower will not enter into any joint venture, partnership or similar arrangement with any other person or make any significant acquisitions without the Bank's prior written consent.