Loan laws favour bank over borrower

Borrowers “Brokers” are more important than ever now that the government is putting responsibility for being able to afford loans onto the relatively inexperienced borrowers and away from the highly experienced and qualified bank risk officers. The bank-paid brokers are on the bank’s side because the banks pay them.

That means banks will foreclose more often and more easily. Borrowers often do not understand the consequences if they pay off their business or farm loans for 10 to 15 years and then some adverse circumstance like illness, drought, flood or fire causes a major loan default and the bank sells them up.

Then all those years of repayment can go down the drain because the bank engages expensive insolvency experts, receivers and lawyers whose astronomical fees absorb all the repayments and capital gains.

It pays to have a firm like GBAC Advisory give your loan an independent, inexpensive, annual or biennial “Compliance check” to  ensure that borrowers have not left themselves vulnerable to foreclosure any time the bank feels like it for the breach of some obscure loan term they did not know about.

Catching problems before the bank does is the key to making the loan work for the borrower as well as the bank

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