A problem? No! Although he called us in a panic we got the additional funds approved on the spot and paid off the old note with a restructured agreement!
This story continues. With his loan set up with what is called a ‘balloon payment’ (this means that at the end of a period of time – in this case six months – all of the loaned money plus interest is due or the loan defaults!) the deadline passed.
Originally asking for a three month term, we had the foresight to write the loan for six months with the ability to extend it to one year via a simple request. All through the loan origination process the borrower’s words were, “I won’t need it.” … but he did.
Selling the out of state property was already in process however an obstacle arose: The new buyers wanted some corrections made to the condo and once these were completed the new buyers needed to be approved by the respective condo association. It wasn’t until after the corrections were made and all was settled (four months into the process!) that it was discovered that approving the new buyers would take no less than three months as they now had to go through a rigorous screening process put in place by condo association after 9-11.
NOTE: When ever you are borrowing money always play ‘what can possibly go wrong’ with your situation because if you don’t and something does go wrong if your lender/funder is not willing to work with you then you could lose a valuable piece of property or hit into some very high expenses trying to protect and/or recover what is already yours.
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