British Expats - Line of credit

Quote:

Originally Posted by navk13 (Post 6828059)

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Rich,

Thank you for your wondeful piece of info.

A few clarifciatons:

1) RBC when they approved the first commercial loan, i see your share was 60% and loan share 40%. and + line of credit 50k. Any colateral security was asked for this loan? or is it purely business loan?

2) Home loan 250k. How long you had to wait for this after taking commercial loan? I guess your home was mortgaged against this loan.

Thanks

You're welcome.

The loan was a commercial mortgage, so the security was the property and buildings that I was purchasing. Nothing additional was required, except a 5yr business plan.

I built my home on the same land that my business is situated on. I couldn't sub-divide the land, so nominally set aside 10 acres for personal use. The home loan had to be on the same terms as the original business loan, as the bank considers my parcel of land a business entity in it's entirety (due to the sub-division restriction). In effect I just topped up my original loan by the additional $250k, and put that towards building the house. It was about 2yrs after starting the business that I approached RBC for funds to help build a new house - that was at the point I felt comfortable borrowing the money. RBC may have lent me additional $ sooner, but that's just speculation. Two full years of audited accounts, and a steady cashflow satisfied their lending unit.