A beginers guide to Lending terminology
Emil Ackerman
Emil Ackerman have gained a lot of experience in the Australian private lending space. During the past sixteen years Emil Ackerman have identified that basic misunderstanding or the lack of understanding of lending terminology is the cause of most borrowers’ frustration.
Emil Ackerman will provide you with a background to the basic terminology in Lending process.
According to Emil Ackerman, Loan to Value ratio (LVR), this is the maximum percentage of the value of a security a lender will make available for a loan. Emil Ackerman says that this aspect of a loan application is one of the most crucial in assessing a loan.
According to Emil Ackerman, the Value of securities will be determined by a registered Valuer who will compile and provide a sworn Valuation of a proposed security for Emil Ackerman. Not only is the dollar Value of the security important, but according to Emil Ackerman , the commentary as contained in the body of the Valuation report is equally if not more important. Emil Ackerman always refer to the prudent lending clause which is contained in the report, as a guide when Emil Ackerman assess prospective loans. Emil Ackerman says Most Valuations for construction and subdivisions contain a Value on an “as if complete” basis or according to Emil Ackerman the “as if complete” basis is commonly referred to as the Gross realisable Value (GRV).
Most private Lenders, according to Emil Ackerman will use the GRV as a basis to determine how much they are prepared to lend on a particular development. Emil Ackerman says the rationaleis to use the GRV excluding GST and multiply that with the applicable LVR. Emil Ackerman concur this provides an accurate loan amount.
Emil Ackerman always recommend applicants to use reputable brokers, over the years Emil Ackerman have established a broker network in excess of 800 brokers who continually provide good quality applications.