There are few ways for the application to be made. There is a form on the website that can be filled or a general introductory email can be send at firstname.lastname@example.org. If easier a requirement can be introduced over the telephone. It is recommended that at least a deal summary have been prepared to include at least address of the property, information about the borrower, loan amount, value of the asset/s, purpose of the loan and exit strategy. Should Avamore receive all of the latter then the best structure and terms can be offered to the borrower. Once everything received we can make a decision in principle in less than an hour, followed by a clarification on any fees and expenses associated to the loan.
Formal Term Sheet
At acceptance of terms set out in the decision in principle we would prepare a formal term sheet containing high level of details like full description of the property, purpose of the loan, term, interest rates, repayment, conditions to be met, covenants, insurance, legal and other general information, also a list of initial information in relation to the KYC (know your customers) and next steps explained.
Once the formal term sheet has been accepted the borrower should put their solicitors in funds, i.e. transfer the legal fees for the lender’s solicitors so a legal cost undertaking can be provided, after which usually a property finance schedule which includes most of the information required from the lender and their solicitors. At the same time Avamore will prepare an instruction letter to appoint the RICS surveyors who will generally visit the property within 2-3 days from the day of instruction, to prepare a formal valuation report and initial cost report in case of development facility. Avamore will also send a list of requirements to the borrowers in order to perform all KYC (Know Your Customer) procedures.
Due dilligence process is the most important process in our business and we use all of our resources to ensure that our loans are effectively priced on a risk-adjusted basis. It effectively starts from the initial contact until drawdown and even further through the term of the loan. We understand that we are not only investing in assets but in people, that is why we carefully choose our borrowers. Through scenario analysis we are able to foresee most of the possibilities for distress and suitably structure the transaction for all parties. We use a range of law firms to handle our documentation. We use RICS qualified valuers to establish property valuations.
Once the due diligence and the loan documentation have been completed and signed then a drawdown request will be sent and funds will be transferred into solicitors’ accounts including the commitment fee which have been paid at acceptance of the formal terms.