The Universal Rule of 
Successful Project Finance.















 
Professional Documentation plus 
Good Collateral PROVIDES Successful Loans

 

So, What Do I Do First?

  1. First send us an Email and let us know basically what your project is all

    2. about. (Note: complete the Executive summary, please Click Here).

    We will write back very quickly and let you know if we can assist you. 
     

  2. For PROJECT FINANCE only, if we accept your project, we need a professional-quality Business Plan/Executive Summary, and an official Letter of Request to Fund signed by a person who has been officially authorized by you’re your company's Board of Directors.

    3. A) Is you Business Plan/Executive Summary complete?  Is it at least 15 pages, preferably more? (60-100 is a good size for a full Business Plan, 15-20 is more suitable for an Executive Summary; always be thorough an complete!).

    B) Did you include all financial projections, background information on your management team, cost estimates, descriptions of your product or project, time estimates for completion of construction, and any other relevant information for the Lender?

    C) Did you provide official letters or documents to support your Security/Collateral? Evidence must prove that you have the Security or Collateral to guarantee the principal and the interest on the loan. If you have a standby letter/line of credit from a Top 100 bank equal to or greater than your loan request, that is the best of all; be sure to include all documentation that the guaranteeing bank will give you.
     

  3. For PROJECT FINANCE only  – Your Letter of Request to Fund must be complete, and signed by a person with legal authority to do so.

A) Did you state the exact amount you need?

B) Did you include a Corporate Board authorization statement, signed by the head of your company, which authorizes you to sign legally binding documents on behalf of your company?

C) Did you make sure that the Letter of Request to Fund is signed and that you've included your company's seal, or a Notary seal? Be sure it is on your own company's letterhead! 

Borrowers who understand the importance of good documentation and good collateral, will almost always obtain good financing and excellent interest rates, no matter how large the loan is, and no matter what the purpose. It is essential that the borrower "think from the Lender's point of view." If you were a Lender, you would want to be absolutely sure that you would be repaid your money, even in the extremely rare or worst case of a disaster, bankruptcy, etc. by the borrower. Give the Lender maximum confidence that he will not lose his money by lending to you. 
 

Then, What is"Good Documentation?"

It is a clean, neatly bound, professional-looking printed Business Plan (or Executive Summary). It is fine to send faxed or digital copies, especially in the beginning but you will BE REQUIRED to provide at least 1 set of documents, sent to us by FEDEX, UPS, or DHL courier, that has been professionally prepared. This is the APPLICATION PACKAGE, which we will take to our bankers to obtain your financing. It will represent your company. Top investment bankers do not have time to try to understand a poor business plan that is not presented in a professional way. Provide professional documentation, always, and good financing will surely follow. 
 

And What is "Good Security?"

For Commercial Mortgages, you must have collateral that can easily be converted to U.S. dollars, and the amount of your collateral should ideally be at least 120% of the value of your loan. An internationally recognized and certified appraisal authority must always independently verify collateral. The points below apply to all kinds of financing, but especially PROJECT FINANCE.

Some of the best security is U.S., Canadian, or European Real Estate or other real estate that can be easily converted into cash to repay the loan principal plus interest. Documentation must be provided to show the value of land or buildings using an independent and internationally recognized appraisal firm (for example, Arthur Anderson; local or national-only appraisal firms usually will not be accepted).  Every loan must pledge both the land and buildings of the project (even if they are not constructed yet) as a first mortgage, allowing the bank to take the property if borrower defaults on the loan and convert it to cash. 

Note please that a first mortgage alone, using only land and future buildings as the only collateral, may not be enough to get successful Project Financing if the project is located in a country with an unstable economy. Most lenders will want at least some bank or other guarantee(s) to increase the Lender's confidence.    

Good luck, we too hope your succeed! And remember the rule: Good documentation and good collateral will give you a winning combination for your Project.

 

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