Solicitors Nominee Company
We have run a solicitors nominee company for many years and through it have been able to provide good opportunities to both investor and borrower clients of this firm.
For those of our clients that are not familiar with the services of our nominee company, the following information may be useful.
What is a solicitors nominee company?
A Solicitors nominee company is a company established by a legal firm which acts as a trustee for lending clients. The name of our company is Trapski Dowd Lawyers Nominee Company Limited. Trapski Dowd was the original name of this law firm.
How does the system work?
Clients who wish to borrow from the nominee company approach us and their proposal is considered by a committee of the partners. The main criteria for lending is that the loan must be secured by a registered first mortgage over a freehold property and there must be a current valuation for the property. Any loans granted will not exceed two thirds of a registered valuer's assessment of the value of the property. In addition, the partners need to be satisfied that the borrowers are reliable and have the ability to meet their commitments on the loan.
Once approval in principle is given, detailed information is sent out to lender clients who have indicated their interest in investing. Subject to those lender clients approval, their funds are then advanced to the borrower. Usually we amalgamate funds from several lenders to make up one loan. The lenders know who the borrowers are. The borrowers never know who the lenders are.
Term of Loan?
Loans are usually for a two year interest only term. The borrower may repay the loan before due date, but in doing so incurs a bonus one month penalty interest which is paid to the lender. The lender has no right to get their money back in under the two year term, but if they do need it back, we can often arrange replacement lender funds to release money back to them early.
Interest rate?
The intrest rate is not fixed and is subject to review if market interest rates move. However, interest rates do not tend to change often. Interest is paid quarterly on the 15th of February, May, August and November by borrowers and after processing by ourselves, is generally paid to the lenders a few days later.
Administration?
Pauline Keven attends to the administration side of the nominee company. She can answer any queries you may have or alternatively you can speak to the person in our firm with whom you normally deal.
