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  • Profile photo of NathanNathan
    Member
    @nathan
    Join Date: 2002
    Post Count: 77
    February 21, 2003 - 7:14 am

    I am currently dealing with a few institutions which are happy for me to vendor finance them, but are not willing to remove the operation of the all moneys clause from their mortgage contracts.

    My legal advisor has told me that it would be a good idea to insist upon this. Without being a ‘special client’ for the institution (a million or two in borrowings) has anyone had success in this area?

    thanks in advance for your responses.

    Nathan

    Profile photo of zizziz
    Participant
    @ziz
    Join Date: 2002
    Post Count: 90
    February 21, 2003 - 8:36 am

    Hi Nathan

    Without digging out one of my mortgage documents could please eleborate as to the ‘all moneys clause’. Are these the clauses that prohibite any transactions against the property?

    Cheers

    Profile photo of NathanNathan
    Member
    @nathan
    Join Date: 2002
    Post Count: 77
    February 23, 2003 - 7:31 am

    Hi Ziz,

    The ‘all moneys clause’ is a common clause most lending institutions use to secure the debt they have with you. For example, if you have a credit card and house loan with the same institution, and you are delinquent on your credit card repayments and up to date on your home loan payments, the institution can call in all moneys owed to them, and thereby access your security (house) for the house loan due to the default on your credit card payment, even though your house repayments are in order. The same applies if you have five house loans with an institution and one goes bad.

    I am currently using investors, and want to secure their and my investment when looking at the worst case scenario. Would not like to see a portfolio of property come under danger if one of the financed ventures fails with that institution.

    Just looking at all worst case scenarios before pushing forward.

    Thanks for your response.

    Profile photo of Steve McKnightSteve McKnight
    Keymaster
    @stevemcknight
    Join Date: 2001
    Post Count: 1,763
    February 24, 2003 - 3:07 am

    Hi,

    In respect to your question I would imagine that you should seek legal advice.

    From my research I found:

    quote:

    Further, a guarantee that contains an “all accounts” (or “all moneys”) clause cannot be enforced in respect of further credit unless certain notice and consent provisions are complied with. So too, if a guarantee is secured by an “all accounts” mortgage, that mortgage will be unenforceable with respect to further credit unless certain notice and consent provisions are met.

    See Source

    Good Luck!

    Steve McKnight

    **********
    Remember that success comes from doing things differently.
    **********

    Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
    https://www.propertyinvesting.com

    Success comes from doing things differently

    Profile photo of NathanNathan
    Member
    @nathan
    Join Date: 2002
    Post Count: 77
    February 26, 2003 - 7:21 am

    Thanks very much for you post Steve, your prompt has given me the awnser I was looking for.[:)][:)]

    Cheers,

    Nathan.

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