Do you believe in a saying that tells if something can go wrong, it will? This is what the Murphy’s law is all about. If you are a businessman you should better believe in it. The nature of business is so dynamic that businessman should always go by this saying. You never know when a bad financial phase may hit the business and there takes place nothing but the chaos.
If Murphy’s law is applied to commercial establishments, then there are chances that many businesses may feel threatened and start taking extra precautionary measures, which will be surely good for them. Even otherwise, business requires that you try to gain competitive edge in the market to stay alive in the industry. Obsolete and stagnant businesses always tend to lose out in due course of time.
Most of the businessman resort to financing for undertaking research and development activities that are beneficial to their line of business. There is a possibility that a lender may recall the loan mid-way. Does it happens often? Yes, it may happen if the lender has a clause stipulated in the loan agreement called “recall clause”. If the lender feels after a period of time that loan advanced by him is not likely to be repaid by the borrower or the company to which the loan was extended may avoid repayment on some fictitious grounds, the lender may use this clause to recall the loan mid-way. As a borrower, you should always insist upon such a clause being removed from the business or commercial loan agreement. This clause may later on threaten your financial stability.
A shrewd and intelligent businessman will always have a contingency plan in case something does not happen in the planned way. Even if there is a provision in the loan agreement regarding the recall of loan under some specific circumstances, having a contingency plan will help you in running the business smoothly without getting affected by the worst possible move from the lender. There are many lenders in the UK that provide low rate commercial loans on the basis of commercial security forwarded by the borrower. The security may be any real estate in the form of office, land, building, etc. Since these assets are likely to have a huge value in the market, the business loans based on them can be quite large in amount.
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