We were approached by a client with a hotel business which they were trying to sell, as they were unable to pay the higher finance costs of an inappropriate fixed interest rate loan facility. The hotel sale price was sufficient to cover the balance outstanding to the bank and other creditors, but not enough to pay the bank’s “exit fee” of about £150,000.
The debt was in the clients’ personal names and they were concerned that they would have to make up the shortfall from their own resources. Their solicitors had tried to secure an agreement with the bank, without success. We reviewed the case with the bank, including the inappropriate fixed rate loan, and the bank agreed to waive the fee in full – a client saving of ₤150k.
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