Providing a loan against an asset without knowing if there is existing debt secured against it, or if more can be taken out in the future, is incomprehensible. Not knowing how many personal guarantees an individual has, or that he can take out more in the future, is incomprehensible. Not knowing whether your finance agreements will be sufficient in court despite huge costs, is incomprehensible.
For too long, lenders have relied on traditional CRAs to understand whether an individual pays for their car each month. They have relied on a borrower’s word and a self written asset & liability statement to “understand their picture”. The uncertainty has increased risk and decreased lending. Mortgages continue to be offered thanks to the LandRegistry with tangibly registered charges - every other loan is exposed to enormous risk because of huge holes in compliance. As we enter an era where fewer professionals are buying homes and instead accumulate collectibles and other assets, take out more director loans and freelance their professions on the back of personal guarantees, compliance and KYC has to be improved in this space. Thankfully we are also in an era where technology can be utilised in the right way and ChargeCheck has been developing market leading technology to create the solution.
ChargeCheck’s purpose is to improve compliance and minimise risk across the lending and finance sectors. It is not a KYC business or a loan management service. ChargeCheck uses pioneering technology and data to provide both borrowers and lenders certainty and clarity. Through the ChargeCheck Register® Lenders can search potential borrowers, register their own provisions, and analyse their portfolio as a whole. ChargeCheck is a formally recognised registry that allows Lenders to securely register their loans and the sureties or guarantees behind them. This registration forms an impenetrable contract and notifies existing charge holders if a borrower is seeking loan elsewhere. Additionally all associated documents can be stored alongside each registration stored securely in our ISO compliant data centre. This uploading of provisions can be automated through API for large lenders or inputted manually for smaller lender or even one-off provisions.
In numerous cases Personal Guarantees have been evaded for multiple reasons, including: a signature by only one director of a company loan, a signature by the lender carried out electronically and not by hand, not covering every entity within a group structure, accidentally discharging a guarantee through a term extension, no recognised position in the case of liquidation. All of these eventualities can be avoided and cannot be questioned once officially registered.
Searching couldn’t be simpler: Simply type in a name and any borrowers across your own organisation will appear. Type in 3 or more details and you will access borrowers from across the registry as a whole. Finally, lenders are able to know if a potential borrower already has numerous personal guarantees, or assets pledged elsewhere providing you with a more significant picture than any other offering. It is also possible to search individual assets to understand if the items themselves have been financed elsewhere.
Each registered provision and collateral or guarantee generates a unique, and date issued, Charge Identification Number (CIN), ensuring that your security if yours and you are first in line. The CIN details can be attached to tracker numbers, serial or product numbers or be inserted into Finance Agreement and legal documents for increased security.
Through your dashboard you are able to analyse your portfolio as a whole: timescales and redemption dates of your loans, the weighting of your sureties and receive and send notifications to your organisation and borrowers with repayment dates, deadlines or other information. Using live data analyse your LTV ratio across the portfolios updated daily so you can be sure your portfolio and the borrowers within it are where you want them to be.
ChargeCheck secures security and ensures your place in the queue.