Dear Nairalanders,
Please I need your advice and recommendation on this very important matter.
I need loan of 1.5m for some businesses I want to venture into. I have tried all I could to raise fund but the fund I've been able to raise are not enough and things has to be done while the business is still viable.
So, I decided to use my Mom's property to raise money in form of loan. This will be done with her conscent.
Kindly advice me on where to go and if banks will accept Survey plan as collateral.
The property is situated at Ayobo area in Lagos and there is a building on it already, that is where we live.
I will appreciate your meaningful contribution and advice

@poster, no bank will give you any loan facility with just survey plan. Even some banks reject offer of grant, you need a CofO to get loan facility from banks.

Godalone:

@poster, no bank will give you any loan facility with just survey plan. Even some banks reject offer of grant, you need a CofO to get loan facility from banks.

Correct, I'm a real estate Marketer and Investor, no bank will grant you loan with survey plan expect for C of O or Letter of Allocation from Government Estate or private estate that already have Global C of O or some important Document like Land Information Certificate.

I do not know a lot about Nigerian law, but in Yankee you can put up the land as collateral for the loan, or you can put up any inventory, equipment, and proceeds of your business as collateral in exchange for receiving the loan. I am pretty sure you can do the same in Nigeria, but since lending Nigeria is extremely high risk, especially to a start-up business, it most likely that the land will accept only the deed or title or any document indicating ownership of the land as collateral for loan. The survey plan does not indicate ownership so it will unlikely be accepted. Again I am not an expert in Nigeria law but Yankee law. But since they are both common law countries, there are striking similarities in common law principles. I hope it helps.

No bank will take survey plan. Pursue your c of o quickly. Meanwhile try coops but not money lenders.

You may also talk to rich individuals to sponsor the project and share the profit.
As long as it is feasible, there are Nigerian who will take it up.

But first of all have a tet a tet with your banker, he may offer some useful advise.

not possible.

You cannot with Just a survey Plan

Even with C of O at times, it may be difficult.
I remeber trying to secure N10m loan facility from GTBank one time to increase the capital base of high profitable Biz (Golden Penny Semovita distributirship)i was laready into for over 5years all to no avail after presenting cerified C of O from Oyo state government and with property valued over N15m (Forced sale value) by Jide Taiwo on the said plot in a high browse area in Ibadan.
O boy, May God help us in this country.

A bank will not accept a survey plan as collateral for a loan because it is not a title document.

You will need a property with a certificate of occupancy, and the property will have to be in a commercially viable area.

Even if your property has a c of o, i dont think your request will be granted because of the location of the property ie Ayobo.

@Lekky2
With your property that has C of O, if you have good financials (well run bank account(s) and if available, management/audited reports etc), approach STANBIC IBTC BANK. You can approach marketers at their regional office at Total Garden. I am talking from experience!

@

Lekky 2:

Even with C of O at times, it may be difficult.
I remeber trying to secure N10m loan facility from GTBank one time to increase the capital base of high profitable Biz (Golden Penny Semovita distributirship)i was laready into for over 5years all to no avail after presenting cerified C of O from Oyo state government and with property valued over N15m (Forced sale value) by Jide Taiwo on the said plot in a high browse area in Ibadan.
O boy, May God help us in this country.
[/quote

Banks will only give you about 30% of the value of your collateral. Even at that level they still run into repayment problems.

There are bad bakers and even worse customers. Many Nigerian will take the loan and wouldn't want to pay back.
By and large we will get out of the woods.


Now, if that your business is still on and you want like 5m. give them a challenge.
Go to their HQ and book an appointment with the top man on loans.
If you cannot see him write him a memo and courier it. Tell them you will be rendering sales back
to them daily and they should appoint an account officer for the account.

Approaching them boldly like this tells them you are serious and will pay back.

If the man does not gel, go to the MD. i am sure if you have a good and bankable proposal
they will oblige but in your case not more than 5m

@ Poster, your premise for seeking a loan is totally wrong and this is one of the major challenge money lender face in decision making for uninformed customers. First in credit principles and management, collateral should not be the reason for a loan. Your ability to repay a loan (Capacity) are good indicators to suggest that the loan will not go bad. With your approach, a good credit analyst will naturally flag your account as a bad one with based on this premise.

I know quite a number of guys that have successfully gotten loan from banks without the usual form of collateral but specialized arrangement when the analyst has been able to convince the approving authority of the credit worthiness of the counterparty.

@ Poster, you still have better work to do. How much capital are u willing to commit to a new business that you want the bank to take risk on? Your survey paper is a worthless document and do not say any serious thing about your commitment. Even with a c of o, a good analyst should not doll out money because the cost of realisation of security at times outweighs the profit. That explains the reason GTB was said to have turn down a proposal with a seemingly good security.

My advise, source your money elsewhere and not the bank if u insist on doing the business? As your business grows better, you can then approach the bank for expansion ,

ayubam:

@ Poster, your premise for seeking a loan is totally wrong and this is one of the major challenge money lender face in decision making for uninformed customers. First in credit principles and management, collateral should not be the reason for a loan. Your ability to repay a loan (Capacity) are good indicators to suggest that the loan will not go bad. With your approach, a good credit analyst will naturally flag your account as a bad one with based on this premise.

I know quite a number of guys that have successfully gotten loan from banks without the usual form of collateral but specialized arrangement when the analyst has been able to convince the approving authority of the credit worthiness of the counterparty.

@ Poster, you still have better work to do. How much capital are u willing to commit to a new business that you want the bank to take risk on? Your survey paper is a worthless document and do not say any serious thing about your commitment. Even with a c of o, a good analyst should not doll out money because the cost of realisation of security at times outweighs the profit. That explains the reason GTB was said to have turn down a proposal with a seemingly good security.

My advise, source your money elsewhere and not the bank if u insist on doing the business? As your business grows better, you can then approach the bank for expansion ,

Very sound and intelligent contribution from ayubam.