i gave out a large loan to a 3 star general
i am not giving out loans unless under recommendation of a bank or a close friend, if you genuinely need a loan a can put you in touch with the loan managers i know.epidemiks wrote:Jackrossi, Do you offer better rates to Barang?
the reasons have been new year/delay on his costumer to pay him.
its the first time he is actally late, before he kept paying, even if not the full amount but large portions on time.
the contract has no limit, it was supposed to be just as a way to avoid delays on a 2 month contract. everyone involved didn't expect it to go on for much more.
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As others have said it sounds like a foolish investment and also like another possible contender for thread of the year.
A bank manager giving you a green light for loaning what must be a hefty amount to a three stars general ?
Let me guess, he did this on his own capacity and the bank he is working for wasn't involved. Let me guess again it was accleda, canadia or a MFI.
I doubt a sensible manager for a malaysian bank or any serious one around would do that, big chances of beeing fired if it goes wrong.
You said the general has perfect credit reccord, who did the due diligence ? I wasn't even aware there was a centralized personal credit reccord in cambodia.
I myself loaned serious money a few times to khmers (up to 60k on a 1 year period). Whether it was for my sister in law business or for militaries just under the general grade (For whom I wouldn't dare since aside my father in law I never met one that was poorer than me not only considering assets but most importantly liquidities).
Anyway I ever only accepted to do it since I knew them, their family, their work colleagues, their friends etc... Also I always tried to be reasonably fair in what I asked for interest. In the case of my inlaws businesses's what a major MFI would give me for the term considered. For the military acquaintances 1% on top of what a bank would ask (not accleda but foreign owned), so ranging from 5 to 14% per annum.
Same as you when I loaned outside the family circle, I also was given very good properties hard titles equity. But I always relied on the word given that I was confident I could trust since I never even imagined, going into a litigation nightmare.
The few loans I talked about are now long repaid and last year it was my turn to be in the need to borrow. I did it through a local bank at 9% per annum and gave them mortgage rights on the property I was building on, with the loan being worth about 10% of the equity.
One wouldn't believe the tickness of the legal documents/contracts I had to sign as well as to pay for (1k worth of greedy lawyers). It was way more than in Europe for sure, where the legal cost if any, is much lower too.
Were you assisted by such a legal team ? How would you repossess ? The court are famously corrupted and such legal battles have been known to last for ages since they are the best court cash cows. Also I believe the final verdict usually favor the party with most connections regardless of nonetheless importantly needed cash availability to keep the thing going at all.
To end on a slightly more constructive note, I would follow earlier advice and give the guy an ultimatum, better even if it is drafted by a lawyer.
Since your borrower must be cash stranded, don't forget that these bong thom always have a few liquid properties they can sell at a loss when they really need cash. Since he apparently miscalculated his forecasted cash flow and is now in a very costly predicament, now is the time for him to swallow his pride and take a double plunge.
In any case don't let this situation grow any worse much longer.
A bank manager giving you a green light for loaning what must be a hefty amount to a three stars general ?
Let me guess, he did this on his own capacity and the bank he is working for wasn't involved. Let me guess again it was accleda, canadia or a MFI.
I doubt a sensible manager for a malaysian bank or any serious one around would do that, big chances of beeing fired if it goes wrong.
You said the general has perfect credit reccord, who did the due diligence ? I wasn't even aware there was a centralized personal credit reccord in cambodia.
I myself loaned serious money a few times to khmers (up to 60k on a 1 year period). Whether it was for my sister in law business or for militaries just under the general grade (For whom I wouldn't dare since aside my father in law I never met one that was poorer than me not only considering assets but most importantly liquidities).
Anyway I ever only accepted to do it since I knew them, their family, their work colleagues, their friends etc... Also I always tried to be reasonably fair in what I asked for interest. In the case of my inlaws businesses's what a major MFI would give me for the term considered. For the military acquaintances 1% on top of what a bank would ask (not accleda but foreign owned), so ranging from 5 to 14% per annum.
Same as you when I loaned outside the family circle, I also was given very good properties hard titles equity. But I always relied on the word given that I was confident I could trust since I never even imagined, going into a litigation nightmare.
The few loans I talked about are now long repaid and last year it was my turn to be in the need to borrow. I did it through a local bank at 9% per annum and gave them mortgage rights on the property I was building on, with the loan being worth about 10% of the equity.
One wouldn't believe the tickness of the legal documents/contracts I had to sign as well as to pay for (1k worth of greedy lawyers). It was way more than in Europe for sure, where the legal cost if any, is much lower too.
Were you assisted by such a legal team ? How would you repossess ? The court are famously corrupted and such legal battles have been known to last for ages since they are the best court cash cows. Also I believe the final verdict usually favor the party with most connections regardless of nonetheless importantly needed cash availability to keep the thing going at all.
To end on a slightly more constructive note, I would follow earlier advice and give the guy an ultimatum, better even if it is drafted by a lawyer.
Since your borrower must be cash stranded, don't forget that these bong thom always have a few liquid properties they can sell at a loss when they really need cash. Since he apparently miscalculated his forecasted cash flow and is now in a very costly predicament, now is the time for him to swallow his pride and take a double plunge.
In any case don't let this situation grow any worse much longer.
Last edited by Barang_doa_slae on Tue Apr 26, 2016 7:58 pm, edited 1 time in total.
Was joking.jackrossi wrote:i am not giving out loans unless under recommendation of a bank or a close friend, if you genuinely need a loan a can put you in touch with the loan managers i know.epidemiks wrote:Jackrossi, Do you offer better rates to Barang?
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If only the bank manager recommended me, I want free money.
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It's quite amusing to listen to the ramblings of a number of non-business owners pontificating about things they know absolutely nothing whatsoever about. But if jackrossi doesn't mind some input from one who does...
First of all, it's completely understandable why the General would run into cashflow difficulties such that he would require a relatively short-term loan. Any business person in Cambodia would tell you the same thing when asked "what is your single biggest problem operating as a business in Cambodia?" It's cashflow. Period. You want a loan from the bank? They'll lend you money at 12-13% per annum (that's around 1% per month for the mathematically disinclined) but require collateral that is essentially 10x the value of the loan they're giving you. You need more than that? Then you have to go the informal route (family, friends) or the local short-term loan market (typically 5-10% per month).
Why would the General need more money? He's working on a (no doubt dirty) construction contract for the Government. These contracts require money up front for the winning of the bid, and more money up front for the equipment, materials, labour costs, etc. You only get paid the majority of the value of the contract when the project is completed. And then you're at the mercy of the Government to pay, a long and painful process at the best of times.
So I would think that this is a sound investment, one backed by someone who has a track record of successfully completing projects and paying back loans and who already has a contract and high likelihood of eventually being paid. The terms of the loan were such that when delays are encountered, a premium on the loan funds are paid so that the lender is compensated fairly for such unforeseen (but actually quite likely) eventualities. Smart move on jackrossi's part as delays in this game aren't just possible, they're almost certain.
And for those of you who believe that 3-6% interest per month on your investment is poor value for risk taken, you may pause to reflect on why it is that jackrossi has the money and connections to make this investment in the first place, while you do not.
So from my point of view, I think you've made a wise investment and done so in a clever way that removes you directly from the point of contact until such time as said contact will be pleasant and beneficial. I expect that you will get all your money and interest back, hence you would likely achieve all your goals by telling the intermediary that you're sympathetic to the good General's plight, and are willing to offer him some relief on the loan conditions as a friendly gesture. You might put in at the same time more hardened conditions in the case that the delay goes well beyond the expected such that you can take the land, but that would not be a happy circumstance and would likely cause you far more headache than profit in all respects. Hence you should just have it there as an encouragement rather than as an expectation of action.
First of all, it's completely understandable why the General would run into cashflow difficulties such that he would require a relatively short-term loan. Any business person in Cambodia would tell you the same thing when asked "what is your single biggest problem operating as a business in Cambodia?" It's cashflow. Period. You want a loan from the bank? They'll lend you money at 12-13% per annum (that's around 1% per month for the mathematically disinclined) but require collateral that is essentially 10x the value of the loan they're giving you. You need more than that? Then you have to go the informal route (family, friends) or the local short-term loan market (typically 5-10% per month).
Why would the General need more money? He's working on a (no doubt dirty) construction contract for the Government. These contracts require money up front for the winning of the bid, and more money up front for the equipment, materials, labour costs, etc. You only get paid the majority of the value of the contract when the project is completed. And then you're at the mercy of the Government to pay, a long and painful process at the best of times.
So I would think that this is a sound investment, one backed by someone who has a track record of successfully completing projects and paying back loans and who already has a contract and high likelihood of eventually being paid. The terms of the loan were such that when delays are encountered, a premium on the loan funds are paid so that the lender is compensated fairly for such unforeseen (but actually quite likely) eventualities. Smart move on jackrossi's part as delays in this game aren't just possible, they're almost certain.
And for those of you who believe that 3-6% interest per month on your investment is poor value for risk taken, you may pause to reflect on why it is that jackrossi has the money and connections to make this investment in the first place, while you do not.
So from my point of view, I think you've made a wise investment and done so in a clever way that removes you directly from the point of contact until such time as said contact will be pleasant and beneficial. I expect that you will get all your money and interest back, hence you would likely achieve all your goals by telling the intermediary that you're sympathetic to the good General's plight, and are willing to offer him some relief on the loan conditions as a friendly gesture. You might put in at the same time more hardened conditions in the case that the delay goes well beyond the expected such that you can take the land, but that would not be a happy circumstance and would likely cause you far more headache than profit in all respects. Hence you should just have it there as an encouragement rather than as an expectation of action.
thank you jacked camry, i am indeed leaning more towards waiting.
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yeah yeah yeah , but if so clued up ? Why ask on a forum full of nutters?Jacked Camry wrote:It's quite amusing to listen to the ramblings of a number of non-business owners pontificating about things they know absolutely nothing whatsoever about. But if jackrossi doesn't mind some input from one who does...
First of all, it's completely understandable why the General would run into cashflow difficulties such that he would require a relatively short-term loan. Any business person in Cambodia would tell you the same thing when asked "what is your single biggest problem operating as a business in Cambodia?" It's cashflow. Period. You want a loan from the bank? They'll lend you money at 12-13% per annum (that's around 1% per month for the mathematically disinclined) but require collateral that is essentially 10x the value of the loan they're giving you. You need more than that? Then you have to go the informal route (family, friends) or the local short-term loan market (typically 5-10% per month).
Why would the General need more money? He's working on a (no doubt dirty) construction contract for the Government. These contracts require money up front for the winning of the bid, and more money up front for the equipment, materials, labour costs, etc. You only get paid the majority of the value of the contract when the project is completed. And then you're at the mercy of the Government to pay, a long and painful process at the best of times.
So I would think that this is a sound investment, one backed by someone who has a track record of successfully completing projects and paying back loans and who already has a contract and high likelihood of eventually being paid. The terms of the loan were such that when delays are encountered, a premium on the loan funds are paid so that the lender is compensated fairly for such unforeseen (but actually quite likely) eventualities. Smart move on jackrossi's part as delays in this game aren't just possible, they're almost certain.
And for those of you who believe that 3-6% interest per month on your investment is poor value for risk taken, you may pause to reflect on why it is that jackrossi has the money and connections to make this investment in the first place, while you do not.
So from my point of view, I think you've made a wise investment and done so in a clever way that removes you directly from the point of contact until such time as said contact will be pleasant and beneficial. I expect that you will get all your money and interest back, hence you would likely achieve all your goals by telling the intermediary that you're sympathetic to the good General's plight, and are willing to offer him some relief on the loan conditions as a friendly gesture. You might put in at the same time more hardened conditions in the case that the delay goes well beyond the expected such that you can take the land, but that would not be a happy circumstance and would likely cause you far more headache than profit in all respects. Hence you should just have it there as an encouragement rather than as an expectation of action.
k440, something to do when you're pissed.
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Because anyone who wants some wheat needs to sort through a lot of chaff.horace wrote:yeah yeah yeah , but if so clued up ? Why ask on a forum full of nutters?
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It was a bad idea and will end in tears.Jacked Camry wrote:It's quite amusing to listen to the ramblings of a number of non-business owners pontificating about things they know absolutely nothing whatsoever about. But if jackrossi doesn't mind some input from one who does...
First of all, it's completely understandable why the General would run into cashflow difficulties such that he would require a relatively short-term loan. Any business person in Cambodia would tell you the same thing when asked "what is your single biggest problem operating as a business in Cambodia?" It's cashflow. Period. You want a loan from the bank? They'll lend you money at 12-13% per annum (that's around 1% per month for the mathematically disinclined) but require collateral that is essentially 10x the value of the loan they're giving you. You need more than that? Then you have to go the informal route (family, friends) or the local short-term loan market (typically 5-10% per month).
Why would the General need more money? He's working on a (no doubt dirty) construction contract for the Government. These contracts require money up front for the winning of the bid, and more money up front for the equipment, materials, labour costs, etc. You only get paid the majority of the value of the contract when the project is completed. And then you're at the mercy of the Government to pay, a long and painful process at the best of times.
So I would think that this is a sound investment, one backed by someone who has a track record of successfully completing projects and paying back loans and who already has a contract and high likelihood of eventually being paid. The terms of the loan were such that when delays are encountered, a premium on the loan funds are paid so that the lender is compensated fairly for such unforeseen (but actually quite likely) eventualities. Smart move on jackrossi's part as delays in this game aren't just possible, they're almost certain.
And for those of you who believe that 3-6% interest per month on your investment is poor value for risk taken, you may pause to reflect on why it is that jackrossi has the money and connections to make this investment in the first place, while you do not.
So from my point of view, I think you've made a wise investment and done so in a clever way that removes you directly from the point of contact until such time as said contact will be pleasant and beneficial. I expect that you will get all your money and interest back, hence you would likely achieve all your goals by telling the intermediary that you're sympathetic to the good General's plight, and are willing to offer him some relief on the loan conditions as a friendly gesture. You might put in at the same time more hardened conditions in the case that the delay goes well beyond the expected such that you can take the land, but that would not be a happy circumstance and would likely cause you far more headache than profit in all respects. Hence you should just have it there as an encouragement rather than as an expectation of action.
Follow my lame Twitter feed: @gavin_mac
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...based on the several businesses I have managed here, loans I have provided to local people and knowledge of Cambodian language and culture.gavinmac wrote:It was a bad idea and will end in tears.
Care to make a wager? One who loses has to buy dinner for the one who wins, and Jack Rossi gets to join for free to regale us with his tales of bidness in Cambodia.
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Jacked Camry wrote:Any business person in Cambodia would tell you the same thing when asked "what is your single biggest problem operating as a business in Cambodia?" It's cashflow. Period. You want a loan from the bank? They'll lend you money at 12-13% per annum (that's around 1% per month for the mathematically disinclined) but require collateral that is essentially 10x the value of the loan they're giving you. You need more than that? Then you have to go the informal route (family, friends) or the local short-term loan market (typically 5-10% per month).
So from my point of view, I think you've made a wise investment....
I think I'm with Jacked Camry on this one, at least based on my experiences of lending here.gavinmac wrote: It was a bad idea and will end in tears.
I've made a couple of unsecured loans here on a smaller scale at 10% a month interest to people that are involved in what I thought were good businesses but who were just suffering from a temporary cash flow problem, due to the lag between buying supplies and actually getting paid by the customer.
In both cases the loan had to be extended but I continued to receive the interest each month. It was quite stressful, as the loans were unsecured, but eventually the capital was repaid.
I think in this case I would offer to cap the interest rate at a maximum of 10% a month as that will hopefully ensure that the general keeps paying it each month. Eventually the capital will hopefully be repaid.
Making loans...profitable? Yes. Stressful? Yes.
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That fact that you have made two successful but stressful loans to people here simply increase the chances of it being a spectacular fuckup in jackrossi's case, especially when you factor in he is dealing with a 3 Star General.
When 3 Star Generals get stressed they tend to resort to measures to get out of it which are likely not approved of by any financial regulatory services authority I can think of. Like guns and shit.
When 3 Star Generals get stressed they tend to resort to measures to get out of it which are likely not approved of by any financial regulatory services authority I can think of. Like guns and shit.
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