Legal Question in Real Estate Law in Georgia

Loan Renewal

I have a construction loan that is up for renewal and despite the historically low interest rates and the fact that we have never missed a payment, the bank is raising our rate to a ''floor'' of 6% from the current 4% (prime plus .75). Can they legally do this? I can't get refinanced through them or elsewhere b/c credit is so tight, so I am essentially hog-tied to this bank as they take advantage of my situation. Do I have any recourse or say in the loan renewal?


Asked on 2/04/09, 10:19 pm

2 Answers from Attorneys
Scott Riddle Law Office of Scott B. Riddle, LLC

Re: Loan Renewal

We do have your loan documents, but that is the place to look for answers. Do the contracts you agreed to limit their ability to raise rates? Otherwise, you don't provide any basis to conclude the lender is somehow limited in the terms they propose.

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Answered on 2/04/09, 10:27 pm
Charles W. Field Charles W. Field, Attorney at Law

Re: Loan Renewal

Since you can't get credit elsewhere, your only choices are to pay off the loan or renew at their rates, unless your existing loan docs provide otherwise. Consult with a local attorney.

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Answered on 2/06/09, 5:52 pm


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