Great Lakes in 'Hail-Mary' negotiations with newest lender

[Boris Badenov]

The money guys are in a win-win that they designed. The Repo Man isn't coming for their Beemers.

This should be written in 72 point font on the top of every loan application.

 

[mshunter]

Airplane Repo won't work in the case of GLA.

For the past several years, GLA has owned their aircraft, with great big loans to the company secured by the assets of the company (mainly the aircraft). When they are in default on the requirements of their loan (as they are, yet again, at the moment), the lender's choice is pretty simple: foreclose, shut the place down, and own a bunch of high-time Beech 1900-Ds and Embraer Brasilias, or jack up the interest rates on the loans, vacuum up what money there may be available, and hope the whole mess can be salvaged. If not, hope that they can use the likely losses on GLA against profits on some of their other (non-airline) ventures.

The money guys are in a win-win that they designed. The Repo Man isn't coming for their Beemers.

I guess that all depends on how the loans were written. They certainly can take possession of their assets. If you owe someone money, they have ways to get all your crap.

 

[gotWXdagain]

Of course a Repo company can come and take possession of the assets. That's what "secured debt" means. The lender is giving the debtor financial liquidity based on the value of the the debtor's secured assets, with the agreement that the debtor will repay the principle balance plus interest, lest the lender have the right to repossess the securitized asset.

Interest would be calculated such that at any given point in time, given the amount of principle repaid, and the value depreciation of the securitized asset plus loan origination costs, that the bank comes out ahead even after they repossess and sell the assets.

 

[jtrain609]

Of course a Repo company can come and take possession of the assets. That's what "secured debt" means. The lender is giving the debtor financial liquidity based on the value of the the debtor's secured assets, with the agreement that the debtor will repay the principle balance plus interest, lest the lender have the right to repossess the securitized asset.

Interest would be calculated such that at any given point in time, given the amount of principle repaid, and the value depreciation of the securitized asset plus loan origination costs, that the bank comes out ahead even after they repossess and sell the assets.

Most civilized individuals don't refer to a court as the "repo company," but to each their own.

 

[Autothrust Blue]

Most civilized individuals don't refer to a court as the "repo company," but to each their own.

You expected civilization?

 

[jtrain609]

You expected civilization?

My expectations are fairly low these days.

 

[gotWXdagain]

Most civilized individuals don't refer to a court as the "repo company," but to each their own.

Court ordered, or court approved, or otherwise legally conducted repossessions are typically executed by private businesses that specialize in asset siezure. aka "repo companies."

 

[jtrain609]

Court ordered, or court approved, or otherwise legally conducted repossessions are typically executed by private businesses that specialize in asset siezure. aka "repo companies."

I'm aware. Maybe I'm just used to a little less hyperbole in discussions of secured interests is all.

 

[Richman]

This should be written in 72 point font on the top of every loan application.

And remember, the lawyers always get their cut. Always.

Richman

 

[FloridaLarry]

And remember, the lawyers always get their cut. Always.

Richman

Up front.

Remember who writes these agreements...

 

[hook_dupin]

Up front.

Remember who writes these agreements...

I offer that most of these deals are authored by inside council vice separate firms.

 

[FloridaLarry]

I offer that most of these deals are authored by inside council vice separate firms.

We think the pilot groups are a small universe; the lawyer / financier groups dealing with this part of the industry are a REALLY small group. They know each other, golf together and do (what we don't want to know ) with each other. The newbies that try to join often end up with egg on their faces and a hollow pit in their hip pockets.

The price of a learning curve can be steep.