interest rate on $500k, page-25

"They get their initial investment back - Guaranteed!! SECURED LOAN!!"

Nothing is guaranteed. They would need to go through a process to secure title to those assets then dispose of them. Hopefully for more than the amount owing. Not as quick or as simple as auctioning off a property by any means. Consider for a moment if there was no fee. This risk is not just to capital there's also risk of acquiring a massive hassle to deal with. Why would you as a lender assume this risk?

FTR no I don't think this is an enviable position for AWD to be in. I've had over 12 months to think about it. Though taking into account the finer details of the story it's not terribly surprising in retrospect. This a very non-conforming asset and lenders really do get squeamish when something doesn't fit neatly into a conforming box.

This is now an all or nothing play. IMHO extreme risk with potential for extreme reward. I don't see why $75k is such an issue. Desperate times, desperate measures. After a year of wrangling to get this funding sorted would you rather they played hardball with the lender and risked the whole house of cards coming down?