Bank Guarantees and Why Polaris Doesn't Want to Issue Them

Hi Anonymus!

Decided to post a response simply to celebrate the fact that someone cares!!!

Anyway I assume you have made 2 payments? I have not yet made the 15% payment which was due last July. I contacted them and told them my solicitor had advised me not to make the payment until I had possession of the initial guarantee.

What I had not realised is that the Spanish bank guarantee is very different from the system here. They must set aside the amount guaranteed in a seperate account and therefore it is "lost" to them as working capital. The only benefit to PW in having these guaranteed funds is that they have a certain amount in hand should a purchaser fail to complete the purchase and forefit funds paid to date.

If working capital is tight, as most people believe it must be, then it makes sense for them to retain use of my 25% - 70000 already held rather than hassle me for the 15% - 41700 for which I would then be hassling them for that to be guaranteed also. I have not pressed for the guarantee since July as I don't want to give them the next 41700 which I have on deposit @ 5%.

I believe they are working on the capital provided by those who haven't got guarantees and they are building only properties - no facilities - so that they can then collect as much as possible from completions to keep the company going.

The problem as I see it then comes when the resorts are almost complete. What incentive do they have to provide the suggested / promised facilities on the resorts? They will have got as much out of the buyers as they are likely to. The only prospect of getting the facilities would be in terms of preserving credibility assuming they wish to continue as resort / property builders.

We can only hope that PW survive and prosper if we are to get the resorts we want.