Learn Guide
Execution Risk Explained
Where execution risk lives and how to manage it before it manages you.
What is execution risk?
Execution risk is the gap between approval and settlement. A deal can tick every policy box and still fail to settle because of what happens after the credit committee says yes.
In private credit, approval is not the finish line. It is the starting gun. The real work — valuation, due diligence, legal documentation, borrower compliance — all happens after approval and before settlement.
Where execution risk lives
Valuation risk
The property values at less than expected, or the valuer applies a methodology that shifts the LVR beyond appetite. This is the single most common deal-breaker post-approval.
Due diligence risk
QS reports reveal budget gaps, environmental reports flag contamination, planning certificates show restrictions. Each finding can trigger re-assessment or withdrawal.
Legal risk
Title defects, caveats, unregistered interests, complex security structures, or consent requirements that surface late in the process.
Behavioural risk
Borrowers who change scope mid-process, fail to provide documents on time, or introduce new requirements after approval.
Why it is higher in complex deals
The more layers, the more moving parts. Multi-tranche structures, subordination agreements, construction drawdown mechanisms — each adds a point of potential failure. Private credit operates with discretion, which means each deal is assessed on its own merits, and small changes can cascade.
How Get Solutions manages execution risk
We identify execution risk before submission, not after approval. By structuring deals to absorb valuation volatility, pre-empting DD findings, and selecting funds whose processes match the deal timeline, we compress the gap between approval and settlement.
Key takeaway
Approval is a milestone. Settlement is the outcome. Execution risk is what lives in between. Managing it is the difference between a term sheet and a settled deal.
Apply this to a real deal
Why: Identifying execution risk early prevents deal failure after approval.
Do: Work through the four risk categories from this guide and flag every factor that applies to your deal. Each factor is weighted by how often it derails settlements — a single high-impact factor escalates the rating on its own.
Output: A weighted risk rating plus a prioritised action plan — your flagged factors ordered by impact, each with a specific mitigation, ready to copy into your deal notes.
Execution Risk Scanner
Step 2 of 8 — Identify where execution risk lives in this deal.