Have you ever been turned down for a loan not because you could not afford it or not because the strategy you were going to use the funds for was too complex, but instead because you did not fit the standard lending profile?
Many of us have, especially people in business or working for themselves.
The criteria is set to reduce the lender's risk and we all know that being in a business can present at times risks and challenges, but also freedoms and greater rewards.
These days, if we do not follow the mainstream of having 2 jobs per household that are held for more than 6 months and are not pulling funds from the same payroll pot and can show excess dollars at the end of each month, our serviceability may be under scrutiny. Then there is having some security that would pose as collateral or simply put - 'loss money'. This can be all yours to offer us or can be guarantor's to the plan. Now there is also another hurdle - credit score, and this is causing alarm and tally of how well you managing your money and make repayments when they are due. Credit scores can be obtained online for free. And then there are deposits required... no doubt, we may find sourcing a loan a bit of a challenge.
But essentially a lender is still a business person looking for a good deal. The type of deal that presents well, answers all the questions, can show how it can make money for everyone, has ease not complexity, has the triggers of risk identified and a plan to tackle them as the symptoms become known. They want to know they are doing business with a trustworthy person, a personality that can lead and make things happen, someone who can deliver the components of their agreement. It is what we would want if the tables were turned.
It is our duty to layout a well illustrated presentation; the strategies we are going to utilise in the plan to repay the lender of their funds. It is also our duty to identify the risks and have multiple risk exit plans to be triggered if any crisis arises. And lastly, we need proof that the strategies we'll utilise have worked for others in the past under similar conditions. Great market examples added here would show proof that your plan works.
With this winning mix, we are now talking about lending for a project and reshuffling the percentage weighted against our individual criteria of our pipe dream.
Money & Success Tip #354 of Portfolio Mastery Facebook Page
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