Hating Banks== Just Don't

49 Replies

Mind Blown: For the longest time many people have posted so many negative things about banks etc. Myself included..... then I thought about it: Why tf would I hate a partner with virtually an unlimited bank account? Because they ask for a personal guarantee? Maybe a different way of thinking of things--- but since I thought about this 2 weeks ago- my banking relationships have improved almost overnight... 

Stay positive guys! Build your business around the BEST business partner: The Bank! 

I hate to be negative but how many billions in fines do banks have to pay for ripping off their "partners" before those partners should start thinking negatively about them?

My sister still hates Wells Fargo even after they had to give her a free house and hundreds of thousands of dollars in legal fees.

They admit to having millions of victims since then.

Their own advertising admits they have had a problem with how they acted.

@Michael Biggs  I think as it relates to most of us BP folks the banks we want to cotton up to are your local community banks owned by your friends and neighbors who are in business to support community business's which is what at some level we all have.

I would NEVER use a national bank.. they make money on checking accounts ATMS and stuff.  

A great commercial local bank and banker that you know personally can open many doors I know it has for me.

I am very old school. though.. other than having my account on line.. I don't have an ATM card.. I go to the bank when I need cash..  and its part of my social routine as much as BP I go  to the bank at least 18 out of 20 business days a month and I make my rounds.. I do my wires and fundings.. my notaries.. then I talk to the head construction lender to get the gossip on who is doing what ( no detail just hey how are sales and payoffs. )  then my banker etc etc.. 

I totally Agree with you sentiment on the big banks.. non personal  out to fee you to death etc.

I pay zero fees on anything I do save wires.. And I pay thoughs because I do so many and take up so much staff time doing them that I would feel guilty if I did not pay for those.. if it was like a typical  premier client who only did a wire or two or less a month I would not pay for those either..  but I can do sometimes 10 in one day  LOL.  And I know I know I could do them form my office but there is wire fraud Risk big time when you do them yourself.. and we have too much money circulating to take that risk.. in person at the bank triple check wire instructions is my MO>

@Jay Hinrichs Great Info—- I feel the same. I got so caught up there for a little while “All Banks are evil” etc... not so at all. Went back to two bankers last week that I got denied from for a deal—- and got lines of credit etc no issues and started a positive relationship.

Originally posted by @Benjamin Maciel:

Jay Hinrichs Great Info—- I feel the same. I got so caught up there for a little while “All Banks are evil” etc... not so at all. Went back to two bankers last week that I got denied from for a deal—- and got lines of credit etc no issues and started a positive relationship.

your local small community banks if you have good credit good standing in the community and some money and experience this is who they lend to.

Now when I talk to my banker they do not do deals .  For those just coming off of BP or a guru training course that have none of the above.. you need it all.

it took me 3 years to land a bank in Charleston SC  even though I domicile on the west coast.. but I kept trying now I have a great banker there and we are his ONLY out of market borrower.. but he did just raise his interest rate from 5.5 to 6.  oh well instead of making a 100k on a deal he funds we will only make 99k..   REALLY all these folks who worry about rates instead of worrying about getting the funding are so short sighted.. they never do deals.. that rate is too high your getting screwed LOL...  if there is good money in the deal 20% rate is OK.. its what I make at the end of the day.. if it works it works if it don't it don't  

Just as landlords like to rent to the ideal tenant, bankers like to lend money to the ideal borrower.

I've found it useful to learn the system and use it to my advantage for accomplishing what I want to do (build wealth) rather than fight the system and face an uphill battle. All it takes is a willingness to learn and a sense of humor.

@Jay Hinrichs I don’t think BP is ready this morning for all of the GOLD you just spilled in your last comment.

I agree 100%—— I just had a DOOMSDAY investor saying the market is going to crash and burn next yr, and wanted to cut my fee’s because his bank raised his interest rate to 6%. I had to send him this text when he messaged me personally on FB. And I quote.

“You are ****ing stupid. Interest rates are at the lowest rates in 5000+ yrs, if you cannot make it work now- good luck. My staff works too hard to be treated this way. Do not invade my privacy with your negative thinking and short sided mindset. Consider this a 30 day cancellation of managing your property. Do not ever talk to me again.”

These people have an extreme scarcity mindset!

Love your attitude (maybe why you are so successful? I think so)

Roger Steciak I came across a story a yr or so ago where an investor walked into a PE firm (ya know- the people who actually have the money!) and asked them what they “look for.” After getting the info- went out and put 150 deals under contract in 4 months and walked his *** right back into their offices and they closed the deal.

TIP: Find the money first? Find out what they bank “likes” and go from there? Would love to hear more professional input Jay Hinrichs

Originally posted by @Benjamin Maciel:

Roger Steciak I came across a story a yr or so ago where an investor walked into a PE firm (ya know- the people who actually have the money!) and asked them what they “look for.” After getting the info- went out and put 150 deals under contract in 4 months and walked his *** right back into their offices and they closed the deal.

TIP: Find the money first? Find out what they bank “likes” and go from there? Would love to hear more professional input Jay Hinrichs

unfortunately there is also the mindset on BP  that find the deal first money will be easy..

well that could be true for a no money wholesaler making their spiff.. but for someone wanting to actually go into the industry you need money first deal second.. deals are like street cars there is always another one.. Money is the key plain and simple.  

@Jay Hinrichs agree’d my friend.

Luckily I have seen upfront and close the different ways to fall on your face in this business at an early age—- wholesaling being one of the TOP 3 ways imo. A lot of ***** work, alot of stress waiting for the deal etc.

I would much rather buy 160 lots in NW Oregon and build homes for homeowners 👍

There are thousands of banks in the country and a handful are global scumbags. That is like saying all people are horrible and cant be trusted because of the ones that commit crimes.

@Account Closed   now to be like Fox news fair and balanced

one does have to be mindful that banks can change policies.. so you do need in my mind a healthy balance of private capital or your own and banks or other lenders as well.

07 to 09 saw banking FREEEZE for us in the business I had almost 30 million in various credit lines out and they all got called Save one.. my core bank kept my 6 million working with out it I would have not made it.. the rest did not care and I had written into my loan terms that if they called these facilities I had 36 months to pay them off and I needed every bit of that time to do it.. but I can proudly say I did not default on a one and paid it all back and the agreed on interest. 

So coming out of that .. unlike many in my peer group that had to reorg.. I was able to go back to my banks and get credit again.. were those folks even the builders that were 10 to 20 to 50 times my size .. they had to go look for HML and private.. so the last 6 years in my buildings business I have paid less than 50% for cost of capital than my competition.

But I also brought in a good number of private equity to balance so I did not have all my eggs in the bank basket.. Remember at the end of the day the banks are told what to do by regulators at the state and federal level they may love you but they may have to take orders from on high. 

@Account Closed

I dislike Wells Fargo for being scumbags in the USA. But my loathing for institutions like Deutschbank, BNP, Société Générale, Credit Suisse...that's of a different order, because I'm Greek-American. When Greek were posed to default on their loans in 2008, these banks didn't take the hit they should have, a hit they deserved for making bad loans.

Instead, the large national banks ran to their governments and demanded that the EU "bail out" Greece. The governments obliged. The money went into Greece for about ten minutes and then went out to pay the banks to sell their loans to their own governments. The bad loans of the Greek people were transferred from the shoulders of the investors in those big national banks to the German, French, Dutch, and Swiss taxpayers. Now Greece couldn't default on their loans. The Greek are now stuck in generational debt slavery with no option for bankruptcy because European bankers in 2008 didn't want to take the hit they deserved for making bad loans and passed the buck to the citizens of the countries they were based in.

I do not think national banks big enough to do thinks like this really make contributions to the societies they prey on that counterbalance the damage that they routinely do.

@Jay Hinrichs Very Impressive!

But... everyone was battling the same things and they curled up instead of spread out. Very smart 36 month strategy! Did it stop you from doing deals? Hell No! You dug back in.

I saved that as a screenshot- hope you don’t mind, warrior.

@Jim K. no offense. But the Greeks were fin lazy. It was a good run for 40 yrs- living on other peoples hard labor. But it’s over. Blame the voters.

I do not want to violate BP terms of use here so I will not comment.

My post is in regards to small scale investing etc.

Great post and views.  I enjoy my banks.  They are there to make money, but so am I.  They can be a pain, and yes some are slower than molasses in December, but usually they make sure the paperwork is right and I have never had to argue with a bank on how they come up with a payoff, or interest I have paid.  

I just paid off an individual that owner financed for me.  Unfortunately, it was an older lady and she did not like that I declared the interest, which she had to claim as income.  The balance was paying down faster than she wanted, etc.  I had to give the bank 1.25% more in interest and the cost of the refinance but the headache is off my back.  Sometimes it is worth it to remove the headache.  

It is important to have more than one bank.  The bank I have used for over 20 years changed branch managers and the new guy and me do not see Eye to Eye.  So I have started with a new guy at another bank.  However, in April, when tragedy struck my family and I needed cash fast, it was my old standby bank that, refinanced a property I had financed with them and had my funds to me in less than 10 days.  

A local bank is hard to beat, but you have to develop a relationship.  Remember that what we do is about relationships, whether it is renting, flipping, buying, selling, or working with contractors.  The better relationship you have with them (and that you follow through) the better things will go for you.  

Blessings folks.

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Originally posted by @Account Closed :

Jim K. no offense. But the Greeks were fin lazy. It was a good run for 40 yrs- living on other peoples hard labor. But it’s over. Blame the voters.

I do not want to violate BP terms of use here so I will not comment.

My post is in regards to small scale investing etc.

No offense taken, Benjamin. You have a right to your own opinion. I was the first to blame the Greeks in Greece for everything when the debt crunch came, because I was there and watched them bring financial doom on themselves. I was lucky to get out in 2007, when everyone was encouraging me to stay, and keep on flipping houses in an economy that would never stop booming by fair means or foul.

@Ron Flatt That is great advice. Thank you.

When investing in other markets—- Find a property manager, 2 real estate agents, 3 banks, and 2 other successful investors.... oh, and PE guys...

That’s what “they” say anyways—- going to be trying it out here sooner than later as we grow!

Originally posted by @Charles Branch :

@Benjamin Maciel Thanks for starting this thread! Very helpful as I am a new investor studying which type of lender I will use first.

@Jay Hinrichs thanks for the advice, as a new investor I had started to analyze deals and put the money as the 2nd option. Thanks for experienced wisdom. 

 I don't know Charles its just my way of thinking about it.. Just like going shopping If you have no money to buy your window shopping.

If you have the funds your actually buying.. 

I just don't want to waste my time and others times with stuff that I don't have the funding for.. or if I did have to go raise it.. I would be clearly denoted as such.. but for me raising the capital while not a gurantee is not like a newbie trying to land their first or second deal

so its relative to your experience and where your at in the RE journey.. I am very tight with my Banker of 24 years.. and when we do social things together we get to chatting.. they wont even look at someone with no experience .. unless they are a VERY high paid W 2 or business owner that is going to drop a million or so in their bank and they do it for the on going relationship.. and its gotten no eaiser.

now to be fair out in the mid west and deep south tons of smaller banks that are more apt to lend on small balance rentals. our west coast banks would not even look at them .. they will only do MF and larger.. they have no interest in loans on SFR rentals.. one because frankly we don't have many .. price of SFR's make renting them out not all the great.. and they let that business go to the national Federally backed loans.. small community banks don't lend those types of money.. its their money.

@Jay Hinrichs that is great info—- It would appear that having an experienced partner would help too.

Everyone- no matter where, always has that “start-up” phase, no one knows you etc. I think partnering up would be a good strategy for the “new guys” on the bloc. I did it in my market- could not imagine starting any other way “alone.”