Reply: 1.1.2.2
From: The Wife
HI RM,
Great post, and yep, you guessed it, I'm going for a freestylers bank, of sorts.
I have now had 3 goes at acquiring finance and supplying it creatively, and when push came to shove, all 3 times, the lendors couldnt get out of the square. Getting lendors out of the square is near impossible, I say near, because I am still chipping away at the system, this will probably be a life time project for me, just as well I have good patience.
I have come across someone else now who I think may just start coming our way, but I am testing them with scenarios like the ones you and everyone is posting, and then I would like to tie them down to it, my last 3 fallovers with others has left a bitter taste in my mouth, and I will be damned if I get so deep into again without the rules coming my way first.
I have had plenty of people and organisations come and offer me the so called holy grail "creative finance' but it always turns out to be standard bank stuff, this i find out in the first phone call with these people.
If anyone in the banking industry is reading this, and you think you can do creative financing, then please email me, although by now, I think you would have put a post up here saying something to that effect anyway.
Having spent a considerable amount of time now, looking at the finance sector, I can now see their side of the fence, I can now see all the rules and regulations they must follow, and if you follow the sequence of events that happens inside a finance institution when they loan out money, you will understand why they have these rules in place.
One bank person said to me, that if you want creative financing, put yourself in the banks position, and ask yourself, would you invest that much money, in your deal? Imagine yourself as the bank, would you do it?
Because thats what the bank is doing, they are investing. They also pointed out to me, that they are not a public service, they are investing for the long term, and we all know that when we say long term, the risk factor goes down considerably.
SO, what do we do? what if a brand new bank pops up? and they are on fine cutting edge of creative financing, they would then be investing for the short term, looking for good hard quick gains, would you put all your business with this bank? do you think they will fall over, and take all you have with them? Yes?
then why should a good long term solid bank invest with you for good hard quick gains?
I know I know its not quite the same, but in a way it is,
Ok, I had a good round table discussion with a group of financiers and a group of people who wanted creative financing, the finance people said, "we will give you more creative finance, but you have to give us some form of guarantee that we will get our money back, something other than the standard guarantee's"...to me, this sounds fair enough, as the finance people are the 'investors' in this deal, they want to know what and how their return will be, they said they will raise their mortgage Insurance to be appropriate with the risk.
Low and behold, the people wanting the finance rejected this, I didnt understand why they would reject it.
Their options where, higher MI, or no deal, and they couldnt do the deal anywhere else, no other financier wanted to know them, it meant that their bottom line, was a little bit thinner, but they would still get a decent percentage of something, as opposed to nothing, the figures to me, still looked viable, but the people wanting the finance said no, to much to pay in MI.
To me, this is cutting your nose of to spite your face. I found it very frustrating, I dont think these people realised , that in business, and investing is business, you sometimes have to do a deal, for a deal. Think of the bank as a joint venture partner, because thats certainly how they think of you.
I cannot stress the importance, of a deal for a deal, if you are looking for that elusive creative fiance. So many people want the bank to be creative, and yet, they themselves wont be creative in the higher split of the deal going to the bank.
SO you make a little less money? big deal, its better than no money, in the scheme of things, that little less money is just a spit in the ocean, as you make pockets of money here and there, you gain momentum, and far more push and shove in the finance world, the more money you make, the higher your demands can be, but you are never going to get there, if you dont do a 'deal for a deal'.
Now, having said all this, not all banks will do deals for a deal. You will have to shop around. Hopefully I can create a finance company that will naturally just give you a deal for a deal, but then I am sure you guys will lift the bar even higher again, and want more
(
Anyway, I am still working on my little bank, so please, lots more ideas.
Cheers TW
~Life is a daring adventure, or nothing at all~
