Business
Negotiating with banks when getting a loan is not only about getting the most rewarding end of the deal. There are a lot of regulations and policies to be considered here after all, and you must be aware of each one to ensure a smooth process. Bob Roark talks with the CEO of https://ppnb.com/ (Pikes Peak National Bank), https://www.linkedin.com/in/robinjroberts (Robin Roberts), to delve into the right approach to bank negotiations. She explains why you can't argue with banks about submitting tax returns and financial statements, delving into why it is not an invasion of privacy. On the other hand, Robin talks about loan covenants - which are negotiable - detailing how you should discuss its specifics with the bank to come up with a satisfying agreement for both parties. --- Watch the episode https://www.youtube.com/embed/sEUCyl3HyaA?rel=0 (here) Robin Roberts: What You Must Know When Negotiating With Banks Have you ever wondered why banks sometimes do things that are not quite clear? In this series, I have Robin Roberts. She’s the CEO of https://ppnb.com/ (Pikes Peak National Bank). She’s here to demystify some of the things that might be bothering you. One of the things that we talked about at length is how to negotiate with your bank. There are so many people that miss this one particular component and it is not the 1/8 of the quarter that you negotiate on the loan. Oddly enough, it might be the covenants that you might want to spend some time on. Take care, enjoy, and I hope you learn something from this episode. --- What can you negotiate with your bank? If you’ve finished negotiating with your bank and you’ve got an extra 1/8 off on my five-year fixed 30-year amortization note, don’t necessarily pat yourself on the back. You may have missed basically the entire positive things that you can do. In this episode, we have Robin Roberts. She is the CEO of https://ppnb.com/ (Pikes Peak National Bank) to illuminate and demystify what you can negotiate with your bank in the commercial loan for your business. The first thing that business owners who have not borrowed before, they equate commercial loans with getting a residential mortgage on their house or getting a car loan. That’s a consumer purpose loan and those types of loans have their purpose. They are very different. They’re regulated differently. They have different laws that cover them than commercial lending. Commercial lending is its own animal. It’s important for business owners to understand commercial lending, how it is different than getting their residential mortgage, and how the process was. Not just now when you get the loan, but over the course of the loan because the bank is much more involved with you on an annual basis with your loan than when you get your residential mortgage for 30 years. You make your payment every month and no one ever bothers you again from the mortgage company or the servicer. You make your payment and you’re good. Commercial lending is not that way and business owners can, if they understand the whole process of the loan, negotiate things at the beginning of the loan that will help them 2 and 3 years down the road. For a lot of them, when you do your home mortgage and you do it through a bank, most don’t realize or don’t realize until they get a notice that the note’s been sold. It’s not on the bank’s balance sheet and their responsibility and concern about your note is now gone. Whereas the commercial loan is the banks are intimately interested in making sure of the quality of your note because it resides at the bank that you have the note from it and it’s not sold. [bctt tweet="Most small business loans are not sold. They're held on the bank's books to be monitored regulatory-wise." username=""] Most commercial loans and small business loans are not sold. They’re held on the bank’s books and the bank has a responsibility regulatory-wise to monitor that loan portfolio we grade it actually on...