I Hate Banks They Are Anti Business

[jmac]

That has always been the hardest part was to get finacing. Being self employed seems to be a black flag for most banks. The thing is, this country was built on self employed people. The worst people to deal with are the banks you use every day for checking, savings account etc. Then insurance companies. Oh don't get me started:Banghead

 

[dayexco]

i know there are those who prefer large banks. personally, i like banking in a small bank, i'm in south dakota, and are quite a few of them. my loan officer is the only one in the building, and i've known him for about 15 yrs. he knows me personally, knows my character. i'm sure that's bought me some loans that larger banks would have shyed away from

 

[jmac]

Dayco I wish we had some small banks left. I started with a small bank and they were bought out by a giant bank just like every thing else around here.

 

[LowBoy]

Lending Institutions are a joke.

Here's a good one. Last October 2005, I got the lame-brained idea to go down and work in Gulfport, Ms. in the Katrina debris cleanup scandal. I worked feverishly 24/7 to prepare to go, given I had a "contract" from a disaster response company, and a seemingly solid connection down there. I needed 2 40' frameless demo trailers, FAST. Got a lead from a friend who referred GAC Capital in Safety Harbor, Fla.(Safe harbor for them, evidently...)
I needed 90K for 2 trailers that a dealer was holding on my WORD, no money exchanged. The shyster at GAC approved my loan, and said it would be funded in 2 days. They requested a 3K dollar downpayment for processing, etc. and faxed me a contract with 3 out of the 9 pages conveniently smudged so I couldn't read them. I had the dealer prepping the trailers, thinking I'd pick them up by Friday of that week.I get a call from a GAC underwriter on Thursday, giving me a phone interview. After 20 minutes of interrogation, he mentions that he will need my HOUSE as collateral. I stated that had they mentioned this within the first 2 minutes of our initial conversation 4 days ago, I would have hung up on him. I am incorporated, and by no means was I going to use my house for collateral. That was the end of the game, and when I mentioned I'd be expecting my 3K back, he said "did you read the contract, we consider that downpayment as "earned" for processing fees, etc". I called the president of that rip-off outfit, and he did the same thing, NOTHING. I blessed a lawyer with 200 bucks to write a letter to them requesting my money back, but got nowhere fast. The part of the contract that was smudged was the part that explained the "earned" processing fee part.
Moral to the story: "He who cannot read smudged faxes is a complete moron"...But God help the necktie-wearing SOB that runs/owns that rip-off felonious company if I ever was introduced to him face to face...I'll give him my personal "double your money back gurantee" that he'll never look the same again as long as he lives, if I decide to let him...
I ended up finding a used,less expensive trailer, went down there as planned expecting to make a killing as originally anticipated, and stayed 8 weeks out of the 6 months that was supposed to be executed in the "contract".Work came to a screeching halt when I arrived due to contract negotiations, fraud claims, dishonest politics, FEMA problems, etc. Most guys that fell into that trap like me lost a whole lot, unfortunately. People financed equipment, trucks, skidsteers, etc. against their homes, and unfortunately lost everything.The corruption that took place in that mess down there took a lot of good people down in the process.I guess I can consider myself fortunate compared to some...

 

[DigDug]

Sorry to hear that . Some lenders are crooks that need to be reported to the reglatory commission . The fact they asked for $3K up front should be a red flag. Hope everything turns out ok for ya. doug

 

[HeyUvaVT]

Dredging up an old thread to share a story

My father in law moves out here to the "country" to buid his retirement home..he has spent 45years as a successful lawyer in the DC/Metro area and now at the age of 68 he comes down here and buys 2 acres of land in a gated waterfront community and pays cash...goes to the bank and applies for a mortgage to build a house on his lot and gets DENIED on the basis of not having enough "liquid assets"...this man hasnt been denied financing once in his LIFE EVER and takes personal exception to this so he sells some stocks and makes a few transfers and re-applies for the loan with an account balance at the same bank of nearly 5x the amount he wants for his mortgage the bank falls all over themselves to approve this time and he goes into final closing to sign the papers...when they pass the contract over to him he tears it in half gets up and walks out telling them exactly what he thinks of the loan officer that denied him without fully checking into his financial statement the first time..to add insult to injury he transfers all his money back out of the bank and closes his accounts..then he literally walks across the street to the competition and has his loan approved the same day..as a final insult the president of the first bank got a hand delivered invitation to his house warming party when the house was completed...he didnt show up tho :crying :bouncegri

Sorry for the long post and no it has nothing to do with equipment but it just goes to show you that not only 21year olds and self employeed folks get d*cked around by banks...:bash

 

[Richfowl]

If it makes sense, we can finance it!

You say that you have receivables from a job that you will get if you can get the equipment? Then what you need is what's called "Factoring".

 

[Countryboy]

Welcome to HEF Richfowl! :drinkup

 

[OzDozer]

The major things you need to know about banks and any lenders of money .. are ..

1. They will fall over themselves to lend you money, when you don't need it .. and then deny you a small loan to see you out of a tight spot ..

2. They generally have the right to recall at outstanding loans .. in full .. at 48 hrs notice. They do not not need any serious reason to do so.
A bank destroyed my business, and all my lifes work (30+ years of gut-busting effort) by demanding repayment of all outstanding loans, within 48 hrs.
The reason? They had done some "forward computer projections - that showed I would possibly, not be able to pay my debts, in 6 to 12 months time" .. " :guns
As a result of their decision, all my assets were sold at fire sale prices. Not one other bank would take my business on, when they learnt that my bank had shut the door on me .. even though I had been in business more than 30 years, had a $15M annual turnover, profitable business, with 55 items of equipment and 65 employees .. and several hundred successfully completed finance contracts.
I could have taken them to court, and tried to fight them .. but who's gonna win? .. when they have $50 billion in assets and I've got $2.5 million?? .. and they can employ the biggest team of commercial lawyers in the country, and just wait until I run out of money .. ??

4. The easiest way to get quick finance is via a credit card .. banks will bend over backwards to give you $15K in TOTALLY unsecured finance on a credit card .. and you can get several, with ease .. but you would not be able to get a $10K loan to finance an item of equipment, from the same banks .. :Banghead

5. Never trust ANY lender! .. and the ones in big glass, concrete and steel buildings, are just as rapacious .. if not more rapacious .. as the ones who operate on the back streets of Philly or Chicago! .. they just use different enforcers, that's all ..

6. NEVER let ANY finance institution demand MORE assets for security .. than what the difference might be, if you default ..

By this, I mean - you borrow, say $30K, to finance a $40K machine .. meaning the most the bank could lose is perhaps the entire $30K (if you never made a payment, and wrecked the machine) .. but they DEMAND .. your house, additional property and assets, totalling $100K .. just to secure that $30K loan!
Whenever they try to do this .. drop a hammer on their greedy fingers!! They don't NEED that $100K in security! .. they are only grabbing it, for two reasons ..

1. It adds to their so-called "asset base" .. meaning they can then lend out another $70K on unsecured credit cards .. using YOUR assets as collateral!! .. which they show on balance sheets as THEIR assets! ..

2. It prevents you from borrowing further against YOUR assets .. even though you may need more money urgently, in the future (i.e. unforeseen dramas such as a good customer filing Chapter X - serious accidents that weren't your fault, etc, etc) .. and this is playing into the hands of the lender who lent you the money in the 1st place . .and who NOW has you by the cojones .. and is in a very good position to start SQUEEZING!! .. :crying

 

[Cat420]

Here's a chart that shouldn't surprise anyone that posted on this thread (except for the oil companies, everyone loves to beat on them)

 

[Serv]

Personally, I wouldn't exactly go so far as to say banks are anti business. Cautious, yes. I waited almost 8 years before asking my current bank for a loan.

In my recent experience, what the banker wants to see are just a few key things. They want to see the numbers as to what your purchase can and will do for your business (business plan). My business plan was a one page letter that my banker said was "Way more than enough". They also want the last couple of tax returns. You need to show a profit on those tax returns. Otherwise, how will you be able to make your payments? The last thing is a sizable down payment to get the deal done. Put the cards on the table and ask your banker exactly how much they expect as a down payment to borrow money.

Also, don't waste your time with the bean counter officers. They give some of these guys big titles to make you think you're talking to the owner of the bank. Meeting and dealing with a person that's truly up there in the ranks is a big plus and you can skip a lot of the BS.

If your current banker (account officer) is not helping you move forward, plain and simple, just request another officer. Talk to seasoned business owners that deal with your bank and meet the people in higher places at your bank. It can save you a lot of time and misery.


I'd be happy to share my simple business plan letter for my recent loan in case anyone wants to see it. Short, sweet and to the point. In my honest opinion, you need to sell "yourself" if you expect to get any money out of any bank.

 

[T_S_S]

could you share that letter with me?

 

[Finance Person]

A true story by a leasing executive who got a call from a banker.

A true story by a leasing executive who got a call from a banker.

A couple of years ago, I received an unsolicited call from a representative of one of the largest banks in the country. "I have been authorized to offer your company a preferred rate loan. The first year has a fixed seven and a half percent interest rate with no fees. Beginning the second year, the rate will be Prime plus one percent, and there will be a fee of just one percent of the entire line. What’s more, because of your fine credit rating and reputation, we will loan up to fifty thousand dollars without requiring financial statements. And that’s not all. [By now, I’m waiting for the six free steak knives]. We will provide a free business checking account. Just write out a check for your loan proceeds as you want them."

"All we ask," he added, his enthusiasm changing to the rapid-fire drug interaction warning whispered at the end of a Viagra commercial, "is that you keep ten thousand dollars in that checking account."

Heck, that ain’t hard, Mr. Viagra Banker. You just gave me fifty grand to play with.

Now let’s take a closer look. If I need $40,000, I have to borrow $50,000. Forty for me; ten for the "free" checking account in which I must maintain ten thousand dollars. (What’s that you say? You usually keep ten thousand dollars in your checking account? Well, it’s a long way from usually - or average - to gotta.) So, I can use forty, but pay interest on fifty. At seven and one half percent per year, the payment on a three year, $50,000 loan is $1,555.31 per month.

Now, $1,555.31 a month to pay off a three year FORTY THOUSAND dollar loan is, er, let’s see, 23.33 percent. And in a year number two it goes up to Prime plus one (plus a one percent fee). Even if there are no further increases in prime rate, payments will be $1,625.12 based on $50,000, and I can use only $39,500 ($50,000, less $10,000 in the non-interest bearing "free" checking account, less that pesky one percent fee). That works out to an effective interest rate of 27.59 percent.*

Your lease of equipment worth $39,500, with first and last payment in advance and a small documentation fee, is going to be hundreds of dollars less each payment, with a one dollar purchase option. Payments are even lower than that with a Fair Market Value or ten percent purchase option, giving you possible significant tax benefits, and, and, and ... and we won’t insult you with lies about "seven and a half percent" or "prime plus one.". Please compare our quotes to any bank or leasing company. But compare dollars to dollars, and terms to terms. Will leases have the lowest real rate? Surprisingly often they will and never try to confuse you with misleading terms.

 

[stumpjumper83]

Is she cute...? Seriously though your not going to be using the hoe to move snow. Now you have the need for a 4x4 pushing machine with a cab. So here is what I would do. Find a used steiger 4x4 tractor w/ a blade. They are usually used for stockpiling silage and haylage. Or a 2wd. w/ loaded tires and chains. Use it for the season, and sell it, and get your backhoe. Ag tractors are a good bit cheaper than backhoes, you can also find really low hour older models. $15k should get you a decent older farm tractor that can push a pile. Like this tractor. http://www.tractorhouse.com/listings/detail.aspx?OHID=5432926&GUID=d214e776a2cb407097186de7538ec829

 

[digger242j]

Uhh, stumpjumper, did you mean to post that in this thread?

Tell us where it's supposed to be, and we can move it...

 

[stumpjumper83]

sure did

 

[ok dirt witcher]

Bail out

$700 billion to housing, finance and wall street and not one have put it back out for loans or mortages like they verbaly pledged to congress when they grabbed the money and run. Now the Big 3 want $50b to $150b so they won't go under.
Point one: the reason the auto industry is in a bind is their sales have dropped 40% in 6 months??????? People are broke, scared out of work or expecting to be out of work in the near future so they're not going to buy their automobiles or anybody else's, why would they? even if they could the finance company's and banks won't loan unless you have a credit score of 750 or better and employed. I made a lot of money the first 6m. of 08 since then I haven't put a 100hrs on my dozer or backhoe combined. Went to talk to the bank and he didn't have a problem about extending my line of credit. (I'm in so deep he doesn't have much of a choice) the problem is I would't be in this shape if I had some work........Last 4 years it's all been in the oil industry and local farmers from time to time. Since Sept i've had 3 years worth of future contracts in oil and exloration jobs that the Oil company's have canceled. The farmers are hurting so bad they just planted around their ditches and washout's and if their ponds break they will sell the livestock. Give this country 6 more months like this or worse the small business owner (who employees 3 out of 4 jobs in usa) will be gone. They (gov) will not bail us out but the same Entity's and Company's that we gave $7 to $800 billion dollars of TAX PAYERS money to will forclose, bankrupt and/or liquidate all of us what it took all of us many years to get. Yes we have to bail out the automakers, (i dont think throwing money at it will work) it's vital for us as a country, but if there's no work who's going to pay the taxes that makes a bailout possible?? Banks are in the business of loaning money and the Fed Gov. needs to remind them of that, after all we as a Gov. loaned it to them. (I prefer gave to them, because you always hear about it going out but I can't ever recall reading in the news where industry has ever paid back loans from bailout money. Just my thought's on the whole sit. Sorry about the typos, misspelled words and the poor gramar I didn't get to finish college because I couldn't get a student loan.ointhead :Banghead:usa:usa:usa

 

[EMT]

I have run into this problem all the time. Banks want sure money, "we are risky business" not to mention we put up our houses, max out credit cards, personally garentee everything. Our whole life is invested to try to make something work.
Then when we get established, start to make money, try to expand or get better rates the banks kick us to the curb. They say "too much unsecure debt" , "low credit score" Who mad the credit score game rules anyway?
If you have money they will lend you more, If you need money the will turn you down. "The American Bank way" What a load of bunk!
Im not bitter just bummed.

 

[barklee]

Revolt, revolt, revolt........ one day the peasants are going to say ENOUGH IS ENOUGH and take this country back. Makes me think the machine we built is turning on us.. HA HA

 

[maloba]

Fools rush in. In my third world country(Kenya), they sms, call, invite you for a cup of tea with the manager having aptly n conveniently forgotten what they previously put you through once your account looks healthy. Take heart my brother, it's universal