1. Think that each loan is a challenge not a chore.
Each loan is an opportunity to put to work the knowledge, the experience. Here’s a challenge to my judgement, a problem to be solved, analyzed, evaluated, and concluded. An opportunity to grow and to increase my effectiveness by learning more about a borrower, a business, an industry, ...
2. Do not prejudge , listen instead and understand.
Sounds easy isnt´t ? but it is one of the most difficult things a human being can do. Most of us don’t listen (we are so busy thinking of what we’re going to say, that we fail to hear and understand in fully). We judge ourselves by our thoughts and others by their actions and words. We must strive to hear precisely what the other person says and then to understand why he said it and what he really meant. Only after we have listened attentively and sympathetically and have understood intelligently should we attempt to evaluate.
3. Don’t pretend to know if you don´t .
You are very wise if you know your limitations. So never hesitate asking questions about other things you don’t know. When a borrower assumes incorrectly that you know certain things about him or his business or his industry or even about commercial lending or law, it is dangerous to let him proceed on that assumption.
4. Don´t get lost on details.
Keep pushing yourself back from the details (though they must be covered) in order to stand off and view the credit as a unified whole. We can become so immersed in figures and details as to lose sight of, or give inadequate attention to, the broad strengths or weaknesses of the credit as a whole. Keep standing off for perspective to see that the picture is complete, that nothing has been left out, that no loose ends remain. Keep looking at the tree, the whole tree, and its place in the forest about it.
5. Remember "how good" is less important than "how liquid."
A safe transaction is a transaction that has no loss. A sound transaction is a transaction loan that can be repaid within its maturity terms without hardship or stress on the borrower. Any transaction must be safe and it must also be sound. Borrowers must not only have adequate balance strength or adequate security, they must also have adequate repayment ability. Always ask yourself this question: "How is the borrower going to pay it back?"
6. Don’t ever commit yourself too soon
Don’t speak the word until you’re prepared to do so and until you’re prepared to be bound by its consequences:
Be sure you have all the facts and that every consideration has been weighed before you commit yourself on any point or in any way at any stage of the discussion. Once a statement is prematurely made or a decision prematurely announced, you’ll be so busy trying to justify your position..
7. Don’t attribute the dirty work to "Headquarters" or "the Credit Committee".
Never say that you might well agree but that the loan refusal or some other disagreeable decision, is the work of "HQ" , "the Credit Committee" or "those people at central office." . You represent your company; you are YOUR COMPANY; you must assume full responsibility for any decision made by your company (we think; we have decided; we...), even if you agree little with it. Your responsibility is to argue the merits of the decision; once it is made, it becomes your decision also. If it then needs defending, you must defend it as your own decision.
8. Never apologized.
Timidity has no place in our makeup. Be sure of your ground, evaluate carefully, then say straight out what your considered judgment dictates, without apology or hesitation because you suspect it may prove disagreeable.
9. Accept full responsibility
and make decisions promptly on your own when you know you have all the facts, have considered all aspects of the case, and have sound reasons for the decisions you make. When you are certain, act, because you believe in your judgement and not by a desire to show your authority or that you have the power to act without consulting.
10. When you are going to say "yes," just say it.
Most problems in life have shades of grey. When you’ve concluded that you’re going to grant a loan request, you must have decided that the pros outweigh the cons. Let it go . Weaknesses that might be helped through constructive comment should be discussed before the decision is reached; once reached, a favorable decision overrides such weaknesses and should be given positively. Don´t imply you are making a favour to anybody.
11. Lend, as if the money you are loaning were your own .
If you say "No" to investing your own funds, then the answer should be "No" for investing your company’s.
12. Be yourself and forget this list.
Lending money soundly and constructively is primarily a matter of applying intelligence to the facts in each case. Intelligence is simply common sense--or perhaps uncommon sense. It is the ability to apply knowledge and experience to the successful solution of a new problem.
Sound lending requires intelligence; setting up list like this is something anybody can do.
November 24, 2015 at 11:07AM
from Alejo Lopez Casao - Blog http://ift.tt/1T82XIS