The Importance of Education!
By Steve Mariani
As much as this may shock many of my regular readers, I wasn’t the greatest student and didn’t really enjoy school, EVER. What I did learn at an early age was the saying: If you’re not the lead dog, the view never changes. Being in a few different careers along my many years I have also learned another important lesson, education and knowledge is the key to success. Staying current in your industry is critical and the only options are that you can lead the way or follow someone else. Those who know me know which path I took and if you’re reading this, you probably took the same one.
I did attend college and did graduate and like 76% of American graduates, I don’t use my degree and it doesn’t relate to my current line of work. Part of the reason was because I was taught so many subjects that I found had no relevance to the real world or my daily life and I had no time for those type of time wasters, I was on a mission to be successful (although a writing class would have been helpful looking back).
Today, as I conduct workshops and classes all over the country, I find that current information and cutting edge rule understanding is critical and the only way to survive in today’s lending markets. Our niche’ area of expertise demands we be the expert day after day and all over the country. We are called on to understand and know how to address a license concern in Oregon and then a homestead rule in Texas, for example. We also have to address and understand the constant changing of SBA rules which happens almost every 6 months these days. Some good rules and some bad but they all must be considered when submitting a completed loan request.
One rule that was put into place almost 5 years ago and is still underutilized is the 25 year rule. This rule basically says that if the real estate value is 50% of the “loan amount” then the entire loan term can be termed out for the full 25 years. I bring this to your attention because this rule is optional and very few lenders utilize it. At Diamond Financial, we insist our lenders term this to 25 years every time the option becomes available with no exception. The savings, on the overall cash flow to a buyer, is just too beneficial to allow any lender to determine the amortization schedule on a blended term basis. A benefit that helps not only the buyer but all parties involved.
Another example is the personal collateral rule change that makes taking personal liquidity as collateral is now optional. Meaning that a lender does NOT have to lien a stock portfolio or personal cash account but again, this is optional and must be addressed and considered upfront.
Putting your client first and providing the highest level of service can only be achieved by staying on top of our industry and understanding the entire transaction from their perspective. We consistently use each and every rule to the best of our ability to benefit the transaction. We have also become the source for many national SBA lenders for information on these rules and share on how other lending sources are interpreting them.
Education is the path to the future and classes are not only provided locally but also on line in many cases. I cannot stress enough the importance as I speak with brokers all over the country that still quote and live by old outdated rules and misconceptions about SBA financing. Buyers are much more informed these days and by quoting anything outdated shows badly to any potential client, ours or yours.
Diamond works for the broker and his buyer with everyone’s best interest in mind, always. We want to help you become the lead dog in your market (if you’re not already).
I have personally expanded my workshops and am presenting at many local BBA meetings along with expanded webinar offerings to supply this critical and ever changing information. If you would like to have your local BBA or broker office of 10 or more host a workshop, have your local chapter contact our corporate headquarters for availability and information including our 7 workshop topics for 2017.
AskDiamond@easysba.com is always available for specific questions regarding this or other SBA rules.