Did you know that there are over 7,500 banks across the country? This may not shock you, but you will probably be surprised by the fact that despite the current economic climate, there are still hundreds of banks that want to lend you money!
"But how can this be? We are in an economic downturn! Credit markets are certainly squeezed!" I hear you say. Well, there is one main reason why banks want you to still access capital. Profit. We operate in a fractional reserve banking system which means that banks have the ability to lend out money in the form of loans based on a percentage of what they have in deposits or vault cash. So, for example, if you were to put $ 100,000 into a bank's savings account, that bank would then have the ability to lend out 9x that amount or $ 900,000 dollars. That $ 900,000 is created from thin air by the bank.
The banks have created money from thin air and want to make a return on this money. Would not you want to lend out as much as you could to profit from the interest if you could create money from thin air like the banks?
They all have at least $ 25,000 – $ 100,000 that they will lend to qualified borrowers. If it's this easy I hear you ask, then why is not everyone doing this?
Well, quite simply, unless you have the three "keys to the vault" (excuse the pun!), Then you will probably have your application for credit forwarded.
The three keys are who, what and how:
- Who to ask – This is knowing the right banks to ask. There are, in fact, thousands of banks across the country: 7,540 according to the FDIC, the federal institution that insures the banking industry. However, only a small percentage of these banks have the types of loans that we are looking for. Do not waste your time trying to figure out which are the right banks to talk to, go to a source that already knows this.
- What to say – These are the words that you speak. The words that you speak have a huge impact on whether you get the money.
- How to present yourself – This is more than the level of confidence that you have or how well you dress. This has to do with how you fill in the blanks on the bank application. How well you present yourself on the application to the bank is critical and will determine your success or failure in acquiring capital.
Once you have these three keys, you will be successful in your credit applications, and there is no limit to the amount of credit you can access. This information is invaluable … think how much time you will save by knowing all this information from the word go. Remember that, if you just blindly apply for credit in every area, this could work against you.