Rich Dad Education Blog

Tips for cultivating strong relationships with your bankers

By Jordan Taylor

If you feel somewhat intimidated by bankers, you’re not alone. Plenty of people share your feelings. After all, bankers have the power to say “yes” or “no” to your loan requests, and that’s quite a bit of power for someone to have over your business.

Keep in mind that banks are not just benevolent entities that lend you money just because you asked for it. They are businesses, and their product is money. Just like you, they’re in business to make a profit on their product, and they do that by lending their product (money) to individuals and businesses, and charging interest, points, origination fees, closing costs, and other service fees. Banks want to make loans, but they have to make good loans, meaning loans that will be paid back on schedule.

By borrowing money from a bank, you are a customer on whose loan the bank is making money. You should act and be treated accordingly. Think about this: When you go into a restaurant and order a steak, does it even occur to you that the server or the cook might not “approve” of your order and therefore might not allow you to have it? Of course it doesn’t. And though that might not be a completely fair, apples-to-apples comparison, it’s not as different as it appears to be on the surface.

Just as there is good and bad in any industry, there are good and bad banks, and good and bad bankers. Most bankers are like most other people: They go to work every day and do their job as best they can without ever standing out. Many bankers don’t even have a lot of business experience. They come out of college and go into bank training programs, and their knowledge of business and investing comes more from textbooks than from practical experience. Learning banking is like learning anything else; if a banker can learn it and be trusted to make loans, why can’t you learn whatever it is that your banker knows?

Outside the bank

Getting to know bankers personally can take a lot of the mystique out of what they do. You can meet bankers by asking friends and business associates for introductions and referrals, as well as by getting involved in your community. Banks encourage their senior staff people to be involved in chambers of commerce and other civic organizations. Join those same groups and begin building your banking relationships. As you meet bankers in social and service situations, you will have many great opportunities to show them what you know by talking about business and investing in a knowledgeable way, but don’t, of course, bring up the fact that you’re looking for a loan when you’re at a networking cocktail party or a kids’ sporting event.

Remember that cultivating these relationships is a long-term investment of time and effort. Introductions made now might not pay off until far into the future. The junior loan officer you meet today might become president of the bank in 10 years, so nurture that relationship.

Inside the bank

When you go into a bank to meet with loan officers, you should approach them with confidence. They are peers, not superiors. They are not doing you a favor by lending you money; you are doing them a favor by borrowing from their banks.

With that said, you still need to be courteous and respectful. Make appointments for meetings and be on time; don’t just drop in and expect the bank officer to be available to see you. Appointments demonstrate that you value both the banker’s time and your own. Dress appropriately and remember that appearance does count. You don’t need to have on the latest designer fashions, but you should wear whatever is considered to be appropriate business attire in your community.

Interview bankers until you find someone with whom you are compatible and feel comfortable. Find the someone who believes in you and what you’re doing, and who will go to bat for you. Also make sure that you’re dealing with bankers who have real authority. Find out what their lending limits are, and if they don’t have the authority to make the kind of loans you need, find out who does.

Give bankers all the ammunition they need to work with you. Put together complete, attractive loan packages. Anticipate any questions the banker may have about the deal, and include the answers with appropriate documentation in the package.

Finally, when it comes to banking, the old saying of “don’t put all your eggs in one basket” has never been truer. Don’t deal with just one bank; establish relationships with several banks by dividing your deposits and loans among different institutions. This way, when one bank can’t provide what you need for any reason, you’ll have a backup lending source that you can access immediately.

Jordan Taylor is a regular contributor to Wealth Intelligence Magazine.