Why You Should Build a Long-Term Relationship with Your Lender

Why You Should Build a Long-Term Relationship with Your Lender

Financial advice websites do not typically talk about establishing long-term relationships with lenders in the context of hard money. That’s too bad, because establishing a long-term relationship with a hard money lender could mean access to fast cash for all sorts of projects. Hard money lenders are no different than any other kinds of lenders in that they value relationships with their clients.

Clients are more than just borrowers to us. They are people trying to build businesses. They are entrepreneurs who invest in local economies, create jobs, and help us meet our own business goals. So if we can build long-term relationships with clients that will give us numerous opportunities to work together, we certainly want to do that.

A Lot More Flexible

One of the most important characteristics of hard money loans is their flexibility. As private lenders, we are able to overlook certain things that banks cannot. In light of that, we are able to offer more flexibility to those clients with whom we have established long-term relationships.

Perhaps we have a client we have been working with for years. We have funded numerous projects without issue. Should that client come to us in search of funding for a new project, despite a temporary lapse in cash flow, we might be able to see our way clear to looking past that problem. Why? Because our years of experience with this particular client tells us we can trust them.

3 Things You Can Do

Whether you are in Actium client or you work with another lender, there are things you can do to build and maintain long-term relationships. Three of them are described below. As you read, remember that solid relationships lead to more productive projects.

1. Maintain Consistent Communication

Communication is the linchpin that holds lenders and borrowers together. One of the easiest things you can do to establish long-term relationships is to commit to consistent communication. If your lender asks you for a particular document, get it back to them as quickly as possible. When the phone rings, answer it. When an email comes in, respond to it in a timely manner.

Borrowers often complain that their lenders do not communicate effectively enough. We work hard to make sure our clients don’t have that problem with us. At any rate, communication is a two-way street. Do your part.

2. Practice Honesty and Integrity

Nothing raises a red flag faster than suspicions that a borrower is not being completely honest. However, the opposite is also true. A lender who knows you can be trusted is a lot more likely to look favorably on your application. You can help your cause a great deal by always practicing honesty and integrity.

It is important to be honest even when doing so could jeopardize a project. On the other hand, being dishonest automatically puts your integrity into question. Hard money lenders do not want to see this sort of thing. They want everything above board right from the start.

3. Maintain an Open Mind

Long-term relationships are more easily established when both parties maintain an open mind. Having an open mind is essential to hard money because no two projects are exactly alike. On any given project, your lender might see a different strategy for helping you reach your goals. At least consider it. If you can make it work, give it a shot.

Long-term relationships with lenders tend to be more productive than a strategy of choosing a new lender for each project. Work with the same lender over the long term and great things can happen.