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Hard to Fund, Hard to Trust – My Simple Lending Filter

Unfortunately, this week I didn’t have much time to sit down and plan out a full-on podcast episode. Things have been a little hectic with travel, a couple of business conferences, seminars, and everything in between. Still, I wanted to make sure we had something to put out this week so I thought I’d share my favorite “Lending Filter” that I use on a regular basis.

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This lending filter that has served me very well—especially during the underwriting process when I’m vetting borrowers, going through loan criteria, and figuring out whether a deal is worth funding. And that insight is this: If it’s difficult to give money to a borrower, it will be even more difficult to get money from them.

If it’s difficult to give money to a borrower, it will be even more difficult to get money from them.

What I mean by that is something I first heard from another lender, and over time, I’ve found it to be absolutely true. There are just some borrowers who make every step of the process feel like pulling teeth. They say they need the deal to close quickly, they claim to be ready to move fast, and they talk a big game about needing funding—but when it comes time to follow through, they drag their feet. I say, “I’m happy to help, but I need you to send over some documents—X, Y, Z,” and what follows is a painful waiting game. Getting them to send even the most basic materials becomes a hassle.

… but when it comes time to follow through, they drag their feet.

And that’s the whole point: If it’s this difficult just to give them the money, imagine how difficult it will be to get paid back. I’ve learned to pay close attention to how borrowers handle that initial exchange. If someone responds quickly, sends over everything I ask for without delay—the purchase agreement, the comps, the supporting docs—then that tells me a lot. Those are my favorite borrowers. I don’t need to chase them down. I don’t need to follow up five times. We’re ready to go.

So again, take that for what it’s worth. It’s a simple lending filter, but one that has saved me countless hours and headaches. Hopefully, it helps you too. Next week, I promise I’ll have something a little more substantial. I just got back from a scaling workshop with Alex Hormozi, and I think that episode will be extremely valuable. So stay tuned!

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