Additionally, in the event you fail to create the cash circulation necessary to pay back the loan, it is the responsibility of the US taxpayer to guarantee the loan ultimately. Of course, hopefully the lender has made enough good loans to compensate for your bad one. But if the banks are poor stewards of their depositors’ money and enough of their loans go south, it will ultimately be the taxpayer through various governmental agencies like the FDIC that will bail them out.
You would think this would humble you enough to make extra sure that you would be able to pay back the loan. That you would do everything in your power to eliminate all the risks and uncertainties in the business you’re going to attempt. That you’ll run projections, research the market, take a look at your competitors and have the most comprehensive and thorough business plan possible all in an attempt to be sure you could pay back the loan. 15 million of other people’s money, you’ll make sure that you could sell those homes and pay them back the first place.
It was middle 2005 and my manager arrived to my office and put a document on my desk. It was that loan we had done because of this real estate designer about a 12 months ago and not just do he wants to refinance the initial loan but take out a new one for a fresh development he was proposing.
- How to Start your own Artificial