How to Negotiate With a Banker

With much hard work and planning, the purchase of a new car, home or business can be close to becoming a fulfilled dream but, in many cases the time for the need may come before all of the funding has been obtained. In these situations, it becomes necessary to seek a loan to help make up the difference. When seeking a loan from a banker, it isn't the banker trying to sell you money. Rather, it is you trying to sell the banker on why he should loan it to you.

Instructions

1

Call ahead and make an appointment with the banker of your choice. Though many banks will permit visitors on a walk-in basis, it is polite and smiled upon by bankers if you show courtesy by calling ahead and asking for a set time to visit with the banker.

2

Present the banker with a copy of your business plan, if starting a business, during the appointment. The business plan should show initial start-up costs, a plan on how income is to be made as well as projected income over a specific period of time. The business plan must be written in a way to show that you have taken into account all of the risks involved and how you plan on mitigating those risks.

3

Provide bank statements for all checking and savings accounts, as well as lists of valuable property such as homes, boats, cars, and anything else of value which you are willing to put up as collateral for the loan. Collateral means that you are willing to let the bank take those items should you find you aren't able to pay off the loan requirements for which you sign any loan contract.

4

Make it a rule to never attempt to seek a loan for more than half of the total needed. If you need $10,000 to buy a car, for instance, try to save up at least half of it and then ask for the other half from a banker. Bankers like to see this kind of initiative when negotiating with them and will be more inclined to give you the loan you seek.

5

Attend a negotiation in your best apparel and with a smile on your face. Be confident and don't let the banker "see" lack of confidence in your eyes or your face in general. If you appear nervous and seem to lack confidence in your ability to repay a loan, a banker will be able to see this from the way you carry yourself and the answer will most probably be "sorry but no."

6

Go to the negotiating table expecting to pay half of the value of what you are planning to buy, but start by asking for 75 percent of the value from the banker first. By starting high in this way, you may be able to receive 55 to 65 percent of the money from the bank rather than just 50 percent. However, if the banker doesn't appear to be interested, allow him to talk you down to 50 percent or, if you can, even 40 percent. In this way, you greatly increase your chance of walking away with at least something.