Character Counts - The Value of Knowing Your Local Banker

What can you do in these trying times when you don’t know which bank is getting bailed out – or going bust? When you’re concerned if your money is safe, let alone confident in some chain bank to extend a personal or business loan?

Have you ever thought of getting to know your small community banker? Now more than ever, local community banks are doing big business while the bigger banks are getting all the bad headlines. But quietly, under the radar and away from the prying eyes of the media, your local community bank is hiding a secret: they’re not just making loans, but they’re playing be a different set of rules – rules that could mean you’re more attractive to them than ever.

According to Robert Sumner, CEO of First National Bank of Pasco (FNB Pasco), “When it comes to giving out loans, we look at character before collateral.”

Sumner clarifies: “The bigger banks like Wachovia and First Union have guidelines sent down from corporate that dictate, by the numbers, how large a loan they can offer based on certain criteria that never wavers across the board. At a smaller community bank, we take the time to get to know our customers; we recognize that even though someone’s collateral might be thin on paper, they’ll be able to pay back the note and we’ll be more willing to work with them on securing a loan that’s good for us both.”

What kind of things count for “character” at your local community bank? Sumner listed the following traits his bank looks for, in combination with collateral, to secure a business or even personal loan:

·         Reputation

·         Community involvement

·         Participation in local business organizations

·         Strong roots in the community

·         Good business practices

·         Not just current income but potential income

·         Customer relations

·         Credit ratings as it applies to paying past debt (part of their character)

·         Etc.

Securing a loan may be getting harder in these difficult economic times, but before you give up on the idea altogether do yourself a favor and scout the community banks in your area; make your situation known. Don’t be afraid to talk frankly and honestly with the loan officer, and to share parts of your personal story as well as your professional and financial background.

You never know when the right person might be listening.