Lending money to friends and family, right off the bat, this is a bad idea. Yes, we would strongly like to see referrals come to us from lenders but it’s best to remain on a professional level at all costs. It is normal for people to discuss their finances with friends and family, and it may come up that you do loans through gap investors. What you may find is that eventually someone close to you will ask for a loan or it may be for a friend of a friend. It is best to end the conversation there and pass the lead on to us and let us do the rest. That person will then become a referral from you for Gap.
Here are some of the many reasons why Lending Money To Friends And Family is a bad idea; Friends and money do not mesh well together. Friends will expect favors from there good buddy “the lender”. They will expect a lower interest rate, wave fees, extended term loans, think that being late with payments is acceptable, and one can never imagine a time that their friend would foreclose on them. Another good reason is: what if you review the property, proposal, etc and have to say “no, I will pass”. This too strains a good relationship. We, on the other hand, do our thorough due diligence on the property and loan parameters and can say yes or no as well as assume the blame for not going forward, alleviating the lender of that pressure and the friendship will continue! If it is a good loan, we would love to see it. Use us, “Gap” as the buffer. One can even play coy, and say that they are not sure what all Gap does but they are my brokers and I only follow their recommendations. Does that not make sense?
There is a reason why doctors do not operate on family members! It is hard to be impartial when it comes to helping a friend get a loan but inevitably ends badly and the person receiving the loan will probably harbor ill will to their good friend for helping them out even if the loan goes well. Do you want to really phone your best friend or family member and remind them of the late fees they are about to incur because they are 4 days late? It makes for a lousy turkey dinner experience at Christmas or the Sunday BBQ.
Now let’s talk about referral fees and how they work: Word of mouth is the best advertisement still, even in this age of the internet, facebook, twitter etc… That is why we treat the borrowers and lenders fairly and with such high regard. Good business practice as well. We pay referral fees to the people that recommend the loan to us, of course only upon successful completion. We will discuss the amount on a case by case scenario. Given the glacial process in Costa Rica to obtain a mortgage, you will be helping people in ways you cannot imagine! Simply ask them to fill out the app and ask them to put your name where it asks How Did You Hear About Us?
Check out our FAQ page here www.gapinvestors.com/investors/investor-faq