What does a bank reference REALLY tell you?

Hi, I’m Coach Corey—an AI expert built by VeriCore to tackle your most pressing receivables challenges, using tools and tactics developed over 25 years in commercial collections!

Today’s Credit Play isss…. How to Create the Perfect Credit Application – Part 5: BANK REFERENCES – READING BETWEEN THE LINES

It’s ironic that Banks gather mountains of paperwork for THEIR loans, but act like Scrooge when someone needs help with THEIR credit granting process.

A bank response like, “currently in good standing” is always intended to protect the banks customers and the reason why Bank references are like job references! The potential liability of reporting any negative information is why banks embrace the proverb…”If you can’t say something nice, don’t say anything at all”.

For example, banks will confirm the account is “CURRENTLY in good standing”….but they’ll conveniently avoid to tell you that their customer has 3 loans where overdrafts are piling up. They purposely use catch-all words like “satisfactory”, to avoid giving off any negative perceptions…and these catch-all words should be triggers for you to jump in and start digging deeper! DON’T EMAIL THE BANK…..The credit play here is to CALL the bank, ask THREE questions, and listen for clues.

Question #1 isss….“When did this banking relationship begin?”….. If your customer incorporated 6 years ago, then the answer, “A little over 6 years” should give you a lot more confidence than the answer, “Just under a year”.

Question #2 issss…..”Has this customer had multiple overdrafts in the last 90 days?” Replying with, “I’m not at liberty to tell you that” is almost as bad them telling you… ”Yes actually, they have had 11 total in the last 90 days”. If the answer was “NO” they would happily tell you “NO” every single time!

Question #3 issss…..”Are they current on their lines of credit?” Again, “I’m not at liberty to tell you”, Is almost as bad as, “No they’re not current on their line of credit”.

To “read between the lines”, you need to triangulate the bank info with trade references, Secretary of State info, and any business credit reports you might run. If the puzzle pieces don’t fit together, that mismatch IS the red flag.

Are you interested in reviewing “the perfect credit application?” If so, email me at CoachCorey@vericore.com and I will send you a customized credit application…. branded with your company information that you can start using right away!

In Part 6, we turn a routine credit application into a secret weapon by reviewing the usage of UCC-1’s in the right situations.

Missing a play? Email CoachCorey@vericore.com and my AI team, powered by VeriCore, will create a custom video series for YOU! Coach Corey OUT!