For financial planners looking to secure a loan, making a good first impression with the lender is crucial, according to NAB national manager for financial planner banking Daniel Lowinger.
The ability of the borrower to repay the loan is always the bank's primary concern, and the first thing NAB looks at to assess regarding the likelihood that "the money [will] come back to us over a period of time" is the borrower's character, said Lowinger.
"We look at the individual borrower as well as any key partners and directors within the business … Are they considered to be people of integrity with a good personal reputation?" he said.
Along with the character of the lender, NAB also looks at cashflow, the collateral backing up the loan, and the capital structure of the business, Lowinger said.
NAB also considers the potential borrower's personal profile within the industry – and in the public domain more generally.
An initial face-to-face meeting is also important, because "you get a lot from sitting across the table from an individual", said Lowinger.
"There's also that 'gut feel' sitting across from someone. Do we actually believe what they're telling us? Because the numbers might look okay, but you just get that feel," he said.
The openness of the borrower during the application is also closely scrutinised, including whether they 'balk' at answering particular questions, said Lowinger.
Another key consideration in the assessment of character is the borrower's history in repaying small loans in the past, he said.
"We're probably OK the first time [a payment is late, but] when it happens two or three times you start to question their integrity and character," Lowinger said.
