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View Full Version : Friend Or Vise President????



FASTERDAMITT
12-01-2005, 08:41 PM
I need a little advice from you all. I have two offers to start a Home Mortgage Lending Business. One from a long term friend and the other offer is from the Vise President of the company I work for.
The friend has been in the business for around ten years. Formerly employeed at Di-Tech, and has been working from home for five years successfully. Friend is a little insecure about opening an office. He would rather do marketing from the home office for awhile, until he is confident about having the larger investment. Personal commission the same as the VP suggests.
The VP however is ready to take the plunge with a office with 8-10 loan officers and a processor/receptionist. Investment would be $50,000 to start and first quarter marketing budget $60,000. Second quarter net profits are around $115K, not including my personal commision.
Any suggestions?

ACCEPTENCE
12-01-2005, 08:51 PM
Just Do It !!!
I was told this when faced with a large life changing decision:
"If you don't give yourself permission to fail, you will NEVER give yourself permission to succeed"
Good luck!!!

FREIND OF AA AND TA
12-01-2005, 09:03 PM
Never do buisiness with friends!!

WetWillie
12-01-2005, 09:09 PM
Never do buisiness with friends!!
Or FAMILY!!
EVERYONE DOES MORTGAGES?? :mad:

FASTERDAMITT
12-01-2005, 09:37 PM
Never do buisiness with friends!!
That's exactly what I have been telling myself. How do I break it to him?
WETWILLIE, I know what your saying. I just closed two loans for my father-in-law. Very stressful for me. He's stated income but wanted full doc. It was hard to explain to him his DTI was not working full doc.
ACCEPTANCE, That I will most likely do!

WetWillie
12-01-2005, 09:43 PM
Best of luck to you! I didnt mean to come off as mortgages are a bad thing..
Lots of room for good honest hard working peoples!

FASTERDAMITT
12-01-2005, 09:58 PM
Best of luck to you! I didnt mean to come off as mortgages are a bad thing..
Lots of room for good honest hard working peoples!
I didn't take it negative anyway. With the incredible equity increases in the last few years there has been a opening for alot of crooks in the business. You wouldn't believe how many crooked shops open and fund a few million and dissapear with the cash. Or bait and switch.
I'm here to be a service to my community and beyond. Hard to sleep at night when you take advantage of people's life savings.

voodoomedman
12-01-2005, 10:08 PM
I need a little advice from you all. I have two offers to start a Home Mortgage Lending Business. One from a long term friend and the other offer is from the Vise President of the company I work for.
The friend has been in the business for around ten years. Formerly employeed at Di-Tech, and has been working from home for five years successfully. Friend is a little insecure about opening an office. He would rather do marketing from the home office for awhile, until he is confident about having the larger investment. Personal commission the same as the VP suggests.
The VP however is ready to take the plunge with a office with 8-10 loan officers and a processor/receptionist. Investment would be $50,000 to start and first quarter marketing budget $60,000. Second quarter net profits are around $115K, not including my personal commision.
Any suggestions?
Strictly from a business standpoint the VP is the way to go. Just watch your terms so he doesn't own you because he's putting up all the money. But anyways here is why I suggest this. Having many friends and family in the business I can tell you that the ones that are spending the money are the ones that are making the money. Another great thing to having a big marketing budget is that it is alot easier to sell to someone when they call you instead of you cold calling. It's great your friend has been successful from home but in the mortgage business that works for individuals and it takes time.

FASTERDAMITT
12-01-2005, 10:34 PM
Strictly from a business standpoint the VP is the way to go. Just watch your terms so he doesn't own you because he's putting up all the money. But anyways here is why I suggest this. Having many friends and family in the business I can tell you that the ones that are spending the money are the ones that are making the money. Another great thing to having a big marketing budget is that it is alot easier to sell to someone when they call you instead of you cold calling. It's great your friend has been successful from home but in the mortgage business that works for individuals and it takes time.
Thanks. This is a 50/50 partnership. Investment and profit's. I agree. They both are in the same income bracket as for now. Two different approach's. I see my friend happy with his income for the most part. But I know he's aware that if he had an office of this kind he could let the loan officers produce his income in time. He has no real business plan but knows what he is doing for himself.
The VP has a full 31 page plan for our venture. One difference between the two is the business aggresivness. The friend will do 10-12 loans a month for minimal profit on each. The VP is fixed on more aggresive approach as to do 4-5 at a higher margin. What concerns me there is, the VP has much less refferal business due to the higher fee's/rates. Am I making sense?

HocusPocus
12-01-2005, 10:39 PM
Never do buisiness with friends!!
i agree.
that is if you want to keep them as friends.

FASTERDAMITT
12-01-2005, 10:44 PM
i agree.
that is if you want to keep them as friends.
I hear ya. But will I lose him as a friend when I tell him of my venture with the VP?

voodoomedman
12-01-2005, 10:48 PM
Thanks. This is a 50/50 partnership. Investment and profit's. I agree. They both are in the same income bracket as for now. Two different approach's. I see my friend happy with his income for the most part. But I know he's aware that if he had an office of this kind he could let the loan officers produce his income in time. He has no real business plan but knows what he is doing for himself.
The VP has a full 31 page plan for our venture. One difference between the two is the business aggresivness. The friend will do 10-12 loans a month for minimal profit on each. The VP is fixed on more aggresive approach as to do 4-5 at a higher margin. What concerns me there is, the VP has much less refferal business due to the higher fee's/rates. Am I making sense?
Your making complete sense. There is money to be made both ways. People with bad credit and stuff expect to pay more and you will get them into those option Arms and stuff and make some good money. But treat them right and they will come back or send a friend. Also someone with with 750 FICO's your not going to make a huge profit but it is still a profit and it all adds up. Those people also are probably more educated when it comes to finances so if you really do things right they will tell people so and be trusted because their friends and family know they are good with their money. But most importantly. The best thing to do is work towards being the boss and having your loan officers do most of the work. If you are going to do all the work you might as well just keep working for someone else. Maybe you make a little less but you go home at 5 o'clock and leave the office behind you. Having others do the work you have that stress but you can focus on making the business more profitable and it will all be worth it the first year you bring home a million dollars.

HOOTER SLED-
12-01-2005, 10:48 PM
I hear ya. But will I lose him as a friend when I tell him of my venture with the VP?
If he is a true friend, he will understand and respect your decision whatever it is. Good luck brutha.

WetWillie
12-01-2005, 10:58 PM
Try and get another 5%
Thanks. This is a 50/50 partnership. Investment and profit's. I agree. They both are in the same income bracket as for now. Two different approach's. I see my friend happy with his income for the most part. But I know he's aware that if he had an office of this kind he could let the loan officers produce his income in time. He has no real business plan but knows what he is doing for himself.
The VP has a full 31 page plan for our venture. One difference between the two is the business aggresivness. The friend will do 10-12 loans a month for minimal profit on each. The VP is fixed on more aggresive approach as to do 4-5 at a higher margin. What concerns me there is, the VP has much less refferal business due to the higher fee's/rates. Am I making sense?

Mtg Pro
12-02-2005, 05:17 AM
I sent you a PM.

FASTERDAMITT
12-02-2005, 07:47 AM
Thanks for all the advise peoples. I'll keep ya up to date.

SummitKarl
12-02-2005, 08:56 AM
I need a little advice from you all. I have two offers to start a Home Mortgage Lending Business. One from a long term friend and the other offer is from the Vise President of the company I work for.
The friend has been in the business for around ten years. Formerly employeed at Di-Tech, and has been working from home for five years successfully. Friend is a little insecure about opening an office. He would rather do marketing from the home office for awhile, until he is confident about having the larger investment. Personal commission the same as the VP suggests.
The VP however is ready to take the plunge with a office with 8-10 loan officers and a processor/receptionist. Investment would be $50,000 to start and first quarter marketing budget $60,000. Second quarter net profits are around $115K, not including my personal commision.
Any suggestions?
I would go with who ever you TRUST!!!!!!!!!!!!!!!!!! the most and whos plan most is in line with yours.
from someone that has either started or been a part of many Hi-tech start-ups
the ones I built slow, were the ones that worked, The ones that required large capitol to start........ALWAYS FAILED!!!!!!