Don’t Be the Middleman: How Selling Your Loans Reduces Stress, Increases Productivity

May 2017

By Selina Stoller, Summit AmeriFirst Holdings, LLC

Whether you sell items like cars, houses, or are in the business of helping your client finance them, dealing with loans and loan payments can get tricky. 

Once the deal is made, the paperwork is signed, and hands are shaken, smiling buyers walk away as debtors – people who will owe you and your company for years to come.

Each person is different. You may have buyers who will always make payments early or on time. Some may forget to make the occasional payment. In the financial industry, missed payments happen and should be an expected part of doing business.

However, is reminding your customers of their delinquent payments something you really want to do?

Think about it this way: when a client misses a payment, it now becomes your job to become the middleman. Doing your own debt collecting is expensive, time consuming, stressful, and no one wants to be the target of frustration when you call to inquire about payments.

The solution is selling your loans.

Selling loans to outside agencies not only reduces stress, but it can increase the productivity of your business, mainly because you won’t be running an in-house collections agency and you’ll continue to have strong buyer-seller relationships. What a relief!

Other benefits include creating liquidity in the market and the chance for your company to make a profit. Selling loans is a practice large corporations and even some countries do from time to time.

Last month, Fannie Mae announced the sale of 9,400 non-performing loans that carry an unpaid principal balance of $1.68 billion. Moreover, banks in the United Kingdom are selling their multi-billion euro portfolios to foreign lenders, which has brought a more domestic focus on their home markets and clients, according to Reuters.

By selling your loans, you can take away the busywork of debt collecting and can focus on growing your business and keeping your customers smiling.

  • 3 May, 2017
  • Josh Smith

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