Understanding the conditions that governs the act of loan giving is very vital,if you truely seeks financial freedom.Financial intelligence is very vital in the art of loan management.Loan management has to do with loan giving,loan taking,loan servicing,loan protection and receipt and loan commercialisation.
Loan servicing, has to do with repayment of loans taken and the accompanied interest,loan protection receipt has to do with deliberate and legal attempts,precaution and protection made towards get paid back a recent loan given out and the accompaning benefits.It equally includes all conditions and agreements that governs the loan given out. This is the most important aspect of loan management.Finally, loan commercialisation is the money making aspect of the loan,the benefits derived from the loan.Good loan is a good commercialized loan for the giver,while for the receiver,the least commercialised loan.
Loan management is very important for finance management.
For those receiving loan,don't bear the direct loan incidence or burden,lets another person pays for the loan or a good servicing structure to taken care of the would-be-taken loan.
Don't give out loan to families and friends,especially your capital,unless you are prepared to forget it.
Two important things in loan protection and commercialisation are:
Every loan must be secured against the properties of the receiver,and with good interest rate,and not just Interest.There is distinction between the two.Find out.All loan must be given out with the help of a professional,and all it's terms and agreements should be carefully structured and with legal backing.Commercialized the loan,and lets all the parties involved agree on the terms of the loan.
Recognising the importance of the professionals is very vital in loan management.
When approached for loan for business,study the business and it's viability.If satisfactory, give out the money on the condition of certain percent shareholding in the business.
Under this condition, you lose when the business fails,and you now jointy bears the risk of the business which is only limited to your percentage share in the business.
Even though you may not be directly part of the management,you can appoint your representative(s),but your a principal member of the decision makers.
Recognise the importance of professions,register the business with corporate,financial and tax consultants of your choice.Some degree of your business' survival depends on them.
