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HOW TO START A MONEY BROKERAGE BUSINESSBecoming a Money Broker is one of the easiest and most rewarding endeavors available. Virtually anyone can begin such a business with a very small investment. You can start this business on a part-time basis and earn large finder's fees, or open your own office and work full-time with absolutely unlimited income potential. During periods of economic instability, loans are more difficult to procure, and the assistance of a loan broker becomes a need of many more people. Your service will help small or beginning businesses procure the capital needed to operate in tough times. Your business will do especially well in such periods. In the past, the ease of operating as a money broker was a secret closely guarded and known only to a few bankers and business consultants. No other business could offer the potential income figure for so small an investment. However, the field of money brokerage is now open to all, creating a new vista of income potential. For example, starting with less than $300, some money brokers have made $100,000 their first year in the business. This is an ideal way for a man or woman to supplement his or her present income, or to begin part-time and change professions after getting well established. It is an absolute dream-come-true for the semi-retired or retired office worker. There is hardly another business requiring less than $300 in start-up costs that can put you into a six-figure income bracket as quickly as a successful money brokerage operation. None give you the power, prestige, or the respectability in your community equal to that of a brokerage service. To get started, you'll need to set up your office operations, most likely out of your own home. You may use your home address or rent a post office box to serve as a business address. Order a supply of your own letterhead stationery and envelopes. Also, have an ample supply of business cards printed with your name, address, telephone number. Also, have printed a supply of your Fee Agreement (a sample is included with this report which you may duplicate after having the instruction we have given in the blanks removed). The total investment in this business is small. When you have your stationery, envelopes, cards, and the Finder's Fee Agreement in hand, you have made a major portion of your financial investment. The next step will be to "find" both borrower and lender and bring the two parties together. You will need to run some advertisements in your local paper under the headings Money to Loan or Business Opportunities. Typical ads might read: Money Available for bill consolidation, home repair, business expansion, any worthwhile project. Call This ad will be used to contact borrowers. Your second ad will be used to attract lenders. Such an ad might read: Capital needed for business expansion. In response to the calls or letters from prospective clients, you will have to be prepared with the proper answers and sales pitch. Practice in the privacy of your room what you will say when certain questions are asked. To the prospective borrower you might reply, "Yes, this is John Johnson. Thank you for calling. First, I will explain how we operate. I'm a money broker, Mr/Ms. __________ . I bring you, the borrower and the lender together. I have many different money sources available such as banks, insurance companies, private investment groups of doctors, dentists, lawyers, and other professionals. My sources are in business to make money by lending out their capital. I need to determine your needs and the purpose of the loan in order to properly prepare the necessary financial papers for a formal presentation to the best suited lenders. I may have to take your loan request to as many as ten different lending groups in order to get the loan for you. Once I have an approval on your loan request, I'm paid anywhere from 2% to 10% of the total loan figure. It is important for you to remember, however, that I don't get paid unless I get the loan for you. I do, however, charge a $100 non-refundable application fee to cover my expenses in preparing your loan papers and presenting this portfolio to the lenders. In a nutshell, that's how these types of loans are negotiated. Now then, how much money do you need?" You then begin to acquire the information you are going to need to proceed: the amount of money needed; purpose of the loan; terms the borrower wants for repayment; and a profile of his background - education, employment record, date of birth, social security number, marital status, general health, and number of dependents. Type this information into a suitable format, assembling it into a portfolio suitable for presentation with a cover letter to at least five different lenders for their consideration. Just five successful registrations per week will bring you a minimum of $2000 per month, excluding the percentage earned on each loan you successfully arrange. Those people with money to lend who answer your advertisement will need to be handled completely differently. You will want to describe to them your service, but will not gather as much information from them as you did from the prospective borrower. Explain that as a broker you bring the borrower and lender together, charging the borrower a small fee for your services. Determine how large an investment the caller is willing to make, what types of businesses or loans he prefers to back, the percentage of return he is seeking on his money, and the length of time he is willing to lend out the capital. After getting a name, address, and telephone number, inform him that you will shortly be presenting him with one or more proposals for his consideration. It's basically that simple. When you have prepared and made your presentation, either for a direct meeting or to be mailed, you will await the lender's decision. He will ultimately determine whether the investment is sound or not. To help him, you must do everything possible to make sure the loan is agreeable. You will only want to make presentations on those requests that look feasible to you. A high-risk loan application with no collateral to back up the investor's risk will not be accepted by most lenders. If you make such a presentation, lenders will begin to doubt your judgement and will hesitate to review proposals from you in the future. You must therefore carefully screen all loan applicants. If their request is impractical, tell them so. Help them prepare a proposal that will be accepted. You should not lose out because you have collected a $100 application fee for your time. However, your big payoffs will only come when you have successfully brought borrower and lender together. Only when the loan is granted will you collect your broker's fee - a predetermined percentage of the total loan figure. A little time spent in preparation of a winning loan proposal will bring success to you. A fantastic amount of money can be made as a money broker. It will take your sharp
consideration and preparation of the borrower's request to develop a proposal acceptable
to the investors with capital to lend. You can line up borrowers with willing lenders.
Present an attitude of professionalism, create a top-notch presentation, and the sky's the
limit to your success. Good Luck! Below is an example of a typical Fee Agreement Form Your Company Name Signed this date, the day of , 1993.
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