With interest rates rising, does it even make sense to have debt anymore? Could you get funding from banks at low rates to grow your business when others are shrinking?
Merrill Chandler, CEO of Get Fundable, shares what banks REALLY look for when lending money, and it’s not just a good credit score. Find out how you get money for less right now!
Listen to the podcast here
How Can You Secure Bank Funding At Low Rates With Merrill Chandler
I’ve got a special guest today who was in my backyard in Salt Lake. That’s usually what happens. I have to usually go talk to people outside of the state of Utah to then refer me to people inside the state of Utah. I’ve got a special guest here named Merrill Chandler. He’s the CEO of Get Fundable! Get Fundable! is especially for those who want to get credit. Not just credit, but be able to get financing. Be able to get money on terms that are barely over prime to be able to get you great bank lines of credit. Not just credit cards where you’re transferring balances, but bank lines of credit so that you don’t have to have all these expensive alternatives, hard money, and everything else. You can get great affordable rates, even with the current rates, more affordable than what you can get out there in the private markets.
He’s had over 30 years of experience in this personal and business credit realm, helping people get fundable and be able to sometimes secure hundreds of thousands, if not millions of dollars of money right now. I’m telling you, if there’s anything you’ve heard me teach over the last several months, is that the person who has the cash will be the king or queen as we move into this next deeper recession than what we’ve seen before. Merrill, welcome to our show today.
I’m excited to be here. Thank you very much for inviting me. I can’t wait to pull back the curtain today on some of the things that your audience may believe are landmines they’ve been stepping on for years and didn’t even know they were doing it. Thank you for having me.
We’re excited to dive in. Before we do, tell us a little bit more about you, Merrill.
I’ve been in the business and personal credit space for 30-plus years now. You’re a Utah guy. I cofounded Lexington Law Firm, the largest credit repair law firm in the country. It’s a huge employer here in the Salt Lake area. When I was there, I learned that you can’t repair your way to approval readiness. You can delete a couple of negative items, but worst case, let’s say you get everything negative off your report, you have to start over.
The only thing that people sell you when you’re starting over is to build your credit. I call them scams. They’re imposters because what we learn from this entire experiment is that your score is the fifth and last and least important contributor to you being approved for your auto loans, credit cards, mortgages, business lines of credit, business loans, commercial loans, etc. Your score is last. That’s a myth we believe in. Credit repair and credit builders all focus on raising your score, and then people wonder why I have an 800-plus score and nobody will give me a business line of credit. There we are.
It’s true because banks are investors, we talk about that a lot on this show. If you think more like the bank, you’ll think like a better investor. Credit score, sure, you made on-time payments, but that doesn’t mean that they’re going to invest their money with you. If I were to invest money in a real estate deal with their operator, that’s okay, I have an 820 credit score. That’s great, but your deals suck.
Perfectly said. We’re up against that all the time. I give a presentation at an event and people come up like, “I want to know more about this because I have an 820 credit score and I can’t get a dime.” I’m like, “It’s because your credit score means, if you get approved, how much they’ll give you and the rate they’ll give you. The score determines rate and term not whether or not you’re approved.”
What is it that helps people get approved more?
This is the secret sauce. There are five fundability factors. The score is the last one. Let’s talk about the first four. Your identity. Your identity is the gatekeeper to your approvals. Every single bank, even mortgages now are going online. Just upload your documents. Sometimes they don’t even look for documents. They’re measuring your borrower behaviors on your credit cards, your auto loans, and your current mortgages. There are 40 borrower behaviors that break down into these five fundability factors. That is what they are measuring. The gatekeeper is your identity. If they can’t recognize you, they don’t want to take the time, energy, and resources to verify your ID and hold it up to your face.
The clearer your identity is in these automatic approval processes and the software online processes, then you have greater likelihood of moving to the next stage, which is evaluating your financials. Financials are your income, debt-to-income ratio, total debt load, payment load, and those types of things. To be fair, we know what all these criteria need to be to be approved. That’s why we seem to rattle cages and more importantly, be popular with real estate investors and serious business owners who are trying to find more money to do their deals.
The third thing after financials is your banking relationship. Many people think you go into a bank and go, “I’ve got an 820 credit score. Give me some money.” They want to see a relationship. Money buys time. The more money you put in. There are algorithm triggers that you can do, we call it interval training. You can train the software inside of a bank to recognize you as a valuable borrower. That is banking.
Number four is your credit profile. Now is when they look at your credit profile, not way upstream. They look at your credit profile to see what your past history has been. What are your borrower behaviors? Those borrower behaviors are the key indicators of what your attitudes and beliefs are about money. The last one is the credit score. That’s when they look at the score. The first four get you approved. The last one determines how much rate and term.
I want to come back to one of those things about the banking relationships because that’s one that not many people talk about, even though I’ve known in my own personal experience, that’s humongous. It’s a huge effect. I’ve heard a lot of guys, even guys that have massive businesses lots of money, even millions of dollars will be funneling through a bank like Chase Bank for example.
All of a sudden, recently, they’re getting ticked off because now Chase Bank says, “You’re not a big enough whale for us. You’re not a big enough fish, so we don’t care about you having $5 million sitting with us. You don’t mean anything.” Is that becoming a bigger reality lately or is that something that’s always been the case?
It’s always been the case, but there’s a context to it. We call it a funding target. You’d know what a target looks like. You got your bullseye, you got rings. It happened in 2008, then we had this 15-year run of low interest, etc. When the banks have lots of reserves, and then can 10X their reserves to lend, you can still get approved way out of the outer range of this funding target. The criteria to be a bullseye borrower, to hit the exact lending criteria, to hit the bullseye of the funding guidelines never changes. The target may get smaller, but the bullseye remains the same. We teach all the members of our community how to create this bullseye borrowing framework, no matter how big the funding target is.
It’s because of your best rates, your best terms, the highest amounts that they’re going to give you. They’ll give you a $10,000 line of credit instead of a $20,000 line of credit if you’ve done it right. What happens is, now that there’s a credit crunch lately, they’re only going to focus on the people with all the borrower behaviors. The amount of money in the account is not a borrower behavior. It sets the status of who you are to them. We get an entire episode of what they do with your money between 5:00 PM and 8:00 AM. While you’re sleeping at night, they’re trading your dollars. You’re valuable. How much money you have has a certain worth to them as you as a customer.
It’s the borrower behaviors because people can make $5 million and spend $6 million if they’re a bad borrower. It’s our attitude that they’re measuring. That’s what’s key here. Having $5 million in the account is not the most important. They’d rather have you have less money in the account. We have people with $20,000 in an account, but they’re training the software to recognize them with spectacular borrower behaviors. Even to this day, since COVID, we’ve had over $100 million in these fundings because they’re bullseye borrowers.
Despite what has been taught in the financial world where they say you can have a great relationship by having a lot of money in the bank, you’re saying that you could have a better relationship with less money in the bank and more borrowing from the bank.
The key is money does not create a relationship. It creates a customer value, and they grade those. There are grades of customers. There are orders of magnitude. How much money you have in there, they’ll consider. Depending on how you use even a $10,000 or $20,000 credit card can counteract the amount of money that you have. Automatic underwriting wasn’t a thing before 2008. It was mostly manual underwriting. Now, they measure your behaviors. If you fit, especially that bullseye, those inner rings in your funding, the funding criteria, they will give you money regardless of how much you have in the bank. That is a complete myth that money equals power to borrow.Money does not create a relationship. It creates a customer value. Click To Tweet
If you get a secured instrument and say, “I’m going to put up $1 million of that to borrow against.” They’re still going to look at what your borrower behaviors look like because if you’re reckless, you don’t have the right instrument, or your entire credit profile is full of the Cabela’s and the retail accounts, you’ve outed yourself as a consumer, not a strategic borrower. You can be denied because of low-value credit profiles. You can get kicked right out.
I want to dig into this even more. Before I do, tell us more about your company, Get Fundable! and if people want to follow you, how would they do that?
You can go to MeetMerrill.com, and it has a list of free everything. It’s got our education packages. It’s got our eBooks. It’s a wonderful list, a central place. It’s GetFundable.com. It’s Get Fundable on LinkedIn, Instagram, and Facebook. It’s our battle cry. We are a tech-enabled borrower education company that wants to transform the relationship between borrowers and lenders.
Who’s the ideal person that would utilize your services?
Serious business owners and real estate investors. That’s interpretable, but if somebody is so hungry for cash that they’re going to go credit card stack and not know what the deleterious effects and mostly the bad and the ugly of getting that level of cash, they’re not our client. We want people who can forecast and say, “In 90 days, I want to pick up my first $50,000 to $100,000, then 90 days after that, another.” We’ve picked up 300 to 500 in credit line portfolios within 90 days for serious business owners.
There’s a difference between being hungry for capital and wanting to grow your business strategically. We don’t want the ones who are chasing because you’re going those are borrower behaviors, you’re ratting yourself out to the lenders right now. We don’t want you as a client per se, because we have to help you ladder out of a hole. We want individuals who have a strategic presence in their space. Real estate investors who are growing their businesses don’t have enough capital.
Here’s one thing I do want to say. We add to private money and hard money. The way we look at it is hard money and private money is the avant-garde. If you’re doing 3 deals a quarter and you want to move to 5 deals a quarter, we want you to backfill the 3 deals a quarter with inexpensive loans and lines of credit. Those next two you’re growing, use hard money and use private money. When you grow to ten, keep using it for those out there while we backfill with this super cheap money. We plus hard money and private money. We’re not against it because it takes a minute to create these lines and these relationships. That’s our client base, serious business owners and serious real estate investors.
Don’t expect that you’re going to get this money tomorrow. This is something you have to build up to to become that bullseye.
Go somewhere else, but it doesn’t take very long if you’re serious about it. Within 90 days, we can recalibrate all those borrower behaviors because they measure the borrower behaviors over the course of what we call a 24-month lookback period in increments of 3, 6, 9, 12, 18, and 24 months. Every one of those increments, we can add more force and more influence with the bank by shifting the borrower behaviors.
You’re helping with both personal and business credit too, correct?
That is correct.
Let’s take an example like me. With money ripples, we bootstrap everything. I’ve got my Delta SkyMiles card because I love being a diamond status and getting all the free bonuses and perks I get on that. Other than that, I don’t utilize it at capital, but I probably could come up with a reason to do it. Is there a reason that someone like me would want to get more fundable in that sense?
Let’s say our glass is 8 ounces. We can’t imagine a world and it’s full. If you have 1-gallon glass, your 8 ounces are conspicuously absent of being filled. The nature of the human experience is to want to fill it up. You will attract, and this is where it gets into my meta world. If you had $500,000 in business lines of credit, all of a sudden, deals would start finding you. Opportunities would start finding you. You would be calling them to you because you have the capacity now. If your cup is full, there’s no capacity. If we’re not repelling them, we’re not inviting new opportunities.
Constantly subconsciously putting it out of your mind because it doesn’t fit that box.
We’ve had individuals because we have this million-dollar formula. Somebody’s like, “I want to do the million-dollar funding formula. They come on, they’re a great client, they hit about 350, and then gone, we never see them again. No joke. I go through. I love every member of my community. I have a regular exercise to reach out to people who are missing in action.
I’m like, “Where’d you go?” You’re like, “I thank you so much. I love what you’re doing. This is amazing. I cannot believe that I have been able to do what I’ve been able to do since learning about your program, but I can’t even spend the $350,000 that I’ve got because the idea of a million dollars sounds good to all of us.” To turn $350,000 in taking down properties, they didn’t want to work that hard. They’re content with their level of real estate investing, so they stopped attending because they were crazy satisfied with their results.
It’s the story of the ten lepers from the Bible. The 9 ran off celebrating, and then the 10 came back to say thank you. You have the nine lepers right there.
That’s good news. You’re so happy that you stop talking to us because you don’t need more money for what you’re trying to create, but there’s always more. One of our most successful clients is Michael from Louisiana. He’s brilliant. We implemented our velocity funding strategy. Think of velocity funding because velocity is direction and speed. Every single real estate investor and every single business owner has a different velocity and a different speed.
We find what that is for you. We look at all of your assets. We look at all of your liquidity. We look at your entire financial picture. We then line up the best credit lines, business loans, commercial loans, and HELOCs. Every financial credit instrument and we put them in the right order to get you what you need as fast as you want to go in the direction you want to go. That’s why we call it velocity funding.
We can go on forever, but I know we’re out of time here. That’s how it goes. It’s probably something we probably have to talk about again, I’m sure. Not only for that, but even for me personally too. I’ll say this from a business owner’s perspective. If anybody else is like me that way, they say, “Do I need more funding?” I’ll tell you this. Reading Trey Taylor’s book called A CEO Only Does Three Things. One of them is to make sure you have funding and you have the capital when you need it. That’s the responsibility of a CEO, as well as attracting new talent and things like that. You’re exactly that answer, aren’t you?
Absolutely. We found ourselves in some amazing rooms with some amazing people, having our clients and the members of our community respond to be able to see that they get to be so much bigger than they thought they could be because they have access to low-cost capital. Imagine the amount of power you wake up to every day when you’re like, “I can do something that I couldn’t do a month ago or a quarter ago.” It’s liberating. It’s a blast to be a part of this experience with them.
Especially when you get rates way better than getting a credit card, that’s for sure.
Credit card stacking is when you get a bunch of credit cards. The problem is, if any of those credit cards report to your personal profile, then those high balances are going to kill your fundability and your approval readiness. You might be saving money, but it’s a consumer-borrower behavior that you’re ratting yourself out. If those cards don’t report to personal and report to business, that’s better, but with those high balances, you’re still ruining the relationship with that bank.
That bank is willing to give you more money if you have the right borrower behaviors. Credit card stacking, bless your heart, you didn’t know before now, but now you heard it here first. Credit card stacking can be dangerous. It is helpful under a few circumstances. I can’t diss it, but you have to know what you’re getting into. That’s your cautionary tale. That’s your PSA. The more you know.
You don’t want to jeopardize that by thinking, “I did a little hack that worked, but I destroyed my future.” You want to make sure you don’t sacrifice something for the now for something that could be better later too.
The thing is then I can’t help you because I don’t take on clients who are that deep in a hole. Can’t do it. It’s not helpful. We have an online course that can help you, but as a client where we’re trying to build and move with velocity, we’re not going to be able to help you.
That’s the one key thing I’ve learned from banks. They always want to give you credit when you don’t need it. The best time to get it is when you don’t need it versus when you do need it, then you’re in trouble.
Merrill, thank you so much for your time today. You’re so generous. There’s so much good stuff here. We’ll probably end up having to bring you back on later as well, but if this is something where you feel like you might need this. Especially, like I said, we are moving to a time where cash will be king or queen, depending on who you are. This is something you should be looking into now to prepare versus when you need it the most. Be sure to reach out to Merrill if this is something that you need. Go and make it a wonderful and prosperous week. We’ll see you later.
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About Merrill Chandler
Merrill Chandler, CEO of Get Fundable!, created the Approval-Readiness Formula™, enabling real estate investors to access Prime + 1% bank loans and lines of credit, reducing reliance on expensive alternatives.
With over 30 years of experience in personal and business credit, Merrill recognized that creditworthiness depended on “fundable” behavior, not just a credit score. He developed Velocity Funding™ to optimize financial behavior for increased approval rates.
Merrill, a family man, enjoys time with loved ones and global adventures, from exploring Southern Utah’s red rock terrain to tackling white-water rapids. Merrill and his team have facilitated clients in accessing $250 million in low-cost fundings.