Banks & Credit Unions & Real Estate by David Guerra

This past weekend, I saw a commercial from a local Credit Union. There was nothing unique about the commercial, it was your regular run of the mill here we are and come shop with us. The commercial was talking about the convenience of doing business with  the Credit Union. The commercial mentioned the many locations in the general area and then they went in for the kill. They introduced their new service and new location for that service: REAL ESTATE.
While it makes sense that a business expand into the sensible extension of the services they are already offering. For the organization, this is GREAT business. Generating revenue from many sources. Heck, I wish I was generating revenue like that.
Yet, is this good business for the customer? Yes and No!
Credit Unions have their depositors believing they are part owners of the Credit Union. They do this by offering token “dividends”, special “members only” services and other contributions. The truth is this is a business and with or without your approval. Business is done based on what the business and its board members agree must be done. Remember, the board members are usually the ones with the most at stake with the Credit Union than the average depositor.
Before I continue I should in full disclosure say the following: I AM NOT A MEMBER OF ANY CREDIT UNION. I was in the past but I am NOT a member now. Reason I left the Credit Union is that I moved to another state and needed the services of a local banking institution.
Moving on.
While it is great for the organization to expand its services, the problem that when a member of the Credit Union buys a home they use the new REAL ESTATE SERVICE to broker the deal from finding a home to the initial offer to the financing and finally to the closing. While it may be convenient for the member of the Credit Union it is also too convenient.
It makes no sense why any individual would want to have their home mortgage where they do their banking.  This applies to the automobile dealerships, why would anyone want to finance their new car at the dealership. Of course, the salesman will tell you they will get you a “good deal” because they work with their financiers “all the time”. It is no lie, but, they also fail to admit something else, the reward or incentives (paid to the dealership and trickle down to the salesman) for using the service to finance customers.
When someone arrives pre-approved (from the bank or credit union) the salesman will service you enough to the pre-approved limit. When a customer walks in cold, the entire interaction becomes a shark feeding frenzy. Things like “undercoating”, “rustproofing”, other accessories and services added to the final price. As the price increases, the amount financed increases, thus the reward or incentive to the dealership increases.
When it comes to other transactions like the real estate service offered by a credit union how does it compare? It does not! It does not compare because they are using the same transaction model as the auto dealership. This model works for them and it will work for about any other situation that calls for a financing situation (think home furnishings).
Still not convinced? Do you go to your Pastor to ask for their advice on how to repair a faulty O2 sensor? No! You go to your Pastor for spiritual advice. Do you go to your Dentist for advice on which roofing shingles are best for your Mid-Century Modern. NO!
So, why go and have the Credit Union to act as your Real Estate Agent?


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#Leadership In The News – March 9, 2017

Lately in my world, there has been plenty of talk about change. Change comes in all shapes and sizes and forms; commercial and personal. Change will continue. It will continue for a long time to come. Enough of what you already know, let’s get to the meat and bones.

I found this article on the USA Today website, “A Financial Adviser’s Top 10 Investment Lessons Learned” and it is loaded with great advice.

The article’s content, while focusing on Finance, with a few minor tweaks can be applied to everyday life.

#1 Don’t Follow The Herd:
Be unique, be yourself. Just do your think and don’t worry about others.

#2 The best investment may be the one you don’t make:
Sometimes the best thing to do is to do nothing.

#3 Invest in your own human capital:
Invest in your own education. Invest in yourself (only of it makes you better)

#4 Avoid large holdings of your company stock:
If only you know what you are worth then it is safe to say you are worth nothing to anyone else. Spread the wealth.

#5 Don’t try to time the market:
There will NEVER be a perfect time. Pick the moment and dive right in. Win or lose

#6 Avoid the noise:
While mob mentality may be all the rage (well according to the news) it is not the way to get things done. If you find yourself in a place where everyone thinks alike then you are in the wrong place.

#7 Equities are for growth, and bonds help you sleep at night:
No matter what you do to pay your bills, be sure to pay yourself for the future.

#8 Implement a disciplined investment strategy and stick with it:
Habits are hard to make but once made they are easy to keep.

#9 Control your behavior:
Attitude, Self-respect, and Discipline are key to success. This applies to everything you do or plan to do.

#10 Time is your best friend:
Think long term, look at the big picture, and be in it for the long haul. The longer you do something, invest in something, and believe in something the better off you will be.

As you can see, with a minor tweak or two these 10 pieces of financial advice can be applied to just about anything in life. Try all ten for yourself and see what happens.


Title: A Financial Adviser’s Top 10 Investment Lessons Learned


What did you think of this #Leadership In The News post? Let me know by email on on Twitter @daveguerra