There’s a reason why banks are very strict with money. There’s a reason why countless background checks and credit score verifications are processed whenever we try getting money from the banks.
Yes, money brings benefits and allows us to succeed and improve in life. However, along with these benefits, money can also result in problems.
To better understand our point, here’s a written version of a podcast by Max Av of Everlast and Peter Guerriera, wherein they talked about bank protocols when it comes to money.
Max: When you’re ultra-high net worth, you don’t need a credit score. When you’re ultra-wealthy, your reputation is automatically highly high with the banks and financial institutions. It’s like, “We don’t need an arbitrary number to tell you how good your financial rep is.”
Once you’re in the Deca millions, you don’t say, “Oh, you inherited it, or you’re parents are rich.” And so, like you inherit the financial reputation, but there’s a lot of social aspects into this where the banker has to figure out if this person still trustworthy? Is his dad rich or mom rich? Can I trust them? Is he responsible? There’s still a big social component.
But when you’re up there in the deca of millions, there’s a different game. You don’t talk to a banker on the phone; you meet with them in real life. It’s a different language.
Peter: Going back on that exactly where you’re like saying, Hey, is your mom and dad, rich? Or is your uncle rich and gave you some money.
In real estate, I never realized how straight that system was. For instance, if you go and buy a house. And this goes for anybody. There’s a little bit of a lesson for everyone. If you go and buy a house, and your parents gave you a gift, let’s say of like $200,000. Everyone thinks it’s not a big deal. My parents gave it to me.
But if you go to the bank and use that money to pay for your house and it’s not yet matured, meaning it’s less than 60 days old. Nobody knows how you got the money, and they will refuse to accept that payment.
And like, I’ve seen it now because we’ve had so many buyers in this last year where people are like,” yeah, I got a great down payment.” Okay. Where’d you get it? Well, it doesn’t matter. No, it does. And then they want to go through with their deal.
Anyway, they want to put an offer on the house, and everyone will be like, this is a great deal. Of course. I’ll take your deal.
The bank comes back and says, “No, sorry, I have no idea where you got that money”.
Max: Everybody likes to villainize the banks. But here’s the thing, man. First of all, many bankers have been caught doing XYZ, you know, but everybody likes to villainize the banks. Do you know how hard it is to trust people with like money? Like, can you imagine how many people in a day lie to the banks? You could probably say that the vast majority of people or a lot of people probably lie to banks all the time.
So everybody likes to villainize the banks. But it’s like, you gotta be tough if you’re giving people money. For people who disagree, think about this. Since you were a child, whenever you gave somebody money, there were always problems. The last time I gave somebody money, a $20 bill because we were at a restaurant, and I gave somebody 20 bucks.
I was like, can you just give me the change back after we’re done eating? Cause I didn’t need to provide her with the full 10, 20 bucks. I need to give her like five or six, so I would like that $15 back. It’s not a big deal, but you don’t give me the 15 bucks back after we’re done eating.
Guess what? That person forgot to give me the 15 bucks back. It’s only 15 bucks, but why. There are always problems when you give somebody money. Ever since you were a kid, you give somebody money, there will be a problem. And that’s why I like that, that scene in the Bronx tale. Everybody can relate to that scene because whenever you give somebody money, there’s always problems – 99% of the time.
From the wise words of Max, “There will always be problems with money – 99% of the time.” It’s not really about the money, but how people react when they receive money.
And that’s the reason why banks always have a very strict attitude when it comes to receiving money. And knowing the fact that they deal with hundreds of people daily, their skepticism is very understandable.