Why do you need my financial information? – Property Rant 045

​So many times we are on the phone to salespeople and they ask us personal information about our situation. So you have the choice to trust them with it or not. 

The truth is an ethical company will use it to provide the right information to help you make an informed decision, a sales company will use it to sell their investments whether they are suitable for you or not.

The question is how to tell?

Video Transcription:

Hey guys, Property Search... Think Gladfish. I'm Brent Alegre-Wood, and this is Property Rant.

So today, it's a question that we get asked often, and it's, "Why do you need my financial details?" And look, the short answer of that is the reason we need that detail, and it's not just us, but it's anyone who you're exploring with, whether it be mortgage brokers, solicitors, or leasing. Some of them are legal requirements: Anti-money laundering and all these sort of things, you know, proof of ID, proof of address, these sort of things.

So some of those are required by law. But for the most part, and you'll find, if you're speaking with our team, they're asking these questions because, to be fair, if I jump on the phone and I speak to someone who's got 25 grand. It's their first 25 grand they've saved. They're on a 30 grand income a year, joint income, you know, now I'm talking to someone very different than someone who's got 20 properties in their portfolio, they've got 300,000 in the bank account, they're earning 100,000 a year. This person is in a very different position than this person.

The types of questions and the type of information I'm going to give to this person versus this person are worlds apart. Now, and the other thing, too, is not only worlds apart, but this person has less room, snuggle room potentially, than this person, so therefore, we're going to be a bit more conservative with this person than that person. You know, this person may be more risk-averse than this person.

So actually, this person will be a bit more flexible. This one might a bit more tighter. So there's a whole range of reasons why we want this information. And what you'll find is it's pretty pre-formatted information. And what it comes down to is what's your experience risk profile? What's your capital or current wealth? In other words, how much cash do you have? How many assets do you have? How many investments do you have? And then it comes down to credit and income.

When you look at those sort of things, they're the initial financial bits of information. And we have clients sometimes, what they'll do is, they'll write all it out on a piece of paper, send it through and email and say, "Right, here's my situation. Let's chat about what we think," because see, we're not coming, we're not throwing a deal to you on the first call, and this is the distinction here. If you phone somebody up, and on the first call, they're talking about the property they're going to sell you or they want to sell you, be very careful. Maybe back away. That's up to you, your call. What you're going to find is, when you talk to my team, we're going to go through probably the first couple calls. We're not really going to get into the actual property that's current because when you go through a process first and when you're ready, the property that's available then, we can take you through.

But what we can do is we can take you through example cashflows, but normally not on the first call. The first call, what we're trying to do is work out what that plan is. And we can talk about incomes and all these sort of things, but the other side of it is, what do you want to achieve? If you've got someone who's in this situation and wants to achieve this, versus someone in this situation, that actually just wants to achieve that, well do you know what? That might be easier than that. That might be a long term, and we need to go into a lot of depth and a lot of things about the market and where the markets likely to go, and you know, risk and loads of values and different mortgage products. Are we going commercial? Are we going High Street?

There's a whole range of concepts that we can discover before we even go, right, now we're in a position to look at investments, look at deals, okay? So you'll find that's the real key here as to why we're asking that information. And look, in terms of, you know, security and all that, we don't sell that data. Anyone who sells data these days, really, you want to be running for the hills from them because they shouldn't be...the database, the value in the database is in the relationship, not in the actual having the email address or the phone number anymore. It used to be that if you had an email address, that was great. But anyway, that's redundant.

You shouldn't be selling it, and certainly, we've never sold it. We do not sell it, and I refuse to. It's something that I just don't want to do, not interested to do. Our clients are precious, if you like. So basically, with this whole thing here, what it comes down to is, yes, we want the information. Because if we can get this information up front, then we can get down and dirty with the detail, all right? So it's going to save you time by giving the information up front. And look, you may want to give generalities. You may say, "Well how much is my income?" You know, your income's 67,000, "Look, my income's 70,000. My income's 60,000." It doesn't have to be exact data for the first call. You know, down the track when it comes to applying for a mortgage, we'd better put exact data down,  because otherwise, when it goes to the lender, if they find out that actually, it's not exact, potentially, that's it. That's that mortgage application done. So initially, it can be more broad based, but then we want to get more specific with the data.

So I hope that gives you an understanding of why we're asked this question, why people ask for the financial data. It certainly shouldn't be shared. It should be kept confidential. But anyway, guys, have a great day. Live with passion.

Brett Alegre-Wood
March 29, 2017

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