Why is it so difficult to get Loan from Nordea?

[catchmeifucan]

Nordea has been my bank since, I came to Finland. The netbank and other services are excellent. But, we got a shock when we tried to ask loan of 10k for a new business (or rather an existing business which we will run temporarily). Their conditions were:
1. Have to pay back within 9 months.
2. Have to mortgage home.
The business papers are all ok and there is nothing wrong anywhere.
Me and my wife have have a excellent credit history with no back logs or late payments.
We are young entrepreneus (of foreign origin ofcouse). We have practically invested all the money we had. Our present business is healthy. I also do a job and salary comes to my Nordea account. Where on earth did Nordea get this kind of conditions?
If we can get this loan it will be a lot easier for us as otherwise, I have to get money from my home country may be sell something there. We employ about 7-9 people and the new one will open doors for atleast 2-3 more temporary workers. I can understand the economic perspective of the world but, I am wondering what I am gonna say to the Nordea lady when I meet her for signing the papers.

[Upphew]

Keywords: for a new business
Reaction: *minimize losses*
Additional keywords: (or rather an existing business which we will run temporarily)
Reaction: "Aaaapuaaa... vartija heittäkää nuo varkaat ulos!" *hups* "I'll make you an offer you must refuse?"

With the current economic situation, there have been lot of news and articles about businesses problems of getting credit.
I'd guess, that you would have your money in hand if you had applied to "joustoluotto" in your own name.

[Tiwaz]

There is something wrong with your application.

Lack of collateral.

What if in current uncertain business environment your business went down next week?
Nordea is 10k short with nothing but your wind swept arse to show for it...

Days of easy loan are over. Get used to being forced to show something concrete to support your loan requests.
Because it, partially, was giving loans given too easily which brought forth this economical disaster we are trudging through.

[catchmeifucan]

There is something wrong with your application.

Lack of collateral.

What if in current uncertain business environment your business went down next week?
Nordea is 10k short with nothing but your wind swept arse to show for it...

Days of easy loan are over. Get used to being forced to show something concrete to support your loan requests.
Because it, partially, was giving loans given too easily which brought forth this economical disaster we are trudging through.

Our tax is clear. We have opened a Oy company. We have a contract with the owner. We made available last year financial report from the owner. The owner visited the bank in person and submitted all required papers and provided all information the bank asked. The owner is also lauging at the banks conditions and said to us that "This is funny. They will not do that to me". Salary account and other business accounts are also in the same bank. We have had a excellent reputation will all the customers and vendors we deal with as far a finance is concerned. There is always a risk in business that;s the nature of the game.
If today we get this attitude for 10k may be in the future when we try out something big we wont' get any help at all.

We are young and hardworking couple we could have just relaxed with what we have and it would give us a peaceful life but, we are trying to create something good which will be beneficial for us ofcouse and few others also.

[Mattlill2000]

I've been with Nordea for 13 years and also have the "Avainasiakas" thing. They also rejected our last loan application for somewhat questionable reasons. So we went to Nooa Sääatopankki and got our loan there and switched all our accounts to them.

[dampa]

Nordea can be an a'''h'''le for whatever reason known to them. When the economic situation was booming, they were reluctant to loan us anything - remonttilaina, asuntolaina, nothing even with enough savings to proof their money will come back. The worst part was when one of the official we were talking with, not knowing that we were about to sign the contract with the neighbour bank and switch said, because I have a foreign background, they need to actually do some checks somewhere if a foreigner is entitled to take loan and buy a house in Finland geez

Immediately, I just told her we are in a hurry somewhere and we shall conclude the talks later. That was the last time they saw us. The neighbour bank did all the account switch for us and when Nordea noticed we were moving, they started jamming our phones with calls. Too bad it was too late, I finally answered and said we don't want the loan or anything from them any longer but I promised to keep a käyttötili with them just because it is nordea.

[maurine]

maybe you should try another Nordea bank, since most of the cases it always depends who you meet. in most cases they all have different views. you can go to the same bank but meet with two different people and they will tell you different things.

[Karhunkoski]

We are young and hardworking couple we could have just relaxed with what we have and it would give us a peaceful life but, we are trying to create something good which will be beneficial for us ofcouse and few others also.

I sympathise with you, especially as you're enthusiastic and clearly have some passion for your business, however unfotunately Nordea don't have much interest in philanthropy.

[catchmeifucan]

We are young and hardworking couple we could have just relaxed with what we have and it would give us a peaceful life but, we are trying to create something good which will be beneficial for us ofcouse and few others also.

I sympathise with you, especially as you're enthusiastic and clearly have some passion for your business, however unfotunately Nordea don't have much interest in philanthropy.

I think, we will accept their strange out of the world conditions (we donot have a choice now). But, in the mean time we would try to get more information from other banks as well. This is the only pragmatic thing we can think of.

We will keep trying and lets see what happens. We never thought it would be easy here. But, it is worth the try.

[Karhunkoski]

But, in the mean time we would try to get more information from other banks as well.

Sounds like the best plan. Good Luck

[Tiwaz]

There is something wrong with your application.

Lack of collateral.

What if in current uncertain business environment your business went down next week?
Nordea is 10k short with nothing but your wind swept arse to show for it...

Days of easy loan are over. Get used to being forced to show something concrete to support your loan requests.
Because it, partially, was giving loans given too easily which brought forth this economical disaster we are trudging through.

Our tax is clear. We have opened a Oy company. We have a contract with the owner. We made available last year financial report from the owner. The owner visited the bank in person and submitted all required papers and provided all information the bank asked. The owner is also lauging at the banks conditions and said to us that "This is funny. They will not do that to me". Salary account and other business accounts are also in the same bank. We have had a excellent reputation will all the customers and vendors we deal with as far a finance is concerned. There is always a risk in business that;s the nature of the game.
If today we get this attitude for 10k may be in the future when we try out something big we wont' get any help at all.

We are young and hardworking couple we could have just relaxed with what we have and it would give us a peaceful life but, we are trying to create something good which will be beneficial for us ofcouse and few others also.

So what you have to act as collateral?

That you have handled your payments in the past is no guarantee that you will in the future.
And if you can't put forth collateral in some form, bank is risking 100% of the money which they loan to you.

There is always risk in the business, your risk is that if you fail, you lose your house to pay the bank. Why would BANK take the risk on it's shoulders so that you do not have to?

As said, banks are not run for philantropic purposes.

[Mattlill2000]

Yeah it was that collateral thing that Nordea said was insufficient for us. But that was a joke. The other bank found that our collateral was quite sufficient. I think that maybe in these economical times that Nordea has really tightened up on their lending habits.
Plus this bank that we are dealing with now, offered to "sell" us collateral before we showed that we have enough. Yes, collateral can be bought.

[catchmeifucan]

So what you have to act as collateral?

That you have handled your payments in the past is no guarantee that you will in the future.
And if you can't put forth collateral in some form, bank is risking 100% of the money which they loan to you.

There is always risk in the business, your risk is that if you fail, you lose your house to pay the bank. Why would BANK take the risk on it's shoulders so that you do not have to?

As said, banks are not run for philantropic purposes.

You have a point but, then there is no point of running a bank offering loans for business and rules should be same for everyone. We already have a healthy business. I am myself employed and my employment does not involve the business. So, I would presume such plutonic risks to be considered when the amount is 100k huge not 10k. Moreover, we have already invested quite much ourselves and what we asked is probably 2.5 months of my salary.

Ofcourse, you might point out that I can be fired for no reasons. There is a possibility but, I have to confirm from my boss about that. As far as the present business goes it might also go down. But, then I presume the whole world economy has to go down for that also. Time is not good but, we have not yet seen the worst.

The bank gives us loan and gets something called interest in return. It is not doing any social service it is making an investment. We asked loan not the start the business but, to keep a liquid capital ready for immediate purchases the new business is up, running and getting returns.

I have experience and proof of the same bank giving a loan of 15K after keeping 10k fixed diposit. So, before you say anything think a bit. We do dream but, we also put in the hard work.

[Tiwaz]

You have a point but, then there is no point of running a bank offering loans for business and rules should be same for everyone. We already have a healthy business. I am myself employed and my employment does not involve the business. So, I would presume such plutonic risks to be considered when the amount is 100k huge not 10k. Moreover, we have already invested quite much ourselves and what we asked is probably 2.5 months of my salary.

So why not wait 2,5 months and pay it with your salary?
See it from bank point of view. They have no means to guarantee your company will keep running smoothly, nor that you are not fired.

Ofcourse, you might point out that I can be fired for no reasons. There is a possibility but, I have to confirm from my boss about that. As far as the present business goes it might also go down. But, then I presume the whole world economy has to go down for that also. Time is not good but, we have not yet seen the worst.

So would in such conditions wise bank take unnecessary risks of offering loan without collateral to cover at least part of their losses?

The bank gives us loan and gets something called interest in return. It is not doing any social service it is making an investment. We asked loan not the start the business but, to keep a liquid capital ready for immediate purchases the new business is up, running and getting returns.

And if you do not pay your loan nor interests. Where it lands the bank then?

Specially since you are, indeed, a foreigner. Don't take it the wrong way, but compared to your average Finn... You are in far better position to take a loan, then head off to some other nation and that's it.

There are enough issues trying to hunt down FINNS who do that. How likely you are to succeed in hunting down someone who might be native to that other country...

I have experience and proof of the same bank giving a loan of 15K after keeping 10k fixed diposit. So, before you say anything think a bit. We do dream but, we also put in the hard work.

And times have changed. No more easy money. And that 10k is acting as collateral in this case. They at least get 10k if you fail to meet your payments.

But there is still risk that they run short 5k plus interests.

[odon]

hi ,

i have had a company (oy) for the last 2 yrs and before that Tmi nimi ,
i with my ex, had the same problems ( we were both foreigners) , but i will tell you a lot depends on who u meet and put the paper too, some of them r so uptight, they think u r going to run off with their money!! so if one official said no, ask for a financial consultant and talk to different person.....

there is always different road to the same solution...i cannot comment on your situation,
but ask different banks....go back to nordea and say someone is willing to lend you and say u are moving the whole stuff off....yeah!!!

i always laugh at their collateral.....for them only blue blood suomalainen is what they want.....