“Form of Value #9: Loan”

This is a preview of a concept contained in The Personal MBA by Josh Kaufman, a book that will help you master the fundamentals of business, hone your business instincts, and save a fortune in tuition. The Personal MBA distills the most powerful principles of business and delivers them quickly and concisely. Order your copy now…

What is a “Loan”? (Form of Value #9 of 12)

“Money talks — but credit has an echo.” — Bob Thaves, cartoonist and creator of “Frank and Ernest”

Key Points:

• A loan is an agreement to let a borrower use a certain amount of resources for a period of time in exchange for a series of payments over a predefined period of time, equal to the original loan plus an interest rate.
• The keys are:
  
  
  
  • Have money to lend.
  • Find people who want to borrow that money.
  • Set an interest rate that compensates you for the loan.
  • Estimate and protect in case the loan is not repaid.
• Loans allow people immediate access to products that they couldn’t purchase outright.
• Loans are beneficial to the lender by benefiting from excess capital.
• It’s critical to identify how risky each loan is, and take the appropriate steps to protect the loan going sour.

Questions for Consideration:

• Does delivering value via lending assets to others make sense for your business idea?
• If so, what do you need to plan for to make it successful?

Share this concept: http://book.personalmba.com/loan/

True leaders aren’t made by business schools – they make themselves, seeking out the knowledge, skills, and experiences they need to succeed. Read this book and you will learn in one week the principles it takes most business professionals a lifetime to master. Buy The Personal MBA by Josh Kaufman now.