IE Business Daily Business news for the Inland Empire.
For the past four years Eugene E. Valdez has been the CEO of The Loan Doctor & Associates, Inc. a business finance and strategic planning consulting firm. Mr. Valdez has created a new service called “COVID-19 Bank Loan Modification Service” which will help those business owners severely impacted by COVID-19 and that have ( Non- SBA ) business loans outstanding with their current bank. Mr. Valdez was a banking executive for over thirty years and has successfully formed and operated two private businesses. Mr. Valdez spoke with IE Business Daily last week about his new consulting service and the reasons he created it.
Q. The Loan Doctor was doing well until COVID-19 hit correct?
A. Yes, it was and it is still doing fine. Client demand for my services are up.
Q. Why move away from your current business model especially with the economy on such shaky ground and not likely to improve soon ?
A. I am always seeking to add new services to diversify and I wanted to take advantage of a growth opportunity. COVID-19 has dramatically altered the economic landscape. During and post COVID-19 there will be a tremendous demand from Business Owners suffering from declining sales/profits for advice on how to negotiate loan terms with their banker or else face possible foreclosure.
Q. Are you closing down The Loan Doctor & Associates Inc.?
A. Certainly not, I am simply adding a new “entrée” to my consulting menu, “Loan Restructure Modifications.” Soon I will be adding a new link to my current website.
Q. Sounds like this new link will be on your website for awhile!
A. Yes, I am forecasting demand for this new service for 2-4 years.
Q. How is your new service going to work?
A. It will feature three parts: Part 1 – Development of a revised business model, Part 2 -Memorialization of the model in a written document, Part 3 – Meetings with a banker to present written document and negotiate the key terms to reach a consensus.
Q. What kind of business loans are you talking about?
A. Any commercial loan not including SBA 7a , SBA 504 or any recent COVID-19 disaster loans.
Q- Why do you think this will work?
A. Banks are under constant pressure from federal and state bank examiners to maintain a “healthy performing loan portfolio.” Doing a bad job in this area drives a bank’s profits down, something executives and shareholders do not want to see. If you present your bank a turn around plan that makes sense they are more inclined to work with you than to call your loan. Its too messy, time consuming and too expensive for banks to commence collection and foreclosure activities, but they will if they feel they have to!
Q. How are you going to sell this service?
A. Strong value proposition. Business owners can negotiate for themselves or they can hire their CPA or business attorney to do so. These business professionals charge higher rates than I do and many of them do not have the same level of expertise. I don’t think I will have to “sell” very hard and I will use social media for branding.
Q. How risky is this move?
A. Very low, the worse that can happen is that the bank will not agree to the turn around plan. If so, I can find the owner an alternative lender to pay off the bank loan in question.
Q. President Trump recently signed a second round of assistance – about $484 billion and it is generally accepted that more aid will needed. How much do you think that will help?
A. That will help tremendously if the funds get into hands of the “right “businesses ( i.e. not Ruth Chris, LA Lakers). But it is still a band aid. Government money can not fix an outdated business model.
Q. The last economic crisis for the IE was in 2007-2008. The IE was hit harder than most California submarkets. Will COVID-19 be as bad or worse?
A. In my opinion worse, because the economic impact is more global. Domestic and International markets are distressed especially supply chains. The Inland Empire has a huge logistics industry.
