Friday, June 14, 2013

Take it to the Bank

Went off the grid for a bit. Gained some perspective though.
Man, let me tell you somethin' man.  The Bank is amazing!  I learned this week that the smartest people in the world, including attorneys, work for the Bank.  Ruthless, cunning, and greedy.  So I'm analyzing loan docs and I come across the words "Participation payment."  Turns out, Participation payment is when one Bank (not the original lender) makes installments to another Bank (the original lender) in order to keep the loan alive even after maturity.  During the process of collection and if any funds are paid toward the payoff amount, a kickback goes to the participating bank.  The downside is that if no money is ever paid on the loan to the originating bank, the participating bank never makes a dime in return!  So they are paying money, in order to make money off of another bank's loan with the possibility of never making money!  Amazing.