Consultants: The Business of Lending to the Masses

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How To Start a Consumer Loan Business

Payday loan, installment loan, car title loan... businesses are popping up all over the United States, Canada, Mexico, the Caribbean, Australia, New Zealand, England, Ireland, and more. The payday loan industry may be the fastest growing financial segment - bar none! Not only can you find a consumer loan store virtually everywhere, but additionally there are consumer loan web sites and Apps as well. As a matter of fact, the consumer loan internet component offers even greater rewards than the consumer loan brick-n-mortar! After all, we all know more and more consumers are migrating to the Internet to purchase products and services.

(That's why it's so important to follow our advice in our consumer loan business training materials and "Embrace the Internet." Let us show you how to profit with consumer loans by using just the Web, stores or both.)

So, why is this so? Why is the consumer loan industry growing at such a rapid rate? And why are a few of the most savvy financial minds entering this "loan shark" business segment? The answer, of course, is the TREMENDOUS PROFITS AVAILABLE! Depending on the state or province, consumer loan consumers are paying $10 to $35 per $100 borrowed for a term averaging 8 days. These cash advance fees are equivalent to 480% to 1200% APR's (Annual Percentage Rate). These returns are simply PHENOMENAL!

Not only are the fantastic profits luring entrepreneurs to the consumer loan industry but consumers throughout the world have an insatiable demand for the consumer loan product! Small loans ranging from a few hundred dollars to $1500 or more are in huge demand by cash strapped consumers everywhere on this planet. The demand for these so-called "micro-loans" is so profound that Muhammad Yunus who founded the Grameen Bank won the Nobel Peace Prize for leveraging small loans to impoverished families. Take a look at his book; "Banker to the Poor: Micro-Lending & the Battle Against World Poverty". (Couldn't we use a portion of our profits and our business model to help families? Think about it!)

So, here are some quick payday loan demand statistics [Note: Payday loans are simply one segment of a broader spectrum of consumer loan products.]:   
• Payday loans, just in the USA, are estimated to be a $40 billion to $50 billion dollar industry and still growing 20% to 30% annually! (Internet transactions are difficult to estimate, but certainly taking market share.)
  
• Publicly traded payday loan companies like: EZ Corp (Nasdaq: EZPW), Enova, Avant, Cash America (NYSE: CSH), QC Holdings (Nasdaq: QCCO), Advance America Cash Advance Centers (AEA), First Cash Financial Services (FCFS), and more are growing 20% to 40% in gross annual revenues and profits. Listen to their quarterly conference calls and check their 10K's.
• CURO for example loaned $300M in their last 3 months! And, they only have 3% of the market!   
• There are consumer loan lead generating companies selling 20,000 plus leads per month for an average $25 to as much as $165 each to payday loan operators. Note: in a recent Cash America conference call, the CEO stated as much. Here is a publicly traded payday loan company with net income exceeding $32 million dollars buying thousands of payday loan applications every month.
• At a payday loan Internet forum, we talked to a payday loan operator purchasing 50,000 payday loan leads every day at an average $9.00 each. He claims to be funding 40% of them!
• We know from operating our own payday loan stores, attending OLA, FISCA & CFSA Conventions, analyzing the earnings reports for the publicly traded payday/consumer loan companies, and having performed dozens of consulting assignments that even a payday loan single store operator can gross an "average" 30% return on their "street money" monthly. Many operators have even higher margins! $100,000 loaned out on "the street" (average loan $278.00 X 360 loans) could result in a $30,000 gross monthly profit! THIS IS WHY OUR INDUSTRY IS IN HYPER GROWTH!
• 12 to 14 million households were served last year.
• 100 million transactions occurred last year
• At a CFSA Payday Loan Convention, Mike Flores, a very respected analyst with Bretton Woods at the time, projected there will be 50,000,000 consumers of payday loans in the USA alone. (Note: we are certain this figure is low.) He also estimated there are roughly 14,000 to 18,000 payday loan stores and this number will grow to 60,000 USA locations! We are not even close yet! [In our opinion, this misses the mark. Apps and the phone will become the primary channel driver.]
• It has been estimated that 70% of us live paycheck-to-paycheck. One small financial setback? We search out a pawnshop, a friend, a family member, or a consumer loan store.
• Banks are changing their models to reflect the rules they must operate under; basically no more free checking accounts. Credit card companies are more discriminating and reducing consumer's access to credit. These strategies are literally driving their previous customers into our arms!

Consumer loans were developed to help a person receive the money they need today without having to wait until their next paycheck.

We delay the deposit of their personal check until their next pay day, which is usually less than 2 weeks away. [Of course regarding Internet/Phone transactions, the process is much different!

With a consumer loan, they get the cash they need before their next payday!

PAYDAY LOANS or PAYCHECK ADVANCES or CONSUMER LOANS are one of the fastest growing businesses in the US, Canada, Australia, Costa Rica, South Africa, England, and others. It's the ideal complement to your present business or as a new establishment. If you have a 5 ft. by 5 ft. area available, you can turn it into additional income.

We are helping entrepreneurs open payday advance/consumer loan offices everywhere! There is a tremendous opportunity for individuals to open a consumer advance business and get in on the ground floor of a wonderful, money making business. You can even open a consumer Loan business in conjunction with your existing business. Pawn shops, check cashers, liquor stores, car and truck rental companies, furniture rental stores, etc., are opening consumer loan businesses.

A typical 8 day paycheck advance extended to your client will yield an annual percentage rate on your money of 805%!. Starting costs vary tremendously and are determined by your goals. A new store might require leases, first and last plus a deposit, signs, licenses, phones, etc. Adding a consumer loan business opportunity to an existing business requires hardly more than working capital, business cards, flyers, advertising, forms, etc.

Consumer Loan working capital requirements are determined by you! We have heard of new deferred deposit operators who began with less than $5000. It depends on your circumstances. You already offer credit repair? Tax preperation? Other? Grab a copy of our 500+ page "How to Loan Money to the Masses Course" delivered immediately into your Inbox [PDF Format} for as low as $237.00!

A paycheck loan or consumer loan business is easy to operate IF YOU KNOW HOW TO CONTROL IT. Typically, you advance your check to your client and accept their personal check for an amount in excess of the amount of your check. Your accepting a check, giving the writer less than its face amount, and holding it for an agreed upon period of time. Thus, paycheck advance or paycheck loan or deferred deposit or...

Obviously, the "loans-by-phone" and Internet/website originated loan process is different and we disclose the process and strategies completely in our Manual.

The rationale behind the boom in payday loans is perceived high credit card rates and high bank fees for bounced checks. Immediate gratification by the consumer is another driving force in the consumer loan industry. There is nowhere a consumer can go for a small loan in an emergency. Banks don't do it and loan companies are too slow and complicated. High check bouncing fees drive the business. Banks charge a $35.00 fee and more for bouncing a check (even more for a 2nd or 3rd!). Then the original recipient of the check charges a fee. (Remember the recipient's bank charges a fee to them!) That can make a paycheck advance/deferred deposit/consumer loan the best choice.

YOU CAN MAKE A TREMENDOUS AMOUNT OF MONEY IN A CONSUMER LOAN BUSINESS AND HELP PEOPLE IF YOU KNOW WHAT YOU'RE DOING!!

• 500+ pages
• Immediately delivered to your email Inbox! Begin your study NOW!
• Forms, contracts, disclosures, arbitration agreements and more. Customize with your company name, phone...
• Industry Overview
• Industry Analysis
• Pkg with Your State License Application (if applicable,Legislation & Laws
• Step-by-step procedures
• Strategies
• Tactics
• Man loading & Personnel
• Licensing: Tribe, Offshore, State, Province...
• How to build your business
• How to screen your customers
• How to advertise
• How to handle problems
• Laws affecting your business
• What type of equipment you will need
• How to select a great location for your store
• Manual or computer managed?
• How to select your bank
• Forms required
• Vendors who will guarantee your customers checks 100%
• State and federal permits/licenses
• Telephone Support
• Operating an Internet Consumer Loan Business
• Borrower identification tactics and data bases
• Instant Bank Verification
• Instant Wage Verifification
• Instant Employer Verification
• Check recovery services
• Industry trade resources
• Payday loan industry trade organizations, conventions & workshops
• Consumer loan guarantee vendors. NEVER lose a dime of your money
• How to become an affiliate/agent of a Nationally Chartered Bank
• Sub prime Consumer Reporting Services
• ACH & EFT methodology
• ATM card procedures
• Electronic Funds Transfer.
• What software is appropriate? What to look for? Vendor contact & pricing info. How to get great consumer loan software for less than $1000
• Collections
• APR formula with examples
• Compliance issues.
• Arbitration discussion
• Demographics
• Marketing
• Infomercial source
• Photo/Signature capture
• Industry Resources & periodicals
• Business Plan & cash flow projections
• Forms, advertising materials, and links to more information
• Discussion of alternative methods for conducting Payday advances. (Internet Service Provider/cash rebate, Sale-Lease back, Catalog sales, etc.
• Additional income possibilities & Traffic Builders
• Discussion of alternative methods for conducting consumer loans. (Sale-Lease back, Catalog sales, etc.
• Additional income possibilities & Traffic Builders
• Includes our Canadian Payday Loan Report when we ship to Canada
• Includes our Payday Loan Software Report
• Includes Australian Pay Day Loan Report when we ship to Australia

Trihouse Enterprises, Inc.
601 East Charleston Blvd.
Suite 100
Las Vegas, Nevada USA 89104
702-208-6736 Office
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