What Are You Prepared To Do?

We all have a time in our lives when we come to a crossroads and we must choose between doing the right thing, the ethical thing, or doing something a bit less ethical which might get us in trouble, but also might boost our career.  Many of us choose the latter path, because we feel it's easier, and we believe it's the quickest way to get ahead.  I am not a saint.  Far from it, but occasionally I do surprise myself.

A long time ago, back when I was working in finance.  Well, not necessarily finance, but mainly legalized loan sharking.  I had my first experience with a boss who asked me to do something I deemed unethical, but he saw as exceptional. The company I worked for offered sub prime loans, mainly B and C paper, even to people who could qualify for better interest rates and loans.  It was my first job after college and I was having trouble selling loans with interest rates of 30%.  Yes, you are reading that correctly 30%! That seems like an easy sale right?  I mean who wouldn't want to sign 5 years of their life away for a modest interest rate of 30%?  In addition, we were offering real estate loans of 15%.  What a deal! 

Naturally, I was having difficulty not only selling the loans because of the excessive interest rates, but also I didn't feel comfortable screwing people just to earn a commission.  In my heart I knew it was wrong, once people signed those loan documents, they might find themselves in a worse financial position then before they signed them.  However, armed with a degree in economics this was what I thought was the world of finance.  WRONG!  Back then I had a conscience, so when I approached my boss about how we could feel good about selling loans with such a high Annual Percentage Rate, he cut me off straight away.

"You took this job to make money right?", he said.

"Right.  But I didn't think I'd be selling loans with such a high APR."

"We're not a bank. We're a financial institution, so we can charge whatever rate we want on a personal loan."

" I know that, but when people come in to sign the papers they always ask what the APR is, and I never feel comfortable telling them.  Especially when they see it on the loan docs.  The last loan I sold was at 30.11%.  That's a bit excessive isn't it?"

" Listen, it's not your job to judge what's excessive.  You're a kid for Christ's sake.  If they balk at the APR put your thumb over it when they go to sign.   All they care about is whether they can afford the payments."

"Do what?"

" Put your thumb over the interest rate.  I do it all the time.  People need money and we're here to give it to them.  Who are we to judge what's fair.  Put your thumb over it and they sign every time."

" Are you serious?  Isn't that a bit shady?"

" Does it matter how you hold the docs?  If your thumb happens to be over the interest rate, so be it.  That's not your fault.", he said and he smiled, like a Cheshire cat.  It was a bit creepy and somewhat evil.  I just looked at him in disbelief.  I'm sure he could see the cogs turning in my head.

" Look.  We hired you to make loans.  So that's what you need to do.  Corporate and I don't care how you make the loans, just make them, and you'll do well.  Start questioning what we do here and you'll be gone.  I know it's tough, it was tough for me in the beginning too, but you get used to it.  Plus you'll make a lot of money! Just try it next time you have someone come in for a loan.  Put your thumb over the APR and I guarantee they won't say anything about the interest rate."

"I don't feel comfortable doing that. Can I just try signing my loans without doing that?"

" Suit yourself, but you want to make money?"

" Yes."

" So you have to ask yourself.  What are you prepared to do?"

" What do you mean?"

" If you want to make money in business, in any business, you have to decide what are you prepared to do.  This isn't college anymore. Life's not black and white, we deal in a lot of gray areas.  And me, I'll do anything to get ahead.  I got 3 kids at home and a wife who doesn't work, so me...I'll do whatever it takes.  What about you?'

I was shocked, "What? Wait. What do you mean? I don't understand. "

"What are you prepared to do to get ahead in this world?  Anything?  Putting your thumb over an interest rate is not being shady, it's being smart.  I hired you because I thought you were smart. Well are you?"

" Yes. I thinks so?", I said, still in a daze and now concerned about whether I made the right career choice.

" Well then if you're smart.  You'll put your thumb over the interest rate and shut the f#$k up.  If they sign,they sign. It's on them.  Got it."
" Yes sir. ", I answered like a good soldier.

" Good.  Now go sell some loans.", he said and slapped me on the back. I shuffled back to my desk in a daze.

Right then, I knew this was not the business for me, yet on went on selling loans at 30% for another year.  I did everything I could to overcome the APR objection, focusing on other aspects of the loan which would help reduce interest payments.  I focused on no pre-payment penalties, and shorter terms.  I encouraged people to use their tax returns to pay off the loans early.

And not once did I put my thumb over the interest rate on the loan documents.  I wasn't prepared to do that. 

How about you?  What are you prepared to do?