Credit Line for sole proprietor
A friend who is a professional and has his own business is moving his office and needs a substantial loan. While he is ok he is no expert in finance. The BankFirst the bank he has used for the last 10 years was offering a below prime rate promotion for a business credit line in December. He applied before the application deadline but did not get some of his financial statements in until after the deadline. Not sure what happened but in January they told him he may be too late for that program but they would see what they could do. His credit is excellent and so his record with Bank X.
A month later he gets a bill for $500 for his new credit line at prime plus 1! He does not really want this, he does not need the credit line, just using it as a cash management tool. Personally in his situation he would be better off with a term loan.
As it turns out BankSecond in his area is looking for new accounts and is offereing a promotion of 5.9 on a term loan or 6.9 on a cerdit line
Does anyone think that if he contacts BankFirst, his bank, and mentions the promotion at BankSecond that they will match it? Or should he simply close out the BankFirst credit line and move his business to BankSecond? This would be a minor inconvenience but well worth the interest rate difference
Any thoughts on the following proposed letter
Dear BankFirst loan office,
I was rather surprised to get a bill for a credit line. Please be advised this is the first contact I have received to tell me that I was approved or the terms under which I was approved. Please be further advised that when I applied in December it was for your below prime promotion. I was never told there was an annual fee involved. I cannot refer to the paperwork since I was never provided with a copy.
I am rather surprised that after 13 years of banking with your bank that I could not receive a better rate or terms. Attached is a flyer from XXXX Bank. As you can see this provides for a rather attractive interest rate. Is this something your bank is able to compete with?