3-Sided Balance Sheet - Questions

Good questions compound into deeper conversations worth having!

Author

Todd Ballenger
May 30, 2025

❝

Your mortgage isn’t a payment — it’s a financial lever. Pull it wisely, and it can accelerate financial freedom."

ME

from Michael Kitces at kitces.com

How to Use the 3-Sided Balance Sheet to Engage Borrowers and Differentiate Yourself from other ‘loan officers’ and ‘financial advisors’…

As a Certified Liability Advisor™, you're not originating loans — you're reshaping the way clients think about debt, equity, and wealth. One of the most powerful tools at your disposal is the Three-Sided Balance Sheet, which introduces a more holistic view of a borrower’s financial world, and introduces the concepts of: Safety, Liquidity, and Return.

Michael shares some amazing questions you can use just as they are, but here’s some thoughts about using questions in the context of our Borrow Smart mindset.

Step 1: Introduce the Conversation

Start by setting the stage:

“We often think of a balance sheet as two-sided — assets and liabilities. But to build real wealth, we need to go deeper. I’d like to show you a third dimension that helps align your home financing with your life goals.”

Then, draw or show them the triangle with the three pillars:

  • Safety

  • Liquidity

  • Return

Step 2: Reframe the Questions

Use these adapted borrower-focused questions to uncover motivations and gaps:

🔐 Safety

  • How confident are you that your mortgage strategy protects you during economic shifts?

  • If interest rates or your income changed, would your current mortgage still feel safe?

  • Is your home financing structure helping or hurting your peace of mind?

💧 Liquidity

  • If an opportunity or emergency came up, how easily could you access your home equity?

  • Are you using home equity as a tool — or letting it sit idle?

  • What would it mean for your lifestyle if you had more cash flow available each month?

📈 Return

  • What return are you getting from the equity sitting in your home?

  • How is your current loan helping you grow your wealth?

  • If you could restructure your liabilities to invest more, where would you invest it?

These questions aren’t just powerful — they shift the borrower’s perspective from “What’s my rate?” to “What’s my strategy?” and help position you for referrals to others on the wealth team that can support!

Step 3: Position Yourself as the Guide

Tie the conversation to your expertise:

“Most lenders focus on products. I focus on outcomes. My role is to help you manage your liabilities in a way that supports your long-term financial independence, and we do that by minimizing your biggest expense - the house.”

Step 4: Create a Custom Plan

Once you've had the conversation, use tools like Mortgage Coach to present your advice in a visually compelling way. Make sure you show:

  • The opportunity cost of not making any decisions

  • How you can help them accelerate their own ‘stated’ goals

  • Demonstrate how liability planning complements their asset planning

  • Always provide at least 2, but not more than 3 possible choices for moving ahead

Why This Works

Borrowers today are overwhelmed with product choices and underserved with strategic guidance. By using the 3-Sided Balance Sheet framework, you transform from loan officer to trusted advisor — someone who helps clients borrow smart, repay smart, and build real wealth.

Want to Learn More?

If you're not yet certified as a Liability Advisor, check out the Certified Liability Advisor™ Course — and take your conversations (and your conversions) to the next level.

LIABILITIES
What’s Happening?

taxes are a big liability, but this clearly benefits everyone but those making the least

this is one of many things bolstering consumer confidence

overall households are healthier than expected with highe rsavings

family finances are more optimistic

there is a goal of lowering rates, not going well so far…

there is still a big gap in where wages should be and where they are

that above - affects this! Gap in housing cost and wages

at least we don’t live in Canada, they pay 70% more in average taxes than US citizens

Thought from James Clear - Atomic Habits that resonates with my core ‘CODE’ for how I live my life

8' - I Can Make You Rich: Reprogram Your Mind for Financial Abundance

Alchemy of Self | 1' - 10' Deep Dives · Episode

open.spotify.com/episode/3Q24IFRGMLLXOUaFe2tzZt?si=scC4qD4PTR2-tJL9Gk59LA

REAL ESTATE
What’s Happening?

Home are getting older on average…

and buyers are getting older on average…

and houses are getting bigger!

but new home sales are up!

more supply could mean lower prices

another look

hey I was right, houses are getting cheaper!

And rent is coming down…

ASSETS
What’s Happening?

red week - first time in a while after a major ramp

ETFs rule - Mutual Funds drool

source: Jim Bianco - Higher finflation rates here to stay

source: John Mauldlin - if we have a recession it will be the most painful in history

because we are big spends and small savers

and prices are going up on things we like to buy

but crypto will save us

see - I told you!

From Mike Zaccardi

many believe we will go higher before we go lower!

ON BEING HUMAN
What’s Worth Sharing?

eat your damn veggies!

and dress nice!

DOPAMEMES
And Other Happy Moments…

the rise of amazon delivery is astonishing, most said it could not be done

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AI
and The Future of Work…

The AI Driven Leader Aid.pdf4.09 MB • PDF File

Source: Spencer Wright