[RichardGerard]

The term 'reverse consolidation' is a misnomer, there is nothing 'reverse' about it.

It should be called either a 'tranched consolidation' since consolidation funds are disbursed in tranches- or perhaps 'perverse consolidation' is maybe the better name of any?

The problem with this product is that from an underwriting standpoint you are playing with fire and nothing is stopping client from stacking on top of the consolidation. With higher defaults and low disbursements your commission is looking to be tight. I can't tell you how many deals we've seen that had a perverse consolidation, a stack on top of that, and/or has done a debt settlement deal on the perverse consolidation. Don't plan on this product being around forever, once enough funders get burned the supply of this product will be very limited going forward. Look for funders with traditional consolidation programs first.

plug time: We do a regular zero-net consolidation @Lendvo to reduce payments by 50%+, full commission, high renewal rates too. Granted it's hard to qualify for this product, but when your customer does it works gangbusters. Most importantly it actually saves businesses via a pathway to exiting their screwed-up situation.

The reality is that these reverse consolidations should be Underwritten mindful of the ability to finding a global solution to the file. The "funder' is writing weekly checks to cover the existing advances, and receiving an amount lesser than that- providing a cash flow savings.

We have been doing that with clients for quite some time- once we get a Letter of Intent- or we know that there are assets that are unencumbered- we provide liquidity by purchasing future receivables- knowing we have the exit strategy lined up. It's a win for all involved. Brokers/ISO's get commission on what we call Bridge Funding, then also earn on the larger solution.

[MidnightAdvance]

The reality is that these reverse consolidations should be Underwritten mindful of the ability to finding a global solution to the file. The "funder' is writing weekly checks to cover the existing advances, and receiving an amount lesser than that- providing a cash flow savings.

We have been doing that with clients for quite some time- once we get a Letter of Intent- or we know that there are assets that are unencumbered- we provide liquidity by purchasing future receivables- knowing we have the exit strategy lined up. It's a win for all involved. Brokers/ISO's get commission on what we call Bridge Funding, then also earn on the larger solution.

Impressive English Richard!