Results 1 to 25 of 50
-
01-17-2018, 03:04 PM #1
Reverse Consolidations?? What is this .....?
Hello my MCA professionals,
I have been getting calls to the office about reverse consolidations? Is this something new, how does it work exactly? Sounds like they are white labeling this product based on my experience. I'm curious to know who is the originator of this product..
-
01-17-2018, 03:12 PM #2
- Join Date
- Sep 2016
- Posts
- 99
-
01-17-2018, 03:16 PM #3
- Join Date
- Jan 2016
- Posts
- 435
Not sure if ML was the original doing the reverse, but they were one of the first I know of. Basically for people that are stacked out and near the tail end of the advances the funder doing a reverse will give weekly disbursements into the chk acct to help float the merchant a little bit while they are struggling. It usually helped reduce the obligations by about 20-30% ish depending on the specific. Ex merchant is paying $500/day ($2500/wk) reverse funder will wire 2500 per week and will pull $350 day to try and give the merchant a little breathing room.
-
01-17-2018, 03:24 PM #4Disclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-26-2018, 03:11 PM #5
What does fund kite pay on reverse consolidations
Disclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-26-2018, 03:37 PM #6
- Join Date
- Dec 2016
- Location
- Brooklyn N.Y.
- Posts
- 428
Midnight does reverse consolidations as of late.
High risk paper
-
01-26-2018, 05:15 PM #7
- Join Date
- Jan 2014
- Posts
- 1,375
-
01-26-2018, 05:23 PM #8
FundKite has been doing them also , it helps the merchant out ,gives them some breathable room to stay current with their obligations to lenders. I know this because they did one for me this week. I’ve been working with the merchant for years , when I presented him the Rev/consolidation he was blown away with how it works. This product as long as it’s done with good intentions can be a great thing for merchants and the industry
Last edited by HumbleDBAD; 01-27-2018 at 05:58 AM.
-
01-26-2018, 06:04 PM #9
Premier Capital Funding has some solid reverse consolidations they offer merchants.
Par Funding is another funder as well that does great consolidations too
.
I've funded reverse consolidations with both Par & Premier. Hence i know the commission structure.
With Fundkite i dont know or remember what they offer?
I have a nice large file and im waiting for the mtd on both accounts, before I submit it.Disclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-26-2018, 06:18 PM #10
Yes I agree with you Par is a top notch house especially with consolidations , definitely they deserve credit there , however I definitely reccomend testing the waters with FundKite , it’s worth it and can be a great addition to your relations. Pm me at anytime I would be happy to discuss it further if you would like and explain more.
Last edited by HumbleDBAD; 01-27-2018 at 05:57 AM.
-
01-26-2018, 06:19 PM #11Disclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-27-2018, 08:43 AM #12
- Join Date
- Jul 2015
- Posts
- 168
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.
-
01-28-2018, 10:38 AM #13
A reverse consolidation is set up in order to save the merchant on their cash flow, and not for them to net additional working capital. Therefore, Fundkite gives a very low buy rate, 1.27, and we only allow an upsell of Five Points in order to make sure that the merchant is paying as little as possible, and that our rate will be lower than the overall Blended rate of the merchants other positions. I just declined a deal for an iso this week before submitting it, because our rate would have been higher than the merchants Blended rate on his three existing positions. If anyone would like more details, please PM me.
-
01-28-2018, 11:32 AM #14
I do not know how much par funding pays. What I do know is that in another post, an underwriter from Premier Capital funding wrote that their buyrates come out at 140 with 10 points up sell to a 150. We are much cheaper, more sellable, the lower rates make,it easier to save the clients as much as 30%, and have no Max size for our consolidations.
-
01-28-2018, 01:33 PM #15
- Join Date
- Dec 2014
- Location
- Quogue, NY
- Posts
- 1,108
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.
-
01-28-2018, 01:58 PM #16
- Join Date
- Dec 2016
- Location
- Brooklyn N.Y.
- Posts
- 428
-
01-28-2018, 04:08 PM #17
OK so Fund-kite pays up to 5 point upsell and Premier Capital Funding pays up to 10 point upsell. I understand now totally on the commission capacity of each funder mentioned for reverse consolidations.
It's funny because on Saturday Night one of my good friends mentioned to me that files that Fundkite declines for reverse consolidations, he sends to Premier Capital Funding and the file is approved.
Something to think about I guess, as it shows me just totally different underwriting guidelines and qualifications process. All in All just because you get a decline doesn't mean it truly is a decline?
Your thoughts 💭 DF FamilyDisclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-28-2018, 04:51 PM #18
-
01-28-2018, 11:31 PM #19Disclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-29-2018, 08:43 AM #20
-
01-29-2018, 10:46 AM #21Disclaimer
This message brought to you by:
CraaaCraaa Radio ®
http://debanked.com/merchant-cash-ad...nce-directory/
World of MCA
E.V.P Business Development
___________________________
"Success is a lousy teacher. It seduces smart people into thinking they can't lose."
-
01-29-2018, 11:26 AM #22
- Join Date
- Jan 2014
- Posts
- 1,375
-
01-29-2018, 11:26 AM #23
No games, no white-labeling, no last minute price changes. If you want to try us out, sign up!! https://fundkite.com/iso5
-
01-29-2018, 11:28 AM #24
-
01-29-2018, 11:49 AM #25
- Join Date
- Jan 2014
- Posts
- 1,375
Similar Threads
-
Reverse consolidation Lenders?
By 1Loanguy in forum All Other LendingReplies: 4Last Post: 06-18-2019, 11:26 AM -
Reverse Consolidation
By FunderGal in forum Deal BinReplies: 12Last Post: 11-15-2017, 03:55 PM -
Reverse Consolidations which direct lenders can actually go over $1,000,000 on these
By Sachip24 in forum Merchant Cash AdvanceReplies: 26Last Post: 10-03-2017, 11:23 AM