[J.Celifarco]

I know stacking is becoming more and more the norm in the industry but if it continues to snowball with 3rd and 4th and however many more positions people want to go we are eventually not going to have an industry.
Life was easier before stacking 1 position you want to fund the deal you pay off the balance

[JSL23]

I know stacking is becoming more and more the norm in the industry but if it continues to snowball with 3rd and 4th and however many more positions people want to go we are eventually not going to have an industry.
Life was easier before stacking 1 position you want to fund the deal you pay off the balance

I feel for the Merchant, but ultimately nobody put a gun to their head and made them take the 4th/5th advance.

My thoughts on stacking is that it can be done responsibly; 2nd position: No problem, 3rd position: Depends on the situation, 4th position or beyond: NO!!! Excessive to say the least. And let's be honest; how much commission can you really earn from a 5th position?! Just try to consolidate or do a Refi a little bit further down the line. Tell the Merchant they are going to be in bad shape. Many will actually respect you MORE for turning down their business and remember you when things go back to normal and turn to you to get them funded.

In the end though, it is ultimately their choice.

[J.Celifarco]

I feel for the Merchant, but ultimately nobody put a gun to their head and made them take the 4th/5th advance.

My thoughts on stacking is that it can be done responsibly; 2nd position: No problem, 3rd position: Depends on the situation, 4th position or beyond: NO!!! Excessive to say the least. And let's be honest; how much commission can you really earn from a 5th position?! Just try to consolidate or do a Refi a little bit further down the line. Tell the Merchant they are going to be in bad shape. Many will actually respect you MORE for turning down their business and remember you when things go back to normal and turn to you to get them funded.

In the end though, it is ultimately their choice.

I dont disagree but the problem is once they have the 2nd and third position no advance company is willing to pay off all the balances because they are afraid the merchant will stack again on them. Once that second position is taken more often then not the account is dead for traditional programs because you can never get the balance paid off.
From a commission standpoint you will make more money doing regular refis for a merchant then you ever will getting them second and third positions

[Chambo]

I feel for the Merchant, but ultimately nobody put a gun to their head and made them take the 4th/5th advance.

In the end though, it is ultimately their choice.

That is the same excuse that Bank Of America, JP Morgan and Citibank used in the mortgage scandal. "But they signed and agreed to the terms!"

How many BILLIONS have been paid in fines to date? How many more to come?

[JSL23]

YAAAWWWNNN.......aren't a large percentage of your deals stacks? You work at YS, don't you? Let's be honest here, you guys aren't the first (or 8th) Lender that one sends their A paper to, now are you?

Going back to what initially said about Funders consolidating more deals, it was just a thought, and I prefaced it by saying I don't know if it would be worth the risk. It is something that is worth exploring. Are the leaders of this industry not innovative or savvy enough to come up with some feasible solutions that could potentially make that type of arraignment work? If someone could successfully do it(and I am not talking about Merchants with 4 or 5 advances at once) they would do quite well(potentially). Whatever, it was just an idea. I don't see you coming up with anything that could decrease multi stacked deals. Instead, we get the same exact conversation, same arguments, same talking points and the same annoying comparisons to JP Morgan and BOA.

[channin19]

YAAAWWWNNN.......aren't a large percentage of your deals stacks? You work at YS, don't you? Let's be honest here, you guys aren't the first (or 8th) Lender that one sends their A paper to, now are you?

Going back to what initially said about Funders consolidating more deals, it was just a thought, and I prefaced it by saying I don't know if it would be worth the risk. It is something that is worth exploring. Are the leaders of this industry not innovative or savvy enough to come up with some feasible solutions that could potentially make that type of arraignment work? If someone could successfully do it(and I am not talking about Merchants with 4 or 5 advances at once) they would do quite well(potentially). Whatever, it was just an idea. I don't see you coming up with anything that could decrease multi stacked deals. Instead, we get the same exact conversation, same arguments, same talking points and the same annoying comparisons to JP Morgan and BOA.

One possible solution: Lenders requiring sales partners to participate on a stack deal.

[J.Celifarco]

How would participation fix this.. We have an underwriter in this thread saying that taking 25%-33% of a companies gross sales is ok.. Do you expect a sales office to have a better grasp of underwriting and be able to tell a good deal from a bad one???

[JSL23]

I think stacking would decline if a few of the bigger banks sued some of the ISOs and sales agents that facilitate stacking.

Yea, forget about finding a way to facilitate more consolidations, let's just sue......brilliant. The only thing that would decline is the Broker/Lender relationship industry wide.

Ways to stop (or greatly reduce at least) stacking:

1)Add-ons. If a Merchant is less than 50% paid off(let's say 30%-35%) and in good standing, no missed payments and balances are good do an add-on. Increase the holdback or daily(slightly) and extend their term. There are Lenders that do this, but should be more proactive, same with Brokers.
2) Stop nickel and diming Brokers on renewals. Why is someone going to accept half the commission when they can get the whole thing?! 80% of the original commission is reasonable and would prevent many Brokers from shopping their clients out or stacking once renewal time is near.
3) CONSOLIDATION!! Sorry if I sound like a broken record, but there must be some way to mitigate the risk. If a Merchant is triple stacked and paying 30%+ of their gross and you find a way to reduce that AND get them additional funds it will inspire loyalty (in many cases at least). If they stack, even one time they go on that black list from NAAMA.
4) Lenders have their association(NAAMA), Brokers/ISOS should really start their own. A big problem would be the indifference among some of the fly-by-night broker shops, but it's probably best for all if they fade into the background. Let both groups negotiate and find common ground regarding all of this. What's the alternative-the Government getting involved?! No thanks.

Someone mentioned earlier 99% of the Small Business market is untouched. I don't know about that, but am sure it is way over 50%, mainly because many of us are chasing the same Merchants over and over again. There is plenty of money to be made out there for Lenders and Brokers. Why risk ruining a great thing, when we can put our heads together and solve some very fixable problems.....just my thoughts

[GRP Funding]

Life was easier before stacking 1 position you want to fund the deal you pay off the balance

100% truth - if the merchant thinks it's OK to take a 2nd - why not a 3rd, 4th, 5th, 6th, etc. ?