[fundgorilla]

I know this is an amateur night question, but I'm sitting here with a new guy, and he's asking me what the lowest possible rate is, and I thought: "Gee, I really don't know....I think IOU is offering 13.99%, but I don't really speak to them and a lot of my guys are not qualifying like that." I have heard numbers as low as 12.99, and some prospects are saying they got a 10 - which I assume to be a lie.

What does group consensus say about the very lowest possible rate and funder, and of course, who is that funder?

[isaacdstern]

Ondeck is offering a 1.11 but it's only for their in house sales guys

[Andy]

On deck will do the lowest rates, I have clients funded 12 month 1.20s with no fees with Ondeck, however those are unusual situations where we have came to special arrangements because that's lower than their normal buy rates. And those were super clean files the merchant could have got bank loan but didn't want to be bothered with all the paperwork, on decks quick and simple streamlined process made it worth the extra cost to the merchant.
IOU has an actual 12.99% APR loan, but it has fees that raise the actual cost.
Keep in mind that very few merchants will qualify for either of those programs.
If you are going to mention your rock bottom rates, I would always do so with a disclaimer-
"well Mr Business Owner since you insist on know what is the best possible rate we can do, its 12.99% however very few of my clients qualify for that program, send in your paperwork and I will get your the lowest rate that you qualify for"

If someone tells you they got a 10% rate 9/10 times they have it confused with their holdback %. You'd be amazed how many business owners that take out cash advances still do not understand what a cash advance is, and they think the holdback % is the cost of the money

[MCNetwork]

Rapid Capital offers 6 month 1.15's for their inside sales team.

[J.Celifarco]

Have to agree with Isaac the lowest I have seen is the ondeck 1.11, I have run into it a couple of times when competing with their in house sales guys and unless you can get them a lot more money that makes the merchant forget about the rate chances are you are going to lose that battle

[isaacdstern]

Gbr's 15 month 130 is a sick product, huge offers but very few actually fund. A lot of them get killed late in the underwriting process and you are left with a pissed off merchant

[bdshaw]

You might be interested in one of our term loans that run as low as 6% simple, not add on and terms up to 120 months.
If you are competing with a low MCA rate we will always come in with longer terms and lower monthly payments.

[MCNetwork]

GBR's underwriting process is the toughest I've ever seen. ARF is also really tough. Stips upon stips upon stips. Good people to work with but they put the merchants through a ringer!

[J.Celifarco]

You might be interested in one of our term loans that run as low as 6% simple, not add on and terms up to 120 months.
If you are competing with a low MCA rate we will always come in with longer terms and lower monthly payments.

what company are you with???

[Akanzer]

Swift Capital does 6 months 1.079 in house. ISO channel 1.139 6 months. 12 month lowest rate in house for us 1.179

[isaacdstern]

Wow that's really low

[J.Celifarco]

how can that be profitable with cost of underwriting, bad debt and all the other overhead factored in????

[Ditty]

I just saw OnDeck give a 1.15 for 9 mos. Merchant averaged about 70K over last 3 months but very up and down, and received 65K

[MCNetwork]

Swift Capital does 6 months 1.079 in house. ISO channel 1.139 6 months. 12 month lowest rate in house for us 1.179

Those rates are ridiculous! A 10% default rate (which is considered optimal for most funders) would put Swift underwater.

[Chambo]

how can that be profitable with cost of underwriting, bad debt and all the other overhead factored in????

Johnny, who said anything about profitability? Every company mentioned so far is losing money

[J.Celifarco]

which begs the question why are they offering these rates

[Akanzer]

Our loss rates are much lower than 10%

[isaacdstern]

That's a great question if it's not profitable why are they doing it?? grab market share and hope to one day way down the line make money, sounds very similar to 1997-2000 dot com era

[mcaguru]

the only ones making money are probably the short term 65-88 day paybacks.

[Akanzer]

That being said...7.9% isnt something everyone gets! on average we are at about 1.19 for 6 month rate

[MTY MSI]

Swift Capital does 6 months 1.079 in house. ISO channel 1.139 6 months. 12 month lowest rate in house for us 1.179

So if your inside sales force has lower rates than are available to your ISO's how do renewals work from the ISO's standpoint considering no doubt you're soliciting them in-house?

[J.Celifarco]

I think companies are making money in the traditional deals the 5-8 month 1.35-1.42 deals and I think some companies are making money on some of the longer term deals depending on the factor rates and how good underwriting is.
That said these companies with these crazy low rates though they sound great to sell, I don't know how long they are going to be around and I would be scared to send a lot of my business there when I don't know if they will be around in 6 -12 months when i need to renew my merchants.

[Akanzer]

So if your inside sales force has lower rates than are available to your ISO's how do renewals work from the ISO's standpoint considering no doubt you're soliciting them in-house?

Not sure I follow? We renew merchants regardless of channel and don't compromise the ISO commission

[omegafund]

Swift has great rates, speed and service NOT there yet compared with the other guys. But with the strict UW and low loss I am sure they will continue to be around for a long time

[Sean Cash]

Swift has great rates, speed and service NOT there yet compared with the other guys. But with the strict UW and low loss I am sure they will continue to be around for a long time

Swift has been around the block long enough to know what they're doing. They were in the lending business at MBNA before the BoA takeover. They just got a nice new $50 mil credit line too: http://www.prweb.com/releases/2014/08/prweb12105186.htm