[OC Funder]

I see a lot of companies lines either being re-evaluated or possibly cutoff when they can no longer use COJ's

Agreed. A lot of companies have terrible default rates and never cared due to COJs. Once their books are re-evaulated under the new reality, all of those advances they never should've funded (if using sane underwriting guidelines) are going to come back to bite them. Their portfolio won't look profitable without the easy COJ collections.

[Michael I]

Chrome Capital sweet spot will remain 3-6th position advances needing 100-600k same day up to 7.5 month terms. This will be with or without COJ. Most of Chrome collections is done by having close relationships and working out payment plans with merchants.

Chrome also offers an mca credit line whereas if we merchant doesn’t stack they will be eligible for additional funds every month like clockwork.

A lot of clients also get effective 1.19 rates after early pay discount is factored in.

Is what you are saying is that you do not rely on coj but more on the first 2 positions underwriting? Up to what percentage of gross will you take someone?

[Davincinc]

I have one big question: If it passes, what will that do to the deals in our pipelines that are more than 90 days in their term?

pre existing condition and obligated to the term of the contract,

[SmartAdvanced]

Agreed. A lot of companies have terrible default rates and never cared due to COJs. Once their books are re-evaulated under the new reality, all of those advances they never should've funded (if using sane underwriting guidelines) are going to come back to bite them. Their portfolio won't look profitable without the easy COJ collections.

what a lie - COJs are effective 1% of the time

[VeganFunder]

Aren't we all basically COJ users on some level? A PSF is basically just an upfront COJ

All positions should be underwritten equally--like the way you would underwrite for a credit card. Credit card companies don't care if you have an Amex AND a Chase card.
First position with garbage credit-- shorter term
5th position with great cash flow and good credit-- longer term

[SmartAdvanced]

Aren't we all basically COJ users on some level? A PSF is basically just an upfront COJ

All positions should be underwritten equally--like the way you would underwrite for a credit card. Credit card companies don't care if you have an Amex AND a Chase card.
First position with garbage credit-- shorter term
5th position with great cash flow and good credit-- longer term

dude you sound like a vegan

[StealMyDeal]

I have one big question: If it passes, what will that do to the deals in our pipelines that are more than 90 days in their term?

The law prevents the filing of COJs, so it wouldn't surprise me if multiple funders mass-file COJs, even on performing accounts, right before the law goes into effect so they can perfect. Anyone who had a single NSF or any other technical default could easily be subject to this.

[Sachip24]

wouldnt lenders just set up offices in other states and file the COJ in that state if it gets banned in NY? not sure how COJ filings work

[funding247]

Totally agree. I have a COJ in most of my contracts and I think I actually got paid because of the COJ two times total. IMO lots of funders only insist on the COJ now because there are certain other funders who use their COJ as a means to do whatever they want. If nobody has the power of COJ's the people with the most to lose are the ones who abuse it. The ones who use it rarely but have to have it to protect themselves actually gain from them being banned.

[golf2014]

Partys over

[KINGCASH]

dude you sound like a vegan

Red flag??

[blashley]

I hope this wont affect Mantis, stacking fundkite lol

[harvey]

pray for mantis

[Chambo]

I have one big question: If it passes, what will that do to the deals in our pipelines that are more than 90 days in their term?

State Legislatures do not operate like Cash Advance companies. It would take effect whenever the posted date is, no ifs, ands or butts...they don't care what is already in the pipeline

[J.Celifarco]

State Legislatures do not operate like Cash Advance companies. It would take effect whenever the posted date is, no ifs, ands or butts...they don't care what is already in the pipeline

what I want to know is if the date the law goes into effect is the date the COJ needs to be signed before or as of that date no more can be filed no matter when they were signed. Is the pile of COJ's that all these funders have for their existing merchants about to turn into a pile of toilet paper or will already signed COJ's for active merchants still be able to be filed

[Kevin Henry-Seacoast]

what I want to know is if the date the law goes into effect is the date the COJ needs to be signed before or as of that date no more can be filed no matter when they were signed. Is the pile of COJ's that all these funders have for their existing merchants about to turn into a pile of toilet paper or will already signed COJ's for active merchants still be able to be filed

More than likely.... The date the law goes into effect is the date COJs are not longer valid....past, present, and future.

[J.Celifarco]

More than likely.... The date the law goes into effect is the date COJs are not longer valid....past, present, and future.

that is what I thought as well but was not completely sure

[Sachip24]

ohh wow I thought ones that have been signed were still good and going forward they would not be valid anymore. What happens if law passes then, merchants get wind and say F-U lender and default on everyone since lender can't collect now? Can't lender still sue then or does that become a wash as well since money is supposed to be unsecured and no collateral

[J.Celifarco]

ohh wow I thought ones that have been signed were still good and going forward they would not be valid anymore. What happens if law passes then, merchants get wind and say F-U lender and default on everyone since lender can't collect now? Can't lender still sue then or does that become a wash as well since money is supposed to be unsecured and no collateral

it will come down to how it was before COJ's. Regular collections and who filed UCC's

[Kevin Henry-Seacoast]

Sachip24-If the client defaults because the COJ was deemed not legal, the finance company can certainly sue them to get their money back. A court would not take to kindly of somebody purposely defaulting on an obligation because part of the agreement contained an instrument that can no longer be used. They could likely get pinned for fraud.

KH

[Kevin Henry-Seacoast]

Of course.... If a funder took a client to court who defaulted on their advance because a COJ was deemed not enforceable said funder would also be in a court room with everyone they stacked.

[Sachip24]

Of course.... If a funder took a client to court who defaulted on their advance because a COJ was deemed not enforceable said funder would also be in a court room with everyone they stacked.

lol this is about to get interesting

[Kevin Henry-Seacoast]

lol this is about to get interesting

If you think this is interesting..... Wait until some of the banks that are getting stacked start defending their agreements with customers. Some have been playing nice because the clients are still somewhat current, but that comes to a screeching halt if the lender that was stacked has a client go sideways on them because they were stacked. Default, accounts locked down, reporting requirements tightened, work-out, forbearance agreements, or files a judgement so they can collect.

[Sachip24]

anyone know what time the two bills are hitting the floor to get passed or declined?

[J.Celifarco]

lol this is about to get interesting

interesting is going to be when funders lines start getting cut or revoked and they don't have money to operate.