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09-03-2019, 10:01 AM #1
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- Jul 2019
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- 31
Underwriting Format
So I receive documents/statements all the time however I would like to know how to decide which statements are worth submitting.
I have received declines with merchants making 30K a month with ending balances ranging 14-17K.
I understand the industry has a lot to do with the decision also, however what is the format as far as knowing what to expect?
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09-03-2019, 10:06 AM #2
- Join Date
- Jun 2019
- Posts
- 78
Most funders will look at daily ending balances and see if they are cashflow positive vs negative and bouncing payments. If you see a lot of returned checks / items and / or neg daily balances thats usually a dead give away what to do with it. Now, assuming they accept CC's there are a different tier of funders that will do a cc split on high neg day merchants.
Also, if they have multiple positions that is eating up 15k in debt service on their 30k revs that would also likely get a decline or a high risk / short term offer assuming positive daily balances.
Hope that helps...
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09-03-2019, 10:11 AM #3
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- Jul 2019
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- 31
Very helpful, and thank you.
Is there a percentage of loan debt that's pretty much a red flag?
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09-03-2019, 10:22 AM #4
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- Jun 2015
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- 3,326
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09-03-2019, 10:33 AM #5
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09-03-2019, 10:38 AM #6
- Join Date
- Jul 2019
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- 31
Got it
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