Results 1 to 25 of 53
Threaded View
-
04-09-2013, 11:19 AM #11
- Join Date
- Sep 2012
- Posts
- 199
Merchants really aren't the problem or the solution. We can tell them whatever we want until we are blue in the face. The bottom line is they need money and they are going to get it if its available. Every time I deny a renewal because it's too early I will hit the merchant up once a month for a new bank statement saying they "might" be eligible. Good way to keep an eye out for stacking early in the game. If I see a stack I don't even say anything. It's time to string along and get paid back in full or as much as possible. There are plenty of deals out there to not try to hold onto one that is willing to stack.
I can't stress enough how conventional thinking or conventional analogies do not apply in this industry. High risk / high returns come with many pitfalls. Courts and black and white is something that should be avoided. The last thing any of us should root for is court cases and defined practices. The next step would be regulation. Is that where any of us want to go? The current admin in the white house has made it point blank clear that they will regulate any industry related to lending with high returns if they feel it's necessary. And if we ever get scrutinized the merchants will be the ones who get the benefit of the doubt. No my company or anyone else.
What's happened to the mortgage, insurance, and banking world since 08 is horrifying from a free market viewpoint. I've been in lending/finance since 99. I started with residential mortgage, went to commercial underwriting and asset sales and then went back to mortgage. I had a great shop. We were a corr banker and a broker. We specialized in A paper and not all the crazy crap. Didn't matter in the end though. I got pushed right out of business. Costs from regulation soared at the same time that margins were trimmed. Just brutal.
My main concern of stacking really isn't from a few extra defaults on our books. It's more about the increasing prevalence and the disregard for affordability. Jam up enough merchants with bad business practices and the voice will eventually be loud enough to attract some attention. Right now the MCA space is completely off the radar from a regulatory standpoint. Hardly anybody knows what it is let alone how it works. It needs to stay that way. We need to police ourselves because if we don't we're going to have a bunch of morons deciding what's best for us.
I think the irony is that the industry did an awesome job policing itself after the AdvanceMe and Rewards Network lawsuits. Rapid's problems in 09 tried to get some attention but quickly went away. The CA ambulance chasing seems to have quieted down from what I can tell. So now we have an industry with mostly favorable press, competition rewarding low risk merchants, and competition in the sales space that keep commissions fair and fee raping at a minimum. The MCA/Loan space as a whole has moved away from scrutiny and is becoming "accepted". But now we have to deal with bottom feeding stackers. I would feel a lot better if they just went away on their own. Doesn't look like that's going to happen. Greed is too powerful of a motivator.Last edited by Finance1; 04-09-2013 at 11:31 AM.