[Moshe73]

Also, I don't think that a merchant who's entering a 24-month program with a balloon will be going back for MCAs so quickly (at least I hope not). Saving the merchant the money on the payoff and increasing cash-flow might save their business.

I'm looking at a submission that used a similar service one month ago on a 12 month term for ~500k and is already looking for advances right now

I question the profitability on these, no way all these deals are getting completely stacked out.

[KanjorskiPartners]

Michah,

You are 100% correct on everything you have said, especially the lines about saving their business.

And again, we have no adversarial relationships with any MCA companies. They are happy to get their capital back from a merchant who is struggling with cash flow.

[KanjorskiPartners]

The ZBLs say that the balance is $0 and that's all in every case where we have done transactions. It is a mutually agreeable transaction between us and the merchant cash company. It is NOT a settlement or a default.

[WestCoastFunding]

The ZBLs say that the balance is $0 and that's all in every case where we have done transactions. It is a mutually agreeable transaction between us and the merchant cash company. It is NOT a settlement or a default.

It’s been brought up before, and I still don’t understand why you’re targeting consolidation of MCAs. 99% of subprime lenders and A paper MCA funders aren’t funding right now. Why not simply use your program to target companies without MCAs considering there isn’t anyone offering subprime 24 month loans? You’d have no competition while getting higher grade borrowers. Why simply pass that up and go right to consolidating cash advances? That really makes no sense to me.

[FHFunding]

It’s been brought up before, and I still don’t understand why you’re targeting consolidation of MCAs. 99% of subprime lenders and A paper MCA funders aren’t funding right now. Why not simply use your program to target companies without MCAs considering there isn’t anyone offering subprime 24 month loans? You’d have no competition while getting higher grade borrowers. Why simply pass that up and go right to consolidating cash advances? That really makes no sense to me.

Because they're angels from heaven doing the lords work! Duh!

[KanjorskiPartners]

Well Ryan and Ricky, please tell me the difference between these two hypothetical transactions. Ricky you will find that your statement is incorrect. My apologies in advance to make you actually have to think.

********WHAT WE DO NOT NOT NOT DO**********

DEBT SETTLEMENT (what we DO NOT DO) (or is it "Advance Settlement"...we all know advances are debts/loans and not anything else if we are being honest):
$100,000 owed at $16,667 per month in daily payments

factor rate 1.33 over 6 months; original net amount to merchant ~$75,000 (or less after closing costs are removed from net amount raising the factor rate actually)

3 months into a 6 month advance duration, payments lowered to $5000 per month by a debt settlement company through tortious interference (but more importantly because the company can't sustain paying out a year's worth of equity in 4 months plus having to contribute more through "stacking" or "reverse ponzi schemes" as I like to call them, but that's another conversation)

remaining duration extended by 3.3x times therefore the ROI for the MCA company goes way down (~70% decrease in ROI) and the risk to their capital goes way up (proportionally)

lump sum payment to the MCA company $0

**************WHAT WE DO DO DO, DO*****************

DEBT REFINANCE (what we DO):
$100,000 owed at $16,667 per month in daily payments

factor rate 1.33x over 6 months

3 months into a 6 month advance duration, we do a lump sum pay off

lump sum pay off $87,375 to the MCA company on the $100,000 "remaining balance"

MCA company gets their 5.5% per month on their money like they would on a 1.333 over 6 months w/ daily payments and they can re-advance the money/put it out new/recycle it/etc)



Every MCA company (that understands return on capital and return of capital) that we deal with do our deals ALL DAY LONG especially when they find out that there are multiple stacks on the file and their risk has exponentially increased with each stack.

Please, again, tell me how DEBT SETTLEMENT and DEBT REFINANCE are same the same thing and then I can tell you that you know nothing about finance or return on or of capital.

Perhaps I am wrong and 2 + 2 really does = fish

[FHFunding]

Well Ryan and Ricky, please tell me the difference between these two hypothetical transactions. Ricky you will find that your statement is incorrect. My apologies in advance to make you actually have to think.

********WHAT WE DO NOT NOT NOT DO**********

DEBT SETTLEMENT (what we DO NOT DO) (or is it "Advance Settlement"...we all know advances are debts/loans and not anything else if we are being honest):
$100,000 owed at $16,667 per month in daily payments

factor rate 1.33 over 6 months; original net amount to merchant ~$75,000 (or less after closing costs are removed from net amount raising the factor rate actually)

3 months into a 6 month advance duration, payments lowered to $5000 per month by a debt settlement company through tortious interference (but more importantly because the company can't sustain paying out a year's worth of equity in 4 months plus having to contribute more through "stacking" or "reverse ponzi schemes" as I like to call them, but that's another conversation)

remaining duration extended by 3.3x times therefore the ROI for the MCA company goes way down (~70% decrease in ROI) and the risk to their capital goes way up (proportionally)

lump sum payment to the MCA company $0

**************WHAT WE DO DO DO, DO*****************

DEBT REFINANCE (what we DO):
$100,000 owed at $16,667 per month in daily payments

factor rate 1.33x over 6 months

3 months into a 6 month advance duration, we do a lump sum pay off

lump sum pay off $87,375 to the MCA company on the $100,000 "remaining balance"

MCA company gets their 5.5% per month on their money like they would on a 1.333 over 6 months w/ daily payments and they can re-advance the money/put it out new/recycle it/etc)



Every MCA company (that understands return on capital and return of capital) that we deal with do our deals ALL DAY LONG especially when they find out that there are multiple stacks on the file and their risk has exponentially increased with each stack.

Please, again, tell me how DEBT SETTLEMENT and DEBT REFINANCE are same the same thing and then I can tell you that you know nothing about finance or return on or of capital.

Perhaps I am wrong and 2 + 2 really does = fish

The bottom line, is that original 'total payback' is not being paid back. In your example, the MCA company is getting $12,625 less than what is stated on the contract. You are using the word 'interest' which is the difference here. It's a very clear stated payback amount on an MCA. Anything less than that is technically considered a default. Most MCA companies won't default the client if an agreement is reached - but it's exponentially harder to get a merchant an MCA once they have 'settled' on a prior MCA. I don't think any broker on here would risk their direct lender relationships - or risk the chance that they will never be able to do another MCA for whichever client takes part in this.

[KanjorskiPartners]

In the end, the letters we get prior to closing before we payoff all the MCAs are "payoff" letters and then we get zero balance letters. There is no language anywhere in the letters stating "settlement" or "default" nor are any 1099-Cs issued which would indicated that it was settled. The contract is simply amended by the payoff letter. Its very simple.

[FHFunding]

In the end, the letters we get prior to closing before we payoff all the MCAs are "payoff" letters and then we get zero balance letters. There is no language anywhere in the letters stating "settlement" or "default" nor are any 1099-Cs issued which would indicated that it was settled. The contract is simply amended by the payoff letter. Its very simple.

You can't possibly guarantee that an MCA company will word THEIR zero balance letters the way YOU tell them to.

[RickyR3712]

Read what I wrote.I understand what you are .But bottom line it goes by what funders consider it.I have no issue submitting a file to you but I will need in writing that the funders that I work with and have renewals with will not cut me off and not a single one was willing to.
Has anyone on here gotten a different response?I assume admin agrees with you as he never banned you

[KanjorskiPartners]

We target MCAs because more than a majority of the time they are unsustainable financing products and without renewals and new money, and even after that, the business cannot sustain the payments. The businesses need a new amortization to survive/thrive and get their equity back and the merchant cash companies normally want to get out of an over-leveraged stack anyway. Its an easy case for a refinance and everyone wins in our transactions.

[WestCoastFunding]

We target MCAs because more than a majority of the time they are unsustainable financing products and without renewals and new money, and even after that, the business cannot sustain the payments. The businesses need a new amortization to survive/thrive and get their equity back and the merchant cash companies normally want to get out of an over-leveraged stack anyway. Its an easy case for a refinance and everyone wins in our transactions.

Wait a minute, so rather than use this 24 month term loan product to market to good businesses who can’t access capital because there aren’t options available, you chose to market to companies that are higher-risk — all because you want to do your civic duty and help them?

If you did have investors, wouldn’t they think this plan is bat****crazy? What investor would say, “bypass the strongest customers that would pay this same rate and, instead, focus on the weakest customers who have a history of adding subordinated high interest debt that puts the original facility in jeopardy”.

Really doesn’t make any sense to me.

[Michael I]

Wait a minute, so rather than use this 24 month term loan product to market to good businesses who can’t access capital because there aren’t options available, you chose to market to companies that are higher-risk — all because you want to do your civic duty and help them?

If you did have investors, wouldn’t they think this plan is bat****crazy? What investor would say, “bypass the strongest customers that would pay this same rate and, instead, focus on the weakest customers who have a history of adding subordinated high interest debt that puts the original facility in jeopardy”.

Really doesn’t make any sense to me.

he answered before in a different post because he needs to make a certain percentage and cant have it be usury. this way he can make 40-50 points and have contract only say 20%.
i fully agree with mica that this helps a merchant however ricky point on how funders will react is a legitimate concern .To me the fact that it is the funder decision and no arm twisting i do not see the issue

[WestCoastFunding]

he answered before in a different post because he needs to make a certain percentage and cant have it be usury. this way he can make 40-50 points and have contract only say 20%.
i fully agree with mica that this helps a merchant however ricky point on how funders will react is a legitimate concern .To me the fact that it is the funder decision and no arm twisting i do not see the issue

1. This would require approaching the original funder and asking for a reduction in the total debt — which could trigger the Funder filing.

2. What’s to stop funder from adding to Datamerch.

[KanjorskiPartners]

he answered before in a different post because he needs to make a certain percentage and cant have it be usury. this way he can make 40-50 points and have contract only say 20%.
i fully agree with mica that this helps a merchant however ricky point on how funders will react is a legitimate concern .To me the fact that it is the funder decision and no arm twisting i do not see the issue

We haven't had one merchant cash company react poorly. They are happy to get their capital back on a file that is overleveraged, especially the 1st and 2nd position funders.

[Franklin]

We haven't had one merchant cash company react poorly. They are happy to get their capital back on a file that is overleveraged, especially the 1st and 2nd position funders.

Are you guys familiar with Solace or New Horizon?


This program has been around for many years by the way.



















www.UccRadar.com

[KanjorskiPartners]

The discount to par and our APR makes the transaction work for us and manages our risk. MCA companies get their capital back with their expected return and they redeploy it, our referral partners get paid and the business / merchant receives a more-than-manageable monthly debt payment and gets on a path to getting their equity in the business back. Period.

[Rickinindy]

Can rest assured on a secured advance platform there would not be a release of lien on property if they did not pay in full. If he owes me 10K he will pay the whole 10K not taking 8K and I will make life hell for the merchant that uses the debt consolidation company to dodge the debt. They were all about it when we fund them we are all about it when its time to collect. No funder should take even once cent of a discount if they are contacted by these clowns on behalf of the merchant debt

[KanjorskiPartners]

Well Rick...we're not debt settlement if you read the post. Its a good thing that we never see metromedia funding solutions anywhere on the thousands of applications that we process. You would be the first funding company to want balance in full. The smart companies get their capital back, take their accelerated return and put it back out on the street LOL.

I'm sure it this policy "...will make life hell for the merchant..." that prevents you from expanding your business and obtaining customers. Don't worry, you are already doing that.