[debtman222]

Would any of the larger, more reputable MCA companies take a second position, or is that something they would absolutely not do? Thanks.

[FUSIONCAPITAL]

Would any of the larger, more reputable MCA companies take a second position, or is that something they would absolutely not do? Thanks.

Some will do a 2nd ONLY if the 1st is 50% paid off.

[MikeGreen-Quarterspot]

At Quarterspot we will take a second position and base it on the cash flow from the last 4 months of bank statements. We do not need the first position to be at any specific level. We may provide an offer to buy out the first position. Also, we are not an MCA. We are a term loan for up to 12 months via ACH, no CC split.

[debtman222]

Thanks. I am particularly curious about the larger guys like OnDeck, CAN, BFS, Rapid Advance, AmeriMerchant, and Merchant Cash and Capital.

[Sean Cash]

Thanks. I am particularly curious about the larger guys like OnDeck, CAN, BFS, Rapid Advance, AmeriMerchant, and Merchant Cash and Capital.

With the exception of OnDeck, I can't see any of them doing it. They are part of the loud anti-stacking crowd and trying to get the industry to end the practice.

[J.Celifarco]

Thanks. I am particularly curious about the larger guys like OnDeck, CAN, BFS, Rapid Advance, AmeriMerchant, and Merchant Cash and Capital.

Nobody on this list stacks.. Auto decline for most if they see a stack in the merchants past

[WhoisKingsley]

I just got an email blast from NewEra... notice it says SECOND position. Not 3+++++++++++ (You're Welcome NewEra)

YOU’RE
INVITED
​to the
BIG 2nd Position
Event!

Funding Amounts Up to $300k
&
7 month terms

Up to 10 point commissions
WE WANT TO FUND YOUR NEXT 2ND POSITION APPLICATION

[jaynyone]

Has anyone dealt with a company that stacks over Quarterspot? I've got a merchant who has a $100k balance and has the balances and deposits to take on more.

He does about $200k a month and is looking for another $50k.

[channin19]

No, at least not intentionally. IOU will.

[isaacdstern]

no one in that crowd stacks

[Capital Stack]

lol

no one in that crowd stacks

[WhoisKingsley]

jaynyone- Okay he has a $100k balance on what terms? UW are going to look at the % taken out to determine another loan. On top of that- Yes, it matters the monthly gross, but what about his balances? NSF? If he takes another $50k the term will be shorter and expensive and exceed what any lender is comfortable giving. Also- you just completely put yourself out there to QS.

What mostly everyone doesn't understand is the longer the term the less money the lender or the person/people/company that are giving these lenders the money to lend make. MONEY COSTS MONEY- even to the funders. The terms are short RISK=PRICE (obvious) BUT they only go up to certain % on the stack. Example- Seconds they won't go over X% of monthly gross.

[jaynyone]

jaynyone- Okay he has a $100k balance on what terms? UW are going to look at the % taken out to determine another loan. On top of that- Yes, it matters the monthly gross, but what about his balances? NSF? If he takes another $50k the term will be shorter and expensive and exceed what any lender is comfortable giving. Also- you just completely put yourself out there to QS.

What mostly everyone doesn't understand is the longer the term the less money the lender or the person/people/company that are giving these lenders the money to lend make. MONEY COSTS MONEY- even to the funders. The terms are short RISK=PRICE (obvious) BUT they only go up to certain % on the stack. Example- Seconds they won't go over X% of monthly gross.

This guy has avg balances in the thousands even after the daily payments to QS. They seem to have good pricing over there though - not the first deal I've lost because of their rates.

[Sean Cash]

A reminder to everyone here since I see brand new funders coming on who barely have enough capital to even afford a real email address, yet they're advertising 2nd positions and more. If you stack, expect to be sued.

Whether or not you think funding a merchant additional advances is within your right is something you will have to convince a judge or the plaintiff's attorney about. Tortious interference lawsuits and settlements are happening all the time behind the scenes. It doesn't matter if it's a 10th position or a 2nd position. Do not stack unless you have a huge cash reserve for attorney fees or better yet I advise you don't stack at all. If you can't figure out how to fund businesses that don't have cash advances already, you're in the wrong business.

[Chambo]

A reminder to everyone here since I see brand new funders coming on who barely have enough capital to even afford a real email address, yet they're advertising 2nd positions and more. If you stack, expect to be sued.

Whether or not you think funding a merchant additional advances is within your right is something you will have to convince a judge or the plaintiff's attorney about. Tortious interference lawsuits and settlements are happening all the time behind the scenes. It doesn't matter if it's a 10th position or a 2nd position. Do not stack unless you have a huge cash reserve for attorney fees or better yet I advise you don't stack at all. If you can't figure out how to fund businesses that don't have cash advances already, you're in the wrong business.

Lord knows Rapid (with newly minted Gilbert $) and Can capital have ample funds. Heck, they probably have in house atty's just sitting around waiting to draft up the paperwork

On Deck won't be too far behind if they actually go through with the offering. Then again, they might have their hands full with the shareholder lawsuits

[JeffMulford]

So much for the Sherman anti trust act of 1890...

[channin19]

So much for the Sherman anti trust act of 1890...

How is this anti-competitve?

[WhoisKingsley]

Preach!

[aredmond]

Retail capital will stack on a second position under 2 conditions:

-As long as that first position lender is not a NAMAA member, http://northamericanmaa.org/category/our-members/
-There is enough gross they can squeak out. Retail rarely stacks on top of On Deck because they are known for eating into a lot of the gross on a first position

However, you may want to heed Sean Bash advice.....

[JayBallentine]

In the eyes of the LAW, is there a difference between stacking a loan vs. a business cash advance? I don't know the law from my elbow but it seems like taking legal action to prohibit a business owner from engaging in a sale may be in violation of that business owners' constitutional rights…

Loans… it makes sense to me… Any experts on this? Sean?

[Sean Cash]

In the eyes of the LAW, is there a difference between stacking a loan vs. a business cash advance? I don't know the law from my elbow but it seems like taking legal action to prohibit a business owner from engaging in a sale may be in violation of that business owners' constitutional rights…

Loans… it makes sense to me… Any experts on this? Sean?

I am not a lawyer but I believe the NAMAA member perspective is that the merchant agrees to terms that require approval from the funder to okay additional debt even if it's unsecured since it could endanger the funder's purchase of future revenues. I get the argument on both sides but this is something the merchant signs off on when getting funded.

At least 1 NAMAA member includes a notice in all UCC filings that roughly says lending to or purchasing future revenues of this business constitutes malicious tortious interference. I can go grab the actual language if anyone wants to see for themselves.

The challenge with that is that an actual unsecured lender is probably not going to do a UCC search. The first time I ever got extended unsecured business credit, the only thing they looked into was my personal credit and banking.

So it would be negligent for a secured lender to plead ignorance but an unsecured creditor, I don't know.

And on a slightly unrelated topic, Robert Cook of the financial services law firm Hudson Cook at Lend360 said that a personal guaranty of performance is still a personal guaranty. Something to chew on about contracts in the MCA industry.

[JSL23]

I am not a lawyer but I believe the NAMAA member perspective is that the merchant agrees to terms that require approval from the funder to okay additional debt even if it's unsecured since it could endanger the funder's purchase of future revenues. I get the argument on both sides but this is something the merchant signs off on when getting funded.

At least 1 NAMAA member includes a notice in all UCC filings that roughly says lending to or purchasing future revenues of this business constitutes malicious tortious interference. I can go grab the actual language if anyone wants to see for themselves.

The challenge with that is that an actual unsecured lender is probably not going to do a UCC search. The first time I ever got extended unsecured business credit, the only thing they looked into was my personal credit and banking.

So it would be negligent for a secured lender to plead ignorance but an unsecured creditor, I don't know.

And on a slightly unrelated topic, Robert Cook of the financial services law firm Hudson Cook at Lend360 said that a personal guaranty of performance is still a personal guaranty. Something to chew on about contracts in the MCA industry.

I hear a lot about people being taken to court for stacking. If anyone would know, I am guessing you would Sean; Has anyone, Stacker or Stackee, been taken to court by a Lender who has won a judgment against them? Monetary or an injunction?

[J.Celifarco]

I hear a lot about people being taken to court for stacking. If anyone would know, I am guessing you would Sean; Has anyone, Stacker or Stackee, been taken to court by a Lender who has won a judgment against them? Monetary or an injunction?

yes. many times.. 1 bank in particular has sued many times for tortious interference and has won. I also know of at least 1 other case that is in court now. I have to agree with Sean on this one. If you are a stacker I hope you have plenty of cash reserve because there is a good chance you will end up in court sooner rather then later

[Al1]

yes. many times.. 1 bank in particular has sued many times for tortious interference and has won. I also know of at least 1 other case that is in court now. I have to agree with Sean on this one. If you are a stacker I hope you have plenty of cash reserve because there is a good chance you will end up in court sooner rather then later

Could you please share the case information or the name of the bank that's suing? It's public information if they'd filed a lawsuit so I wouldn't think they'd have a problem and I would guess they would want others to know they won't be stacked on.

I keep hearing about all these suits but I've yet to see particulars. Sending out demand letters is not the same thing as filing a compliant in court.

[JSL23]

yes. many times.. 1 bank in particular has sued many times for tortious interference and has won. I also know of at least 1 other case that is in court now. I have to agree with Sean on this one. If you are a stacker I hope you have plenty of cash reserve because there is a good chance you will end up in court sooner rather then later

I'm not a Stacker(personally). I have brokered 2nd position deals, but usually stick to firsts....I was seriously just wondering if a lawsuit has actually gone to trial and what the outcome was. Does this bank take the Funder who stacked AND the Merchant to court? What type of defense was used against the tortious interference complaint?