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  1. #26
    Quote Originally Posted by Michael I View Post
    so basically you believe that the guideline of what is called greedy is based on what is standard ?
    The fact that the merchant's generally always get pissed once the PSF hits from the ISO. If you want to **** up the renewal game by taking another 5-10% PSF, you're doing it wrong.

  2. #27
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    Quote Originally Posted by TheUnderwritingProdigy View Post
    Just curious, and I mean no shade, but how do you have time to get any work done when you're commenting in depth, back and forth on seemingly every single post on here?
    it honestly probably not as hard as youd think

  3. #28
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    Quote Originally Posted by TheUnderwritingProdigy View Post
    The fact that the merchant's generally always get pissed once the PSF hits from the ISO. If you want to **** up the renewal game by taking another 5-10% PSF, you're doing it wrong.
    if what you are saying is that merchant always need to be aware that i 100% agree but that is not a greedy issue . Merchants get upset about all parts of the loan, the term the rate and then getting the docs and seeing that they are not even getting the whole amount.
    My question to you is what is the guidelines of greedy ?

  4. #29
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    I think the funder adds a fee and a hefty commission through a calculated percentage of cost of overhead, cost of defaults, investors portions, etc...

    it does seem a little odd that a broker feels they have the right to randomly come in and say "hey i dont really care about any of that i just want to make more money". I also do agree that getting paid 12 points should make anyone and everyone very rich if you just play this game the right way which 100% involves renewals.

  5. #30
    Quote Originally Posted by pcfunder View Post
    I think the funder adds a fee and a hefty commission through a calculated percentage of cost of overhead, cost of defaults, investors portions, etc...

    it does seem a little odd that a broker feels they have the right to randomly come in and say "hey i dont really care about any of that i just want to make more money". I also do agree that getting paid 12 points should make anyone and everyone very rich if you just play this game the right way which 100% involves renewals.
    Agreed. So many brokers have blinders on and refuse to see the big picture. The long term renewal game is where all the money is at. Stop screwing it up for yourselves and everyone else.

  6. #31
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    Quote Originally Posted by TheUnderwritingProdigy View Post
    Agreed. So many brokers have blinders on and refuse to see the big picture. The long term renewal game is where all the money is at. Stop screwing it up for yourselves and everyone else.
    the number one thing by far to have a renewal game is to make sure you placed the merchant correctly . i dont care if you made 1% if you put the merchant in the wrong home they will wind up going somewhere else .
    Also funders need to know the market and renew based on that. I remember how easy it was to move a merchant when on deck and bfs started going out 12 plus months instead of the 6 month 1.38 and 8 month 1.48 that it was at for ever. Same thing happened when the second position guys went from the 3- 4 moths to the 6-10 months the ones that were not adapting were losing all their clients

  7. #32
    Quote Originally Posted by TheUnderwritingProdigy View Post
    In a perfect world, ISO's shouldn't be paid at all until the deal pays off. None of this 30 day BS. If I'm in the hole $10k on a deal after 30 days and the merchant decides to stop payment, the broker should be entitled to nothing IMO.
    lololol! its a risk/reward decision. The reward is far greater as a funder! Which is why there are funders at all. I am a broker not an underwriter. Please do not make me responsible for your sub-par underwriting skills. I don't work with any lender whos claw back period exceeds 30 days ( not 30 business days 30 regular old days).We work really hard to get deals submitted and performance on a deal should not be the brokers responsibility( obviously if the broker double funded or took a large PSF that is a different story and deserves to be clawed back) ! In a perfect world there would be no clawbacks for honest,hardworking non-psf charging, non -stacking ISOS!!

  8. #33
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    Quote Originally Posted by alexd12345 View Post
    lololol! its a risk/reward decision. The reward is far greater as a funder! Which is why there are funders at all. I am a broker not an underwriter. Please do not make me responsible for your sub-par underwriting skills. I don't work with any lender whos claw back period exceeds 30 days ( not 30 business days 30 regular old days).We work really hard to get deals submitted and performance on a deal should not be the brokers responsibility( obviously if the broker double funded or took a large PSF that is a different story and deserves to be clawed back) ! In a perfect world there would be no clawbacks for honest,hardworking non-psf charging, non -stacking ISOS!!
    Yah I agree that the weight of performance should not really be put on the broker AS LONG AS brokers don't do things to actively ruin performance. Being and acting shady makes a merchant completely second guess what they are getting into and they probably are way more willing to default if the sales rep acts shady. As long as a broker understands to treat merchants right, to not hide fees, to be honest and up front about the entire program, to not promise BS, and to just generally be an all around good sales rep when a merchant needs it then I don't care if a mistake happens and the merchant defaults.

    the problem I notice is that a lot of brokers dont treat MCA like a sales job they treat it like a numbers job. Call 300 merchants and hope that they want money. Force the program down their throat and on to the next. Force another program down their throat and on to the next. 30 days has passed, sweet I dont need to worry. Honestly regardless of bad credit, regardless of negative days, regardless of debt and legal issues if someone called me cluelessly shoving MCA down my throat until I'm desperate enough, I would probably be like **** this guy and this program im out too.

  9. #34
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    Quote Originally Posted by alexd12345 View Post
    lololol! its a risk/reward decision. The reward is far greater as a funder! Which is why there are funders at all. I am a broker not an underwriter. Please do not make me responsible for your sub-par underwriting skills. I don't work with any lender whos claw back period exceeds 30 days ( not 30 business days 30 regular old days).We work really hard to get deals submitted and performance on a deal should not be the brokers responsibility( obviously if the broker double funded or took a large PSF that is a different story and deserves to be clawed back) ! In a perfect world there would be no clawbacks for honest,hardworking non-psf charging, non -stacking ISOS!!
    In a perfect world i would agree with you. there would not be a need for CB since brokers are acting in good faith and the onus is on the UW. Unless an unforeseen circumstance were to occur like a natural disaster or a merchant suddenly having no income a deal should not default. And if it does, one cannot blame the broker.

    But since we do not live a perfect world. An UW can make a great decision and fund a deal and it can go bad due to PSF, Stacking, double funding, lying to a merchant etc. Therefore causing a funder to want a commission back

  10. #35
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    Quote Originally Posted by alexd12345 View Post
    l. I don't work with any lender whos claw back period exceeds 30 days ( not 30 business days 30 regular old days).
    I also have the same rule especially for the ones that do the 40-80 day deals . If you are giving a merchant a 12 month plus deal than I would be ok with a longer clawback .

  11. #36
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    Quote Originally Posted by Akanner View Post
    In a perfect world i would agree with you. there would not be a need for CB since brokers are acting in good faith and the onus is on the UW. Unless an unforeseen circumstance were to occur like a natural disaster or a merchant suddenly having no income a deal should not default. And if it does, one cannot blame the broker.

    But since we do not live a perfect world. An UW can make a great decision and fund a deal and it can go bad due to PSF, Stacking, double funding, lying to a merchant etc. Therefore causing a funder to want a commission back
    This is the truth. Claw back should only happen if the broker did something wrong.
    Is this your claw back policy?

  12. #37
    Quote Originally Posted by DTFdowntofund View Post
    Understanding the box. ie, I do B-C paper, 250k max approval, 10 month max term, buy rates 1.29 - 1.33.

    • don't send me A paper with an 800 fico and expect me to compete with IOU.

    • don't submit a deal where the last 3 positions were 1.499 40 day terms and think I'd entertain it

    • don't flood my underwriting with loads of deal flow and never fund (we know you use them as a catalyst for completing offers elsewhere)

    • don't have 61 of your reps calling me asking questions on every single deal they've ever sent.. designate someone to follow up on statuses if needed in a pipeline request

    • don't expect to be prioritized on the 2 subs you send me a month
    (I respect every single partner I've ever had, and happy to assist... but it's not a secret that if you focus on building a strong relationship with 1-2 funders in each product space you're always better off than spreading out a handful of deals to them all and never really building rapport with a few specifically)

    • don't call and request an increased approval amount and longer term on every single deal you send. (it's smart to try and get the most out of deals from a broker's perspective... of course. but learn how to pick and choose your battles here; if you fund 20 deals a month with me and on 2 of them you reach out and explain why you want an offer bumped and it makes sense to do so... you'll get a much better response, guaranteed)

    • don't send me deals with 15 NSFs.

    • don't quietly usher in problematic files and attempt to try and get away with omitting there's an issue with it from the jump. It's going to come to light, and there's only a few strikes you get there before you're going to have a negative connotation to you from then on.

    • don't call me and start playing the blame game if your deal dies in the 25th hour over something that is rational (ie, decision logic shows -$47,000.00 in their primary acct) Listen, I get your frustrated.. I really do, but your best course of action is to figure out how to rectify the issue, fix it, and help it come to fruition.

    Knowing how to allocate your deals properly is not only going to establish credibility with the funder, but it's going to result in the best terms and ergot the most funded deals possible... which is why we all play this game to begin with.
    ^^^^^^^

    Well said @DTFdowntofund .

    I don't care how a file is labeled on submission as long as the merchant profile fits our funding box. Lenders send you guidelines for a reason; use them. ISOs would close 40% more deals if they took the time to look at the client's banks before submitting.

    Remember lenders are the ones taking the risk to fund the deal. We instantly can lose 20-500k on a merchant going bad. So if/when you get mad at deals getting killed at the 11th hour remember that. NO ONE wants to kill deals at the 11th hour but the industry is based on risk and we calculate the risk to the best of our abilities and sometimes it happens.
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  13. #38
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    Quote Originally Posted by pcfunder View Post

    the problem I notice is that a lot of brokers dont treat MCA like a sales job they treat it like a numbers job. Call 300 merchants and hope that they want money. Force the program down their throat and on to the next. Force another program down their throat and on to the next. 30 days has passed, sweet I dont need to worry. Honestly regardless of bad credit, regardless of negative days, regardless of debt and legal issues if someone called me cluelessly shoving MCA down my throat until I'm desperate enough, I would probably be like **** this guy and this program im out too.
    Funders listen to him. Pay 12 upfront like everyone does and give a couple of points on the backend if merchant fully pays. This way the broker has an incentive to keep merchant paying pass the 30 days.

  14. #39
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    Quote Originally Posted by RickyR3712 View Post
    Funders listen to him. Pay 12 upfront like everyone does and give a couple of points on the backend if merchant fully pays. This way the broker has an incentive to keep merchant paying pass the 30 days.
    great idea

  15. #40
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    Quote Originally Posted by RickyR3712 View Post
    Funders listen to him. Pay 12 upfront like everyone does and give a couple of points on the backend if merchant fully pays. This way the broker has an incentive to keep merchant paying pass the 30 days.
    thats a game changing idea....

  16. #41
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    Quote Originally Posted by RickyR3712 View Post
    This is the truth. Claw back should only happen if the broker did something wrong.
    Is this your claw back policy?
    To be fully honest, that is not my policy.

    1. Very often it is very hard to find out what went wrong and why the deal went bad, especially if the merchant has gone MIA.
    Every so often, you get updated docs and find out that you were double funded, stacked etc. Or eventually, you hear from the merchant that he defaulted on your MCA since the SBA or LOC he was promised never came.

    2.I have a few isos that i have full trust in and if a deal comes bad every so often it can slide and not clawback a cm.
    But there are other isos that pretty quickly you notice that all their deals go a bit sour and you see that they are just trying to shovel whatever they can at you (most deals are previous defaults, funding mtd that they knew about, hidden accounts). in a case of a day one default, we would be more inclined to take our cm back and either be more cautious with them or no longer fund for them.

    Obviously, there are shops that fit between those 2 types.

  17. #42
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    yeah I think most funders let good ISO's get away with a lot. Theres a lot of money to go around as long as it goes around in an honest way. When I first became an ISO rep I had an ISO that would flood us with submissions like 60-70 a day. We catered to this ISO like CRAZY until we noticed every. single. deal. defaulted. literally not one paid in full. found out that the owners BUSINESS PLAN was to stack until they couldnt get approved by anyone else and then give them a reverse. They sold the merchant on how "amazing and awesome" a reverse consolidation is so the merchant looked at every position like free money. most of the time the merchant never even qualified for a reverse and even if they did they would default anyway.

    other ISO's I dont have a single default with. Not sure what they do or if its just luck. Just seems to be how things work right now.

  18. #43
    Quote Originally Posted by Akanner View Post
    In a perfect world i would agree with you. there would not be a need for CB since brokers are acting in good faith and the onus is on the UW. Unless an unforeseen circumstance were to occur like a natural disaster or a merchant suddenly having no income a deal should not default. And if it does, one cannot blame the broker.

    But since we do not live a perfect world. An UW can make a great decision and fund a deal and it can go bad due to PSF, Stacking, double funding, lying to a merchant etc. Therefore causing a funder to want a commission back
    I very clearly stated Im ok with a no stack no psf no false promises as a clause in the no clawback policy .

  19. #44
    Quote Originally Posted by alexd12345 View Post
    I very clearly stated Im ok with a no stack no psf no false promises as a clause in the no clawback policy .
    I think if funders put the following into their iso agreement that if at any time there is irrefutable proof that an iso either lied to merchant, charged a psf or double funded/ stacked a merchant, the iso can be clawed back immediately, even without a default, it would cause alot less of this kind of activity and clean up this industry in a major way ! Als we ISos would not t have to be responsible for crappy underwriting.

  20. #45
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    The reason for clawback is because of shady brokers. Do you know how many funding calls I've been on with a merchant and they tell me well XYZ broker told me if I take this he's going to get me X amount more in a few days. The broker takes the commission then disappears on the merchant then another shady broker promises the same thing and boom another funding in a few days.

    I love the idea of paying half commission upfront and then another half on the back when merchant is paid off or ready for renewal.

  21. #46
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    Quote Originally Posted by alexd12345 View Post
    I think if funders put the following into their iso agreement that if at any time there is irrefutable proof that an iso either lied to merchant, charged a psf or double funded/ stacked a merchant, the iso can be clawed back immediately, even without a default, it would cause alot less of this kind of activity and clean up this industry in a major way ! Als we ISos would not t have to be responsible for crappy underwriting.
    I hear, but i think that would be almost to impossible to enforce. Each clawback will be like a court case with each side presenting their evidence.
    Also, the same brokers that will do the grey area tactics are not the type that will honor a clawback for getting caught. It will most likely lead them to fund side accounts, pull psf under entity and all sorts of other tricks to skirt getting caught.

    I think a clear cut 30 day (usually 20 payments) policy is clear cut and leaves less room for debate. Sometimes you make it by one payment/day sometimes you lose it by one payment/day no matter if its a 40 day deal or 140 days. It can be like football; a game of inches.

    An iso and funder can make up their own agreement or own deal by deal basis. whether it is a period of time or out of principle on the deal.

  22. #47
    Senior Member Reputation points: 51397 DTFdowntofund's Avatar
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    Quote Originally Posted by TheUnderwritingProdigy View Post
    Just curious, and I mean no shade, but how do you have time to get any work done when you're commenting in depth, back and forth on seemingly every single post on here?
    So I skim the board occasionally, and if I have something specific to say I do.. and then move on. I know what I say is always on point and very succinct , but I type 90WPM and the thoughts come very rapidly and organically so it takes a fraction of the time you would think.

    On the flipside, I couldn't tell you how many times you've posted today, this week, or about what.

  23. #48
    Quote Originally Posted by DTFdowntofund View Post
    So I skim the board occasionally, and if I have something specific to say I do.. and then move on. I know what I say is always on point and very succinct , but I type 90WPM and the thoughts come very rapidly and organically so it takes a fraction of the time you would think.

    On the flipside, I couldn't tell you how many times you've posted today, this week, or about what.
    I do have to give it to you... you do post some of the best, well thought out responses I've seen. Kudos to you-dos

  24. #49
    Senior Member Reputation points: 51397 DTFdowntofund's Avatar
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    Quote Originally Posted by TheUnderwritingProdigy View Post
    I do have to give it to you... you do post some of the best, well thought out responses I've seen. Kudos to you-dos
    Very kind of you to say. Just been playing the game for a long time is all.

  25. #50
    Quote Originally Posted by DTFdowntofund View Post
    Very kind of you to say. Just been playing the game for a long time is all.
    You got it. What company are you with by the way? Just curious

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