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  1. #51
    Quote Originally Posted by Michael I View Post
    on that topic , can you explain to me why funders have to charge a psf fee or whatever they want to call it. Term ,rate i get they do based on how risky the feel it is but than why add 5-10% in fees on top on that?
    sell rate is for the funders investors (less upfront commissions and defaults). "psf fee" is for operational costs (UW's, admin's, rent etc.)

  2. #52
    Senior Member Reputation points: 13016 capaxess's Avatar
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    Quote Originally Posted by RickyR3712 View Post
    Funders want funding volume. Any other answers is just what will be nice to have. Any iso with serious volume can be a total dick.

    Lior honestly would you be happy with an iso that submits a deal with "j1hb23ghj123" labeled on the statements, no information and "GET ME MAX" but funds 3 million a month with you
    My perspective from a one- man & hard-working ISO shop is that, even when all the procedures are maintained to the letter once a file is submitted it becomes "fair game" within 24-48 hours with few exceptions. That is, unless I'm able to get the approval across the finish line in that time frame 90% I lose the deal. That is especially hard for those of us who also have to do our own marketing. Thousands of cold calls, return calls and follow ups along with endless hours of chasing docs, stips and sudden "changes of heart" from lenders who see us as expendable, all to have that one deal that makes it get taken by one of the lenders I submitted the file to. I understand the mentality of funders who have to deal with unprofessional ISO's - I hear the same horror stories from merchants I talk to. The babies get thrown out with the bathwater however and the result is that merchants get the message: Get the broker (ISO) out of the way and get a better deal. It seems sometimes as if lenders feel they can survive and remain viable while at the same time kneecapping their front line Sales folks who develop relationships with the merchants. I doubt it, just saying.

  3. #53
    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.
    Hey all,
    I see both sides of the coin here, I think we should all keep in mind the fact that anything acquired without effort and without cost is generally unappreciated, often discredited. Due to the unregulated, "if you know you know", clandestine nature of the MCA Industry that we're all in, it's not hard for a lender to put their name out there and start generating business. The second your entity's name is in a few merchants bank statements and you fund a few deals, a viral effect occurs where notoriety quickly becomes established and before you know it you're getting a heavy influx of ISO's trying to sign up with you. Look at ironwood for example, they were arguably the fastest lender in the game for a few months before EVERYONE found out about them.. because every one is looking for the next best new lender while simultaneously broker shops have an existential journey ahead of them if they want to develop even a quarter of the notoriety in general let alone doing it in the timeframe that a new lender can incoherently do it in. So my point in saying all of this is yes, renewal game is key.. However, in the minds of most brokers, they're ALWAYS in competition with other lenders approvals in the clients ears, other brokers hammering the clients phone number trying to bad mouth the guy that they're currently working with and work with them instead. As we can all understand, this promotes a caged lion mentality where if they don't behave the way they do in some circumstances, they'll get burned. Hence where PSF's / greed, clawback periods come into play. Because no matter who it is lending, if they know what they're doing, their bottom lines are always in the green and that's with an industry wide 10%+ default rate, that's why we're in this business in the first place because yes we're helping people but at the same time we're making money, this statement is axiomatic. If there's any vitriol to that statement, keep in mind that if the motives weren't 90% self fulfilling for some of these platforms, we wouldn't see 1.50 factor rates for the high risk clients, we'd see declines.. plain and simple. We need to keep in mind that the entirety of this thread is congenial, so of course these ideas of infinite time framed clawbacks if the client goes bad, waiting till it's fully paid off to pay the ISO commission, renewal game, etc., will be gratified by everyone here because it serves the party at hand. We have to visualize that the industry is the way it is after 10+ years for a reason. If we had a really nice car but filled the gas tank with acid it would corrode the internals and now we can't drive at all, hence why it's filled with the fluid that makes it move.. gas. If everyone starts changing the very criteria that has a direct correlation with their main source of business (ISO'S), this causes a direct negative impact to their main source of business (ISO'S), which eventually will cause an incoherent negative result for them as well. Yes, you'll make a little more money in the short term by saving a few defaults, saving some commission that would've been paid, but a pernicious effect will be underlying and lurking in your platform. Before you know it, 50% of your ISO's are gone, the other 50% aren't performing nearly as well due to the lack of incentive, and now because of the criteria changes that you put in place because you thought it was the right move, your platform has quickly become dilapidated along with the ISO partners that utilized you for their business. In conclusion, although some of these points are valid to the utmost degree, they're not realistically viable to put in place in the space that we're in.
    Last edited by Finance; 02-12-2021 at 12:04 PM.

  4. #54
    Quote Originally Posted by Finance View Post
    Hey all,
    I see both sides of the coin here, I think we should all keep in mind the fact that anything acquired without effort and without cost is generally unappreciated, often discredited. Due to the unregulated, "if you know you know", clandestine nature of the MCA Industry that we're all in, it's not hard for a lender to put their name out there and start generating business. The second your entity's name is in a few merchants bank statements and you fund a few deals, a viral effect occurs where notoriety quickly becomes established and before you know it you're getting a heavy influx of ISO's trying to sign up with you. Look at ironwood for example, they were arguably the fastest lender in the game for a few months before EVERYONE found out about them.. because every one is looking for the next best new lender while simultaneously broker shops have an existential journey ahead of them if they want to develop even a quarter of the notoriety in general let alone doing it in the timeframe that a new lender can incoherently do it in. So my point in saying all of this is yes, renewal game is key.. However, in the minds of most brokers, they're ALWAYS in competition with other lenders approvals in the clients ears, other brokers hammering the clients phone number trying to bad mouth the guy that they're currently working with and work with them instead. As we can all understand, this promotes a caged lion mentality where if they don't behave the way they do in some circumstances, they'll get burned. Hence where PSF's / greed, clawback periods come into play. Because no matter who it is lending, if they know what they're doing, their bottom lines are always in the green and that's with an industry wide 10%+ default rate, that's why we're in this business in the first place because yes we're helping people but at the same time we're making money, this statement is axiomatic. If there's any vitriol to that statement, keep in mind that if the motives weren't 90% self fulfilling for some of these platforms, we wouldn't see 1.50 factor rates for the high risk clients, we'd see declines.. plain and simple. We need to keep in mind that the entirety of this thread is congenial, so of course these ideas of infinite time framed clawbacks if the client goes bad, waiting till it's fully paid off to pay the ISO commission, renewal game, etc., will be gratified by everyone here because it serves the party at hand. We have to visualize that the industry is the way it is after 10+ years for a reason. If we had a really nice car but filled the gas tank with acid it would corrode the internals and now we can't drive at all, hence why it's filled with the fluid that makes it move.. gas. If everyone starts changing the very criteria that has a direct correlation with their main source of business (ISO'S), this causes a direct negative impact to their main source of business (ISO'S), which eventually will cause an incoherent negative result for them as well. Yes, you'll make a little more money in the short term by saving a few defaults, saving some commission that would've been paid, but a pernicious effect will be underlying and lurking in your platform. Before you know it, 50% of your ISO's are gone, the other 50% aren't performing nearly as well due to the lack of incentive, and now because of the criteria changes that you put in place because you thought it was the right move, your platform has quickly become dilapidated along with the ISO partners that utilized you for their business. In conclusion, although some of these points are valid to the utmost degree, they're not realistically viable to put in place in the space that we're in.
    strong 1st post lol

  5. #55
    Quote Originally Posted by Finance View Post
    Hey all,
    I see both sides of the coin here, I think we should all keep in mind the fact that anything acquired without effort and without cost is generally unappreciated, often discredited. Due to the unregulated, "if you know you know", clandestine nature of the MCA Industry that we're all in, it's not hard for a lender to put their name out there and start generating business. The second your entity's name is in a few merchants bank statements and you fund a few deals, a viral effect occurs where notoriety quickly becomes established and before you know it you're getting a heavy influx of ISO's trying to sign up with you. Look at ironwood for example, they were arguably the fastest lender in the game for a few months before EVERYONE found out about them.. because every one is looking for the next best new lender while simultaneously broker shops have an existential journey ahead of them if they want to develop even a quarter of the notoriety in general let alone doing it in the timeframe that a new lender can incoherently do it in. So my point in saying all of this is yes, renewal game is key.. However, in the minds of most brokers, they're ALWAYS in competition with other lenders approvals in the clients ears, other brokers hammering the clients phone number trying to bad mouth the guy that they're currently working with and work with them instead. As we can all understand, this promotes a caged lion mentality where if they don't behave the way they do in some circumstances, they'll get burned. Hence where PSF's / greed, clawback periods come into play. Because no matter who it is lending, if they know what they're doing, their bottom lines are always in the green and that's with an industry wide 10%+ default rate, that's why we're in this business in the first place because yes we're helping people but at the same time we're making money, this statement is axiomatic. If there's any vitriol to that statement, keep in mind that if the motives weren't 90% self fulfilling for some of these platforms, we wouldn't see 1.50 factor rates for the high risk clients, we'd see declines.. plain and simple. We need to keep in mind that the entirety of this thread is congenial, so of course these ideas of infinite time framed clawbacks if the client goes bad, waiting till it's fully paid off to pay the ISO commission, renewal game, etc., will be gratified by everyone here because it serves the party at hand. We have to visualize that the industry is the way it is after 10+ years for a reason. If we had a really nice car but filled the gas tank with acid it would corrode the internals and now we can't drive at all, hence why it's filled with the fluid that makes it move.. gas. If everyone starts changing the very criteria that has a direct correlation with their main source of business (ISO'S), this causes a direct negative impact to their main source of business (ISO'S), which eventually will cause an incoherent negative result for them as well. Yes, you'll make a little more money in the short term by saving a few defaults, saving some commission that would've been paid, but a pernicious effect will be underlying and lurking in your platform. Before you know it, 50% of your ISO's are gone, the other 50% aren't performing nearly as well due to the lack of incentive, and now because of the criteria changes that you put in place because you thought it was the right move, your platform has quickly become dilapidated along with the ISO partners that utilized you for their business. In conclusion, although some of these points are valid to the utmost degree, they're not realistically viable to put in place in the space that we're in.
    dayuuuumm

  6. #56
    Senior Member Reputation points: 41209 DTFdowntofund's Avatar
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    Quote Originally Posted by Finance View Post
    Hey all,
    I see both sides of the coin here, I think we should all keep in mind the fact that anything acquired without effort and without cost is generally unappreciated, often discredited. Due to the unregulated, "if you know you know", clandestine nature of the MCA Industry that we're all in, it's not hard for a lender to put their name out there and start generating business. The second your entity's name is in a few merchants bank statements and you fund a few deals, a viral effect occurs where notoriety quickly becomes established and before you know it you're getting a heavy influx of ISO's trying to sign up with you. Look at ironwood for example, they were arguably the fastest lender in the game for a few months before EVERYONE found out about them.. because every one is looking for the next best new lender while simultaneously broker shops have an existential journey ahead of them if they want to develop even a quarter of the notoriety in general let alone doing it in the timeframe that a new lender can incoherently do it in. So my point in saying all of this is yes, renewal game is key.. However, in the minds of most brokers, they're ALWAYS in competition with other lenders approvals in the clients ears, other brokers hammering the clients phone number trying to bad mouth the guy that they're currently working with and work with them instead. As we can all understand, this promotes a caged lion mentality where if they don't behave the way they do in some circumstances, they'll get burned. Hence where PSF's / greed, clawback periods come into play. Because no matter who it is lending, if they know what they're doing, their bottom lines are always in the green and that's with an industry wide 10%+ default rate, that's why we're in this business in the first place because yes we're helping people but at the same time we're making money, this statement is axiomatic. If there's any vitriol to that statement, keep in mind that if the motives weren't 90% self fulfilling for some of these platforms, we wouldn't see 1.50 factor rates for the high risk clients, we'd see declines.. plain and simple. We need to keep in mind that the entirety of this thread is congenial, so of course these ideas of infinite time framed clawbacks if the client goes bad, waiting till it's fully paid off to pay the ISO commission, renewal game, etc., will be gratified by everyone here because it serves the party at hand. We have to visualize that the industry is the way it is after 10+ years for a reason. If we had a really nice car but filled the gas tank with acid it would corrode the internals and now we can't drive at all, hence why it's filled with the fluid that makes it move.. gas. If everyone starts changing the very criteria that has a direct correlation with their main source of business (ISO'S), this causes a direct negative impact to their main source of business (ISO'S), which eventually will cause an incoherent negative result for them as well. Yes, you'll make a little more money in the short term by saving a few defaults, saving some commission that would've been paid, but a pernicious effect will be underlying and lurking in your platform. Before you know it, 50% of your ISO's are gone, the other 50% aren't performing nearly as well due to the lack of incentive, and now because of the criteria changes that you put in place because you thought it was the right move, your platform has quickly become dilapidated along with the ISO partners that utilized you for their business. In conclusion, although some of these points are valid to the utmost degree, they're not realistically viable to put in place in the space that we're in.
    Did you say Ironwood was the fastest lender? lol

    I remember years ago we had a 5k offer from them, and they needed the physical COJ to be mailed in prior to funding. The entire process took almost 2 solid weeks, and in the end, they said the banks were fraudulent without conducting a decision logic or bank login and just killed the deal.

  7. #57
    Quote Originally Posted by DTFdowntofund View Post
    Did you say Ironwood was the fastest lender? lol

    I remember years ago we had a 5k offer from them, and they needed the physical COJ to be mailed in prior to funding. The entire process took almost 2 solid weeks, and in the end, they said the banks were fraudulent without conducting a decision logic or bank login and just killed the deal.
    Lol, in recent times they were incredibly fast. I’d say around June they started ramping up MCA’s again and they were lightning fast. Over saturation in more recent months caused them to become utterly slow again.

  8. #58

  9. #59
    Quote Originally Posted by theunderwritingprodigy View Post
    origination fees are standard for 99% of funders, so it wouldn't make sense to be the only one not charging one. Most "good" iso shops that don't suck and submit trash don't charge psf's.
    lol

  10. #60
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    Quote Originally Posted by Michael I View Post
    on that topic , can you explain to me why funders have to charge a psf fee or whatever they want to call it. Term ,rate i get they do based on how risky the feel it is but than why add 5-10% in fees on top on that?
    This is a for profit business. Quite simply.

  11. #61
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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!!
    PAR did No Clawbacks qwith Preforming ISOs and were HATED BY SO MANY

  12. #62
    Quote Originally Posted by ryan $ View Post
    PAR did No Clawbacks qwith Preforming ISOs and were HATED BY SO MANY
    LOL not sure what your point is but doing one thing right and being scummy in every other area doesnt do anything for you

  13. #63
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    Quote Originally Posted by ryan $ View Post
    PAR did No Clawbacks qwith Preforming ISOs and were HATED BY SO MANY
    haha if you do not pay the cm you do not need to claw anything back

  14. #64
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    Quote Originally Posted by Akanner View Post
    I agree to this to a certain extent.
    By doing this, brokers will be forced to work and follow up with clients to ensure they are paying. Minimizing stacking, double funding, and excessive PSFS.

    No chance it would fly in reality though
    Deals used to be paid in upfront commission and when the deal was paid off. 6 and 6 Points Split.
    Literally everyone started competing, then it all became upfront commission, Higher upfront Fee's. ETC.

  15. #65
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    Quote Originally Posted by Michael I View Post
    haha if you do not pay the cm you do not need to claw anything back
    They always paid me. My family can be tied to the Mafia, if you try. 70's and 80's. SO its hard for me to really hold a grudge for that.

    The thing I disagreed with is renewal stealing, but once you know its just YOUR RESPONSIBILITY to reach out to merchants, then get renewal offers from PAR. It didnt happen.

    Wide is Great, But i literally HATE HATE HATE, when I submit to them, get a better offer elsewhere and fund elsewhere, then 2 weeks later wide funds the same approval they issued me and I get no commission, but again, once you know they do this, its not an issue anymore.
    Last edited by ryan $; 02-16-2021 at 12:37 PM.

  16. #66
    Quote Originally Posted by ryan $ View Post
    They always paid me. My family can be tied to the Mafia, if you try. 70's and 80's. SO its hard for me to really hold a grudge for that.

    The thing I disagreed with is renewal stealing, but once you know its just YOUR RESPONSIBILITY to reach out to merchants, then get renewal offers from PAR. It didnt happen.

    Wide is Great, But i literally HATE HATE HATE, when I submit to them, get a better offer elsewhere and fund elsewhere, then 2 weeks later wide funds the same approval they issued me and I get no commission, but again, once you know they do this, its not an issue anymore.
    Why would you get commission in this scenario? You do know that the same files are generally submitted by other ISO's, right? Whoever gets back signed contracts first wins. If you never requested or closed contracts w/them because you funded elsewhere, then they got it submitted by another ISO and funded it with them, I don't see the problem...

  17. #67
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    Quote Originally Posted by TheUnderwritingProdigy View Post
    Why would you get commission in this scenario? You do know that the same files are generally submitted by other ISO's, right? Whoever gets back signed contracts first wins. If you never requested or closed contracts w/them because you funded elsewhere, then they got it submitted by another ISO and funded it with them, I don't see the problem...
    Wide reaches out directly. No one mentioned other ISO's. Normally its an ISO's deal for 30 days.
    2 Weeks..... Is frustrating.

    Unless yea like where you stated there is no ownership to ISO whatsoever, its a free for all until contracts are signed. That has downsides though too though.

    My POINT was more of every lender operates how they operate, and once you know how that is, and operate within their guidelines, most (not all) lenders are fine, Par Included. At least my experience with them
    Last edited by ryan $; 02-16-2021 at 01:22 PM.

  18. #68
    Consistency , Honesty and not pushing nonsense! We have many isos that just send deals to all funders and always ask for exceptions and dont close. Funders want to fund without having to run in circles for no reason. As a funder, we like helping our isos succeed but we find many isos don't care and like to spin wheels for no reason without even talking to the merchant. The # 1 asset we have in life is time! We also like isos who dont double, triple and quadruple fund clients and then put the client on a reverse.
    Also we love isos who dont pitch the client a Term loan in 30 days if they show good payment history on the advance. If yall only knew how many time we here of clients getting caught on that lie. SMH

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