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07-06-2021, 07:43 PM #1
- Join Date
- Aug 2016
- Posts
- 5
Paying Net on Renewals
I find it a total disrespect when a funder expects you to renew a deal like for $100,000
Carrying a $75,000 balance and then make double profit but want to pay only on the $25,000 Net.
So i'm suppose to make you $40,000 in profit while you lend only $25k and i'm suppose to take a $10k lost and receive only $2k. Im a ISO not an employee.
If funders are like this they don't deserve business no matter how good the deal is. I Would only send from now if it's a good bank 10 months or less deals. Greedy and shady people do that on top of that the funders want to contact your merchant to renew and pretty much rob you out of making a good amount. It's truly a joke.
If you cant pay whats right don't be in the MCA industry period.Last edited by Pbs; 07-07-2021 at 02:06 PM.
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07-06-2021, 08:36 PM #2
- Join Date
- Mar 2019
- Posts
- 254
EPIC ADVANCE
Mark@epic-advance.com
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07-06-2021, 10:21 PM #3
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- Aug 2016
- Posts
- 5
Yes I know its common in some lenders but thats why you dont renew
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07-06-2021, 11:28 PM #4
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- Mar 2019
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- 254
EPIC ADVANCE
Mark@epic-advance.com
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07-07-2021, 08:12 AM #5
- Join Date
- Jul 2015
- Posts
- 215
The ONLY way i have ever been able to get behind a funder paying net on renewal is if they waive remaining interest on the refinanced amount. In that case it would be a loan not an advance, which already locks out 90% of the "funders".
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07-07-2021, 08:13 AM #6
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- Jun 2021
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- 47
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07-07-2021, 08:16 AM #7
- Join Date
- Jul 2015
- Posts
- 215
Too many of my partners made changes during covid that made it clear they were not our partner. Understandably they probably took it on the chin with most of their book, however it forced me to reevaluate where I place my volume. I have systematically over the last 18 months moved 95% of my business to more boutique shops that seem to have the partnerships best interest and more importantly the merchants best interest as a priority. My book has rebuilt almost to precovid levels as a result of that. I would suggest anyone with the ability to seek out smaller shops that you can build real relationships with do that. It will pay dividends in the long run.
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07-07-2021, 08:19 AM #8
- Join Date
- Jul 2015
- Posts
- 215
That is exactly the problem. You think because the funder put out the funds its now YOUR client? What about the money spent on leads, overhead, and payroll to aquire the client in the first place? Too many people in this industry are greedy and blind to the fact that there is more than enough money in these deals for both broker and funder to make a pretty penny. Why screw over the guy who brought you the deal? Seems very short sighted. In all my time the only place I have seen do that well was Kabbage and they have deeper pockets than most of this industry combined. Bite the hand that feeds you and eventually you will stop getting fed.
Last edited by Oxforddan; 07-07-2021 at 08:51 AM.
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07-07-2021, 08:59 AM #9
- Join Date
- Aug 2020
- Posts
- 145
There are enough funders (not lenders) that it shouldn't be a problem to take your business elsewhere. There are only a couple of companies that operate this way.
Many companies made short-term decisions during covid to survive. I don't know if this is a covid-related decision, but there should be deal flow pressure from other companies to eventually pay full commission unless they're offering unique terms.
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07-07-2021, 09:10 AM #10
- Join Date
- Feb 2017
- Posts
- 3,426
Why does that make it automatically a loan? We just had a discussion about this here https://dailyfunder.com/showthread.p...l=1#post154029
Select is giving full prepayment benefits, just make sure not to call it "loan" or "principle" or "interest" and you're good to go.
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07-07-2021, 09:11 AM #11
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- Jul 2015
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- 215
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07-07-2021, 09:13 AM #12
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- Feb 2017
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- 3,426
@Pbs Stinks to have the goalposts moved on you. But don't call them "banks" they're just "MCA funders". Banks are licensed.
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07-07-2021, 10:29 AM #13
- Join Date
- Oct 2020
- Posts
- 92
[QUOTE=Mcadefender;154946]lol your not making the funder anything its a renewal the deal is 30-60 days in which at this time the funder prob has a better relationship
with the client then you hes the one risking his funds to fund the deal NOT YOU so take what you can and move on
LOL! would never send you a file. What a terrible way to view your isos. Who brought you the file? WHo spent hours on the phone convincing the merchant to submit? Very short-sighted approach. Dont bite the hand that feeds you.
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07-07-2021, 10:35 AM #14
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07-07-2021, 10:43 AM #15
This the kinda guy who was a ****ty sales rep at an ISO and convinced someone with money to open a shop, then leverages the investor out with ****ty deals, then moves on to open another ****ty lender with another braindead investor
Lather rinse repeat
Def from QueensIf you know you know
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07-07-2021, 12:15 PM #16
- Join Date
- Mar 2014
- Location
- Florida
- Posts
- 2,952
Dave Lambert, Business Development
dave@fcbankcard.com
Merchant Services Consultant
High Risk Merchant Payment Solutions
SBA 7(a) Loans & Short-Term Funding
T/VM: 727-291-7890
Office: 727-233-1111
Skype: fc-financial
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07-07-2021, 12:48 PM #17
- Join Date
- Aug 2020
- Location
- 7125 Peri Lane Brooklyn Ny 11234
- Posts
- 113
Some of you guys should really watch what you’re saying. These are merchant cash advances you’re buying receiveables at discount, therefore not a loan and you can get in trouble for using the word interest. Just saying lol.
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07-07-2021, 02:06 PM #18
- Join Date
- Aug 2016
- Posts
- 5
lol You make a good point MIke
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07-08-2021, 09:19 AM #19
- Join Date
- Feb 2018
- Posts
- 1,349
unless it was an add on of $25K, that is a bad deal for the merchant to net $25K but pay RTR on $100K.
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07-09-2021, 04:09 PM #20
- Join Date
- Jun 2017
- Posts
- 2,049
Rapid used to do this.
That's why 9 times out of 10, we would flip them away from Rapid instead of Renewing
Thankfully they changed it.
I don't know anyone still doing it.
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07-09-2021, 04:23 PM #21
- Join Date
- Oct 2020
- Posts
- 92
Breakout capital still does it. But They also have a 5-month clawback and take almost 6 weeks to pay commissions. They are nice people and give good offers however they clearly don't value their isos and I'm sure they lose out big time because of it. I did fund a few deals with them ( none were clawed back) but it's impossible to run a shop when you have a 5-month clawback and don't pay commissions for 6 weeks so I no longer submit to them. I submit to the many other A- paper lenders who give the same offers but treat their isos like they need them as opposed to the other way around. They are the only company that I know of that still only pays net on renewals. Could be why I very rarely see them in deals. Who would submit there?
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07-09-2021, 05:12 PM #22
They do this, as do others, because they look at reps as pawns. A means to an end. In their eyes, you are easily replaceable and another ISO shop will come around soon enough. That's the whole reason to employ ISO reps. It's not right, even a lil troubling....but it is the way several funds think.
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07-10-2021, 12:01 PM #23
- Join Date
- Dec 2017
- Posts
- 238
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07-12-2021, 12:24 PM #24
- Join Date
- Jun 2021
- Location
- New York
- Posts
- 31
We'll treat you better! briano@vitalcapfund.com
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07-12-2021, 07:25 PM #25
- Join Date
- Feb 2018
- Posts
- 1,349
Breakout I never thought was a good ISO driven funder. More direct sales
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