[loan]

Can someone explain how syndicating on a deal would work given the scenario below:

Funding Amount: $100,000
Factor: 1.37
Term: 6 month
Funding Company: $70,000
ISO Syndicating: $30,000

With a a typical commission and management fee, how much is the ISO making and over how long

[Sean Cash]

ISO's portion is $30,000. Your Purchased Amount is $30,000 x 1.37 = $41,100.

Let's say commissions are 10% on funded. $100,000 x 10% = $10,000. You're paying 30% of it for $3,000.

Let's say management fee is 3%. A funder can assess this in their own way but let's say it's 3% of every dollar that comes in. On $41,100 at 3%, that would be $1,233.

$41,100 - $3,000 - $1,233 = $36,867 or a 1.23 factor net of fees and commissions.

I don't know what you mean by "over how long". In your example you said 6 months. You'd be making 23% over 6 months. If you want an approximate APR, that's 46% a year.

[loan]

Thanks for the detailed breakdown Sean.

From an ISO's perspective though, why would you be subtracting the 10% commission? Wouldn't that be paid on top of the purchased amount?

[Sean Cash]

Thanks for the detailed breakdown Sean.

From an ISO's perspective though, why would you be subtracting the 10% commission? Wouldn't that be paid on top of the purchased amount?

Oh yea good point. I was thinking as if you were a third party syndicate.

You would get paid a prorated commission based on 70k in funding. The only thing you need to pay is the management fee.

[mcaport2]

Do most syndicates leads share the contractual origination fees or no?

[Chambo]

Thanks for the detailed breakdown Sean.

From an ISO's perspective though, why would you be subtracting the 10% commission? Wouldn't that be paid on top of the purchased amount?

depending ont he fund you are syndicating with, they cut chop off whatever % you are syndicating, all costs included, or they reduce the commission paid by the syndication amount (ex: $10,000 commish, the fund would only pay $7000 commish, because they are only doing 70% of the deal)

The breakdown depends on the fund you are syndicating with