[TheProphecyofMCA]

Just watched the Lex LOC webinar.

They claim to offer traditional bank lines of credit, with little to no docs, monthly payments, to "anyone under the sun" including high risk and restricted industries, with no time in business requirements & even if you don't qualify,
all you need is a cosigner and you are good to go.

Did this group figure out a product the rest of our industry didn't?

Or is this all one big - too good to be true?

[Shorebird]

Credit Score of 680+
Funding Range: 1K - 100K ; Avg. 50K
No Outstanding Charge-Offs
Great Payment History
At Least A Year of Individual Credit
History
Hard Inquiries: 4 or less in the last 6
months
No Time in Business Required - Great
for Start-Ups!
No Revenue Requirements
No Restricted Industries - We fund it
all!
Co-borrowers Accepted


These are the terms for credit card stacking.

[TheProphecyofMCA]

Credit Score of 680+
Funding Range: 1K - 100K ; Avg. 50K
No Outstanding Charge-Offs
Great Payment History
At Least A Year of Individual Credit
History
Hard Inquiries: 4 or less in the last 6
months
No Time in Business Required - Great
for Start-Ups!
No Revenue Requirements
No Restricted Industries - We fund it
all!
Co-borrowers Accepted


These are the terms for credit card stacking.

So Lex Loc essentially is helping the clients apply for a few different credit cards with big banks to increase their limit

[Olderguy]

Here's guidelines from Midwest Corporate Credit. I've had this awhile so there may be an updated version.

BAILEY BLASDEL
(630) 974-5507
(630) 281-5915
Bailey@midwestcorporatecredit.com

Business Credit Cards (BCCs)

Our most popular product. Up to $150,000 in 30-60 days for brand new startup companies.
Larger amounts are available for more established companies with strong revenues.
Overview and Benefits - This Program Is Available In All 50 States
- To Qualify - Minimum needed is a business entity and a guarantor with a strong personal
credit profile
- These Lines of Credit Do Not Report To Personal Credit as long as accounts are in good
standing. We’ve compiled a list of lenders that will not report the client’s accounts to the
client’s personal credit report. Clients keep their business and personal credit separate.
- Visa/MC Corporate Credit Cards - Funds come in the form of business Visa/MC credit
cards in the company name. These cards are non-vendor specific; i.e. The cards will NOT be
cards that can only used with certain stores, like a Macy’s, Staples, or Home Depot card.
- 0% Intro Rates on Purchases and/or Balance Transfers for the first 6-12 months on
most, if not all the cards. We can avoid lenders that do not offer 0% intro rates, if desired.
- Rates typically 9.99%-19.99% or so on Purchases after the Introductory 0% Period.
Rates vary based on strength of the guarantor’s personal credit profile.
- Possible additional promotional rates in the future. We can teach people how to use accounts
strategically, so that after the initial 0% rates expire, they can increase their chances of
getting additional promotional rates in the future. Some past clients consistently get 0% on
Balance Transfers for 12- 18 months, with just a one time 2-4% balance transfer fee.
- Pre-revenue and startup companies can apply and receive these cards also, as well as
established companies, of course. Biggest factor for approval is strength of personal credit.
- No collateral required - Clients don’t have to tie up personal assets to obtain financing.
- Revolving Accounts - Lines of Credit can stay open for the life of the business.
- Up to $100,000 in Business Credit Cards for business entities less than 2 years old.
- Up to $150,000 in Business Credit Cards if the business is 2+ years old w/ good revenues.
- Accounts typically report to client’s business credit profile every month, which will help
the company be more likely to get higher approval amounts and better terms on other Cards,
Loans, and Lines of Credit in the future. Usually Corporate Experian or Commercial Equifax.
- Lender provides the client a Fast, no-cost Funding Estimate usually available within one
business day. Clients need to submit a one page pre-qualification form and a three bureau
personal credit report. This way they have a reasonable expectation of approval amounts.
Business Credit Card Features and Benefits, continued
- Most clients receive one or more ‘Instant Approvals’, where a lender approves their application
in 48 hours and sends out the cards right away. In this case, the client can receive
30-50% of the total funding they are going to receive within about two weeks.
- Clients typically receive all cards in as few as 15 days, nearly always within 30 days.
- Balance Transfer Checks - Clients who use their accounts properly for the first 6 months or
so may be offered Balance Transfer Checks by the lenders. They can use these checks to
make a deposit right into a business checking account, allowing them to be completely liquid.
- Credit Limit Increases available after properly servicing the accounts for a few months.
Past clients have doubled and tripled their limits on some cards within 15-18 months, with
some people building up to $50,000 to $100,000 per card. Clients must request increases.
- MCC has over one hundred relationships with national, regional and local commercial
bankers, underwriters, and investors. Our relationships with these lenders help to ensure that
our get clients the highest approvals and best rates available, specific to their situation.
Some Potential Uses:
- Cash Flow Management Tool - Helps a new business owner keep his cash on hand for things
like payroll, while they can use the cards for other things that they can pay with CC for, like:
- Save money over other lending product by using 0% promotional offers on Balance Transfers
- Buying product/stocking the shelves
- Launch Marketing Campaign/Advertising/Branding
- Upgrade business systems/infrastructure
- Upgrade storefront
- Operating Capital
- Real Estate Investors can use the funds to purchase materials for a rehab project
- Balance Transfer Checks can be used to turn the Credit into Cash, which can then be used
for downpayment or purchase of equipment or property, or for any other cash transaction.
* Because there is no deposit, collateral, or automatic daily/weekly payment withdrawls, personal
credit and their promise to pay is all the lenders have to go on. The list below outlines
what the lenders like to see. Everything on the credit report is considered. Positive items are
weighed against potentially negative items. If someone falls just outside of any of these
guidelines, and the company has strong revenues, and/or if the rest of their credit report is
strong, they still might see approvals. Checkbook BLOCs require all 20% owners to have
730+ credit scores (sometimes 10%+).
1. 730+ credit score across all 3 bureaus (700+ can sometimes work, it depends on the
strength of their personal credit overall, as well as the business and it’s credit, if it has any)
2. No missed payments on any account in last 12 months
3. No Foreclosures, Bankruptcies, or Liens, ever. *Client may be considered if the event was
3+ years ago and client has good history and accounts since then.
4. At least 5 years personal credit history
5. One major bank Visa/MC-type credit card with a $5,000+ Limit, that has been open 12+
months (Individual/Joint). Authorized User cards considered, but AU Balances are still counted.
The larger the Limits they have on personal cards, the larger they tend to get approved for on
the business side. **If they have small limits but have a good cash flowing business, the
strength of the business can outweigh their weaker personal credit.
6. Usage ratio of less than 30% of available personal credit Limits. The lower the better.
7. Less than 5 inquiries on each credit bureau in the last 12 months
8. Not too many new revolving accounts opened in the last 24 months. Ideally less than 4 in
the last 4 months on any one bureau.
Business ‘Checkbook’ Lines of Credit (BLOC)
Overview and Benefits
-Will NOT report to personal credit as long as the line stays in good standing
- Checkbook access to funds immediately. Recipients usually get a Visa/MC debit card, too
- Secured Lines up to $1,000,000 initial approval limits available for well qualified businesses.
- Unsecured Lines go up to up to $150,000 per lender. Multiple lenders are usually available.
- Initial approval amounts are typically 10% to 20% of Gross Annual Revenues, per checkbook BLOC
- Rates are typically Prime Plus 1% to 6% or so, up to about 9.25% or so over Prime.
- These will typically report to business credit, helping the business become more bankable over time
- Clients are typically approved and receive access to funds within about 10 - 21 days
- Simple Application Process
Business Checkbook LOC Applicant Requirements:
Personal Qualifications:
-FICO scores above 730 on all three bureaus
-No more than 4 inquiries showing on any one bureau in the last 12 months
-No more than ONE isolated 30 day late on any account reporting to the personal credit report
-No bankruptcies, judgements, or liens
-Overall personal credit utilization no more than 35%
-Good communication. Bankers and underwriters do not have the time or resources to chase
down your clients, if you've waited days for call backs or documents from your client, please
think twice about submitting the application.
Business Qualifications
-Entity must be 2 years old.
-No real estate companies at this time
-Gross revenues $150,000 per year, minimum
-No more than 2 business owners
-All business owners and correct addresses must be shown on the SOS website
-Business owners applying for the BLOC must have had ownership of the business for two full
years prior to applying (no recently acquired businesses)
-No business lates, bankruptcies, judgements, or liens. Ask your clients about their existing
business accounts, past and present, if any of those accounts have had more than ONE isolated
30 day late please do not take the application, it will get declined.
-If your client is reporting a million or more in annual revenues please obtain the most recent
two years of business tax returns and financials.
Many BLOC lenders are currently requiring open active seasoned business deposit accounts
before they will consider extending a BLOC,
Items needed to review a Checkbook Business Line of Credit Prospect:
1. Completed pre-qualification form with Debt Schedule. Please fill out the the Blank Prequal Form
we provide you. Using your own form is fine, as long as we get all the information we need. If the
company has any credit cards, loans, or LOCs (even with $0 balance), we need the Lender, product
Type, Limit, and Balance.
2. Credit reports from anybody that owns more than 20% of the business, preferably from Identity-
IQ.com which is doing a 7 day trial for $1 if they use this link: https://www.identityiq.com/securemax.
aspx?offercode=431136EV
3. Last filed Business Tax Return. Other financials like a Profit and Loss statement, Balance Sheet,
and bank statements are helpful, if they are readily available.
This product is available in all 50 states, but some states are better than others,

[Michael I]

Just watched the Lex LOC webinar.

They claim to offer traditional bank lines of credit, with little to no docs, monthly payments, to "anyone under the sun" including high risk and restricted industries, with no time in business requirements & even if you don't qualify,
all you need is a cosigner and you are good to go.

Did this group figure out a product the rest of our industry didn't?

Or is this all one big - too good to be true?

Keep in mind they are brokers both for the loc program and mca products

[Shorebird]

Yes, the LEX LOC is the Personal CC stacking.

[abfunders]

I recently wasn't able to convince a client of mine to use my group over Lex. Lex came back with small approvals, and I sent him a list of options for up to $1.7mm between business term loans and LOCs, personal loans, and business and personal credit cards (0 APR and regular APR). This person was penny wise and pound foolish, he didn't like my pricing, but Lex was doing it at 10% and we came in slightly higher (not because we couldn't, but because we didn't know we were competing). I use MWCC also, but I'm not limited to them.