[Scott Williams]

Lenders that require the merchant to payoff their existing balance on a renewal are always going to run the risk of the merchant taking a second funding. Double dipping these merchants causes them to pay interest twice on the money and upsets many merchants. I bet lenders that "add on" renewals see a lot more of their merchant not take second fundings.

[Ryan Shiroky]

Lenders that require the merchant to payoff their existing balance on a renewal are always going to run the risk of the merchant taking a second funding. Double dipping these merchants causes them to pay interest twice on the money and upsets many merchants. I bet lenders that "add on" renewals see a lot more of their merchant not take second fundings.

Agreed... you renew a merchant that is 50-60% paid down and they are paying for the money twice... where as on 2nd positions its kind of averaging up (or down in some circumstances) their total cost of money (between both advances). I am seeing more and more merchants who actually counter a renewal pitch with saying EXACTLY that... "why would i pay for it twice when i can get a few grand somewhere else without paying off anything...???"

Once i tried the "but then you would be breaking your contractual obligation to XYZ to NOT take a second position"

Merchant - "sue me..." *click*

what to do then?