[jotucker1983]

Looking for some advice... How do merchant cash advancers / alternative lenders delineate between "A" through "D" paper? Is there a clear market standard that is recognized across the industry or are they more specific to each lender? What are the key metrics when considering paper strength?

Well, from the MCA industry as a whole, the paper grade is pretty much the same. However, this does not mean that the lender in question will "reward" the higher graded paper with lower rates like other lenders will. The best lenders use risk based pricing and will price the deal based on its grade.

From my perspective and experience, you have A - E graded paper:

A Paper: Usually over 650 fico, clean bank statements (low OD/NSFs), healthy bank balances (ending and average), no tax liens, no judgment liens, no recent bankruptcies, and no landlord/mortgage issues.

B Paper: Usually 600 - 640 fico, somewhat clean bank statements, somewhat healthy bank balances, might have a tax lien on a payment plan, might have a judgment lien on a payment plan (and the judgment is not from a prior MCA and not based on fraud), might have had a bankruptcy but it's dismissed/discharged now, might have landlord issues but can be resolved at closing.

C Paper: Usually 540 - 580 fico, bank statements might have some issues, might have a tax lien on a payment plan, might have a judgment lien on a payment plan (and the judgment is not from a prior MCA and not based on fraud), might have had a bankruptcy but it's dismissed/discharged now, might have landlord issues but can be resolved at closing.

D Paper: Usually 500 - 520 fico, bank statements might have some issues, might have a tax lien on a payment plan, might have a judgment lien on a payment plan (and the judgment is not from a prior MCA and not based on fraud), might have had a bankruptcy but it's dismissed/discharged now, might have landlord issues but can be resolved at closing.

E Paper: Under 500 fico, bank statements are bad, might have a tax lien but no payment plan, might have a judgment lien but no payment plan (and the judgment might be from a prior MCA and/or based on fraud), might have had a recent bankruptcy, might have landlord issues that can or cannot be resolved at closing.