[CreditGuy]

Here's a free underwiting lesson for you.

I have a client who is sick and tired of doing daily ACH.

How many advances has he had previously? If one, how has it performed? How far is it paid down in terms of both percentage of total payback and term? What was the initial pricing, payback schedule, and net funded amount?

If more than one, how have they performed? How often is he renewing? Is the borrower renewing at the same amount paid down every time? If not, is he renewing earlier or later in the repayment term?

Sometimes ends months neg. bal. but average daily bal. $1,000;

The answers to the above questions will add some more color to the above statement, but generally speaking, if the borrower has already taken an advance, or multiple advances, and they haven't gotten their cash flow managment in order, what good is another loan going to do here? Since we aleady know this is a renewal, the borrower should be demonstrating that they are using the funds to put themselves in a better financial condition. This company has $500k in cash flow a year and they can only manage to retain $1k in short term working capital in the bank. You mention they end negative, so that's at least one negative day. How many others during the month? I'm sure they have NSFs too, given the $1k average balance. I'm guessing they are living on float a lot. That's not effective cash flow management.

Credit is about mid 600s.

Why?

General questions: Is this home based too? If not, where are they operating out of? How long have they been there? How many employees? How many jobs/crews are they working simultaneously? What is their bread and butter (residential, commercial, TI, remodeling, etc)? Time in business? Since their initial advance, how much have their revenues grown? How much has their average balance grown? Have they shown a decrease in neg days/NSFs? How has the borrower's FICO trended since their initial advance? What was the initial advance used for (working capital is a **** answer, UWs hate it)? What are the new funds being requested for?

I realize I'm not going to get all the answers to these questions, but if you are managing this relationship and haven't already asked them all these questions or already know the answers, you are doing both the borrower and yourself a disservice.

I'm looking for 12 pts or more.

You don't deserve 12 points let alone more. Your expectations here are so out of line with the risks associated with the file that you can't possibly be effectively managing your client's expectations. It sounds like you already sold him on a pretty ****ty product the first go round, and are now trying to find him a sweetheart deal to smooth things over.