[mfs01]

To our lenders on this forum:

What are your thought on funding merchants with a chapter 13 Bankruptcy with a payment plan in place and documentation support it?

[Chambo]

Depends on how far into the plan the merchant is and what outstanding balance is vs. the amount you are funding them

[iLikeBigNumbers]

rule of thumb is a merchant must be at least a year discharged

[James]

As long they in a payment plan they can be funded.

[mfs01]

As long they in a payment plan they can be funded.

Which companies are accepting them if they are on a payment plan?

[Finance1]

We've funded a few but we don't do ISO biz. Performed fine. Our legal determined that it would be unlikely to pursue anything against the merchant individually so the performance guaranty would likely be worthless with an intentional default. They also determined that we can't fund a sole prop.

It's a judgment call like many other deals out there. If the deal looks good and you have the appetite then it's no more risky that many other ones out there.

[mfs01]

Thanks for the responses.

[Chambo]

As long they in a payment plan they can be funded.

The issue with funding a 13 in a payment plan is...what if they STOP making the payments? If they default on their plan, and the creditors scour through financials to find out you as the funder factored them? They could come after you. I have personally seen that happen with the IRS before...and that was BEFORE the US went broke.

So ask yourself, are you willing to roll the dice in that game? Personally, I feel the stakes are too high

[mfs01]

The issue with funding a 13 in a payment plan is...what if they STOP making the payments? If they default on their plan, and the creditors scour through financials to find out you as the funder factored them? They could come after you. I have personally seen that happen with the IRS before...and that was BEFORE the US went broke.

So ask yourself, are you willing to roll the dice in that game? Personally, I feel the stakes are too high

That was my thought on it , Chambo.
I was really seeing what everyone else's opinion on this was.

[skideeppow]

So is anyone willing to look at a BK 13 deal? On a payment plan. Been in business since 2002, large Hair salon doing about 70k gross sales a month and 45k in cc sales?

[Chambo]

So is anyone willing to look at a BK 13 deal? On a payment plan. Been in business since 2002, large Hair salon doing about 70k gross sales a month and 45k in cc sales?

and a $300,000 tax lien that they have made 5 payments out of 60 on?

[skideeppow]

no idea what you are referring to^^^.