[jotucker1983]

So I wanted to see what some of you guys thought about this practice. I've ranted and raved about this before, but I notice that it continues to happen from time to time with partners of mine.

What do you guys think of Funders/Lenders who randomly change the renewal compensation rules throughout the middle of the relationship, which end up being in stark contrast to the original Broker/ISO Agreement that you signed?

* You start out signing a Broker/ISO Agreement with compensation rules that state you will be paid for the lifetime of the client as long as they renew/reload, aren't past due, etc.

* Then, randomly throughout the middle of the relationship, you get a random email about how they are "changing the rules" and now implementing new deal minimums along with other provisions in order to keep getting paid on your renewals.

What is the damn point of signing an Broker/ISO Agreement, if they are just going to randomly change the rules as we go along?

Anybody else deal with this and if so, how do you handle it?

This type of practice pisses me off because, I structure my business based on my renewal/residual portfolio. I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward.

But when they keep screwing around with the renewal rules, the "foundation" starts to get shakey. I'm independent, pay for my own healthcare, pay for my own expenses, and configure my own marketing plans, so what in the hell is the problem about continuing to pay renewals for the lifetime of the client like we originally agreed upon?

[J.Celifarco]

So I wanted to see what some of you guys thought about this practice. I've ranted and raved about this before, but I notice that it continues to happen from time to time with partners of mine.

What do you guys think of Funders/Lenders who randomly change the renewal compensation rules throughout the middle of the relationship, which end up being in stark contrast to the original Broker/ISO Agreement that you signed?

* You start out signing a Broker/ISO Agreement with compensation rules that state you will be paid for the lifetime of the client as long as they renew/reload, aren't past due, etc.

* Then, randomly throughout the middle of the relationship, you get a random email about how they are "changing the rules" and now implementing new deal minimums along with other provisions in order to keep getting paid on your renewals.

What is the damn point of signing an Broker/ISO Agreement, if they are just going to randomly change the rules as we go along?

Anybody else deal with this and if so, how do you handle it?

This type of practice pisses me off because, I structure my business based on my renewal/residual portfolio. I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward.

But when they keep screwing around with the renewal rules, the "foundation" starts to get shakey. I'm independent, pay for my own healthcare, pay for my own expenses, and configure my own marketing plans, so what in the hell is the problem about continuing to pay renewals for the lifetime of the client like we originally agreed upon?

I have seen it and that email will generally be the end of a relationship for me.. I will speak to them explain that if they do this they will see a significant drop in new business submissions and then it is up to them how they want to move forward. Hopefully this is one of your bottom end funders and not someone who you are sending a significant amount of business to

[jfeinberg]

So I wanted to see what some of you guys thought about this practice. I've ranted and raved about this before, but I notice that it continues to happen from time to time with partners of mine.

What do you guys think of Funders/Lenders who randomly change the renewal compensation rules throughout the middle of the relationship, which end up being in stark contrast to the original Broker/ISO Agreement that you signed?

* You start out signing a Broker/ISO Agreement with compensation rules that state you will be paid for the lifetime of the client as long as they renew/reload, aren't past due, etc.

* Then, randomly throughout the middle of the relationship, you get a random email about how they are "changing the rules" and now implementing new deal minimums along with other provisions in order to keep getting paid on your renewals.

What is the damn point of signing an Broker/ISO Agreement, if they are just going to randomly change the rules as we go along?

Anybody else deal with this and if so, how do you handle it?

This type of practice pisses me off because, I structure my business based on my renewal/residual portfolio. I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward.

But when they keep screwing around with the renewal rules, the "foundation" starts to get shakey. I'm independent, pay for my own healthcare, pay for my own expenses, and configure my own marketing plans, so what in the hell is the problem about continuing to pay renewals for the lifetime of the client like we originally agreed upon?

Are you seriously saying that you work hard for some time then you coast because your comfortable? You my friend need to change your mindset, unless you are comfortable being average. Who in the world would want to sit back because they have some renewals/Residuals coming up that can carry you through some time.

This is ridiculous. I see you post a lot of good information that most new people to the industry can learn from, however this is not one of them.

[J.Celifarco]

Are you seriously saying that you work hard for some time then you coast because your comfortable? You my friend need to change your mindset, unless you are comfortable being average. Who in the world would want to sit back because they have some renewals/Residuals coming up that can carry you through some time.

This is ridiculous. I see you post a lot of good information that most new people to the industry can learn from, however this is not one of them.

what did he say about sitting back and coasting?? He is saying that if a company agrees to pay you something they should not change the agreement in the middle with no good reason

[jfeinberg]

what did he say about sitting back and coasting?? He is saying that if a company agrees to pay you something they should not change the agreement in the middle with no good reason

"I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward. "

[J.Celifarco]

"I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward. "

I didnt take it as he stops working or gets lazy, but as that gives you some security for the future

[jotucker1983]

Are you seriously saying that you work hard for some time then you coast because your comfortable?

I'm not sure what you mean by "coast"? I run my own business (one man, 1099 independent shop). The business revenue is structured based on new deal compensation and renewal/residual portfolio compensation, both are very important to the stability of my business.

When I sign a contract with a Partner stating that said built, established, renewal portfolio that I have with them will be paid for the lifetime of the relationship with the clients, but they randomly change that provision, that could seriously affect my incoming business revenue as well as the stability of my business.

Who in the world would want to sit back because they have some renewals/Residuals coming up that can carry you through some time.

A smart business person, that's who. It's called working smart not working hard, and it's called building a business asset. My portfolio of clients is an asset that continues to produce an income stream and I don't like any change in provisions that threaten said income stream.

I didnt take it as he stops working or gets lazy, but as that gives you some security for the future

Exactly, the main benefit of a 1099 shop is being able to build a portfolio that produces a consistent income stream. I don't like how these companies randomly change the compensation rules long after an original Broker/ISO Agreement was signed.

[Chambo]

So I wanted to see what some of you guys thought about this practice. I've ranted and raved about this before, but I notice that it continues to happen from time to time with partners of mine.

What do you guys think of Funders/Lenders who randomly change the renewal compensation rules throughout the middle of the relationship, which end up being in stark contrast to the original Broker/ISO Agreement that you signed?

* You start out signing a Broker/ISO Agreement with compensation rules that state you will be paid for the lifetime of the client as long as they renew/reload, aren't past due, etc.

* Then, randomly throughout the middle of the relationship, you get a random email about how they are "changing the rules" and now implementing new deal minimums along with other provisions in order to keep getting paid on your renewals.

What is the damn point of signing an Broker/ISO Agreement, if they are just going to randomly change the rules as we go along?

Anybody else deal with this and if so, how do you handle it?

This type of practice pisses me off because, I structure my business based on my renewal/residual portfolio. I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward.

But when they keep screwing around with the renewal rules, the "foundation" starts to get shakey. I'm independent, pay for my own healthcare, pay for my own expenses, and configure my own marketing plans, so what in the hell is the problem about continuing to pay renewals for the lifetime of the client like we originally agreed upon?

if there is a clause in the ISO agreement that they reserve the right to change terms at any time, well, then you are kind of SOL

[ridextreme]

I'm not sure what you mean by "coast"? I run my own business (one man, 1099 independent shop).

this doesn't make sense, if you own your own business, why do you get paid as a 1099 independent contractor?

[jfeinberg]

I'm not sure what you mean by "coast"? I run my own business (one man, 1099 independent shop). The business revenue is structured based on new deal compensation and renewal/residual portfolio compensation, both are very important to the stability of my business.

When I sign a contract with a Partner stating that said built, established, renewal portfolio that I have with them will be paid for the lifetime of the relationship with the clients, but they randomly change that provision, that could seriously affect my incoming business revenue as well as the stability of my business.




A smart business person, that's who. It's called working smart not working hard, and it's called building a business asset. My portfolio of clients is an asset that continues to produce an income stream and I don't like any change in provisions that threaten said income stream.




Exactly, the main benefit of a 1099 shop is being able to build a portfolio that produces a consistent income stream. I don't like how these companies randomly change the compensation rules long after an original Broker/ISO Agreement was signed.

1. Im not sure what you mean by "Sit Back" From what I read I took it as coasting because you are comfortable with the income that is coming in. AKA Complacent

2.Im not saying renewals is not an asset to your company or not. Now what I don't consider smart is "sitting back" *what I read was complacency

3. I don't think its right to change a contract when you are the one bringing them business, and building a relationship. This is greed and unacceptable.

[jotucker1983]

this doesn't make sense, if you own your own business, why do you get paid as a 1099 independent contractor?

Well, because being a 1099 independent contractor means you are self-employed, and being self-employed means you are operating your own business. I'm not an "employee" of any funder/lender, I'm an independent contractor and thus, I cannot even display myself to the public as an employee of any said funder/lender.

if there is a clause in the ISO agreement that they reserve the right to change terms at any time, well, then you are kind of SOL

I honestly didn't see any provisions like that in the original agreements I've signed. What they will usually do when it's time for another renewal to be paid, is say you have to "sign this new agreement in order to remain active". Then they send over said agreement and you notice the changes to the compensation procedures. They will try to hold up the commissions until you sign the new agreement to remain "active".

1. Im not sure what you mean by "Sit Back" From what I read I took it as coasting because you are comfortable with the income that is coming in. AKA Complacent

Okay but if a guy is comfortable with the income solely coming in from his renewal portfolio, then so what? Different guys have different goals, the bottom line (which we agree on) is that if you sign an agreement that states lifetime renewals for the life of the client relationship, that agreement shouldn't be randomly changed for no reason.

2.[B]Im not saying renewals is not an asset to your company or not. Now what I don't consider smart is "sitting back"

Explain why you don't consider it "smart" to build a client portfolio to where (from that portfolio alone, before your other sources of income come in) you can cover all of your personal expenses along with retirement investing plans, and all you have to do is maintain the business of the clients you have already established? In my opinion, renewals are the lifeblood of the business.

[dpFund]

In general, I don't know why any lender would bite the hand that feeds them. Just dumb *&%! stupid if you ask me.

While we don't pay as much as the MCA guys do...we pay the same amount for every client, for the life of that client.

In fact, by far my FAVORITE thing to do is send renewal checks. Especially if the referring broker is not expecting it. I've had brokers call me up when I send them a $10k renewal check and ask what it was for. I've explained that it was for a client we funded last year that took out another round and they have gotten extremely excited. One fellow literally said "Dan, it was just a name in the database and I would have had no idea that you funded him again. Thanks for your honesty".

Then I know I have a friend and referral partner for the rest of my career.

That's just smart business. It is a lot easier to get repeat business from a trusted referral partner than it is to start with a new one.

Dan Page

[ridextreme]

Well, because being a 1099 independent contractor means you are self-employed, and being self-employed means you are operating your own business. I'm not an "employee" of any funder/lender, I'm an independent contractor and thus, I cannot even display myself to the public as an employee of any said funder/lender.

1099 is a form which is filed by a company to the IRS who hired you to work for them as an "independent contractor".

If you are a one man ISO shop then you get paid commissions directly from the funding source, with a W9 on file, not a 1099. That is why I was confused.

Also, this industry isn't the same as it was 10 years ago, renewals often get scooped up by competitors promising them the world, which is why we have to continue to work hard instead of coasting on renewals.

[dpFund]

1099 is a form which is filed by a company to the IRS who hired you to work for them as an "independent contractor".

If you are a one man ISO shop then you get paid commissions directly from the funding source, with a W9 on file, not a 1099.

Sorry, but this is not the case. As a direct funder, I collect the W9 at the beginning of the relationship, before sending commission checks. Then at the end of the year, I am required to send a 1099 to every person/company that I have paid, in addition to filing it with the IRS.

[MCNetwork]

1099 is a form which is filed by a company to the IRS who hired you to work for them as an "independent contractor".

If you are a one man ISO shop then you get paid commissions directly from the funding source, with a W9 on file, not a 1099. That is why I was confused.

You're both talking about the same thing. W-9 is used to ensure 1099 compliance. Both forms are used with independent contractors.

[MCNetwork]

What do you guys think of Funders/Lenders who randomly change the renewal compensation rules throughout the middle of the relationship, which end up being in stark contrast to the original Broker/ISO Agreement that you signed?

Unfortunately this is the way the industry works. Business conditions change from month to month, year to year and the ISO agreements clearly spell out that the terms are subject to change. You can either choose to terminate your relationship with the funder, try to renegotiate terms, or just swallow the bitter pill. However, too many random revisions will be a reason to move my book to a new lender.

[John Galt]

No Dan, Unless things have changed recently you are required to send one to individuals. Corps are not mandatory although some send 1099s on those too.

[Karen37a]

Some Iso or Independent Contractor agreements state that they can change the compensation at anytime, they also state that you can become "inactive" if you coast or do not submit new business, or a certain dollar amount ..lets say hmm 250k ( this is a set up )

If you build a book of business you need to make sure that the Lender does not have these clauses in their agreements. If they do either get them to change it ( which most wont ) or don't sign it.

This is a common practise in Financial Services and the reason Isos/Brokers become jaded and break non competes/tortious interference clauses.

If they do not value you, they really do not care.

Like any negotiation you need to know what you are getting in to UPFRONT, not get burned on the back end.

This is why I tell the small broker to get with an ISO who doesn't have these clauses in their agreements, or can keep new deals flowing and meet "quotas" and to not side with them in arguments that they know nothing about .....yet

If you build a book of business you have the right to "coast" , only a few ways out of it.

One of them being...not to do business with them in the first place, no matter how many commercials you see on tv or how loud they yell, its the rate, its the rate , its the rate.

[Karen37a]

Question for Everyone ...

Do I have a fiduciary responsibility to place my client with a Lender who will not faithfully stand by their Renewal policies because they supposedly have best pricing??????? ( didnt sign on with certain lenders because of this , and I TOLD you they would cut your renewals or keep them)

Do I have to send the fruit of my labor to Lenders who are going to try to squirm out of a contractual obligation but I am going to be held to the highest moral standard ????

You are going to Regulate this industry and control my business because you think you know what's best for my merchant and me??

Funny that the biggest advocates for regulation and the brokers siding with them are the ones who are going to get their arse handed to them on a silver platter because they have no clue

Like sheep being led to slaughter. I wonder if they laugh in their board rooms. I am just amazed by it all smh

[brokerCompany]

Self regulation,
Reality is the person that has the money makes the rules and changes the rules nothing you can do about it.
We try best to stay on top of all renewals. If the merchant is eligible for better terms at a different lender we will take that merchant to another lender or stay on top of it with current lender and make damn sure we get paid. It as you know can be a tedious process depending on the month.
That is why we always liked the invoice factors, met a couple in person and they have been faithful and have been paying commissions every month for the past 6 years on the same clients!' We bring them more business.

[Karen37a]

I agree Brokercompany ..the point that I was making, or was made for me with this post ( the timing was impeccable ) is that if one company supposedly has a better rate or apr ,they think they are going to force people to send business their way because of regulation with out regard to the merchants or the 1099 broker ( who usually knows what the merchant wants, what color underwear he is wearing and on what day and his grandkids names)..... it isnt going to happen.

These merchants do business with certain people because they "trust" them, some of us independent 1099 brokers and ISO's take pride in the fact that we went independent so no one tells us what to do , or who we are going to compromise our principles for, whether its A paper or D Paper.

What I have found is that there is always a "gotcha" on contracts, agreements and money. Its nice to do business with someone who has experience and can tell you the real deal, not the story they are pitching on the pamphlets or websites.And also tell you the pitfalls UPFRONT

THATS why I am never going to have someone force my hand to send business to people who i think or know are unethical to their merchants OR to their brokers, no matter how loud they yell "its the Rate and Apr", only fools fall for that.

Not that anyone cares..but imagine someone running an ISO, they have brokers in their business and they have to have a meeting...guess what guys, our commission on our renewals are cut in half...Why? because they said so.

For the few people I talked to that think you do not need isos to drive traffic to you..everyone thinks that when they get too big for their britches and again you think you are going to cause regulation so that we have to do business with the companies of your choosing?

Nice try. People have to know the whole picture, not just the partial picture or slant on a story that someone is planting to further their personal agenda.

Add DD to the mix when you figure in Aprs and also find the communist reason why I have to choose one company over the other.

I DISCLOSE upfront..you think I cant sell a deal with disclosures upfront?????? I do a pre pre pre merchant call on ALL my brokers deals to make sure they understand because if I order a contract i want it closed.

The absolute arrogance in some people/companies to think they can hoodwink regulation so they get more deals. I dont even do business with some D paper owners but called and said..wtf, stop this. They said "what do you want me to do"

So many of us explain the process to merchants ( full disclosure ) , the merchants are not as dumb as you think either, they are shrewd BUSINESS OWNERS, cunning , sharp, some mean as a snake, not everyone is the happy little florist who needs 5k.

You cant "trick" someone into sending a contract back( and sustain a business ), they have to sign it all over the place, and i make sure they initial the bottom of every page, even if not expected. I tell them not to take the money if they do not really need it or to wait.

Sour grapes to the people who cant sell and are looking for excuses why they cant get a contract sent back..its saturated, yeah yeah thats it thats it

** another thing..I do not saddle my prefered lenders with all my junky files then when I have a great one go take it elsewhere. So they will be forced to sell off D paper claiming its A, like tranches and some of the darlings of wall st..

This isnt as clear cut as people make it out to be and everyone yelling the sky is falling the sky is falling regulation.You cant create regulation to shrink a market so that its almost a monoploy or communist like. There will always be a better way to build a mousetrap.


** i want to know what the regulation is going to be to MAKE me sign a contract with a Lender that's not in my best interest, so the merchant saves 12 dollars a day,after they lowered the price to beat a rate to try to hold onto the client. So they think Ill sign on, so they can do a bait and switch kinda thing to keep my book after I didnt get paid a salary and I paid for my own leads phone etc Dream on

[WhoisKingsley]

So I wanted to see what some of you guys thought about this practice. I've ranted and raved about this before, but I notice that it continues to happen from time to time with partners of mine.

What do you guys think of Funders/Lenders who randomly change the renewal compensation rules throughout the middle of the relationship, which end up being in stark contrast to the original Broker/ISO Agreement that you signed?

* You start out signing a Broker/ISO Agreement with compensation rules that state you will be paid for the lifetime of the client as long as they renew/reload, aren't past due, etc.

* Then, randomly throughout the middle of the relationship, you get a random email about how they are "changing the rules" and now implementing new deal minimums along with other provisions in order to keep getting paid on your renewals.

What is the damn point of signing an Broker/ISO Agreement, if they are just going to randomly change the rules as we go along?

Anybody else deal with this and if so, how do you handle it?

This type of practice pisses me off because, I structure my business based on my renewal/residual portfolio. I build up my portfolio for a couple of months, then "sit back" a bit because the porfolio can carry me through for a good period of time going forward.

But when they keep screwing around with the renewal rules, the "foundation" starts to get shakey. I'm independent, pay for my own healthcare, pay for my own expenses, and configure my own marketing plans, so what in the hell is the problem about continuing to pay renewals for the lifetime of the client like we originally agreed upon?

Big picture. Everyone is going off on regulating the industry and disclosures but no one ever talks about regulating the "Partnership" that direct providers have with the wholesale companies (ISOs) that work with them. It's insane because different ways of "selling", servicing, and brokering (verb) is the same with most companies but we do not have a set "rule" set around the process.

In regards to John's post- like any other agreement within a Partnership, if there are current contracts that are in place while a "new rule" is passed, the contract that is in standing should remain with the older "rule" until it is expired OR a DATE should be given when the rule goes into effect. THAT MEANS, if you have a file that is up for renewal tomorrow and the rule was passed a month ago and started yesterday, the first contract expired and your renewal falls under the new rule. Yes, there are times when there are exceptions when/if a file does not run smoothly and if it is on the direct company- they should take responsibility and appease their agent just as they appease their contract holders. Many of you will disagree, but that is how Companies and Partnerships operate. Our "industry" or "Merchant Cash Advances" aren't any different than any other model and basic process and operational rules shouldn't be any different. If something changes in the middle of your relationship that doesn't reflect HOW YOU do business with them, question it, challenge it, and agree to it. If you have a book of business with a specific company, you should be able to review your partnership and if you feel you need more, less, or revisions to have an unique partnership, SAY SOMETHING. A Direct Partner would rather understand your business goal and how their product will be included and how your agreement should be structured.

If your ORIGINAL AGREEMENT states that you will be paid for the lifetime of the client BUT then the agreement also states that it can be changed for any reason throughout the lifetime of the agreement... then expect anything to happen. The "legal" jargon in some ISO agreements are so condescending and evil and you really have to have relationships built on understanding rather than just that piece of paper.

I know MANY people are seeing the changes with renewals. Just think now of who you are sending deals to. Where do you think they will be in 6 months? A year? Where's your renewals? Who's buying their book? Who's buying their lists? Hmm...

[Karen37a]

Good points

I tell people its like the movie Goodfellas...Morty put together the heist and never got paid..when he kept bugging Deniro for money that he was owed...he offed him

If he had a few more heists coming they might have paid him

Keep sending in those deals !! lol

( this is a joke of course )

[Karen37a]

Their is a counter argument to this

John like you said. Too much competition and its saturated..

( it isn't the rate )

Off to make money

Everyone make the next few weeks the biggest weeks of your lives !!

[jotucker1983]

Wanted to bump this thread.

So refresh my memory, what do some of you guys do about these changing ISO/Broker Agreements around renewal compensation?

I have one funder in particular (not going to mention names yet) but it's a very small portfolio with them, but I just can't stand the shady tactics of these "30 - 90 day" rules on if you don't fund a new deal with a particular platform......they keep your ENTIRE book of business with them.

It's the stupidest crap I have seen in my life. We are paid 100% commission, no benefits, no expense kickbacks, no business plan assistance, no nothing. The LEAST any of these damn companies can do is allow us to keep our book of business until said book of business is no longer there.

What the hell is the problem with this? Especially if the book doesn't have a lot of defaults, you haven't had any issues from my end, etc.....what is the point of cutting someone off?

I would love to do something in relation to this (even though this is a very small portfolio and won't put any dents in my goals/income for the year at all) just to send a message that us small broker shop guys aren't going to take this crap.