[J.Celifarco]

Now I know there are companies that back door deals and it is a problem we have in this industry.. That said I see more and more posts of people claiming this is what is happening or thinking this is happening if they get a decline or if they lose a deal.. I am doing this for a while and yes it does happen but the more common thing is that you just lost to another company.. Yes it sucks but there is no such thing any ore as an exclusive lead or deal, every merchant is shopping around.. With this comes competition and the possibility of losing deals. You will win some you will lose some and the only thing I am sure of is every deal you lose is not back doored.. When did this become the automatic goto response for any deal that comes across a persons desk that doesn't get funded. Just curious what makes people think this is the only reason they lose a deal. Some times you just get beat, I hate to admit it but it happens.. The only way to make sure it happens as little as possible is to understand that there is competition on most deals and always go in expecting to be pitching against someone else. I hate losing deals as much as anyone but part of the game and learning and getting better is acknowledging when you get beat finding out the why and how and never letting it happen again. If all you do is blame other people when you lose a deal you will never get better

[Kevin Henry-Seacoast]

Now I know there are companies that back door deals and it is a problem we have in this industry.. That said I see more and more posts of people claiming this is what is happening or thinking this is happening if they get a decline or if they lose a deal.. I am doing this for a while and yes it does happen but the more common thing is that you just lost to another company.. Yes it sucks but there is no such thing any ore as an exclusive lead or deal, every merchant is shopping around.. With this comes competition and the possibility of losing deals. You will win some you will lose some and the only thing I am sure of is every deal you lose is not back doored.. When did this become the automatic goto response for any deal that comes across a persons desk that doesn't get funded. Just curious what makes people think this is the only reason they lose a deal. Some times you just get beat, I hate to admit it but it happens.. The only way to make sure it happens as little as possible is to understand that there is competition on most deals and always go in expecting to be pitching against someone else. I hate losing deals as much as anyone but part of the game and learning and getting better is acknowledging when you get beat finding out the why and how and never letting it happen again. If all you do is blame other people when you lose a deal you will never get better

If you are exclusive in this environment you will still get shopped.

[Michael I]

First off i agree with you. To many times people think they are the only one the merchant is dealing with.( Hell i had it yesterday where a merchant told me they never applied anywhere and only working with me since their banker recommended me . I got a decline for to many credit pulls in the last 30 days with no fundings) . People need to get passed their egos .

Next is where it is past the amount of time for exclusive where the lender themselves based on the iso agreement can call it . Every lender does this and do not be naive to think other wise.This is not called backdoored. (this is why you never shot gun a deal to too many lenders at once)

Next is what an underwriter mentioned on another thread that every submission sent in cost a lender money. Now if a lender sees an iso that sent a 100 submissions and not one funded , they will get backdoored .

You also have the honest mistakes, that if you doing this long enough can happen.

Next is sneaky merchants, I had a merchant that after i sent him the docs he called the lender direct to see if he can get a better deal. This happened to be a small lender with no sales floor that told me, but any large sales floor that has sales rep will take that call get in the submission and offer cheaper.(national actually made a rule because of this that once docs requested there in house team cant get in a new submission)
Now do not get me wrong even though i understand all this, i did have lenders that straight up tried to backdoor me.

[RickyR3712]

What was the whole thing with funding circle awhile back?

[FundingCzar]

Backdooring is rampant, its not a feeling. I process about 140 new files weekly, and routinely put dummy info on apps that redirects to phone numbers/emails I own. At one point it was happening so much it was hard to keep track of all the backdooring. That being said, I've cut off 5 funders in 6 months, and haven't noticed (or haven't found it out yet) it continue to happen in over a month.

Create some google voice/other numbers that redirect to your phone/email, see if any calls come in (they will). It wasn't the people I was expecting, but 4 out of 5 were just rogue underwriters/reps in various companies.

That being said, if I lose to a backdoor deal it means I was either charging too much or using the wrong funders. The majority of the time even when I think its backdooring, I can trace it to trigger data pulls. But backdooring is happening and you need to test your partners (and their employee's) loyalty.

[J.Celifarco]

Backdooring is rampant, its not a feeling. I process about 140 new files weekly, and routinely put dummy info on apps that redirects to phone numbers/emails I own. At one point it was happening so much it was hard to keep track of all the backdooring. That being said, I've cut off 5 funders in 6 months, and haven't noticed (or haven't found it out yet) it continue to happen in over a month.

Create some google voice/other numbers that redirect to your phone/email, see if any calls come in (they will). It wasn't the people I was expecting, but 4 out of 5 were just rogue underwriters/reps in various companies.

That being said, if I lose to a backdoor deal it means I was either charging too much or using the wrong funders. The majority of the time even when I think its backdooring, I can trace it to trigger data pulls. But backdooring is happening and you need to test your partners (and their employee's) loyalty.

I never said it doesn't happen but I just think people jump to that conclusion to quickly.. Also I am lucky, I work with a small group of funders that I have been working with a long time and really have no worries about this. Maybe I am being naive but I tend to believe That people I am working with for a long time I can trust

[funding pro]

Backdooring is rampant, its not a feeling. I process about 140 new files weekly, and routinely put dummy info on apps that redirects to phone numbers/emails I own. At one point it was happening so much it was hard to keep track of all the backdooring. That being said, I've cut off 5 funders in 6 months, and haven't noticed (or haven't found it out yet) it continue to happen in over a month.

Create some google voice/other numbers that redirect to your phone/email, see if any calls come in (they will). It wasn't the people I was expecting, but 4 out of 5 were just rogue underwriters/reps in various companies.

That being said, if I lose to a backdoor deal it means I was either charging too much or using the wrong funders. The majority of the time even when I think its backdooring, I can trace it to trigger data pulls. But backdooring is happening and you need to test your partners (and their employee's) loyalty.

I believe that there are a lot of bad banks out there, but if you have had to cut off 5 funders in 6 months you are working with the wrong banks.

[WestCoastFunding]

I guess it depends on your definition of backdoor. I define it as funders who decline your deal but then shop it out to another funder.

I have caught very reputable "A" funders doing just that. Was getting ready to fund with them and at last moment they said that they were going to hold off a day because they heard this merchant may be funding with another company. Next day they said, "yep, our sources have confirmed they, in fact, funded, so we are declining."

Merchant denied it but I had a major "B" funder that I have an excellent relationship with look into the file to see if a search turns up anything. He said, "believe it or not, I personally funded this deal. It was sent to us by the "A" funder a few days before."



So the "A" funder issued contracts and completed DD only to -- at the last minute --have it fund with a company they referred it to. They blamed their inside sales team, but that's horse****.

Anyway, it happens. I mentally price it in as just a part of doing business in this industry.

[Sean Cash]

Daymond John said it, not me.

sharktank.png

[Karen37a]

Everyone is right. Merchants lie and say they do not talk with other brokers and you see their credit and it has 50 hits on it.Also like Czar said If you put out dummy info on an application you will see that its being shopped around from some of the people you sent it to. Some of these companies have a mole in it and its as easy as taking the name and number and telling your buddy in the business down the road ,who is looking for what. I have coded information on the White sales boards in my office.. we never spell out the clients names just in case I have a mole..I caught 2 out of the last 2 years. I caught an old employer calling a fake google voice number trying to drop the rate on my file to take it.. I was 5 days in the business and thought...wtf, what did I get into.

Merchants stack the lenders, some of the brokers who are complaining about being backdoored are also not loyal to their preferred lenders, they do not care if they stack someone up the ying yang and bankrupt the merchant, and lose the lender money so they stack the prefered lender who had a no stacking clause, then they wonder why the lender isnt loyal to them.

And some Lenders even if you are loyal, will cut your throat no matter what , its just in their nature and thats their business model

Some crazy people are coaching merchants into non payment thru these debt companies..i do not know if they got a commission from it. I am constantly on the phone telling these merchants, who ever told you that is nuts because they will not negotiate and you will never get an advance or loan of any kind for the next 10 years, so gl with that advice.

Some Lenders wonder why small brokers make an attempt to retaliate against them when their deal was "truly" backdoored.

Merchants play brokers against each other in an effort to lower the rate..they also shop out the contract. Wouldn't you?
These merchants don't really like the MCA brokers half the time. I am amazed when my brokers say"he is my friend" on all the files. I finally say " can you stop saying that you sound like a babbling fool "lol

This is Money and its a high cost advance, these business owners, some of them ruthless are wolves in sheep clothing, they will say or do anything to get the price down.Half of the time its the Merchant backdooring you in a play to get the best rate and lower costs.

Even if they are not ruthless, don't they have the right to try to get the best pricing? I understand their motives and they really do not know who to trust.When you are a new MCA broker you do not know who to trust, how can they?Some people claiming to be Direct Funders are Brokers sitting in the basement of their mother's house in their dirty socks and underwear...

When brokers get better at this you can tell if you are really being backdoored( 95% of the time). The people who backdoor make their living off of the fact that people wont know 100% if it was backdoored or not.

Bottom line. You cant be backdoored If the client is loyal to you and we cant expect 100% loyalty from strangers who have some type of bad financial issue so they are taking out back to back Mca advances, being double dipped

The merchants put themselves in that position, some want to fix themselves, the ones who really don't want to fix themselves...watch out, you have a snake on your hands and a potential default

When you have Lenders who go out of their way to help the brokers, I have a few ( stayed one hour late one night so we funded and my broker didn't miss the pay period cut of, one helped me type in docs into the system cause I was over run ) Be nice to them, don't stack them and do shady crap. But Lenders need to recognize when they have a good Iso and Brokers and also treat them well, not try to do a hit and run on them because they can't pay their rent, under capitalized, no funding allocation or something.Bragging that they do this and that and they really fund 2 million a month .

There are good people in this business, you have to find them and in the end we do not get paid the rockstar commission cause its easy.And we are all gunning for the same pool of clients. My cash cow is going under .

And if some company backdoors you, get mad in the form of dialing for dollars, go find more clients, shake it off.I will take my own advice.


If you are not a strong sales person, tops in your old industry I advise you to not enter into the shark infested waters and if you do, go to a legitimate ISO shop so they can act as your body guard to protect your deals and also mentor you thru all the mistakes that you are going to make, that you are not aware of yet.Be coachable and respctful to the people who are giving you free advice or helping you......Or , spend an enormous amount on advertising and paying useless brokers hourly wage and commission to never close sales then go under and then turn over all the files to me or the other brokers left standing ( the nice ones who gave free advice on this site) and your leave your new furniture with us as you go out the door.

Next new person( iso ) buy a black leather Ergonomic chair with the massage feature in it,. Get the Success is not an accident motivational pictures for the wall, professional chairs ( law firm look ) for the lobby and a mont blanc pen, black.Be within 100 miles or buy a new fancy truck( cash) so you can deliver it, I wil pay pennies on the dollar so you do not have to pay for storage if /when you go under lol....oh yeah Hon file cablinets, tan, must have keys. I have a referral broker who works for me part time who owns a Car Lot, he can also take the truck off your hands for the black book auction value, bring title.

[Karen37a]

Sarcasm...sorry, last part is a half truth/joking, 4 Mca companies went under near me, I am still spinning from the fall out and my aversion to paperwork and contempt from smarty pants 1099 brokers who are now on my team who cant close sales trying to tell me what to do because someone gave them the title of Senior something or Vice President of Underwriting of the universe for Capital funding before they came to me.

Oh yeah. I finally have a default, some crazy pizza man who got a renewal and has been calling me monthly asking about his next renewal, telling me every 3-4 weeks how well his company is going, how pizzas are flying off the shelves, they also have a refrigerated pizza, college kids love it ,,delivery, blah blah blah. Finally he comes near renwal range, I ask for a bank statement, i never hear back from him, I call the lender about another potential merchant, ask about the pizza guy and this moron went out of business 8 months ago, but he kept paying his advance until 2 weeks ago. And has been calling me making stories up that I had to listen to when I didnt want to, cause I dont give a crap about his pizzas, every pizza guy says they have the best pizza.

If I told anyone in the real world these stories, they would never believe me. And I am sure you all have some doozies of your own.I am the only nut to type them out. I have never seen anything like this in my entire life lol I guess its fun and profitable and stressful at the same time if you do it right?

See yall soon waving **

[tgabcmca]

Great piece John! Can't tell you how many ISO's blame us for this. I was a broker for two years and was guilty of the blame game too! When I sold copiers in another life, I learned the golden rule. I lose sight of it now and then, but it is true in the MCA business as well....

BUYERS ARE LIARS!!

Even when your merchant says they aren't shopping, they are! We live in a Wal-Mart, Amazon world. As consumers we always seek the best deal. Why would the merchant you are dealing with be any different?! Why are we surprised when they do just that? Be good and honest to your merchant and they will be loyal to you!

[J.Celifarco]

Great piece John! Can't tell you how many ISO's blame us for this. I was a broker for two years and was guilty of the blame game too! When I sold copiers in another life, I learned the golden rule. I lose sight of it now and then, but it is true in the MCA business as well....

BUYERS ARE LIARS!!

Even when your merchant says they aren't shopping, they are! We live in a Wal-Mart, Amazon world. As consumers we always seek the best deal. Why would the merchant you are dealing with be any different?! Why are we surprised when they do just that? Be good and honest to your merchant and they will be loyal to you!

agreed and believe me it does happen, a lot of banks are guilty of it, but it is not always the case.. Completely agree anyone who thinks they are competing on almost every deal they get is crazy

[Karen37a]

Certain companies do not backdoor but certain companies whole business strategy or business model is set up to backdoor.

That is their only business model or business plan or strategy. Certain brokers have the same system or mentality.

The trick is to try to find out who they are and to try to stay away from them.

They usually get found out or go out of business etc.