[MX211]

Before you mention it, previously searched this same question however I am asking again only because I noticed what seem to be brokers responding as Direct Lenders.

Auto Services
40k a month CC's
Credit is below 600's
NSF and Overdrafts 15+ in 3 months

Wants to do a lockbox on cc's however, all the lenders I deal with only do a lockbox with banks meeting requirements


What Direct Funders that do Lockboxes please pm or reply ??

[Chambo]

the reason they do that is....if the guy cannot handle his cash flow NOW, how is he going to handle it when 10-15-20% of his CC revenue is taken away?

[WestCoastFunding]

I'm a broker but I'll point you in the right direction: Sterling Funding.

[ADiamond]

Before you mention it, previously searched this same question however I am asking again only because I noticed what seem to be brokers responding as Direct Lenders.

Auto Services
40k a month CC's
Credit is below 600's
NSF and Overdrafts 15+ in 3 months

Wants to do a lockbox on cc's however, all the lenders I deal with only do a lockbox with banks meeting requirements


What Direct Funders that do Lockboxes please pm or reply ??

i can do a lockbox of about 12-15k to start and the split would be 15-20%

pm if interested

[Yankeeman07]

Before you mention it, previously searched this same question however I am asking again only because I noticed what seem to be brokers responding as Direct Lenders.

Auto Services
40k a month CC's
Credit is below 600's
NSF and Overdrafts 15+ in 3 months

Wants to do a lockbox on cc's however, all the lenders I deal with only do a lockbox with banks meeting requirements


What Direct Funders that do Lockboxes please pm or reply ??

Call me, we do lock boxes - 1st Position Only.

[FireflyFunding]

There are literally thousands of merchant services reps that would die for a file like this. As long as his Visa/MasterCard volume is decent then he should be able to get 20-30k at a 1.20-1.22 over 9 months. Yeah the upfront commission wont be as much but the back-end residual every month will be nice to have

I can point you in the right direction if you'd like.

[MCA]

There are literally thousands of merchant services reps that would die for a file like this. As long as his Visa/MasterCard volume is decent then he should be able to get 20-30k at a 1.20-1.22 over 9 months. Yeah the upfront commission wont be as much but the back-end residual every month will be nice to have

I can point you in the right direction if you'd like.

First let me point out the original poster is talking about lockbox, which means the CC processing will not be changed so I am not sure why you think that would happen? Second no funder would offer this guy a 1.20 - 1.22 over 9 months NO WAY, that is a A paper rate for a D-F file. Chambo is correct in his post and if he can't manage his cash flow right now what makes you think he can when he loses 20+% of his CC receipts? He can't and will change his lockbox deposits back to his account and the Funder will then be looking at a loss.

[ridextreme]

why is this auto mechanic so in love with his processing company?

Another example of how new/weak sales reps let unqualified customers with 15 NSF's call the shots as to what they "want".

Instead, why don't you sell him on the fact that he has no cash flow? Do you want money? We're gonna have to change your processing company. It's going to be simple and smooth. Hey, we're probably gonna give you better rates anyway! This is going to help you in the long run, and your batches won't be delayed while it goes through a lock box.

Sales 101 is better than running onto df with your tail between your legs.

[J.Celifarco]

why is this auto mechanic so in love with his processing company?

Another example of how new/weak sales reps let unqualified customers with 15 NSF's call the shots as to what they "want".

Instead, why don't you sell him on the fact that he has no cash flow? Do you want money? We're gonna have to change your processing company. It's going to be simple and smooth. Hey, we're probably gonna give you better rates anyway! This is going to help you in the long run, and your batches won't be delayed while it goes through a lock box.

Sales 101 is better than running onto df with your tail between your legs.

even though I completely agree with what your saying there is one problem with this statement. New sales reps dont know anything about CC processing and the switch probably wont be smooth and easy. When most of us started in this business we had to know about processing because every deal was a split. Now so few deals are splits most sales people dont know how to talk about processing, I will even go a step further and say many are scared of switching processing. Lets be honest how many of the newer sales people in this industry even know what interchange is forget how to sell it as pricing for processing

[ridextreme]

even though I completely agree with what your saying there is one problem with this statement. New sales reps dont know anything about CC processing and the switch probably wont be smooth and easy. When most of us started in this business we had to know about processing because every deal was a split. Now so few deals are splits most sales people dont know how to talk about processing, I will even go a step further and say many are scared of switching processing. Lets be honest how many of the newer sales people in this industry even know what interchange is forget how to sell it as pricing for processing

They don't need to know about interchange rates or anything else. All they have to do is say we're going to re-program your terminal so you can pay us back. Your credit cards are going to be processed by "X" company, who partner with us, until we're paid back. The process is going to be smooth and easy. if they run into issues later (equipment not compatible/locked, customers getting denied for processing due to being black listed, etc.) it's handled one step at a time.

No one said making money was easy, but it's certainly not for the weak hearted.

[Chambo]

They don't need to know about interchange rates or anything else. All they have to do is say we're going to re-program your terminal so you can pay us back. Your credit cards are going to be processed by "X" company, who partner with us, until we're paid back. The process is going to be smooth and easy. if they run into issues later (equipment not compatible/locked, customers getting denied for processing due to being black listed, etc.) it's handled one step at a time.

No one said making money was easy, but it's certainly not for the weak hearted.

"until we get paid back", but forget to mention the monthly min charge...or if they turn off entirely, the ETF fee. Most, if not all, of these processors out there have a 2-3 year contract enforced when you sign them up

[MCNetwork]

So the merchant wants a lockbox so that instead of 15 NSFs in three months, he'll have closer to 30? You need to set him straight!

[J.Celifarco]

agreed completely, I just know that unless you know how to speak about the processing intelligently including pricing and process people are very hesitant to switch.. It can be done and i think anyone in the space as a sales person should be able to do it, I just feel most people now don't have the vocabulary to get this done. Merchants look at credit card processing almost like magic.. A person comes in swipes a card then a day or two later the money is in their account. If the sales person does not sound like they know what they are talking about, then the merchant is scared something will go wrong and the money they count on to run their business wont be there when they expect it to be

[J.Celifarco]

one thing this thread makes me think about is the difference from a few years ago to now.. Then when you got the signed contracts that was like maybe the halfway point because that is when you had to start with the processing switch and any issues that came up from that. Now signed contracts come in and people are like ok fund my deal. Signed contracts a few years ago was just the beginning. How many times was a deal killed after signed contracts because you could not switch the processing (proprietary processing, TMF list, POS system not compatible).. Login is a pain in the ass but compared to processing issues that used to come up it is nothing

[FCF Fund]

Lockboxes are never good for the merchant, besides delaying the batches there are fees the lender pays, most times they absorb them other times they pass it on to the merchant. Also, dont forget a reserve amount lockboxes would require to maintain and good luck getting a refund from the lender on those.

In the end, its better to switch the merchant to a an open processor you control, I dont like IPS as they eat up a lot of your residuals although for newbie brokers they are perfect.

[Yankeeman07]

It amazes me the amount of misinformation that is being posted. Lockboxes are bad for a merchant with numerous NSF Days?

Really? The purpose of a lockbox is to avoid ACH Requests Rejects, causing another NSF. A reserve for a Lockbox? Where did that information come from, why would you need a reserve? Changing Processors, some funders that are involved in the cc business may impose that condition, but not all.

Since I am heavily involved in the Credit Card Processing World, call me with any questions.

[Michael I]

It amazes me the amount of misinformation that is being posted. Lockboxes are bad for a merchant with numerous NSF Days?

Really? The purpose of a lockbox is to avoid ACH Requests Rejects, causing another NSF. A reserve for a Lockbox? Where did that information come from, why would you need a reserve? Changing Processors, some funders that are involved in the cc business may impose that condition, but not all.

Since I am heavily involved in the Credit Card Processing World, call me with any questions.

All lockboxes put a minimum reserve and put a one to 2 day delay on merchant receiving money.Have you ever done a lockbox?

[Yankeeman07]

All lockboxes put a minimum reserve and put a one to 2 day delay on merchant receiving money.Have you ever done a lockbox?

At least 2 The initial delay is about 2 days, but after the merchant is receiving funds everyday, assuming he does processing every business day. If there is zero processing, no payment is deducted.

[FCF Fund]

It amazes me the amount of misinformation that is being posted. Lockboxes are bad for a merchant with numerous NSF Days?

Really? The purpose of a lockbox is to avoid ACH Requests Rejects, causing another NSF. A reserve for a Lockbox? Where did that information come from, why would you need a reserve? Changing Processors, some funders that are involved in the cc business may impose that condition, but not all.

Since I am heavily involved in the Credit Card Processing World, call me with any questions.

Paysmith requires a reserve. I believe they are run by Citibank and when doing a lockbox with them thats typically why most lenders require 1 to 2 batches before funding, aside from confirming the transition is complete.

[ADiamond]

Paysmith requires a reserve. I believe they are run by Citibank and when doing a lockbox with them thats typically why most lenders require 1 to 2 batches before funding, aside from confirming the transition is complete.

They are partnered with US Bank, and the reserve amount is up to the lender. The typical rule of thumb is to wait until a few batches show to ensure the client is batching normal volume. It will also take a good 48-72 business hours for the first batch to show once the switch in processing deposits is made.

Aside from that I am just amazed at how misinformed people are here in the process in general. People who claim to have been in the business for YEARS!

[Chambo]

It amazes me the amount of misinformation that is being posted. Lockboxes are bad for a merchant with numerous NSF Days?

Really? The purpose of a lockbox is to avoid ACH Requests Rejects, causing another NSF. A reserve for a Lockbox? Where did that information come from, why would you need a reserve? Changing Processors, some funders that are involved in the cc business may impose that condition, but not all.

Since I am heavily involved in the Credit Card Processing World, call me with any questions.

almost ALL lockboxes have a reserve...for CC processing fees

[MCNetwork]

Yankeeman07 needs to learn what a lockbox is and how it works. The reserve is used to cover the monthly processing fees since fees will be deducted from the lockbox account and not the merchant's bank account. The reserve prevents the account from becoming overdrawn once fees are deducted. Lockboxes are bad for the merchant with numerous NSFs because it adds up to 48 hours for credit card funds to clear to his checking account. If he was having difficulty managing his bank account without a delay, the 2 day delay will only make things worse for him.

[Yankeeman07]

Yankeeman07 needs to learn what a lockbox is and how it works. The reserve is used to cover the monthly processing fees since fees will be deducted from the lockbox account and not the merchant's bank account. The reserve prevents the account from becoming overdrawn once fees are deducted. Lockboxes are bad for the merchant with numerous NSFs because it adds up to 48 hours for credit card funds to clear to his checking account. If he was having difficulty managing his bank account without a delay, the 2 day delay will only make things worse for him.

Beg your pardon, but, the main purpose of a "Lockbox" is to negate any NSF days. If the merchant is to receive 5K in deposits and his
payback percentage is 20% - he receives 4K in his bank account. Credit card funds are ACH which are immediately credited to a merchants account, or at least show pending that day and most banks give access to those funds.

[ridextreme]

Beg your pardon, but, the main purpose of a "Lockbox" is to negate any NSF days. If the merchant is to receive 5K in deposits and his
payback percentage is 20% - he receives 4K in his bank account. Credit card funds are ACH which are immediately credited to a merchants account, or at least show pending that day and most banks give access to those funds.

No. The purpose of a SPLIT is to negate any NSF days. That's the whole point in dong a splt, because of too many NFS's and/or negative days would make it hard to collect ACH payments (because they would bounce).

The purpose of a lock box is to collect the split when it's impossible to change processors, either due to complicated POS systems, locked terminals which buying new ones would be a deal killer, or even if the merchant refuses to split and lock boxes are an option.

Now our next lesson would be Split ACH. Do you have any idea what the heck that is? This is a tough one.

[Jason Sterling]

We are a direct lender and credit card processing company. We have been in the MCA space since 2005 and processing since 2001. We can most likely convert processing and save him money at the same time. If he can't switch due to equipment or other reason we do offer lockbox as long as deal is $15,000 or greater.