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03-29-2017, 04:45 PM #1
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- Jan 2016
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- 54
Lockbox only / nsfs /direct funders only/ strong cc's
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 ??
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03-29-2017, 04:46 PM #2
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?
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03-29-2017, 04:52 PM #3
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- Oct 2016
- Posts
- 4,318
I'm a broker but I'll point you in the right direction: Sterling Funding.
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03-29-2017, 05:51 PM #4
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03-29-2017, 06:04 PM #5
- Join Date
- Mar 2014
- Location
- Florida
- Posts
- 2,977
Dave Lambert, Business Development
dave@fcbankcard.com
Merchant Services Consultant
High Risk Merchant Payment Solutions
SBA 7(a) Loans & Short-Term Funding
T/VM: 727-291-7890
Office: 727-233-1111
Skype: fc-financial
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03-29-2017, 08:51 PM #6
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.
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03-29-2017, 09:37 PM #7
- Join Date
- Aug 2014
- Posts
- 194
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.
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03-30-2017, 09:35 AM #8
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.
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03-30-2017, 11:03 AM #9
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- Sep 2012
- Location
- New York, NY
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- 1,780
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!
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03-30-2017, 11:09 AM #10
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
John Celifarco
Managing Partner
Horizon Funding Group
3423 Ave S
Brooklyn, NY 11234
T: (347) 773-3990 | F: (718) 795-1990
Linkedin: Profile
Email: john@horizonfundinggroup.com
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03-30-2017, 11:27 AM #11
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.
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03-30-2017, 11:33 AM #12
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
John Celifarco
Managing Partner
Horizon Funding Group
3423 Ave S
Brooklyn, NY 11234
T: (347) 773-3990 | F: (718) 795-1990
Linkedin: Profile
Email: john@horizonfundinggroup.com
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03-30-2017, 12:14 PM #13
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03-30-2017, 12:36 PM #14
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
John Celifarco
Managing Partner
Horizon Funding Group
3423 Ave S
Brooklyn, NY 11234
T: (347) 773-3990 | F: (718) 795-1990
Linkedin: Profile
Email: john@horizonfundinggroup.com
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03-30-2017, 01:06 PM #15
- Join Date
- Nov 2013
- Posts
- 598
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.
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03-30-2017, 01:36 PM #16
- Join Date
- Mar 2014
- Location
- Florida
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- 2,977
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.Dave Lambert, Business Development
dave@fcbankcard.com
Merchant Services Consultant
High Risk Merchant Payment Solutions
SBA 7(a) Loans & Short-Term Funding
T/VM: 727-291-7890
Office: 727-233-1111
Skype: fc-financial
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03-30-2017, 01:38 PM #17
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- Jun 2015
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- 3,325
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03-30-2017, 02:08 PM #18
- Join Date
- Sep 2012
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- New York, NY
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- 1,780
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.
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03-30-2017, 02:14 PM #19
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- Nov 2013
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- 598
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03-30-2017, 04:01 PM #20
- Join Date
- Jul 2015
- Location
- Tampa Florida
- Posts
- 502
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.
Jason H l Sales & Business Development
Quikstone Capital Solutions l Tampa FL
Direct Line & Mobile 813-371-8233 l Fax 813-371-8233 l Text 727-492-8812
Jason.Hausle@quikstonecapital.com
www.quikstonecapital.com
Direct Lender Since 2005
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03-30-2017, 04:11 PM #21
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- Mar 2014
- Location
- Florida
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- 2,977
Lockbox System
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.Dave Lambert, Business Development
dave@fcbankcard.com
Merchant Services Consultant
High Risk Merchant Payment Solutions
SBA 7(a) Loans & Short-Term Funding
T/VM: 727-291-7890
Office: 727-233-1111
Skype: fc-financial
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03-30-2017, 04:19 PM #22
- Join Date
- Sep 2012
- Location
- New York, NY
- Posts
- 1,780
Actually the main purpose of a lockbox is to facilitate a credit card split cash advance in which the merchant does not wish to change processors to one that the funding company has a split agreement with or if the funding company wants to include AMEX deposits in the split (because AMEX doesn't split with funding companies). The funding company takes his split (i.e. 20%) from the lockbox deposits. It does not "negate" the NSF days. The NSFs are still happening in the business checking account because the merchant is having cash flow problems.
As far as credit card funds being ACH'ed immediately from the lockbox to a merchant's bank account? It happens within 24 (sometimes 48) hours. It's not "immediate." Again, this delay is what creates additional strain on a merchant's cash flow.Last edited by MCNetwork; 03-30-2017 at 04:23 PM.
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03-30-2017, 04:21 PM #23
- Join Date
- Jun 2015
- Posts
- 3,325
ok Dave i think you just confirmed that you never did a lockbox
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03-30-2017, 04:28 PM #24
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03-30-2017, 04:34 PM #25
and this is point point exactly some people have no idea what they are talking about yet have no problem just saying stuff that is blatantly false
John Celifarco
Managing Partner
Horizon Funding Group
3423 Ave S
Brooklyn, NY 11234
T: (347) 773-3990 | F: (718) 795-1990
Linkedin: Profile
Email: john@horizonfundinggroup.com
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