Results 1 to 8 of 8
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06-23-2020, 10:58 AM #1
"Underwriting Fee" Without Funding
Is this common? First time I've seen it. Or maybe I just never looked for something like this?
underwriting fee.PNG
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06-23-2020, 11:24 AM #2
- Join Date
- Feb 2017
- Posts
- 3,354
There is such a thing as a "due diligence fee" that is often done on bigger equity deals that need serious underwriting. I did hotel in December and it was a $10,000 commitment fee that was refundable for whatever wasn't used. They physically flew to the location, it covered wires and credit pulls, if they needed a few appraisal, etc.... WBL does it also, but at least we all know that they close deals.
The lender/funder can do whatever they want, it's just not smart business since I as a broker wouldn't send a client there knowing that my relationship with the client is at stake if I cost them $500 just for producing them contracts and the funder/lender changes their mind. Pulling credit costs money, still gotta pay UW, even if the deal doesn't go through.
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06-23-2020, 11:42 AM #3
- Join Date
- Feb 2018
- Posts
- 1,349
if thats an mca company, it is not a normal clause.
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06-23-2020, 11:48 AM #4
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06-23-2020, 12:00 PM #5
- Join Date
- Feb 2018
- Posts
- 1,349
scam. if the company is forcing a merchant to pay $499 per contract to pay for their employee staff to UW, I would say it's a very poor choice policy
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06-23-2020, 01:05 PM #6
- Join Date
- Aug 2019
- Posts
- 94
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06-23-2020, 01:41 PM #7
- Join Date
- Mar 2019
- Posts
- 253
Never seen an MCA funder with a non-refundable UW fee. Only seen it in things like collateralized deals where there is an inspection/ appraisal
EPIC ADVANCE
Mark@epic-advance.com
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06-23-2020, 03:08 PM #8
- Join Date
- Apr 2016
- Location
- Ft Lauderdale
- Posts
- 57
If any MCA Funder asks you or your merchant for that run in the other direction as fast as you can . Nothing more than a grab and run cash scam.
Things like this give the industry a bad name.
Jake Strelzik
Vice President / ISO Relations
4000 Hollywood Blvd
Hollywood , FL 33021
954-641-8756 (office) /305-785-2548 (cell)
888 472 2933 fax
jstrelzik@flashadvance.com
www.flashadvance.com
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