Planning a Payoff Just Right
According to Scott Griest, the CEO of American Finance Solutions, paying off a competitor is more complex than writing a check to pay off the balance. In his latest blog post, he explains this:
- When calling too early for a balance, the funding provder risks tipping off the competitor that they are about to get bought out of a deal. If its a good, profitable client (which is most often the case) the competitor will often “instantly approve” the renewal and offer to wire funds that day and beat the offer.
- It’s best to wait until the day of funding to receive the payoff instructions. That is unless the sales agent has grossly underestimated their outstanding balance or account performance.
- Sometimes you’ll find out the reason that the client cannot renew is because of collections issues, fraud (altered payoff letters) or trying to get double funded on the same day by the old and the new MCA company.
- Sales partners need to know their clients. Find out the funding date of their current advance and deal terms. If the contract payback amount is $50,000 and they got the advance six months ago and the balance is over $30,000, then there’s an issue with payback.
To read the full article, visit Scott Griest’s Blog
Sean Murray is the President and Chief Editor of deBanked and the founder of the Broker Fair Conference. Connect with me on LinkedIn or follow me on twitter. You can view all future deBanked events here.