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Great question. Do NOT know GVC Financial or Marvin.
Why would you pay $25K up front, when you can use that money as collateral or talk to your bank
Also check with SCORE (online). SCORE is FREE
I do appreciate your input, however due to the current financial landscape it is difficult at best in securing money. With that said, I asked for input on this company since I am forced to look for alternative lending. I had not look at SCORE but now that you mentioned it I have glanced at their Web Site but do not see actual Lending Groups. Can you shed any more light on this subject.
It is generally highly recommended that you do not pay "up front fees" to brokers who are trying to secure you a loan.
To be fair, there are 2 sides to every story:
Every broker has at least one story of how they busted their backsides, and then had a client go with another offer.
Every client has at least one story of how they gave a very high up front fee to a broker, and got nothing in return.
I would suggest you err on the side of caution. $25,000 is a HUGE amount of money up front to a broker in exchange for them "securing" your financing. I have personally seen way to many vaguely worded fee agreements that state the fee is refundable, unless a specific set of circumstances. I can just about guarantee you that you will end up triggering that, and you will get nothing back if your broker does not get you a suitable offer.
I would also suggest you do not confuse up front fees with commitment fees that many lenders will charge. It is not at all unusual for lenders to charge a point or two of the requested loan amount as a commitment fee. Once the bank commits, and you accept, the bank or lender puts that money aside for your funding request, and also incurs real expenses. They will pay for title work, appraisals, accounting, legal, and much more.
Most brokers do not incur hard expenses to submit your file, or in the case of many lenders, start posting online to find someone who can fund it. They do use their time, which does have a value to it, but as is the case with my own company, we prefer to be performance based. On small ticket items we do charge an engagement fee of $495 which covers application and processing costs, but thats it. We do not ask for the large fees to shop your deal around with no guarantee of success, and suggest you do not give someone a large fee in order for them to find you funding.
If you have any questions, please feel free to contact me.
President, Business Lending Associates
Very well said and greatly appreciate your input. Am I to assume you also do this type of work? I looked at you web site and sent you and email, hope to hear from you and that you might be able to help me.
Don't know this person or his company - but, my suggestion is this. If you are to pay upfront - make sure you get a guarantee in writing (reviewed by your attorney). The guarantee should state that you will get your money back less reasonable expenses (which you will want a detailed list of) or that the fee will be applied to the total funding fee if this company can get you funding.
Most scammer knows that people in your situation are either naive or desperate and they try to take advantage of that. But you should also know that scammers are lazy - thus, if this person is unwilling to provide some type of guarantee - run away.
Another thing that surprises me here is the amount. Most brokers will ask for a few hundred dollars to get the ball rolling - they want to ensure that you are also serious before they waste their time. $25K seem like alot.
Business Money Today
Thank you for your insight.....I am already looking for alternative funding.
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I found this forum and noticed there was a discussion about GVC Financial and Melvin Gilbert. I too have now come across GVC/Melvin and am now looking for financing/acquisition of an existing company and he is still asking for $25k up front fee for securing the financing for me. So is this GVC/Melvin Gilbert for real or should I pack up and run the other way? Please tell me your experiences with this company?