Visa & Mastercard Processor for Loan Modification
Merchant Account: A challenge for the Student Loan Providing Firm. Have you ever faced a situation where you are a student loan provider and have found it really tough to be able to find a merchant account provider for the services that you offer? Getting some terminals for the same can be really difficult to find and it is equally impossible to find a gateway setup that is affordable. It is actually a challenge to run any business in these days of tough competition. It is very important for a loan provider to be able to accept ACH processing and credit cards. You thus need to look for a merchant who charges reasonable rates and also has employee friendly staffs that make it very easy for you to accept the payments on the phone or even online. You should also look for someone who offers you their services without charging any service fee.
High Risk Friendly Banking Solutions
There are High Risk vs. Low Risk merchant account providers and since providing a student loan is high risk you may not be able to negotiate on the rates a lot. There is a lot of requirement for student loan documentation, preparation and loan modification. There is a lot of increase of student loan debt that is increasing year on year. Students today are starting their professional career with a huge student loan which is indeed a big debt. There are two kinds of students here. One who wants to clear off the debt as quickly as possible and the other who want to wait and pay slowly in smaller monthly instalments maybe because they have some other commitments or they are working only part time now. A merchant who helps in loan modification plays this role. But when you work in the industry you will realise that they take a cut on this. The rates vary by start-up vs. history and this is a high risk business. Most of the credit card processors end up rejecting this because of the strict underwriting rules that they have. However, the market is not completely shut and you can get some merchant account providers if you own a student loan firm.
High Risk Classifications in The Industry
The student loan modification business is not a stable industry. The business has very low revenue and thus the number of merchants who offer the student loans in documentation prep and the student loan modification service is very low. The business is high risk and this makes the business even more complicated. The problems with most of the application process submitted by clients are that the client who approaches the merchants comes with expectations that are highly unrealistic. Charge backs are huge and this is the major reason why the processors do not encourage this business. Also there are some merchants who are frauds and this increase the risk of this industry.
How To Apply and Get Approved
So, how do you get started? In case, you are at high risk then there are reasons why you need a merchant provider who lets you accept payments through MasterCard, ACH processing, visa, or check processing. The merchant account should have links with many underwriting banks and this will let you do business even if a particular bank does not want to get associated with you. There are merchant account providers that give you a free setup service. They do not charge you anything in order to set up the gateway for any of the merchant services. This is an indication that the merchant account provider wants your business to be successful and especially if your business is a start-up. You should look for a provider who has some experience of being in the business. They should have helped business of various sizes as well as helped those who have dealt with cases of lost mitigation.
What To Look For
Look for providers that do not charge a bomb for the services that they offer. They should be able to charge competitive rates even if you are a start-up. First get a quote on how low the service provider is charging you. They should also be capable of providing virtual terminals for those transactions that does not involve using cards. They should have employed the latest in technology and should also offer services like accepting payments through smart phone apps. The Business Isn’t Easy. This business is definitely very difficult and it takes a lot of commitment and hard work in order to succeed in this business so look for a merchant account provider who provides you with a host of services without charging you a lot of money. It can get really exhausting to run a loan modification firm and it is even more painful to look for a company that accepts the credit card payments.
Domestic Underwriting Banks are Best
The major concern among the merchants who look to create a merchant account for their new start-up or an existing business is to have to deal with consequences when it comes to credit card processing for long term. It can be difficult to opt for an account based offshore than one that is set up domestically. The domestic firms will offer you benefits that might be temporary as they will be capable of managing risk for a very short time. The established business must have already had an experience with many processors and would have already done their research. They would also be able to analyse if they are low risk or high risk. They also know the benefits of keeping the decline rate and charge backs low. If these are taken care of then opting for a domestic provider is the best solution. But if you are a high risk firm then it is best to opt for an offshore firm.
Startups are Approved
If you are a start-up then you could choose a domestic account and this will also be the only option that you will have. The domestic firms will not disqualify you on various risk factors or on the basis of your business volume. A domestic merchant account provider should be your first option. But in case your transactions do not get cleared on time then it is time for you to switch to an offshore merchant account provider.