It happens to the best of us:  the perfect new client.  The prospect you have been waiting for; edged out the competition; ran the deal by your boss, underwriting and credit; crossed your “t”s and dotted your “i”s; and finally were able to tell the prospect “yes, we can do the deal”.  Everything seems to be going along perfectly until the day of closing and it all falls apart. 
 
This is a common scenario in today’s credit climate and damage control is becoming a valuable trait for relationship managers, business development officers and in-house counsel when the words “lender liability” start floating around. 
 
THE PERFECT DEAL: A couple of months ago, we received a call from a relationship manager from a local bank.  The business owner was in growth mode when he received the good news that the bank said “YES” to the line of credit and “YES” to the equipment lease.
 
THE PROBLEM: The owner pulled the money from the line of credit to bridge the cash flow gap between increased orders and payments from receivables. The owner also placed the order for the new equipment.  Things were looking great and business was booming.  A couple of months later the owner went back to the bank to close the equipment lease and was told in a nutshell, “sorry, we can’t approve the equipment lease now”.  Call it the perfect storm or the credit crisis, either way it’s what we’re all dealing with these days.  Not only was the owner unhappy but he was starting to mumble “lender liability”.
 
THE FSW SOLUTION: The relationship manager was at a loss of what to do. Fortunately the bank line of credit was small and there were still significant receivables to leverage. The relationship manager called FSW and in one week we were able to negotiate a subordination agreement with the bank and fund the business.  
 
The extra cash flow funded by Factors Southwest has enabled this business to double sales
  
If you are looking for a way to finance the growth of your business, contact Factors Southwest today.