pricing
Double-Dipping
Double-dipping is when a broker or lender charges interest or fees on a rolled-over balance that has already been paid for in the previous advance.
Last updated Reviewed by ICG Funding
Definition
What it means.
On a renewal or "refi" of a BCA, a double-dip happens when the unpaid balance of the old advance is netted against the new advance amount, but the full new factor rate is applied to the gross new amount. The borrower effectively pays fees twice on the same unpaid principal.
Double-dipping is a common abuse in the BCA industry. Before accepting a renewal, always ask for the net funded amount and confirm that the factor rate is applied only to new dollars in your hand, not to dollars already paid interest on.
Now what?
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