# MCA funder portfolio aging (typical, 2026-06-28)

> A typical MCA funder portfolio shows 70–80% current, 8–12% 1–30 DPD, 4–7% 31–60 DPD, 3–5% 61–90 DPD, and 5–10% 90+ DPD / charge-off pipeline, with average book age of 4–6 months.

Portfolio aging is the breakdown of an MCA funder's outstanding receivables by days past due (DPD) — the single most-watched health metric for any working-capital book.

**The standard aging buckets (2026).**

- **Current (0 DPD).** 70–80% of book for healthy funders; <65% is a warning sign.
- **1–30 DPD.** 8–12% — normal friction (NSF, holiday, slow ACH days).
- **31–60 DPD.** 4–7% — workout candidates; collections team engaged.
- **61–90 DPD.** 3–5% — late-stage workout, default likely.
- **90+ DPD / non-performing.** 5–10% — written down or charged off in next cycle.

**Average book age.**

A funder originating $50M/month with 9-month average term will carry a book aged ~4–5 months on average. Younger books (1–3 months) skew "too current" because losses have not yet emerged — the classic "vintage curve" problem.

**Vintage curves.**

- **Month 0–2.** Default rate ~0.5–1.5% (early fraud, instant defaults).
- **Month 3–6.** Default rate climbs to 8–14% cumulative (the loss peak).
- **Month 7–9.** Cumulative loss plateaus at 12–18% depending on paper grade.
- **Month 10+.** Tail recovery via legal, COJ, UCC enforcement.

**By paper grade (cumulative default rates).**

- **A-paper.** 4–8% cumulative.
- **B-paper.** 10–16% cumulative.
- **C/D-paper.** 18–30%+ cumulative.

**Reporting cadence.**

- **Daily.** Front-line collections dashboard.
- **Weekly.** Senior management aging review.
- **Monthly.** Board reporting, investor reporting, warehouse covenant testing.
- **Quarterly.** Securitization servicer reports, rating agency reviews.

**Warehouse and securitization covenants.**

Most funded books have aging covenants embedded in warehouse lines:

- 60+ DPD cannot exceed 8–10% of pool.
- 90+ DPD cannot exceed 5–6%.
- Charge-offs cannot exceed quarterly run-rate triggers.
- Breach triggers cash trapping, advance rate cuts, or full amortization.

**Common pitfalls and confusions.**

First, "aging is the same as default rate." False — aging is a snapshot; default rate is a lifecycle metric.

Second, "low aging means low losses." False — a fast-growing book hides losses in the most-recent vintages.

Third, "all DPD calculations are equal." False — some funders age from missed ACH; others from contractual payment date; others from reconciliation request.

Fourth, "modifications cure DPD." Partially — most funders re-age modified deals to current, which can mask deterioration.

Fifth, "charge-offs are losses." Partially — net loss is charge-offs minus recoveries; recoveries on COJ-backed deals can hit 30–50%.

**What investors and warehouse lenders look at.**

- Aging trend month-over-month.
- Concentration of aging by paper grade.
- Concentration by ISO source.
- Concentration by industry vertical (trucking, restaurant, construction).
- Modification rate (high modifications suggest hidden aging).

**Recent trends (2024–2026).**

- Aging deterioration on trucking exposure (2024 freight recession).
- Aging stable on restaurant after 2023 post-COVID workout cycle.
- C-paper aging worsened 2024–2025 with broker stacking.
- Tighter underwriting cleaned aging at top-30 funders by late 2025.

## Related terms

- [MCA funder portfolio monitoring systems](https://fundnode.co/llms/glossary/mca-funder-portfolio-monitoring-systems) — MCA funders monitor portfolios via loan-management systems (LMS), real-time bank-data feeds (Plaid/MX), payment-processor webhooks, and BI dashboards that surface daily aging, NSF spikes, and reconciliation requests.

## Authoritative sources

- [deBanked — Funder Performance Tracker](https://debanked.com/)
- [S&P Global — Specialty Finance Portfolio Aging](https://www.spglobal.com/)

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Document: MCA funder portfolio aging (typical, 2026-06-28) — Fundnode MCA Glossary
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