Merchant Cash Advance Loans

Merchant cash advance loans are a form of working capital provided by the qualified lenders. These loans function as working capital and the one of the nice features is just about any small business that accepts credit cards can qualify for an approval. The way the loan works is the merchant cash advance lender will evaluate the last 6 months of credit card statements and determine the average monthly sales. Normally only Visa and MasterCard credit card transactions are evaluated as the primary collateral for the loan. The loan formula is normally from 40% to 80% of the average monthly sales provided in a lump sum. Example, if your monthly credit card sales average $100,000 you would most likely qualify for a merchant cash advance loan of $40,000 to $80,000. The loan is then paid down over a 6 to 12 month time frame via weekly or daily ACH deductions from the credit account of the business.

Uses for the Merchant Cash Advance Loan

Since this is a very flexible loan it can be used for all kinds of business needs. A common need is for working capital and investment in growth. You’re essentially getting an advance on future sales so it makes sense to make sure the opportunity profit exceeds the cost of getting the advance on your future sales. Restaurants often use the merchant cash advance loan for new equipment and upgrades. Doctors and healthcare firms use this loan for upgrading equipment or medical devices. Seafood retailers can use this loan option to purchase inventory at better prices. Seasonal companies that need to make purchases before the cash is in house use can use this credit card advance loan.

The loan advance is repaid automatically, by taking a percentage of your credit card transactions until the advance is fully repaid. This makes the pay back part of the loan fairly simple with no worries about missing payments. Unlike a traditional loan, a merchant cash advance loan does not require any collateral or personal guarantee. Applying is fast, free, and easy. Just complete the loan request application to start the process. Keep in mind you will need 6 months of bank statements to receive a loan quote from most of our merchant cash advance lenders. Funding can occur in within 4 to 7 business days making this one of the faster loans when considering business financing.

Why Consider the Merchant Cash Advance Loan

Qualifying for a traditional small business loan in today's economy is difficult and this quick low doc funding solution can be an easy alternative. A regular bank loan is a lengthy and complicated process that includes extensive paperwork, low approval rates, collateral, and personal guarantees. If you’re sure your business does not have the solid financials that bank’s require the merchant cash advance loan can be a nice option for a quick working capital solution. The down side is the higher cost of funding, but if it can make your business more profitable the profits could make this a small price to pay in the long run.

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