In today’s economy, it would be much easier to get approved for a merchant cash advance, than it would be to get a loan from any bank in the USA. A merchant cash advance provider looks at: the businesses credit card processing receipts, the longevity of the business and the credit worthiness of the owner. Financial Institutions focus more on the cash flow statements, profit & loss, and balance sheets. In my opinion, a merchant cash advance is more easily obtainable given the underwriting criteria.
How long will it take to receive the funds?
Once the merchant cash advance application is submitted, it takes approximately seven to ten business days for the merchant to receive the funds into their specified bank account. Keep in mind if our underwriting department requires more documentation, it will take longer for the merchant to get approved.
What are the fees/costs?
When trying to obtain merchant cash advances; there are no closing costs or application fees. The cash advance provider will not charge any interest either. You will receive the money today, in the promise that the provider will receive payments based on the businesses future credit card receivables. This is an alternative financing product for small to mid size businesses; it tends to cost more than a traditional bank loan. However, the payment structure is much more flexible.
Will I get penalized for prepayments?
Absolutely not, this product is a financing receivable program. The provider receives payment from your businesses credit card processing transactions. Let’s say the business has a rough month, the payment to us would be substantially less; than a month where business was booming. It can take 2 months to 18 months to pay back your merchant cash advance.
What are the terms associated with a merchant cash advance?
Every merchant cash advance is unique; we customize each advance individually to match the merchant’s business. There are several factors to consider when paying back a merchant cash advance. For example, how much do you expect to earn in credit card processing receipts per month? What is the seasonality of your business? Once you take these factors into consideration, you are looking at six to twelve months to pay back your merchant cash advance.
How do I make the payments?
Payments are expected from the businesses daily credit card processing transactions. Depending on the terms of the merchants specific merchant cash advance financing, the retrievable rates can vary from five to twenty five percent. If your business makes $100 a day in credit card transactions and your rate is 20%; your daily payment would be $20 until the cash advance was paid in full.
What are the qualifications?
Here are some helpful facts, to find out if your business qualifies:
• Business must be producing a minimum of $3500 per month in credit card sales.
• Provide 3 months worth of credit card processing statements
• Business has to be in operation at least one year
What is a merchant cash advance?
It allows a merchant to get the funds they need today based on future sales down the road. Basically, a merchant cash advance lender will supply funds of up to 150% of the merchant’s monthly credit card transactions. If your business processes $10,000 a month in credit card sales, you would be eligible for a cash advance of $15000. The financing of a merchant cash advance is based on credit card processing transactions, and payment is expected off the future credit card receivables.
Are there any hidden costs?
Unlike traditional bank loans which come with origination, prepayment, application and annual fees, there are no hidden fees or costs associated with a merchant cash advance. What you see is what you get! A merchant cash advance lender will give you A and you promise to pay back B. This is why so many small businesses are opting for merchant cash advance financing over small business loans.
What are the advantages of a merchant cash advance?
A small business owner can leverage credit card sale receipts to make necessary upgrades, expand, or get the capital the business needs to thrive. For example- a business owner wants to expand to the other side of town and is currently making $100000 in credit card sales per month. A merchant cash advance could give the owner the funds necessary to expand off the credit card sales. If the same owner approached a bank it would be extremely difficult, the owner would have to prove how long they have been in business, have impeccable credit, and great financials. In the cash advance industry it becomes a win-win situation, the business owner gets the funding it needs to expand and the merchant cash advance provider gets a chance to finance the expansion. More and more, small business owners are getting funding through merchant cash advances-why not apply today? Contact Genesis Capital Enterprises for your Merchant Cash Advance