When the country fell apart with the housing market, unless you came into a bank or credit union with unwavering credentials and a credit report about 700, you were not going to get the financing that you needed.
Your desperate cries were heard
Merchant account servicers heard your cries for help. A lot went unheard until they got a little organized. Some were taking advantage and groups were formed to prevent this from being legalized stealing. With the watch group in place, plans were initiated and a great way to get a business cash advance came into fruition.
It’s a great advantage
After you have found your merchant account servicer to process your credit/debit cards, you have started a whole new relationship with a business that can help you. Ask for a cash advance and work out the paperwork. It’s not all bim bam boom and you have it. There are still a few hoops to jump through. As with any money being loaned, you will have things to prove and often it gets frustrating. But, it still is easier than a bank telling you ‘NO’.
As a way to pay them back, they have two different options, and that will also depend on who you are working with.
• Option one: You can pay a monthly fee like a traditional loan. You and the merchant servicer work out a good payment plan.
•Option two: A daily payment is taken out of your credit/debit card processing. It relies on the type of business you have and your amount you take in. Typically 1% up to 9%. That really works out to small amounts. If you have a bad day, so does the repayment. This accomplishes two things. It does not amount to a huge payment and drowned you, as well as not taking away too much when things are slow. If you are having a bad day so are they.
• Just remember: If you are paying daily, that cash advance is being paid off quickly and will not be a burden for very long. If you borrow five thousand dollars and your daily payoff is 100 dollars, then at the end of the month, you have paid off $3,000. And you almost have the whole thing paid off. NOT bad at all.
• Whatever plan you agree too, be certain you can live with the details. If it will bury you, then don’t do it. If it will help you, run with it! Go grow your business.
Whichever you do
Whatever you end up doing, look at all angles before you do it. Do not enter into something that is giving you nightmares and causing you lack of sleep. Find the plan that you can get and you can advance with it. If you can make enough to pay a loan off in about 45 days, you are doing very well. But if your business is just getting by, and you aren’t sure you can grow enough that quick, then do the monthly payment option.
Getting a business cash advance is not for everyone. Make sure it’s what you are looking for before you sign the dotted line. Good luck and happy growing for your business!