Give us a call for more info 1-800-210-5649
Skip to content

What is The Purpose of Your Small Business Loan?

Small business loanMore times than not small business owners find themselves in a tight cash flow situation. It could be that more capital is needed to hire temporary workers so that larger orders can be delivered on time. Maybe more raw materials need to be purchased to fulfill orders or to stock the shelves. After all, if you do not have a product in hand, you cannot sell it. You missed the boat and the revenue. When these short-term emergency needs arise, a long-term small business loan is not the answer. If the merchant accepts credit and debit cards a small business loan in the form of a merchant cash advance is the answer.

In the first place a small or medium size company needs good or excellent credit for a small business loan. This is not the case with a merchant cash advance. In essence the merchant is borrowing his own money in terms of future sales. Compare it with taking a loan against your 401K. You apply for the loan and you receive your money. You make payments each month that go back into your 401K account and you are paying yourself interest. A merchant cash advance is similar.

The lender takes a look at how much revenue you generate in credit and debit card sales and tells you the amount for which you qualify. You are borrowing on your own sales. In this instance, however, you will be paying the lender the interest – not yourself. But these shorter term loans have payments that are based on your sales. There is no fixed payment each month. If you sell only $6,000 in goods in one month, your account will be ACH’d based on that amount. If you have a $10,000 month the payment goes up accordingly.

Unlike long-term small business loans that take weeks or months for approval, a merchant cash advance can be approved quickly. After approval the money can be in your account within 72 hours. Based on your needs and sales history, an advance up to $150,000 is not unusual. One of the requirements that definitely lessen the application time is that business owners do not have pages and pages to complete, no tax returns or financial statements are required and no collateral is demanded. The loan is based on the strength of your sales. Even those with credit scores of 500 or less can qualify.

Unlike long-term small business loans the acceptance rate for a merchant cash advance is extremely high. The acceptance rate for the small business loan is low, especially for a business with fair or poor credit.

When you need funds for the short term do not waste your time and energy applying with a traditional bank for a small business loan. Call the expert lenders for merchant cash advances.

If you need money today, call 1-888-784-6811 or click below to get your cash within 72 hours.