Those that are against the concept of merchant cash advance don't realize one point that the lenders of such cash advances help those that no one else is willing to help. When you apply for merchant cash advance you don't really apply for a loan. What you do is borrow money based on your future sales figures. Is there any bank that is going to offer loans basis what the future holds for a business? Banks are more interested in lending to a borrower basis their past history.
Before you apply for merchant cash advance you should know what this is all about. To be honest this type of borrowing is not meant for all businesses. There is one caveat that you should be aware of in merchant cash advance and that is - you pay more as APR than a traditional loan. Having said that, this form of borrowing has some immense benefits that make the APR seem inconsequential at times.
A merchant cash advance can be taken against future sales volumes. Let us assume there is this business that accepts credit card payments. This business can apply for merchant cash advance. Once the application is approved basis monthly credit card sales volumes of the past three months the money is disbursed.
As per the agreement between the lender and the borrower a certain percentage of the business generated through the credit card POS machine will go into the payment of the loan. The lenders of merchant cash advance are extremely flexible in this regard and for very low margin businesses they may even charge as low as 1% of the monthly sales volume. This arrangement continues until the entire borrowed amount along with the interest payment is completed. This type of loan is mostly short term in nature and one tends to pay off the loan in 18 months or less.
Despite the many detractors of merchant cash loans there are scores of businesses that apply for these loans. Why do businesses apply for merchant cash advance when they know that the APR is more than traditional loans? The biggest reason for the success of these loans is the speed of disbursal. One can expect the money in their account within 2 days of applying for the loan.
These loans are also typically more lenient as far as credit rating is concerned. For someone that is not being able to get a loan from a traditional lender because of poor credit history can get this loan. There are many small businesses that faced hardships during the economic downturn of 08-09 and they became defaulters without much fault of theirs. All of us know that a business cannot survive without cash injection from time to time. So these lenders don't even think of banks when they need money. They opt for this form of short term borrowing to meet their cash flow requirements.
For ready cash apply for merchant cash advance and change the way you do business. With merchant cash advance your cash issues will be taken care of.
Before you apply for merchant cash advance know what this loan is about. A merchant cash advance is a kind of loan that can help you solve your cash flow issues.