subject: Merchant Cash Advances - Acquiring Business Loans For Your Business With Ease [print this page] Merchant Cash Advances are unsecured advance of funding on revenues a business will recognize in the short term, frequently provided by independent investors. Not like the normal loan, this one is secured by future credit card sales and involves much less paperwork than a conventional small business loan attained through the bank. Ideal for merchants that don't have several years of work history on their resumes, a merchant account loan provides needed cash quickly.
Banks review five characteristics when figuring out whether to give a business loan. These characteristics, called "the 5 Cs," are as follows: character, capacity, collateral, capital and conditions. As bank loans are only given to those merchants with exceptional credit and a verified record, it is understandable that a lot of businesses just don't make the grade.
The qualifications for a merchant cash advance are less tough, and payment terms are also more flexible. Repayment is tied directly to the credit card sales earned on a daily basis. However, the entrepreneur should use a little due diligence when applying for such working capital.
Even though a reliable merchant loan provider will give the necessary working capital at a reasonable price, some will try to charge high interest, ask for up front fees and have unreasonable default terms. Reading the fine print is essential.
While many business consultants will suggest that going after financing from family and friends, credit cards and personal savings are better options, they are not always realistic. Also, it can take time to obtain such financing, and it really is best not to do business with family and friends. Turn around time on this type of funds is usually less than a a few business days, and with no set payment numbers, Merchant Cash Advances are a good way to acquire money immediately without involving additional people.
