Merchants, be aware! Although contracts were signed, the funding has not been deposited into a bank account yet. Merchant cash advance lenders still have to underwrite the file, check trade references, check landlord/mortgage references and settle all other outstanding issues (like tax liens and mortgage payment plans) if they exist. Merchant cash advance lenders can [...]
Home Based and Online Businesses
December 1, 2009 By
The difficulty in funding home based and online businesses is that the merchant is not locked into any lease or mortgage. Because a merchant cash advance is an unsecured loan i.e. there is no collateral involved and the private lender cannot take over assets if the merchant goes out of business, there is an extreme [...]
I was declined because of industry type
November 30, 2009 By
The merchant cash advance industry has evolved a lot from where it used to be five years ago. Private lenders have learned from their past mistakes and are constantly modifying their businesses practices in order to reduce their bad debt. The merchant cash advance industry has expanded to many types of businesses that typically were [...]
Split Funding
November 24, 2009 By
Split funding is the preferred method of most lenders to collect their return on investment. When a merchant decides to go with a lender he has three different methods of paying back the advance (depending on the lender and the cash flow situation of the merchant): Split funding, ACH and Lockbox. For an in-depth discussion of [...]
How Much Interest Am I Paying on Processes Credit Cards?
November 24, 2009 By
What are these interest charges I see on my credit card processing report? There are two methods which a merchant processor charges interest on credit cards: 1) Three tier plus basis points 2) Interchange rates plus basis points There exist some 200 odd types of Visa/MasterCard credit cards which are issued by banks. An example [...]
Broker Vs. Direct Lender
November 19, 2009 By
There is a misnomer in the Business Cash Advance industry about broker’s and lenders. Direct Lenders are the “bank” so to say. If contacted they are the actual lenders who are providing you with the majority of the funding for your business and set the rates. They will be able to provide you with one [...]
ACH vs Lockbox
November 19, 2009 By
Many merchants are hesitant to change their processor for numerous reasons. Maybe they have good rates with their current processor, a long standing relationship with them, or have multiple locations and aren’t interested in complicating things. An ACH and a lockbox method may be available to merchants depending on the size of the advance and [...]
I received contracts. Am I approved now?
November 19, 2009 By
Merchants often receive contracts from their broker or lender, sign them and send them back thinking the deal is done and they will be receiving money shortly. Signed contracts bring the merchant closer to the finish line, but it is in no way an indication that the deal is done and will be approved for [...]
Is a Merchant Cash Advance Right for Me?
November 19, 2009 By
Many merchants as the question, “Is a merchant cash advance right for me?” The response of course is, “Well, that depends.” Let’s look over what a merchant cash advance is. A merchant cash advance is a true sale. It is not a loan because the private lender is purchasing a commodity that a merchant is [...]
Caution – Holdback Percentage
November 19, 2009 By
A good lender will not jeopardize a merchant’s business by giving him holdback percentages that his business cannot support. Many times merchants are so pressed for cash that they put pressure on the lenders to give them whatever holdback percentage they need in order to get paid back in a timely manner, just as long [...]