Merchant Cash Advance - When Should You Consider It Over A Bank Loan Or Line Of Credit

By Author: Daljeet Sidhu
Total Articles: 4762
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Looking for financing for your business? Did you know that merchant cash advance providers can deliver funds to your doorstep within a week, with little paperwork and no collateral? But is merchant cash advance suitable for your business? Read on to find out when you should consider merchant cash advance as your business financing option.

Here are the signs that merchant cash advance is a good option for your business.

1. You Have Already Investigated Other Forms of Financing

MCA is costlier than other funding options. Funding options like home equity loans, especially if you own a paid-off house and credit cards may offer you funds at cheaper rates. If none of the cheaper financing sources are available, then MCA may be ideal for your business.

Further, with the expansion of the industry, merchant cash advance lenders are offering you better and cheaper terms comparable to other bank loans. In this case, you should opt for MCA financing, given its advantages over conventional loans.

2. High Credit Card Processing per month

MCA lenders rely on your monthly credit card sales to determine ...
... your eligibility for MCA financing and your loan amount. If your business enjoys good monthly credit card sales, then merchant cash advance is just the right option for you. The better your monthly credit card sales, the better your chances of negotiating a favorable and cheaper deal with MCA lenders.

3. Bad Credit, Good Business

With the economy still recovering from recession, there are few businesses whose credit score has not been negatively affected by the economic crisis. If the global meltdown has ruined your perfect credit record, making your business ineligible for bank loans, then MCA may be the way to go to help your business grow and expand to its potential. Remember while banks may fuss about the late payments in the past, merchant cash advance providers will reward your business if it is performing well lately.

4. Immediate Need of Funds

Time is money! If you find a business opportunity that you must seize immediately, MCA provides the means. While conventional loans and financing methods take weeks to deliver funds, MCA providers can make funds available within seven days. Merchant cash advance may be ideal for business owners in need of urgent funding.

5. No Guarantee, No Collateral, No Hassles

If you do not want to put your house or vehicle at stake and pledge collateral to procure funds, MCA is highly suitable for you. Moreover, with MCA you can receive funds without any hassles and personal guarantees. Another major benefit of merchant cash advance is that it is not treated as a loan. Therefore, if your business gets into trouble, MCA will not spoil your credit history. MCA is more like an investment in your business by the lender.

Whenever you decide to opt for merchant cash advance, survey the market carefully. Familiarize yourself with the terms and conditions of MCA. Meet with multiple MCA providers to get the best deal for your business.
About Author:
Daljeet Sidhu. Read our business cash advance advice and small business cash advance blog. Sellers join for business cash advance leads.