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Most business owners have felt the sting of a lost opportunity; when a piece of equipment or marketing opportunity passes you by due to lacking the extra capital on hand to exploit the resource.  If you’re in the position to make money with money, then a merchant cash advance can be a very attractive and exciting option.

How does a Merchant Cash Advance work?

A merchant cash advance is money up front in exchange for a percentage of the future receivables of your business.  Suppose you own a retail business, and have a chance to purchase a potentially lucrative piece of equipment for $50,000;  a merchant cash advance will provide you with the money quickly, and in one lump sum.  That $50,000 will purchase a negotiable share of your future receivables, e.g. $57,500, which you would then pay back gradually over a period of months through payments, or through a percentage of credit card sales.

How do I get a Merchant Cash Advance?

One of the features that makes a merchant cash advance from an experienced provider an attractive option is the ease and speed with which one may be obtained.  Paperwork tends to be minimal—typically a one page application and a few months of bank statements.  Because the advance is based on the future receivables of your business, it’s not necessary for you to provide collateral, and your personal credit matters far less than with (e.g.) a bank loan.  The main factors impacting your ability to qualify are:

  • Monthly deposits — deposits should be over $5,000 a month on average.
  • Cash advance history — If your business has or has had cash advances, a good payment history is helpful.
  • Healthy bank balances — It’s a positive sign if a business generally avoids excessive negative balance days.

Having a current balance with a cash advance company, even if the balance is fairly recent, does not significantly impact your ability to get additional funding.  Many business owners find it helpful to take out multiple advances at once in order to meet their financial needs.  Click here for a free merchant cash advance application.

Making money work for you

A merchant cash advance is an ideal option for business owners in a position to take money, and then make money with it.  If you have a vision for your company, lack of funding doesn’t need to stand in the way.  If you would like to know more about merchant cash advances, call (530)231-5093, or email me at john@coconutfunding.com