For a small business which may not qualify for a traditional bank loan, a merchant cash advance is one of the most suitable options to get quick cash. A borrower only needs to meet a couple of requirements to qualify for one. The fact that the approval rates for this financing plan are quite high makes it even more suitable for small businesses. Providers of merchant cash advances do not require your credit score – this lifts a big burden off the shoulders of many business owners who have poor credit scores. This plan has become a way for businesses to grow themselves and fund their own growth while continuing to make sales.
When you, as a business owner decide that it’s time to take your business to the next level, it is important you have a couple of things in mind. You have to understand that a merchant cash advance is not a loan. Thus, it is not regulated by laws which govern the issuance of loans and interest rates. This means that the interest rates for merchant cash advances could go as high as 200%. Which means that you need to have a lot of cash to pay back in less than about 24 months or so. It is always important to take into consideration while choosing the merchant cash provider you want to work with. Here are a couple of considerations:
You have to do your research well. You have to understand that apart from being cash advances that help businesses out, the providers are also running a business. Thus they have to make a profit while providing you with a merchant cash advance. You have to look at all the borrowing options you have. Be flexible enough, font sideline any company, and more so look closely into all the features of the company. The internet becomes a great tool for research. Look for a company that matches the financial situation of your business so that you don’t get a deal you cannot handle. Research is a very important step in getting what works for you.
2. Understand the fine print
Read the contract closely before signing anything. You should understand that the contract describes all that you are getting into. It lays out all the fees, though some are quite hidden. It is your duty to read through the contract and understand everything. You do not want to start complaining about the hidden fees you don’t know about after signing the contract.
3. Weigh your options
Weigh all your options that are on the table. To get a reliable and credible merchant cash advance provider, you have to look at all aspects. Look for a company that is suitable for you in terms interest rates and payment options. The key is knowing how to protect yourself by having enough knowledge about what the whole plan entails, including rates, government regulations, among others. All these help you get the right provider and the right type of merchant cash advance that is truly helpful for your business.