Cash flow is the lifeblood of your daily business. Without having the necessary funds available, you may find it difficult to pay for the services and products your business requires. Many business owners opt to obtain a merchant cash advance, which is essentially a loan in advance of future sales. Read on to determine whether a merchant cash advance might be the best option for your business.
How Does a Merchant Cash Advance Work?
This kind of advance is extended all at one time, as a lump sum. The amount requested might range from a few thousand dollars to more than $200,000. The lender then receives a royalty on the amount loaned for a set period. The royalty is usually a percentage of daily sales.
What a Borrower Needs to Qualify
To successfully obtain this kind of loan, a business must meet certain requirements. The lender will want to know how much you and the business have earned. Also important are the projected sales/earnings for the foreseeable future.
You will need to provide proof of income and earnings. You should expect to provide a state ID or a state driver’s license, bank statements, and tax returns. As a rule when applying for most loans, the higher your credit score, the better. However, expected earnings are a primary factor when securing this type of advance.
Growing Your Business with a Merchant Cash Advance
Your business may need a cash advance to accomplish a variety of improvement and expansion goals. You may want to open a new location, for example. If this is the case or if your business is growing in other ways, you will likely need to hire more personnel and purchase more products. As an alternative or enhancement to adding a location, you may want to change the design of your store. In order to reach some of your visions, you may also need cash to support an expanded marketing campaign.
If you plan to grow your business, a merchant cash advance could be a viable financing solution. Contact Nations Capital Financing today for more information on cash advances for businesses.