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A list of do's and don'ts for getting merchant loans?

Many of you have heard about a merchant cash advance before. If you haven’t, here is a brief definition;

A merchant cash advance is when a business owner is advanced a cash sum -- usually between $5K and $500K -- often within a week and without the amount of paperwork required by banks. The merchant agrees to pay back the principal plus a fee. The merchant loan provider collects the money by taking a portion of the business's credit card sales until the debt is paid off.

Merchant cash advance providers offer companies with few financing options a quick, easy way to find funds. Some entrepreneurs like the arrangement because it allows them to repay less when sales are slow and more when revenue picks up. However, it is typically a more expensive form of financing and most business owners are scheduled to complete repayment within six to nine months.

Now that we got that out of the way, I am going to go over some of the do’s and don’ts of getting a merchant cash advance.

Don’t: Never secure a cash advance without looking at your other options first. A business cash advance is more expensive than a traditional business loan. Depending on your circumstances; a small business loan may be the better option.

Do: Research all your other options. You might even consider getting a loan from a close friend or a family member. It may turn out that even after you’ve exhausted your other options, a credit card cash advance is your best option after all.

Don’t: Don’t borrow more than you can comfortably pay back. Often times, a bank will lend you more money than can afford to pay back. When a bank gives you a loan, you are expected to make the minimum payment even if your business slows down.

Do: You should take a business downturn into consideration during the planning phase of your loan. For most loans; creditors only look at your yearly sales figures and your credit history when approving your loan. A merchant cash advance agent is trained to look at your month to month sales figures to decide on an amount that makes sense. Because the payback is flexible; you payback less when your business slows down. This flexible payback takes the burden off your business and helps to promote a more sustainable business atmosphere.

Don’t: Do not use your merchant cash advance for anything other than something that will directly benefit your business. That said; you should not use your advance for taking a vacation, buying a new car or putting a down payment on a new house. I’m sure you can see the foolishness in this.

Do: It is important to understand that a merchant cash advance does not come cheap. As with any business decision; it should be taken seriously. You need to ask yourself; will what I am doing with this money help my business grow? Things like; marketing, expansion or buying out a business partner are good examples of this.

Don’t: A merchant cash advance is a big decision. Don’t just go with the first provider you happen to find on the Internet. Make sure the company you are dealing with is reputable. A good way to find a provider is to get a referral from someone you know who has received a cash advance in the past. You can also try the Better Business Bureau..

If you need business capital and are considering getting a credit card cash advance; you may be making a good decision. Make sure that you don’t take that decision lightly. It could be one of the best business decisions you’ve made all year.

How does a merchant cash advance work?

	First, submit our easy two page application along with 4 months of your merchant statements.
	We will make an approval decision in less than 24 hours. If approved, your funds will be available in as little as 7 days.
	You will continue processing credit cards as usual and the repay is automatically deducted as a small percentage from your future credit card sales until it is paid back.
	Renew every 4 months and grow your business! Over 85% of our customers renew their merchant loans.