Everything One Should Know About Cash Advance Loans
by Aritra Agarwal Marketing MangerIt's a
well-known fact that to avail of a business loan, one must carry a good credit
score. This is even more important if one requires some urgent cash as the
working capital. A low credit score can make this job extremely challenging.
However, with cash advance loan bad credit, getting
business loans has become easier. This scheme is also known as a merchant cash
advance loan. This article explores different aspects of the same.
What is a Merchant Cash
Advance Loan?
A
merchant cash advance loan is technically not a loan. This works in a
completely different way if compared to other traditional loans. With this
scheme, a finance agency helps one with cash in advance. They get it repaid by
charging a certain amount on the daily credit cards of the consumer. This is
the most convenient way of getting the required cash assistance, even if anyone
doesn’t carry a great credit history.
Who
can Avail MCA- How Can a Business Qualify?
In
case a person has limited, or no collateral, a very low rating of credit, cash advance loan bad credit can significantly help. This loan is
for the businesses, which are in urgent need of cash in a very short period.
This
finance option can help in solving instant cash shortages of a growing
business. This program doesn't have any set qualifying parameters. So, any
business that is in search of cash assistance for working capital, debt
payments, inventory purchases, and many other needs.
How
Can One Apply For MCA?
The
process of applying for a Merchant Cash
Advancement loan is quite easy. One
can pay it back from every sale that occurs with a credit card. To make sure
that you have a regular volume of sales, sometimes the MCA agency may ask for
your bank statement. A few companies may ask for a credit score check, but
that's just a part of formal paperwork.
There
will always be the option of applying online for MCA. The application generally
gets the approval within 24 hours. Like every fast cash system, MCA is
expensive too. It has the highest cost when it comes to the capital.
Documents
Checklist
·
Business check (Voided)
·
Driving License
·
Bank Statement
·
Tax Return File
·
Processing Statement of the credit
cards
·
Credit Score ( in very rare cases)
The Rate of Interest
Instead of regular
interest rates, MCA or cash advance loan bad credit works with factor rates.
This is the amount by which the loan amount getsmultiplied and results in the
total owed amount. It can be anything from 1.14 to 1.48. Sometimes this starts
at 15%. However, they can bring the output of triple digits as well.
Sometimes, due to several
factors, Merchant cash Advances look a little expensive. This happens only in
the case of the borrowers with whom the recovery risks are greater. This may
sometimes result in a higher rate of interest.
Hope
this post helps! Now with cash advance loan
bad credit, one can do business in a relaxed way without
taking much stress of working capital. Opting for the same may help a business
owner in achieving bigger goals.
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Created on Oct 21st 2019 06:56. Viewed 774 times.