Choosing a Merchant to Provide Cash Advance Services
Posted On May 9, 2019
Being able to find a reliable and trustworthy merchant that’s providing cash advances is easier said than done. To be able to narrow down confusion in the process, there are a handful of things to be considered. By doing this, it will ensure that you are doing business with a lender that works best for you.
The Hidden Charges they are Hiding
Well first things first, majority of the lender won’t be charging slew of additional costs while they’re still processing your cash advance application. With some transactions, it requires closing costs. These are basically costs that are beyond the price of item you purchased that are typically paid at closing transaction, hence the name.
Before you decide which merchant to choose, be certain that there’ll be no closing costs on top of the fee for your cash advance application.
Additionally, you must not pay interest on this service. In comparison to business loans, majority of the merchants aren’t imposing interest rates on their products.
Credit Card Sales
The sales volume of credit card that your business is processing every month can be used as one of the many factors to determine which lender to talk to. Before a loan is approved, lenders require applicants to provide certain amount of the most recent, consecutive credit card statement of the business.
This plays an essential role in determining whether your business is capable of supporting merchant cash advancement payment or not. More often than not, merchants will ask applicants to submit the last 6 months of credit card statements that have been processed. Lenders then used this to get the average monthly income of the business.
The Amount Needed
A great number of lending companies may offer funding of up to half a million dollars. But this will vary on the lending company and the documents you have submitted to them. In most cases, applicants are funded around 20 to 30 percent more than what their business is making on a monthly basis.
When applying for cash advances, it is imperative to know these things prior to making an application. This way, you can steer clear of lenders that are taking advantage of the situation and milking clients in the process.