Merchant Cash Advance Loans to Grow Your Small Business

Who Qualifies for Merchant Cash Advances

To apply for a merchant cash advance, you’ll need a successful application and three months’ worth of official sales documents. For a merchant cash advance, you’ll also need to prove that you have steady credit and debit card sales.

How to Apply for a Merchant Cash Advance

Your merchant cash advance application will look just like any other UCS business loan application. If you take the following steps in order, you’ll have a smooth and easy process.

Consider Your Needs

How much funding do you need? How do you plan to use that funding? When you think about these questions ahead of time, you’ll have more clarity throughout the rest of the application process, which will make the whole thing easier and save you a lot of time.

Gather Your Documents

When you have your documents ready to go, you’ll speed through the application process. It always helps to know what you need ahead of schedule. At First Down Funding, we don’t require nearly as much paperwork as the banks require. The following documents are all that we’ll ask for during your application:

• Driver’s license
• Voided business check
• Bank statements
• Credit card processing statements
• First Down Funding 1 Page Application

Submit Your Application

Now, all that’s left is for you to submit your application. Start your application online or give us a call for a free consultation. We’ll get in touch with you to discuss your business loan options and possible terms, and then you finalize your application. After that, you’ll hear back from us within 24 hours to let you know about your approval status. From there, you could receive your funding within a few business days.

How Does a Merchant Account Cash Advance Work?

We gave a bit of an overview already, but let’s take a closer look at how a merchant cash advance works. Just like with a regular business loan, you pay it back over time. However, with a merchant cash advance, the funds for your payments will always come from your credit and debit card sales. These funds are deducted automatically by your merchant services provider, so you don’t have to worry about the payments.

What Do Merchant Cash Advances Cost?

The other difference between a term business loan as a merchant cash advance is that a term loan comes with interest. A merchant cash advance comes with a factor rate and a retrieval rate. The factor rate is the percentage on top of the advance that you’ll have to pay back. Ultimately, your business financing will cost the original amount multiplied by your factor rate. The retrieval rate is the percentage that goes back to the lender until you pay off the entire merchant advance.

For example, let’s say that you have a $50,000 merchant cash advance.

If you have a factor rate of 1.15%, then your ultimate cost is $57,500. That is, this is the amount that you will pay your lender once you’ve paid off your entire merchant cash advance.
$50,000 x 1.15 = $57,500.

Your retrieval rate is the percentage of your credit and debit card sales that your lender will receive until you’ve paid off the full amount. Let’s say, for example, that you make $2,000 in credit card sales on a given day. If your retrieval rate is 10%, then your lender will receive $200 that day.
$2,000 x 0.10 = $200.

Once you know your merchant cash advance amount, your factor rate, and your retrieval rate, then you can easily calculate your costs.