Today we will be discussing the topic of business cash advances to give you a strong overview of what to expect from them. We will discuss the approval process, the time it takes to get approved, how long it takes to get funding and how to get approved quickly for a second advance. Also we will discuss the typical costs of these advances as they compare to other loan types.
Getting approved: The approval requirement is one of the greatest advantages of business cash advances. Although they tend to be more expensive than other loan types there are very loose requirements in being approved. Typically they will only look at the last six months of revenue to make a determination of how much money they are willing to lend you if any. They will not need to see a long-term history of your business as this is not relevant to the time and scope of this loan type.
Time to Completion: time to completion depend somewhat on you in that you must turn in all required paperwork in a timely fashion. However, assuming that you turn in all requested documents quickly, you can expect to have your loan approved in as little as 72 hours. This is much faster than the typical approval times for bank loans.
Getting Funded: Funding is usually done through some form of wire transfer or direct deposit, but there are other options as well. Sometimes advances will be given to you on a debit card which you can then use at any location where the credit card logo on the card is accepted. Make sure to ask lender how they disbursed funds to make sure it is compatible with your requirements.
Recharging your advance: If you are approved for an advance and you pay off on time there is an opportunity to obtain a second advance when necessary through a process called recharging. Recharging your advance is simply a way of streamlining the approval process for a future advance of the same amount. Most companies that offer business cash advances will allow you to do this two times for each approval.
Typical Costs: costs are where business cash advances fall short. Although it is quick and easy to get this type of funding it is also very expensive with interest rates in the high double digits at times.
It is quick and easy to get business cash advances but you must pay much higher than average interest rates and as such this form of fast funding should be considered for emergency purposes only.