What it is
One amount with fixed or scheduled payments and a stated term. You can put the payments on a calendar. Term and total payback are on the agreement.
Merchant cash advance
A purchase of future sales. Not a loan.
- Structure
- Sale of future receipts
- Payments
- Move with daily sales
- Cost
- Usually higher
Term loan
One amount with a schedule.
- Structure
- A loan
- Payments
- Fixed schedule
- Cost
- Usually lower
When it fits
Expansion, a refinance of a short facility, a project with a payoff date, a spend you can plan around.
It is a poor fit for an emergency payroll week if a scheduled product will not clear in time. Speed and paperwork trade off, and pretending otherwise costs money. A need that comes and goes belongs on a line of credit.
What we need to start
Use of funds, the amount, and statements. Tax returns if the file heads toward a bank or SBA shape.
What happens next
Submit one application. We package the file and send it to lenders that buy this kind of paper. Options appear in your account when they exist. Sometimes more than one, sometimes none. You compare terms there, pick an option if you want one, and still review that lender's agreement before you sign.