Loans Lease :: Business Cash Advances - How They Really Work

Business payday advances is a fast and simple way for just about any business to acquire access to money in a short time. Although business loans and cash loans will be the most common methods to fund your business activities, below are a few fundamental problems with this which is why pay day loans are becoming very popular.



Traditional loans can take forever to. The application process is slow and cumbersome and also if you are running a very successful business, it can be hard to get the money you need to grow your small business. These types of loans can also be very expensive in many instances and you may find yourself paying it off for many years - often spending over you anticipated.

Business pay day loans are quite different in that they don't work just like a loan. It works on the concept called factoring and basically it allows you to acquire money in as little as 48 hours. The way it works is that you simply use your business' credit card history as collateral and as opposed to getting the money as a loan you "sell" a percentage of your future bank card sales for the lender.

Obviously your company needs to process major charge cards like Visa and MasterCard if you want to qualify as well as the amount of plastic card sales you are doing per month will determine the quantity of money you may get. In most cases you need to provide proof of at least six months worth of credit sales as your small business cash advance will probably be determined by this.

The way you repay the advance is probably the one thing which is least understood. You won't make monthly payments towards the loan. Instead your original agreement with all the lender will automatically deduct a percentage of the future credit card sales.

The great thing about this is that is certainly reduces your risk in this you only make payments when you make money so that you won't turn out with the burden of loan repayments during difficult months. Obviously there are a lot of fine print and heavy penalties apply using circumstances but in general this is a great financing option if you need a quick business loan.