Why a Merchant Loan?
Bank lending standards have tightened, credit lines are being cut and business credit card rates and interests are on the rise. These are only a few of the reasons that many merchants are taking an alternative approach to business financing.
The merchant loan was designed specifically for those who own retail and/or service-oriented businesses. It gives merchants an opportunity to get the ever-so-coveted business funds of today.
It's Easy
There are very few requirements for merchant loan eligibility. Basically, a merchant who has owned his business for at least six months and processes $3,500 a month or more in credit card sales can be approved for $5,000 to $500,000, depending on the business's actual monthly credit card sales. Additionally, merchant loans are typically unavailable for merchants with unresolved bankruptcies and those with less than one year remaining on their business leases.
These requirements are put into place to ensure that the business can support the repayments.
It's Convenient
The way that a merchant loan is paid back is very original, innovative and most of all, convenient. Merchant loan borrowers are never required to make payments on their own. The provider will automatically deduct a small percentage of the business's daily credit card sales to repay the merchant loan. This way, whenever customers use credit cards to pay for products or services, the business's merchant loan is paid down a little more.
This method is very flexible and many business owners feel that it is stress free as well.
It's Renewable
In addition to being easy and convenient, merchant loans are also a renewable source of business financing. It usually takes about 7 months to repay a merchant loan, but about 3 ½ months into a merchant loan, a borrower can choose to renew his/her funds. This time around, the funds can be received in 24 to 48 hours. Merchants can renew their accounts as many times as they'd like.
Now that you understand why to get a merchant loan, get a free quote for your business.
About the Author:
Chrystal King writes articles about Merchant Loans , the alternative method of business funding, for Merchant Resources International.