Mar 28, 2022
A Merchant Cash Advance(MCA) consolidation can be a useful financial tool for businesses that don't have great credit to qualify for conventional or SBA loans. It is a type of funding that allows them to consolidate all their debt into one to free up cashflow, reduce the number of lenders, and make repayments easy to cover expenses.
Businesses that take more than one merchant cash advance over time deal with very high factor rates, exorbitant fees, and daily repayment schedules for each deal. A merchant cash advance consolidation is a service that allows them to combine multiple MCAs or business debts or advance payments into one. An MCA debt consolidation has the potential to reduce the amount of interest and fees you pay to different lenders.
An MCA debt consolidation can either be a working capital loan of under $200,000 or a traditional SBA loan up to $5 million. It helps businesses combine multiple MCAs into one loan to simplify repayment through single monthly payment. The biggest advantage of MCA debt consolidation is that businesses can lower the combined interest rate that they were paying on the multiple advances from different lenders.
If you have taken out multiple MCAs to meet your business expenses but are unable to manage multiple fees and repayment schedules, MCA debt consolidation may help you save your money and time. It simplifies your repayments by converting multiple rates, fees, and schedules into one to save you from making multiple payments to different lenders. So, if you want to avoid inconveniences you face while managing multiple lenders to clear your debts, it may be time to consider MCA debt consolidation.
When you are applying for MCA consolidation funding, it’s good to look at:
· Current interest rates you are paying
· What you'd be able to get with a new loan
· Payment fees and the repayment period
You may want to take a consolidation loan to get a lower interest rate than your current rates. Also, it is very crucial to decide on the repayment period. A shorter repayment period will require you to pay bigger payments that could challenge your affordability. But a longer repayment period means you have to pay more in total for a longer period in form of smaller payments. It is up to you how you want to afford your consolidation to keep up with the cash flow for your business.
So, if you are paying too many fees on multiple cash advances, consolidating your MCAs could help you lower your interest rates into one payment. It gives you control of your business finances and keeps you away from inconveniences you may face managing multiple debts from different lenders. There are different types of MCA debt consolidation loans available from lenders that you can use depending on what you can afford and qualify for. Talk to experts at Royale Capital to find out the best solution to consolidate your MCA loans as per your specific business needs and goals.