List of the Top 9 Reasons why your MCA was declined
Top 9 Reasons Your MCA was Declined:
1. Affordability
This MCA decline reason means your company cannot handle the new payment without significant problems. This is often a decline
reason when your total monthly deposits are under $10,000 per month.
If you know you can manage the payment, then prove it! Provide your current bank statement, other accounts you may have, or tax return that shows you have the cash flow.
Make sure the investor isn’t using the lowest month to make their decision. Ask them to use the average of your deposit totals for your most recent 3 months.
This almost always happens when the business has cash flow problems during the current month.
The verification failed for either low deposit volume, overdrafts and NSF’s, or not enough individual deposits. It is usually some combination of these issues.
Ask specifically what they saw in the current Month that they don’t like.
Decide if this can improve enough to qualify in the next few days. If not, apply above to get another funding option.
4. Credit Score Too Low:
Some programs require a minimum credit score of 550, 600, or even 650.
Find out what score is required. If it is too high, apply for a program that will accept your credit score before you apply.
Ask the lender what minimum sales amounts are they looking for?
Also ask how much do you need to put into your account in the next week or two to qualify. By doing so, you may be able to qualify before the current month is over and not have to wait until the next month.
6. Recent Overdrafts or NSF’s:
Overdrafts or NSF’s in your checking account in the last 3 months were excessive, and why your MCA was declined.
Add up exactly how many Overdrafts and NSF’s you had. Ask the lender what the maximum is and how long before you will qualify.
7. Not Enough Deposits Per Month:
There were not enough individual deposits. Some funders require 5 or more each month.
Make more frequent smaller credits if possible.
Find a source that will accept the number per month you are now making until you can start making more. Ask in advance what their mimimum is.
8. Time in Business Too Short:
The time in business is not long enough through the Secretary of State or on your License.
Ask the funder how long they require. If you are within 30 days of the minimum, then ask for an exception.
If they refuse, then find a program that will accept how long you have been operating.
9. Background Check Failed:
A background check revealed something they didn’t like. When you get this MCA decline reason, learn more about a Business Loan with a background problem here.
Ask the MCA company specifically what the problem was, and if that matches what you know to be true.
Shop other MCA companies that have programs that accept your background issue before applying.
Unsecured financing has less risk. You do not need to offer collateral with a loan against your assets.
Up to 18 Month Term options for 600 and 1 Year in business and higher.
Get money against your cash flow again after payoff. Use it to get money more than once.
Programs for as low as $2,000.
Lower offers makes this a better option than regular title loans. No need to risk your vehicle or equipment for a small amount of money.
Need more general info on developing your business? Visit the SBA for resources
such as local assistance, business guides and business plans.
Conclusion: Why your MCA was Declined.
Your MCA was declined for one of these reasons listed above.
Take the actions listed and you can still get an approval offer and funding quickly!
We are a leading funding source for all Small Businesses looking for the best alternatives to Banks.
Author Biography:Will Sanio, Owner of SCF Funding, dba bankstatementloan.com/, has a Bachelor of Science Degree in Business Administration with a concentration in Finance from the University of Tennessee, Knoxville.
Over 20 Years experience including 10 Years with Wells Fargo, formerly Wachovia Bank and First Atlanta Bank. Specializing in Traditional and Alternative lending.
Will Sanio: University of Tennessee Diploma – Bachelor of Science in Business Administration with concentration in Finance – Click or Tap to Enlarge Image.
Choose from a loan against equipment and even a large business loans that you can still get even with missed cash advance payments. Closing your business checking account to avoid payments can cause big problems for your business. Apply below.
How to get a business loan with missed MCA payments:
Steps and tips on how to get a business loan after missing mca payments.
Tools needed: internet connection, computer, phone. Supplies needed: Time available
Step 1 Evaluate your missed payments.
The number missed is important. Missing 1, 2 or 3 payments is considered minor and should not prevent your business from being approved for more unsecured type bank statement loan funding.
Missing more than 3 consecutive daily advance payments may trigger denials with other lenders. Bringing your account current is the first step to get new funding.
Communicate with the lender during the process. Regardless of the outcome, it almost always causes the lender not to take more adverse action against you when behind. It will also make new funding much easier.
Evaluate your missed payment status
Step 2 Match funding options
Tip: Begin a search for other funding options. Start the search broadly with other programs that your business may qualify for. Decide which programs are the best fit for your business.
Look at the qualifying requirements for other programs. Eliminate those programs that your business likely could not qualify for. Prioritize and choose programs you can get approved for instead of programs you prefer.
Match the best programs that best fit to your business.
Step 3 Apply
Apply for the best matching program that allows for recent missed payments on other financing. Talk to a representative before applying when possible.
Tip: Give them information on your overall profile and discuss your chances. If it is still a good fit, then apply.
Step 4 Close approval
Review terms and conditions of any approval offer. Close the transaction if your business can handle the payments and the funding will assist in generating future revenue.
Step 5 Make a plan after denial.
If the request remains a denial, then make a plan. Understand the decline reasons. There may still be a chance to reverse the decision and get an approval. Try this first. Consider applying with other lenders when you cannot get approved.
Apply with other lenders. If that still does not work, do not stop the process.
Begin working on correcting the reasons that were used for denial during the first funding request. Whether it is credit, financials, or cash flow, try to improve this month over month until your profile meets the requirements of the previous lenders.
Make a short term plan if the denial remains in place.
Missing just 1 mca payment should not cause your business problems. But what if you have more missed mca payments? What can you do to avoid problems? In this post we will talk about 4 initial steps further below to take if you cannot pay cash advance payments. Author Biography: Will Sanio
Also consider if you can instead get out of your merchant cash advances now. Payoffs may be possible through a longer term loan that are asset based. Also read what to do if you have been declined more funding due to missed mca payments.
If you are not going to be able to get current, here are options to get out of an mca cash advance, or watch the get out of mca video.
Apply below to get started now on safe ways to fix this problem before lenders take action against your business.
You have missed mca cash advance payments. What should you do now? Several immediate solutions to save your business.
What can you do after missed mca payments?
1. Communicate with the lenders immediately.
Contact the cash advance companies right away. Do not think the problem will work itself out or that you will probably catch up in a couple of days. Communication is key. It is better if you contact them before you miss more payments. However, if you already missed a payment then contact the advance companies that day or the next day at the latest. Maybe the missed payments are not your fault.
2. Tell the cash advance companies what has happened and why.
But how do I explain this to the mca companies?
It depends on your situation. What is your cash flow situation right now? Can you begin making the payments again right away? Figure out what you can pay, when, and how often. Let them know what is happening with your business. If you have a good reason for missing payments, tell them that reason. If you can back it up with documentation, all the better. Being proactive and communicating will be your best option at the beginning. If the lender has no coj confession of judgement, you will still want to work out a payment plan to avoid a default.
3. Can you start making payments again? If so, make an agreement with the advance companies to begin.
Call the cash advance companies even when you can start making payments immediately. They still want to know why you missed mca payments. That will help your case. You may end up missing another payment later you did not expect to miss. It is better if you are already on record as being in contact with the lender.
4. Payment plans after delinquent mca payments
Payment plans are best when the business can neither keep making the daily payments or paying off the advance. The cash advance company may be very willing to set up a payment plan. They will be able to get payments in full and the merchant will make the total sum of payments. It is up to the lender to do this. If your business wants to go this route then be ready to explain to the cash advance company why a payment plan will work for both of you.
Other Considerations on handling your loan if it is past due
Missing consecutive payments
If you expect to miss more payments consecutively, then you want to decide if you can payoff the advances first. Paying off advances with another loan is better than continuing to miss payments. You can choose from unsecured options such as bank statement loans and a large business loan if you need a lot.
Bouncing more mca payments.
If you know you cannot sustain your payments then paying off the advance may be the best option. This is because missed payments will make it much more difficult for your business to borrow in the future and make this your worst option. Many merchants would rather not take out a new loan. However, if you are approved for a new loan that can payoff loans you cannot pay, you should strongly consider doing so. Many businesses cannot even get approved for a payoff and don’t have that choice.
Payoffs
Paying off your merchant cash advances may be the best option. But when is it better to payoff and when is it better not to? It is usually better to payoff the cash advances when you know you cannot keep paying the current payments. Paying the advance off with another loan works very well if you have less than 3 months or so left on the exiting advances. Taking out a loan to payoff a low balance is still much better than missing mca payments and defaulting. You can avoid damaged credit, court action and trouble getting loans in the future.
When does it make sense to payoff one loan with another?
Example: A merchant has an advance with a daily payment of $100 and has a remaining balance of $3,000. He has 30 payments left but he cannot keep making those last payments and will go past due and default. Before going past due the merchant is offered another loan for 6 months to payoff the $3,000. The new daily payment will be about $35 per day for 120 days. The borrower can afford this easily. Problem solved. The business now has a payment they can afford and does not have to worry about paying the advance on time.
Extending the term
Extending the term and lowering the payments is usually similar to a payment plan. Sometimes it is more informal and the cash advance company will just let the borrower continue making payments past the term without a formal contract. At other times a formal new contract will be written that replaces the old contract. Expect the mca company to charge penalties, fees and more interest as part of the new contract.
Lowering Payments
Getting your mca cash advance company to lower the payments works best when your business just needs short term cash flow relief for a week or two. Your business may just have a brief cash flow problem it needs to work around. Be aware that mca companies are not receptive to businesses calling in multiple times and asking to lower payments for a while. It is supposed to be a rare request rather than one of convenience. Some lenders may only do this once during the term of the contract. If you think your business will need to ask for lowered payments several times then find a different option.
Pausing payments
A pause for one to three weeks may be all a business needs. As with lowered payments, your business has to be sure it will be able to restart and continue payments when the payment pause is over. You should not pause payments if you need a longer term permanent solution. Sometimes businesses will ask to pausing payments when they know they will have a problem again when the regular payments start back up. If this is you, then you should put all your efforts into solving the problem permanently on the front end.
Settlements after significant missed mca payments
A settlement directly with the mca cash advance company can be considered when other options will not work. Settlements usually happen after a merchant has failed with a payment plan or lowered payments and not able to handle regular payments anymore. It is a step before a default but still considered better than a default situation.
Beware of 3rd party settlement companies that tell you to put a stop payment on a merchant cash advance company.
We believe this is the worst choice in almost all cases.
Many settlement companies will tell you to do this to buy time for them to negotiate with the mca cash advance companies on your behalf. However, they still want you to pay them a lot of money upfront before they start negotiations for you. We believe this is a very bad idea for your business for several reasons.
Let’s break down why:
Your advance will be declared in default immediately when you put a stop payment on them. You certainly will not want to even consider this if you have not read your MCA contract in detail. The contract will tell you all the actions the advance companies can take when you put a stop payment on their daily Payments. Putting a stop payment on a merchant cash advance will definitely result in the strongest response against you by the mca companies. If they have a coj, then they will file it against you almost immediately. The settlement companies telling you to do this do not have to deal with the problems you will have! Do not do this!
Beware of companies that tell you to close your business checking account
An intentional default happens when a borrower takes an intentional action not to make good on the contract. This is almost always combined with little or no communication with the cash advance company. Lenders think of the borrower as trying to evade an obligation and contractual promise to pay. Worse, their contract usually includes specific language that talks about what actions and remedies they can take if the borrower closes their account. We believe this is a bad option for almost all borrowers. Contact us above for much better options!
Defaults
Defaults are the least desirable option. The lender has declared that they are taking a loss on the loan. The worst adverse action has already been taken against the merchant, which may include filing a coj confession of judgement. All efforts should be taken to avoid a default on a cash advance.
If the mca company has a coj confession of judgement, they can have it enforced through a court in one or two days. Sometimes they can have it affirmed by a court the same day.
What can the cash advance company do then?
They can have the sheriff contact any bank they wish and demand that the bank verify if your business has a checking account there. If so, the cash advance company can debit all the funds out of your account.
In conclusion
The tips above can guide you on how to handle specific situations with cash advance payments. If you continue to struggle with debt long term the National Foundation for Credit Counseling, NFCC can help with budgeting and strategic long term debt planning.
FAQ Frequently asked questions on missed mca payments.
My business sales were down recently and I cannot pay my daily cash advance payments. What are my options?
Do not stop communicating with your mca merchant cash advance companies. Consider any ongoing relief programs they can offer. Look at asset based alternative programs to payoff your advances in the short and medium term if you have collateral.
I missed an mca payment. What can the merchant cash advance company do?
If you have only missed one or two payments then the mca companies are very unlikely to take action besides trying to contact you. If you have not talked with them yet and you miss more consecutive payments, then contact them asap.
My cash advance company has threatened to take action against me for missing payments. What can I do?
If your mca company has threatened to take legal action against you it means they probably have not done so yet. You still may have a chance for a good result. Look at what you can pay and consider offering to make the maximum payment you can.
If they refuse then put your offer in writing and email it to them certified. This may work strongly in your favor if there is future court action against you. It shows that you communicated with the cash advance companies and tried to work out a solution to fulfill your obligation to them with your worsened financial situation and they refused to work with you. Whatever your outcome ends up being, this action should put you in the best possible position later.
I don’t want to talk to the mca companies. They are very aggressive, rude and threatening. Why should I talk to them?
Talk with them because if you don’t they will take action against you. They may be able to put a freeze on your business checking account or block your account. You will not be able to use your business checking account if they do that. That will be the worst result for you and your business. Contact them to see if you can come up with a solution.
My cash advance company said they can lower or pause the payments. Which one is best?
Pausing the problems is best when your business has a short term cash flow problem for a few weeks and will be able to begin making the full daily payments again after that. Lowering the payments will be best if your business is going to keep having trouble making the regular payments later. If you cannot make the regular mca payments later then it is better to get the payments lowered long term until you have paid off the contract.
I have some delinquent mca payments right now. Should I payoff the mca payments or try to work out a compromise?
Payoff the cash advances if you are able through another loan when you cannot keep making the daily payments and will default. Work out a compromise with the lender when you have the cash flow to make a lower payment. Ask them not to declare you a default account.
Is it good for a settlement company to tell me to close my business checking account so that the mca companies cannot debit my daily payment?.
You should not close your business checking account to stop daily mca debits except in some rare cases. Closing your account automatically causes you to be in default. The mca company can also declare the act of closing your business checking account to stop the daily debit as an intentional default.
I missed some daily mca payments and the advance company is telling me I am in default. Can they declare me in default?
If the contract says missing a certain number of payments puts your account in default and you missed that number of payments then they can declare you in default. Negotiating is usually better even after you have been declared in default on a cash advance. Communicating with the advance company will usually get the best possible outcome for your business.
FAQ: How to get a business loan with missed mca payments:
Can I get a business loan with missed mca payments?
Yes, you can get a business loan with missed mca payments. Review the decline reasons with the lender to see if the decline can be reversed. Finally, you can work on correcting the denial reasons to get funding.
Can I get another cash advance after missing payments?
It is possible to get another approval. An offer will depend in part on how many were not made, when they happened, and if they are still past due. Getting the account current is the most important step. Staying in frequent communication with the lender will help your chances as well.
Do missed cash advance payments show on my credit?
Untimely payments do not show up on your personal credit report if the lender has not declared a default. Default accounts may show up on personal or business credit. Check your contract. It may provide information on how and when the lender reports delinquencies.
Conclusion
Being declined for missed mca payments is something that can be overcome. Don’t wait several months to get funding.
Try to reverse the decline decision with any current lender. Look for lenders that will approve your profile the way it is now. Then work on correcting all your main decline reasons for the future.
We are a leading funding source for all Small Businesses looking for the best alternatives to Banks.
Author Biography:Will Sanio, Owner of SCF Funding, dba bankstatementloan.com/, has a Bachelor of Science Degree in Business Administration with a concentration in Finance from the University of Tennessee, Knoxville.
Over 20 Years experience including 10 Years with Wells Fargo, formerly Wachovia Bank and First Atlanta Bank. Specializing in Traditional and Alternative lending.
Will Sanio: University of Tennessee Diploma – Bachelor of Science in Business Administration with concentration in Finance – Click or Tap to Enlarge Image.
Video Description: Get an MCA Merchant Cash Advance After a Default; 00:37 Default Programs for Qualifying Companies; 00:44 Include Payoff or Settlement Letters; 01:04 How long since mca default; 01:11 How many mca defaults I had; 01:25 What if I Did not repay MCA Defaults
How to get an MCA Merchant Cash Advance after a Default
Some businesses that have defaulted on 1 + mca cash advances in the past now understand the amounts and daily payments they can handle, and make. These programs are targeted for:
How to get another Cash Advance after not paying a previous one.
Step 1: Research companies online that offer merchant cash advances to businesses that have a previous default on an mca cash advance. Closely review restrictions for terms and conditions of approval.
Step 2: TIP – Repayment of a previously defaulted merchant cash advance as well as the amount of time since the default may affect your ability to be approved under different programs. Ask if there is a minimum time requirement since the cash advance default. Know the month and year your business first officially defaulted and the amount of the default. Default reporting drags on time wise in business and personal credit reports and makes it look like the default was much more recent than the original date the merchant cash advance company declared a default. Any payments you made on the default often do not appear on the business and personal credit reports a lender looks at and you will not get credit for any payments made. Provide documentation of the payments made.
Step 3: Select the programs that your business will most likely qualify for.
Decide on the programs that your business will most likely get an offer from.
Step 4: Make contact with these lenders that fund with previous defaults. Try to verify how likely your business is to meeting the funding program conditions and requirements.
Contact mca default lenders. Apply here to begin.
Step 5: Submit an application for funding. Provide all documentation you have that improves your chance for an approval. Provide documentation that proves the time since the default and if any payments were made.
Apply and provide any documentation that show how long it has been since your business originally defaulted on the mca merchant cash advance.
Step 6: If approved, review terms and conditions. Rates and terms will not be as favorable for some time on your advances after defaulting.
FAQ Frequently asked Questions on getting an mca merchant cash advance after defaulting
Can I get a merchant cash advance after I defaulted on one?
About 6 months to 1 year after a default your business can be considered for financing, including a cash advance. Approvals and amounts depend on how well your business has recovered, it’s ability to repay and if any of the default was paid.
What if I did not repay any of the defaulted cash advance?
It is easier to get another cash advance if you repaid or settled the old defaulted cash advance. New lenders want to see your business made an effort to repay what it could or reach a settlement on the debt.
Does it matter if I defaulted on more than 1 advance?
You may still be able to qualify even if you defaulted on more than 1 previous advance. Approval depends a lot on whether you repaid any of the debt, how many you had, how long it has been.
We are a leading funding source for all Small Businesses looking for the best alternatives to Banks.
Author Biography:Will Sanio, Owner of SCF Funding, dba bankstatementloan.com/, has a Bachelor of Science Degree in Business Administration with a concentration in Finance from the University of Tennessee, Knoxville.
Over 20 Years experience including 10 Years with Wells Fargo, formerly Wachovia Bank and First Atlanta Bank. Specializing in Traditional and Alternative lending.
Will Sanio: University of Tennessee Diploma – Bachelor of Science in Business Administration with concentration in Finance – Click or Tap to Enlarge Image.
Get an MCA Cash Advance After a Default (Video Transcript: Click to Expand)
Transcript
00:42 Borrow after Default Business Profile 00:48 How Payoff or Settlement Letters Help 01:07 Does time since my loan default matter? 01:15 What if I defaulted on more than 1 MCA 01:29 What if I did not repay my MCA?
You can get an MCA cash advance after a default? Yes, get an MCA Cash advance after a default. Get money if your business defaulted on an MCA and get started
Again. Start building a relationship as soon as possible, and gain access to the funding
You need now, and in the future. Whenever you need it. Call us at 919-771-4177. Don’t
Wait until you need a loan for your business and can’t get it. Apply Now. You’ll find what you need here. To apply, click on the apply button at the bottom right of this screen, or on the endscreen of this video, or call us at 919-771-4177 or go to bankstatementloan.com/. Complete the application, send in the most recent 4 months checking account statements.These programs are for companies that have had defaulted accounts, payments, and also missed and delinquent payments. Make your request stronger and include any payoff or settlement letters if you have them. Are you making payments on previous
Advances now? Then add any documentation or information on your payments. Approvals, amounts and terms depend on how well your business has recovered, if you can repay now and also if any of the old debt was repaid.
Frequently asked questions:Do you look at how long it has been since my cash advance default?
There are no absolute minimum time requirements. The older, the better.Does it matter if I defaulted on more than 1 advance?
You may also be able to qualify if you defaulted on more than 1 previous advance. Approval terms consider whether you repaid any of the debt, settled, and how many MCA’s you had.
What if I did not repay any of the defaulted cash advance?
It is easier to get a new cash advance offer or stronger offer if you repaid or settled the old defaulted cash advance to show your business repaid what it could or reached a settlement on the debt. Click on the apply button at the bottom right of this screen, or on the endscreen of this video, or call us at 919-771-4177 or go to bankstatementloan.com/.
They are negative balances in a bank account by the end of the day and reported by your financial institution in their ending daily balance section of your statement.
Maybe you have had them because you have a 2nd MCA or even a 3rd Cash Advance? If so, get approval options, Apply Below.
How can your company overcome being declined for a loan or Merchant Cash Advance for having excessive Overdrafts or excessive NSFs? Here are several tips that your company can follow to get funding.
We assist your company in overcoming these obstacles so they can prosper.
Many times a loan that is approved falls through at the last minute and does not close if there are overdrafts and NSF’s before closing.
When an account verification is done and the Account is overdrawn, the loan may then not close and be declined.
At the time you are trying to close a loan with an overdrawn business account, make a deposit immediately before the Lender checks your account balance.
If you make a deposit beforehand, you can save the approval. If it is too late and the loan is declined, ask the funding source if you can make a deposit to bring the account into the positive will they close the Loan then?
Do not try to close a loan if your account is overdrawn. Wait until it is in the positive.
FAQ Too many overdrafts and nsfs
Can we get funding with nsfs and overdrafts?
Approvals are issued everyday to businesses with nsfs and overdrafts in their checking account. Still, provide a good explanation for why the account was overdrawn when asked.
How hard will overdrafts and nfs make it to get a business loan?
They do not always cause a decline. You may get approved for a lower amount with higher rates and shorter terms.
Being overdrawn in your business checking account in the last 30 days is most important, and the last 90 days are reviewed. Rules on the maximum number vary by Lender.
How many overdrafts and nsfs can we have?
Most business loans limit these to about 5 per month. Ask specifically for any financing you may apply for. Some programs will not allow more than 3 recent overdrafts in the last 30 days.
Why were we declined for paid nsfs?
You were likely declined because the cash flow and average balances were not strong enough. Even when insufficient fund items are paid, they still happened and the funding source may believe any new debt will be too much.
Talk to lenders in advance and find out if they have a maximum number per month they accept. We can put your business into qualifying programs so your business can get all the Capital it needs.
Business Loans with Overdrafts and NSF’s
Other options if declined
Too many Overdrafts or NSF’s for an MCA merchant cash advance or ACH bank loan.
Talk to the Merchant Cash Advance companies and ACH business loan lenders directly about being declined for having too many Overdrafts or NSF’s per month. Ask them if there are other programs available you may qualify for right now. Always ask if you can start out for a lower amount.
In addition, make sure your Account is not overdrawn for a few weeks and apply at the start of the next statement month.
Possible solution:
If you know you will not be overdrawn or have NSF’s in the next few weeks, tell the Lender.
If the overdrafts or NSF’s were from a single event instead of spread out throughout the months, this can make a difference. It is an isolated incident.
Let them know the NSF’s resulted from a one time event. Many decisions are automated and made quickly. Make a strong case and the lender may reconsider your request.
If you still cannot get an offer, ask how long you have to wait before your application can be reconsidered. It is usually 30 days. Ask what needs to be corrected to avoid being declined again.
Get other working capital loans
Your business can apply for other types of financing if time is critical. Which ones are best depend on your company’s financing needs and situation. Choices include:
Also consider financing based on Real Estate, Equipment Assets
that are free and clear, and Account Receivables.
Monthly Term loans up to 60 months or longer with full financials.
You can overcome being declined for a MCA Merchant Cash Advance for having too many Overdrafts and NSF’s. The SBA small business administration offers advice and workshops.
We are a leading funding source for all Companies looking for the best alternatives to traditional institutions.
Author Biography:Will Sanio, Owner of SCF Funding, dba bankstatementloan.com, has a Bachelor of Science Degree in BA with a concentration in Finance from the University of Tennessee, Knoxville.
Over 20 Years experience including 10 Years with Wells Fargo, formerly Wachovia and First Atlanta. Specializing in Traditional and Alternative lending.
Will Sanio: University of Tennessee Diploma – Bachelor of Science in Business Administration with concentration in Finance – Click or Tap to Enlarge Image.
Has your business been declined for a loan for not making enough deposits into your checking account every month, or having under $10,000 a month in deposits?
Get approved and choose one of severalsmall business loans for your business that do not require a lot of deposits per month. Apply below and get approved today.
Contact us and we will put your business into the approval program that can accept less than 5 deposits per month. Only have 1 or 2 deposits per month? We have programs waiting for your business now that can you approved fast. Contact us above!
FAQ on being declined for a business loan for not having enough deposits
How many deposits does our business have to make each month to qualify?
5 deposits or more per month are usually required for a merchant cash advance. Some advance companies require as many as 10 or more. They must be real business revenue from customer sales and not transfers between accounts.
Can our business qualify with only 2 or 3 deposits per month?
Some lenders consider a low number of credits per month into a business account as higher risk because the business has fewer customers that it makes money from. Losing one customer will cut revenues and their ability to repay a loan much more than a business with many customers.
Why were we declined for not enough business deposits when we had more than 5 per month?
Deposits that are not from the sales of the business may not have qualified as revenue. Examples are transfers from other accounts, loan proceeds, very small deposits compared to others, and rebates.
Businesses have used cash flow loans to a great extent in recent years to finance their businesses. The business account has low recent sales in one of the most recent months.
Our Small Business Development Center assists in getting past these problems to help business owners get a fast and easy business loan.
Other options
Make more deposits immediately during the rest of the month and apply at the start of the next month. A deposit to a business checking account statement is often from several customers. Retailers usually have several checks and cash from several customers, go to the bank and make 1 deposit. Instead of 1 large deposit, break the deposit into several smaller deposits over the course of 2 or 3 days.
Talk to the Merchant Cash Advance companies and ACH business loan lenders directly about being declined and ask them how you can get your business approved. As your business grows, it will add more customers. Having deposits from more customers will increase the number of deposits per month into your business account. As a result, this will make your business a better risk from the lender’s point of view. The number of customers a business has is an important part of looking at risk by lenders.
For example, restaurants have hundreds of customers per week. As a result, they will show many deposits per month. Restaurants that lose a few customers only lose a small percent of their customer base. A business that has 4 large customers loses 25% of their customer base when they lose just 1 of their customers.
Possible solution:
If you know the deposits you make into your business checking account have multiple items, you can tell the Merchant Cash Advance company or ACH business loan company.
What are multiple items?
Multiple items means that the funds in the deposit are from more than 1 customer. If the merchant cash advance company knows this, you can get a copy of the deposit from the bank. The copy of the deposit will show the items deposited. If it is 5 items, you may get credit for 5 deposits instead of 1. You may be able to get the MCA company to change the decline to an approval. A number of ACH lenders and merchant cash advance companies are open to this.
If this does not work, ask how long you have to wait before they will consider you again. Be clear on what they want to see the next time so you will not be declined again.
Get working capital through other loans
If the options above do not work or you cannot wait, your business can consider other types of business loans. Which ones are best depend mostly on your company’s profile. Choices include:
– Monthly Term loans up to 48 months based on Tax Returns
– Accounts Receivables Financing
– Business loans based based on Real Estate or Equipment Assets.
Business loans based on real estate, equipment or accounts receivables will usually not have this requirement. Having collateral that covers the loan amount means that cash flow is not as critical. The number of customers is also not important.
Unsecured loans depend heavily on cash flow and as a result, the cash flow of the business is scrutinized much more. Businesses applying for unsecured loans should also have financial statements that show the business making money and having net income. Many businesses do not show net income and this hurts their request and also causes declines.
The SBA small business administration also has excellent resources on alternative business loans
The best and safe options to consolidate merchant cash advances. Many businesses have multiple mca’s by stacking cash advances.
Get immediate relief to lower their daily and weekly payments.
There are options to payoff your cash advances as well.
A regular and reverse consolidation will improve your cash flow up to 50% for some programs, thereby reducing your number of positions from a 2nd or 3rd cash advance position. Apply below now!
Calculate how much you can afford to pay per day, week and month compared to what you are paying now.
Research and contact companies that offer consolidation programs that match your business needs and daily budget.
Review the qualification requirements and choose from programs that you have the best chance to qualify for.
Do not get another mca during the term of the transaction.
Why Not Consolidate Several…..Into 1 AND Lower Your Payment ?
FAQ Frequently asked questions.
How much can I save daily?
Your business can lower the daily or weekly payments between 25% and 50%. Some programs can lower them as much as 75% and convert into weekly or monthly debits.
How does the consolidation work?
A merchant cash advance consolidation is usually one large loan used to payoff several smaller ones. The goal is to lower total daily payments by extending the term, lowering the rate, or both. Some programs are structured differently or give you a longer term to payoff the current debt while others have a shorter term.
How do we qualify?
If you can simply make the new payment, then you can qualify based on cash flow. It should be 30 days since your most recent advance closed and you should be current. Lenders want to know you can meet your obligations now before being approved.
How can I get the best terms?
Apply for the longest term program available because the payment will be the lowest. The lower the payment, the more likely your cash flow will qualify.
How does a reverse consolidation work?
A reverse consolidation covers the payments on your existing advances while you make a much lower one on the reverse. During the term of the transaction, the other daily debits you had before drop off until you only have one payment left.
How we can help
Your business may be in a position where it must extend out the term of current positions. We can assist in paying off 2, 3 or 4 other mca’s and lowing your payment as much as 50% or more.
Tips on how to get approved:
– Make all of your payments on time.
– Wait until 30 days after the most mca closes to apply. Most requests are declined if new funding is deposited into your account in the last 30 days.
Lenders want to see how a business is paying it’s most recent debt before it approves.
– Don’t have more than 5 overdrafts or 5 NSF’s per month.
Program Features:
– No net funding requirement.
– No maximum number of positions.
– Daily, weekly, bi-weekly, and monthly repayment programs.
We try to tie payment frequency to your deposit volume. The main things looked at are:
The repayment history on current advances.
– If we are materially cheaper, and if your business has been able to pay your existing higher cost mca’s with minimal NSFs, we will aggressively pursue a consolidation.
– Deposit volume and consistency are reviewed. Are your deposits enough? Or are they under $10,000 a month?
If deposits vary significantly from month to month, we will typically look at the lowest month when calculating an amount to offer.
Up to 1.25 times your deposits with a 6 to 12 month term are offered.
– (NSF) insufficient funds and overdraft frequency are looked at.
Other features and products:
1. Advances are available in almost all states EXCEPT California. Term loans are available.
2. Your future consolidation is more like a like of credit. A merchant can request additional capital at anytime from us.
We will quickly re-underwrite it with no fee and offer additional funds and keep your scheduled payment the same.
Renewals
You do not have to pay off our loan to get more capital. This holds true if your business requests more capital after one month, or after six months.
Your business saves money at renewal. Your business will not pay interest on interest if you renew for premium programs.
– Low or no origination and underwriting fees. Fees as low as $250 to consolidate 3 to 4 positions, $500 to $750 for 5 or more. No NSF fees or other junk fees are charged.
– The maximum initial funding is $100,000.
– This is first position funding only. This funding can be the only funding following a consolidation. A standard line of credit, credit card split loan, traditional bank loan.
– SBA loan, car loan, student loans and home loans can be left in place.
– Daily, weekly, bi-weekly, and monthly payment options are available.
Your business may need help creating a business plan. The SBA can also assist with ideas and programs to develop a business plan.
