![]() ![]() The main advantage is that merchant cash advances have less stringent qualification requirements and can be obtained quickly. Repayments might be made daily or weekly until the loan is fully repaid, based on your business’ credit card or debit card sales. Factor rates are typically associated with high-risk loans and have much steeper borrowing costs than other loan types. Companies that provide merchant cash advances often use “factor rates,” which are expressed in decimals rather than percentages like interest rates. This type of advance comes in the form of a lump-sum payment repaid as a percentage of future sales, according to LendingTree. You’ll usually have to pay a high interest rate, with a shorter repayment period than other types of loans, according to Funding Circle. This type of loan is available from banks and other lenders and is designed to let small businesses meet immediate funding needs. Here’s a look at five small business loans that can help you meet your payroll obligations.ĭoctors and Healthcare Providers: How Small Business Loans Can Help You Meet Your Financial Needs 1. How can you avoid the need for payroll loans in the future, and what steps are you taking to achieve this?īecause payroll funding shortages can happen quickly, it’s best to find options that can deliver the money sooner rather than later.What type of repayment plan works best for you?.When will your cash flow return to normal?.Was the payroll funding gap expected or was it a surprise?.The Funding Circle website recommended considering these key questions: ![]() This will not only give you more insight into your own business - it will also help you answer questions from lenders. Hiring new people to grow your businessīefore applying for a payroll loan, take the time to address different reasons it is necessary.Unexpected expenses for repairs or new equipment.Here are a few situations cited by LendingTree: Even if your business is on solid financial footing, you never know when you might need a payroll loan. That’s why it’s important to have a plan in place in case you ever struggle to meet your payroll obligations. ![]()
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